EXHIBIT #5(c)
SUBADVISORY AGREEMENT
AGREEMENT made as of 21st day of May, 1993 among ATLAS ADVISERS, INC.,
a California corporation (the "Adviser"), ATLAS ASSETS, INC., a Maryland
corporation (the "Company") and THE BOSTON COMPANY ADVISORS, INC., a
Massachusetts corporation (the "Subadviser").
WHEREAS, the Company is registered under the Investment Company Act
of 1940, as amended (the "1940 Act"), as an open-end management investment
company and is authorized to issue separate series (the "Funds"), each of which
will offer a separate class of shares of beneficial interest, each Fund having
its own investment objectives, policies and limitations;
WHEREAS, the Company currently offers shares in six series, which
invest in municipal securities (the "Municipal Funds"):
Atlas National Municipal Money Fund
Atlas California Municipal Money Fund
Atlas National Municipal Bond Fund
Atlas California Municipal Bond Fund
Atlas National Insured Intermediate Municipal Fund
Atlas California Insured Intermediate Municipal Fund
WHEREAS, the Company has retained the Adviser to render
investment management and related administrative services to the Municipal
Funds;
WHEREAS, the Adviser and the Company desire to retain the Subadviser
to furnish portfolio management services to the Municipal Funds in connection
with the Adviser's investment management activities on behalf of the Municipal
Funds, and the Subadviser is willing to furnish such services to the Adviser and
the Company;
NOW THEREFORE, in consideration of the promises and mutual covenants
herein contained, it is agreed between the Adviser, the Subadviser and the
Company as follows:
1. APPOINTMENT. The Adviser and the Company hereby appoint the
Subadviser to act as Portfolio Manager to the Municipal Funds under the
supervision of the Company's Board of Directors and the Adviser for the periods
and on the terms set forth in this Agreement. The Subadviser accepts such
appointment and agrees to furnish the services herein set forth, for the
compensation herein provided.
In the event the Company designates one or more portfolio series
("Additional Funds") other than the above named Municipal Funds with respect to
which the Adviser and the Company desire to retain the
Subadviser to render portfolio management services hereunder, they shall notify
the Subadviser in writing. If the Subadviser is willing to render such
services, it shall notify the Adviser and the Company in writing, whereupon such
Additional Funds shall also be subject to this Agreement.
2. REPRESENTATIONS OF THE COMPANY. The Company represents,
warrants, and agrees that:
A. The Adviser and Subadviser have been duly appointed by the Board
of Directors of the Company.
B. The Company will deliver to the Subadviser a true and complete
copy of its then current prospectus as effective from time to time and such
other documents or instruments governing the investment
of the Municipal Funds and such other information as is necessary for the
Subadviser to carry out its obligations under this Agreement.
C. The Company is currently in compliance and shall at all times
comply with the requirements imposed upon the Company by the 1940 Act and
applicable state laws.
3. REPRESENTATIONS OF THE SUBADVISER. The Subadviser
represents, warrants, and agrees that:
A. The Subadviser is registered as an "Investment Adviser" under the
Investment Advisers Act of 1940 ("Advisers Act") and under applicable state
laws, is currently in compliance and shall at all times comply with the
requirements imposed upon the Adviser by the Advisers Act and applicable state
laws.
B. The Subadviser has a written code of ethics complying with the
requirements of Rule 17j-1 under the 1940 Act, will provide the Company with a
copy of the code of ethics and evidence of its adoption, and will make such
reports to the Company as are required by Rule 17j-1 under the 1940 Act.
4. PORTFOLIO MANAGEMENT DUTIES.
A. Subject to the supervision of the Adviser and the Company's Board
of Directors, the Subadviser will provide a continuous investment program for
the Municipal Funds' portfolios, including investment research and management,
with respect to all securities and investments and cash equivalents in the
portfolio. The Subadviser will determine from time to time what securities and
other investments will be purchased, retained or sold by the Municipal Funds and
will place orders for execution of such portfolio transactions in accordance
with paragraph B below to effectuate the investment decisions made. The
Subadviser will provide the services under this Agreement in accordance with the
Municipal Funds' investment objectives, policies and restrictions as stated in
the Company's registration statement filed with the Securities and Exchange
Commission ("SEC"), as amended from time to time.
