Exhibit 5(a)
INVESTMENT ADVISORY AND ADMINISTRATION CONTRACT
Contract made as of April 13, 1995 between PAINEWEBBER/XXXXXX XXXXXXX
MUNICIPAL MONEY MARKET SERIES, a Massachusetts business trust ("Fund"), and
PAINEWEBBER INCORPORATED ("Manager"), a Delaware corporation registered as
a broker-dealer under the Securities Exchange Act of 1934, as amended
("1934 Act"), and as an investment adviser under the Investment Advisers
Act of 1940, as amended.
WHEREAS the Fund is registered under the Investment Company Act of
1940, as amended ("1940 Act"), as an open-end management investment
company, and intends to offer for public sale distinct shares of beneficial
interest ("Shares"), which may be offered in separate and distinct classes
of shares, each corresponding to a distinct portfolio ("Series"); and
WHEREAS the Fund desires to retain Manager as investment adviser and
administrator to furnish certain administrative, investment advisory and
portfolio management services to the Fund and each Series as now exists and
as hereafter may be established, and Manager is willing to furnish such
services;
NOW, THEREFORE, in consideration of the premises and mutual covenants
herein contained, it is agreed between the parties hereto as follows:
1. Appointment. The Fund hereby appoints Manager as investment
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adviser and administrator of the Fund and each Series for the period and on
the terms set forth in this Contract. Manager accepts such appointment and
agrees to render the services herein set forth, for the compensation herein
provided.
2. Duties as Investment Adviser.
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(a) Subject to the supervision of the Fund's Board of Trustees
("Board"), Manager will provide a continuous investment program for each
Series, including investment research and management with respect to all
securities and investments and cash equivalents in each Series. Manager
will determine from time to time what securities and other investments will
be purchased, retained or sold by each Series.
(b) Manager agrees that in placing orders with brokers, it will
attempt to obtain the best net result in terms of price and execution;
provided that, on behalf of any Series, Manager may, in its discretion, use
brokers who provide the Series with research, analysis, advice and similar
services to execute portfolio transactions on behalf of the Series, and
Manager may pay to those brokers in return for brokerage and research
services a higher commission than may be charged by other brokers, subject
to Manager's determining in good faith that such commission is reasonable
in terms either of the particular transaction or of the overall
responsibility of Manager to such Series and its other clients and that the
total commissions paid by such Series will be reasonable in relation to the
benefits to the Series over the long term. In no instance will portfolio
securities be purchased from or sold to Manager, or any affiliated person
thereof, except in accordance with the federal securities laws and the
rules and regulations thereunder, or any applicable exemptive orders.
Whenever Manager simultaneously places orders to purchase or sell the same
security on behalf of a Series and one or more other accounts advised by
Manager, such orders will be allocated as to price and amount among all
such accounts in a manner believed to be equitable to each account. The
Fund recognizes that in some cases this procedure may adversely affect the
results obtained for the Series.
(c) Manager will oversee the maintenance of all books and records
with respect to the securities transactions of each Series, and will
furnish the Board with such periodic and special reports as the Board
reasonably may request. In compliance with the requirements of Rule 31a-3
under the 1940 Act, Manager hereby agrees that all records which it
maintains for the Fund are the property of the Fund, agrees to preserve for
the periods prescribed by Rule 31a-2 under the 1940 Act any records which
it maintains for the Fund and which are required to be maintained by Rule
31a-1 under the 1940 Act and further agrees to surrender promptly to the
Fund any records which it maintains for the Fund upon request by the Fund.
(d) Manager will oversee the computation of the net asset value and
the net income of each Series as described in the currently effective
registration statement of the Fund under the Securities Act of 1933, as
amended, and the 1940 Act and any supplements thereto ("Registration
Statement") or as more frequently requested by the Board.
(e) The Fund hereby authorizes Manager and any entity or person
associated with Manager which is a member of a national securities exchange
to effect any transaction on such exchange for the account of any Series,
which transaction is permitted by Section 11(a) of the 1934 Act, and the
Fund hereby consents to the
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retention of compensation by Manager or any person or entity associated
with Manager for such transaction.
