UBS HIGH YIELD BOND PORTFOLIO
SUB-ADVISORY AGREEMENT
Agreement made as of September 30, 1997 by and between Union Bank of
Switzerland, New York Branch (the "Adviser") and UBS Asset Management (New York)
Inc., (hereinafter called the "Sub-Adviser").
W I T N E S S E T H:
WHEREAS, the Adviser has entered into an Investment Advisory Agreement
dated September 30, 1997 (the "Advisory Agreement") with UBS Investor Portfolios
Trust, an open-end management investment company registered under the Investment
Company Act of 1940 (the "1940 Act") and organized as a trust under the laws of
the State of New York (the "Trust") on behalf of one of its diversified mutual
fund series, UBS High Yield Bond Portfolio (the "Portfolio"), pursuant to which
the Adviser will act as investment adviser to the Portfolio;
WHEREAS, the Advisory Agreement contemplates that the Adviser may retain
the Sub-Adviser to provide certain investment advisory services to the Portfolio
in connection with the management of the Portfolio, and the Sub-Adviser is
willing to render such investment advisory services; and
WHEREAS, the Sub-Adviser is registered as an investment adviser under the
Investment Advisers Act of 1940.
NOW, THEREFORE, this Agreement
W I T N E S S E T H:
that in consideration of the premises and mutual promises hereinafter set forth,
the parties hereto agree as follows:
1. The Adviser hereby appoints the Sub-Adviser to act as sub-adviser to the
Portfolio for the period and on the terms set forth in this Agreement. The
Sub-Adviser accepts such appointment and agrees to render the services herein
set forth, for the compensation herein provided.
2. Subject to the general supervision of the Trustees of the Trust and the
Adviser, the Sub-Adviser shall manage the investment operations of the Portfolio
and the composition of the Portfolio's holdings of securities and other
investments, including commodities and commodities contracts, cash, the
purchase, retention and disposition thereof and agreements relating thereto, in
accordance with the Portfolio's investment objective and policies as stated in
the Registration Statement (as defined in paragraph 3(d) of this Agreement) and
subject to the following understandings:
(a) the Sub-Adviser shall furnish a continuous investment
program for the Portfolio and determine from time to time the
securities, commodities, commodity contracts and other
investments to be purchased, retained, sold or lent by the
Portfolio, and the portion of the assets to be invested or held
uninvested as cash;
(b) the Sub-Adviser shall use the same skill and care in the
management of the Portfolio's investments as it uses in the
administration of other accounts for which it has investment
responsibility as agent;
(c) the Sub-Adviser, in the performance of its duties and
obligations under this Agreement, shall act in conformity with
the Declaration of Trust, Bylaws and Registration Statement of
the Trust and with the instructions and directions of the
Trustees of the Trust and the Adviser and will conform to and
comply with the requirements of the 1940 Act and all other
applicable laws and regulations;
(d) the Sub-Adviser shall determine the securities to be
purchased, sold or lent by the Portfolio and as agent for the
Portfolio will effect portfolio transactions pursuant to its
determinations either directly with the issuer or with any broker
and/or dealer in such securities, commodities or commodities
contracts; in placing orders, the Sub-Adviser will select the
brokers and/or dealers as it shall deem appropriate in conformity
with the policy with respect to brokerage as set forth in the
Registration Statement; and the Sub-Adviser shall also determine
whether or not the Portfolio shall enter into repurchase or
reverse repurchase agreements;
On occasions when the Sub-Adviser deems the purchase or sale
of a security, commodity or commodity contract to be in the best
interest of the Portfolio as well as other customers of the
Sub-Adviser and to the extent permitted by applicable law, the
Sub-Adviser may, but shall not be obligated to, aggregate the
securities to be so sold or purchased in order to obtain best
execution, including lower brokerage commissions, if applicable.
In such event, allocation of the securities so purchased or sold,
as well as the expenses incurred in the transaction, will be made
by the Sub-Adviser in the manner it considers to be the most
equitable and consistent with its fiduciary obligations to the
Portfolio;
The Sub-Adviser may execute the Portfolio's brokerage (but not
principal) transactions through an affiliate, provided that such
transactions are effected in accordance with Rule 17e-1 under the
1940 Act and the Trust's procedures adopted thereunder as such
may be amended from time to time;
(e) the Sub-Adviser shall maintain books and records with
respect to the Portfolio's securities transactions in accordance
with Rule 204-2 under the
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Investment Advisers Act of 1940 and shall render to the Trust's
Trustees such periodic and special reports as the Trustees may
reasonably request; and
(f) the investment advisory services of the Sub- Adviser to
the Portfolio under this Agreement are not to be deemed
exclusive, and the Sub-Adviser shall be free to render similar
services to others.