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B. The Subadviser shall have authority and discretion to select
brokers and dealers to execute portfolio transactions for the Municipal Funds
and for the selection of the markets on or in which the transactions will be
executed. In placing orders with brokers and dealers, the Subadviser shall
generally place portfolio transactions with primary market makers for these
securities on a net basis, without any brokerage commission being paid by the
Municipal Funds. It is understood that transactions with dealers serving as
primary market makers reflect the spread between the bid and asked prices and
that the Subadviser may cause the Municipal Funds to pay fees to third parties
for information as to potential purchasers or sellers of securities but only if
the Municipal Funds would obtain the best price and execution, including such
fee, on a particular transaction. The Subadviser may make purchases of
underwritten issues which include an underwriting fee paid to the underwriter.
The primary objective of the Subadviser in placing orders for the
purchase and sale of securities for the Municipal Funds shall be to obtain the
best price and execution taking into account such factors as price, commission
(negotiable in the case of national securities exchange transactions), if any,
size of order, difficulty of execution and skill required of the executing
broker/dealer. When it can be done consistently with the policy of obtaining
the best price and execution, the Subadviser, in circumstances in which two or
more broker/dealers offer comparable prices and executions, may place such
orders with broker/dealers who supply market quotations to the custodian of the
Municipal Funds (the "Custodian") for appraisal purposes, or who supply
research, market and statistical information to its clients including the
Municipal Funds or the Subadviser. The term "research, market and statistical
information" includes advice as to the value of securities, the advisability of
investing in, purchasing or selling securities; and the availability of
securities or purchasers or sellers of securities; and furnishing analyses and
reports concerning issuers, industries, securities, economic factors and trends,
portfolio strategy and the performance of accounts. The Subadviser is not
authorized when placing portfolio transactions for a Municipal Fund to pay a
brokerage commission (to the extent applicable) in excess of that which another
broker might have charged for effecting the same transaction on account of the
receipt of research, market or statistical information although it may do so in
seeking to obtain the best execution with respect to a particular transaction.
In effecting transactions in over-the-counter securities, orders are placed with
the principal market-makers for the security being traded unless, after
exercising care, it appears that better prices or executions are available
otherwise.
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C. All transactions will be consummated by payment to or delivery by
the Custodian for the Municipal Funds or such depositories or agents as may be
designated by the Custodian, of all cash and/or securities due to or from the
Municipal Funds, and the Subadviser shall not have possession or custody thereof
or any responsibility or liability with respect thereto. The Subadviser shall
advise the Custodian and the Company daily of all investment orders placed by it
with broker/dealers pursuant to procedures agreed upon by the Subadviser and the
Company. The Company shall issue to the Custodian such instructions as may be
appropriate in connection with the settlement of any transaction initiated by
the Subadviser. The Company shall be responsible for all custodial arrangements
and the payment of all custodial charges and fees, and, upon giving proper
instructions to the Custodian, the Subadviser shall have no responsibility or
liability with respect to custodial arrangements or the acts, omissions or other
conduct of the Custodian.
5. EXPENSES. During the term of this Agreement, the
Subadviser will pay all expenses incurred by it, its staff and their activities,
in connection with its portfolio management under this Agreement. This does not
include costs payable by the Company or the Adviser.