3. The Adviser has delivered copies of each of the following documents to
the Sub-Adviser and will promptly notify and deliver to it all future amendments
and supplements, if any:
(a) Declaration of Trust of the Trust (such Declaration of
Trust, as presently in effect and as amended from time to time,
is herein called the "Declaration of Trust");
(b) Bylaws of the Trust (such Bylaws, as presently in effect
and as amended from time to time, are herein called the
"Bylaws");
(c) Certified resolutions of the Trustees of the Trust
authorizing the appointment of the Sub-Adviser and approving the
form of this Agreement;
(d) The Trust's Notification of Registration on Form N-8A and
its Registration Statement on Form N-1A (No. 811-7553) each under
the 1940 Act (the "Registration Statement"), each as filed with
the Commission on February 28, 1996, and all amendments thereto.
4. The Sub-Adviser shall keep the Portfolio's books and records required to
be maintained by it pursuant to paragraphs 2(e) of this Agreement. The
Sub-Adviser agrees that all records that it maintains for the Portfolio are the
property of the Portfolio and it will promptly surrender any of such records to
the Portfolio upon the Portfolio's request.
5. During the term of this Agreement the Sub-Adviser will pay all expenses
incurred by it in connection with its activities under this Agreement, other
than the cost of securities and investments purchased or sold for the Portfolio
(including taxes and brokerage commissions, if any).
6. The Adviser shall continue to have responsibility for all services to be
provided to the Portfolio pursuant to the Advisory Agreement and shall oversee
and review the Sub-Adviser's performance of its duties under this Agreement.
7. For the services provided and the expenses borne pursuant to this
Agreement, the Adviser will pay to the Sub-Adviser as full compensation therefor
a fee at an annual rate equal to 0.25% of the Portfolio's first $25 million of
average daily net assets, plus 0.20% of the next $25 million of average daily
net assets, plus 0.15% of the Portfolio's average daily net assets in excess of
$50 million. This fee will be computed daily and payable monthly.
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8. The Sub-Adviser shall not be liable for any error of judgment or mistake
of law or for any loss suffered by the Adviser or the Portfolio in connection
with the matters to which this Agreement relates, except a loss resulting from a
breach of fiduciary duty with respect to the receipt of compensation for
services (in which case any award of damages shall be limited to the period and
the amount set forth in Section 36(b)(3) of the 0000 Xxx) or a loss resulting
from willful misfeasance, bad faith or gross negligence on its part in the
performance of its duties or from reckless disregard by it of its obligations
and duties under this Agreement.
9. This Agreement shall continue in effect for a period of more than two
years from the date hereof only so long as such continuance is specifically
approved at least annually in conformity with the requirements of the 1940 Act;
provided, however, that this Agreement may be terminated by the Adviser or by
the Trust on behalf of the Portfolio at any time, without the payment of any
penalty, on 60 days' written notice to the Sub-Adviser. Termination by the Trust
shall be effected by vote of a majority of all the Trustees of the Trust or by
"vote of a majority of the outstanding voting securities" of the Portfolio (as
defined in the 1940 Act and a rule thereunder). The Sub-Adviser may also
terminate this Agreement at any time, without the payment of any penalty, on 60
days' written notice to the Adviser and to the Trust. This Agreement will
automatically and immediately terminate in the event of its "assignment" (as
defined in the 0000 Xxx) or upon termination of the Advisory Agreement.
10. The Sub-Adviser shall for all purposes herein be deemed to be an
independent contractor and shall, unless otherwise expressly provided herein or
authorized by the Trustees of the Trust and the Adviser from time to time, have
no authority to act for or represent the Portfolio in any way or otherwise be
deemed an agent of the Portfolio.
11. Notices of any kind to be given hereunder shall be in writing and shall
be duly given if mailed or delivered as follows: (a) to the Adviser at 000 Xxxx
Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: General Counsel, with a copy to
Xxxxxxx X. Xxxxxxxx at Union Bank of Switzerland, New York Branch, 0000 Xxxxxx
xx xxx Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000; (b) to the Sub-Adviser at 0000 Xxxxxx
xx xxx Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: President; (c) to the
Trust, c/o IBT Trust Company (Cayman) Ltd., X.X. Xxx 000, Xxxxxxxx Xxxxxx,
Xxxxxx Xxxx, Xxxxx Xxxxxx XXX; or (d) at such other address or to such other
individual as any of the foregoing shall designate by notice to the others.
12. This Agreement may be executed in one or more counterparts, each of
which shall be deemed to be an original.
13. This Agreement shall be governed by and construed in accordance with
the laws of the State of New York.
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IN WITNESS WHEREOF, the parties hereto have caused this instrument to be
executed by their officers designated below as of the 30th day of September,
1997.
UNION BANK OF SWITZERLAND,
NEW YORK BRANCH
By: /s/ Xx. XxxxXxxxx Xxxxxxxxx
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By: /s/ Xxxxxxx X. Xxxxxxxx
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UBS ASSET MANAGEMENT (NEW YORK) INC.
By: /s/ Xxxxxx X. Xxxxxxxxxx
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