6. COMPENSATION. For the services provided, the Adviser will pay
the Subadviser a fee, payable monthly based on the average daily net assets, as
calculated by the Custodian, of each Municipal Fund (and Additional Funds, if
applicable) as provided in the Fee Schedule attached to the Agreement. The
"average daily net assets" is defined as the average of the values placed on the
net assets as of 4:00 p.m. (New York time), on each day on which the net asset
value of a Fund's portfolio is determined consistent with the provisions of Rule
22c-1 under the 1940 Act or, if the Company lawfully determines the value of the
net assets of a Fund as of some other time on each business day, as of such
time. The value of net assets of a Fund shall be determined pursuant to the
applicable provisions of the Company's current Registration Statement and
the 1940 Act. If, pursuant to such provisions, the determination of net assets
value is suspended for any particular business day, then for the purposes of
this Section 6, the value of the net assets of a Fund as last determined shall
be deemed to be the value of the net assets as of the close of the New York
Stock Exchange, or as of such other time as the value of the net assets of the
Fund may lawfully be determined on that day. If the determination of the net
asset value of a Fund has been suspended by the Company pursuant to the
Registration Statement and the 1940 Act for a period including such month, the
Subadviser's compensation payable at the end of such month shall be computed on
the basis of the value of the net assets of the Fund as last determined (whether
during or prior to such month). If the Company determines the value of the net
assets of a Fund more than once on any day, the last such determination thereof
on that day shall be deemed to be the sole determination thereof on that day for
the purposes of this Section 6.
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7. BOOKS AND RECORDS.
A. The Subadviser will make available to the Adviser and the Company
promptly upon request its records and ledgers with respect to and relating to
the Municipal Funds' securities transactions to assist the Adviser and the
Company in compliance with the 1940 Act and the Advisers Act, and other
applicable laws. The Subadviser will furnish the Company's Board of Directors
with respect to the Municipal Funds such periodic and special reports as the
Adviser and the Directors may reasonably request.
B. In compliance with the requirements of Rule 31a-3 under the 1940
Act, the Subadviser hereby agrees that all records which it maintains for the
Municipal Funds are the property of the Company and further agrees to surrender
promptly to the Company any of such records upon the Company's request. The
Subadviser further agrees to preserve for the periods prescribed by Rule 31a-2
under the 1940 Act the records required to be maintained by Rule 31a-1 under the
1940 Act and to preserve the records required by Rule 204-2 under the Advisers
Act to the extent necessary or appropriate to comply with the period specified
in the Rule.
8. INDEMNIFICATION. The Subadviser agrees to indemnify and hold
harmless the Adviser, and its directors, officers and employees (absent the
Adviser's willful misfeasance, bad faith, gross negligence in the performance of
its duties or reckless disregard of its obligations and duties under this
Agreement with respect to the matter which is the subject of the
indemnification), and the Company and its directors, officers and employees
(absent such person's willful misfeasance, bad faith, gross negligence or
reckless disregard of the duties involved in the conduct of his Office with
respect to the matter which is the subject of the indemnification), against any
and all losses, claims, damages, liabilities or litigation (including without
limitation all legal and other expenses) to which the Adviser or the Company may
become subject, arising out of the Subadviser's responsibilities as portfolio
manager of the Municipal Funds (and Additional Funds, if applicable) which may
be based upon any (a) willful misfeasance, bad faith, gross negligence in the
performance of its duties or reckless disregard of its obligations and duties
under this Agreement with respect to the matter which is the subject of the
indemnification by the Subadviser or (b) untrue statement or alleged untrue
statement of a material fact contained in a Company's Registration or Proxy
Statement or other regulatory filing or the omission or alleged omission to
state a material fact required to be stated in a Company's Registration or Proxy
Statement or other regulatory filing to make such filing not misleading, if such
statement or omission was made in reliance upon information furnished by the
Subadviser to the Adviser or the Company.
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9. DURATION AND TERMINATION.
A. The initial term of this Agreement shall begin on May 21, 1993,
which term shall continue until December 31, 1993 if the agreement is approved
by the vote of a majority of the outstanding voting securities (as defined in
the 0000 Xxx) of each Municipal Fund, and shall be renewed annually thereafter,
unless terminated, if approved by (a) the vote of a majority of the entire Board
of Directors of the Company, or by the vote of a majority of the outstanding
voting securities of each Municipal Fund (as defined in the 1940 Act), and (b)
the vote of a majority of those Directors of the Company who are not parties to
this agreement or interested persons (as such term is defined in the 0000 Xxx)
of any such party, cast in person at a meeting called for the purpose of voting
on such approval.
B. Notwithstanding the foregoing, this Agreement may be terminated
at any time without payment of any penalty by (a) the Adviser, upon sixty
(60) days' written notice to the Subadviser and the Company, (b) the Company,
upon the vote of a majority of the Company's Board of Director's or a majority
of the outstanding voting securities of each Series, upon sixty (60) days'
written notice to the Adviser and the Subadviser, (c) the Subadviser upon one
hundred twenty (120) days' written notice to the Adviser and the Company. The
Agreement shall automatically terminate in the event of its assignment (as such
term is defined in the 1940 Act).
10. AMENDMENTS. No provision of this Agreement may be
changed, waived, discharged or terminated orally, but only by an
instrument in writing signed by the party against which enforcement of the
change, waiver, discharge or termination is sought and no amendment of this
Agreement shall be effective until approved by a vote of a majority of the
outstanding voting securities of the Fund, if such approval is required by
applicable law.
11. USE OF NAME. It is understood that the name "The Boston Company
Advisors, Inc." or the name of any of its affiliates, or any derivative
associated with those names, are the valuable property of the Subadviser and its
affiliates and that the Company and/or the Company's distributor, Atlas
Securities, Inc., have the right to use such name(s) or derivative(s) in
offering materials and sales literature of the Company so long as this agreement
is in effect with respect to any Municipal Fund or Additional Fund, provided
that the manner of such use shall have the Subadviser's prior written approval,
which approval may not be unreasonably withheld. Upon termination of the
Agreement with respect to any or all of the Municipal Funds or Additional Funds
the Company (or Fund) shall forthwith cease to use such names(s) or
derivative(s).
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12. MISCELLANEOUS.
(A) This Agreement shall be governed by the laws of the State of
California, provided that nothing herein shall be construed in a manner
inconsistent with the 1940 Act, the Advisers Act or rules or orders of the SEC
thereunder.
(B) The captions of this Agreement are included for convenience only
and in no way define or limit any of the provisions hereof or otherwise affect
their construction or effect.
(C) If any provision of this Agreement shall be held or made invalid
by a court decision, statute, rule or otherwise, the remainder of this Agreement
shall not be affected thereby and, to this extent, the provisions of this
Agreement shall be deemed to be severable.
(D) Except as expressly authorized and provided for in this
Agreement, the Subadviser shall be deemed to be an independent contractor and
shall not in any way be deemed an agent of the Adviser, the Company or the
Municipal Funds.
IN WITNESS WHEREOF, the parties hereto have caused this
instrument to be executed as of the day and year first above written.
ATLAS ADVISERS, INC.
By: /s/ Xxxxx X. XxXxxxx
-------------------------------
Its: Group Senior Vice President
and Chief Operating Officer
ATLAS ASSETS, INC.
By: /s/ Xxxxx X. XxXxxxx
--------------------------------
Its: Group Senior Vice President and
Chief Operating Officer
THE BOSTON COMPANY ADVISORS, INC.
By: /s/ Xxxxx X. Gallary
--------------------------------
President and
Chief Executive Officer
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THE BOSTON COMPANY ADVISORS, INC.
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SUBADVISORY AGREEMENT
REVISED FEE SCHEDULE
For the
Atlas Municipal Funds
FUND ANNUAL RATE
------------------------------------- -----------
Atlas Municipal Money Funds
On the Combined Daily Net Assets 0.14%
Atlas Municipal Bond Funds
On the Portion of Daily Total Net Asset Value
on Assets up to and including $100 million 0.20%
On the Portion of Daily Total Net Asset Value
on Assets over $100 million 0.15%
This Revised Fee Schedule amends the Subadvisory Agreement made as of
May 21, 1993 among Atlas Advisers, Inc., Atlas Assets, Inc. and The Boston
Company Advisors, Inc. and shall be effective as of January 1, 1995.
ATLAS ADVISERS, INC.
By: /s/ Xxxxx X. XxXxxxx
------------------------------------
Its: Group Senior Vice President and
Chief Operating Officer
ATLAS ASSETS, INC.
By: /s/ Xxxxx X. XxXxxxx
------------------------------------
Its: Group Senior Vice President and
Chief Operating Officer
THE BOSTON COMPANY ADVISORS, INC.
By: /s/
-------------------------------------
Name:
Title: Vice Chairman, The Boston Company