3. Duties as Administrator. Manager will administer the affairs of
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the Fund and each Series subject to the supervision of the Board and the
following understandings:
(a) Manager will supervise all aspects of the operations of the Fund
and each Series, including oversight of transfer agency, custodial and
accounting services, except as hereinafter set forth; provided, however,
that nothing herein contained shall be deemed to relieve or deprive the
Board of its responsibility for and control of the conduct of the affairs
of the Fund and each Series.
(b) Manager will provide the Fund and each Series with such
corporate, administrative and clerical personnel (including officers of the
Fund) and services as are reasonably deemed necessary or advisable by the
Board, including the maintenance of certain books and records of the Fund
and each Series.
(c) Manager will arrange, but not pay, for the periodic preparation,
updating, filing and dissemination (as applicable) of the Fund's
Registration Statement, proxy material, tax returns and required reports to
each Series' shareholders and the Securities and Exchange Commission and
other appropriate federal or state regulatory authorities.
(d) Manager will provide the Fund and each Series with, or obtain for
it, adequate office space and all necessary office equipment and services,
including telephone service, heat, utilities, stationery supplies and
similar items.
(e) Manager will provide the Board on a regular basis with economic
and investment analyses and reports and make available to the Board upon
request any economic, statistical and investment services normally
available to institutional or other customers of Manager.
4. Further Duties. In all matters relating to the performance of
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this Contract, Manager will act in conformity with the Declaration of
Trust, By-Laws and currently effective Registration Statement of the Fund,
as delivered to Manager and upon which it shall be entitled to rely, and
with the instructions and directions of the Board, and will comply with the
requirements of the 1940 Act, the rules thereunder, and all other
applicable federal and state laws and regulations.
5. Delegation of Manager's Duties as Investment Adviser and
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Administrator. With respect to any or all Series, Manager may enter into
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one or more contracts ("Sub-Advisory or Sub-Administration Contract") with
a sub-adviser or sub-administrator
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in which Manager delegates to such sub-adviser or sub-administrator any or
all of its duties specified in Paragraphs 2 and 3 of this Contract,
provided that each Sub-Advisory or Sub-Administration Contract imposes on
the sub-adviser or sub-administrator bound thereby all the duties and
conditions to which Manager is subject by Paragraphs 2, 3 and 4 of this
Contract, and further provided that each Sub-Advisory or Sub-Administration
Contract meets all requirements of the 1940 Act and rules thereunder.
6. Services Not Exclusive. The services furnished by Manager
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hereunder are not to be deemed exclusive and Manager shall be free to
furnish similar services to others so long as its services under this
Contract are not impaired thereby. Nothing in this Contract shall limit or
restrict the right of any director, officer or employee of Manager, who may
also be a Trustee, officer or employee of the Fund, to engage in any other
business or to devote his or her time and attention in part to the
management or other aspects of any other business, whether of a similar
nature or a dissimilar nature.
7. Expenses.
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(a) During the term of this Contract, each Series will bear all
expenses, not specifically assumed by Manager, incurred in its operations
and the offering of its shares.
(b) Expenses borne by each Series will include but not be limited to
the following (or each Series' proportionate share of the following): (i)
the cost (including brokerage commissions) of securities purchased or sold
by the Series and any losses incurred in connection therewith; (ii) fees
payable to and expenses incurred on behalf of the Series by Manager under
this Contract; (iii) expenses of organizing the Fund and the Series; (iv)
filing fees and expenses relating to the registration and qualification of
the Series' shares and the Fund under federal and/or state securities laws
and maintaining such registration and qualification; (v) fees and salaries
payable to the Fund's Trustees and officers who are not interested persons
of the Fund or Manager; (vi) all expenses incurred in connection with the
Trustees' services, including travel expenses in the case of Trustees who
are not interested persons of the Fund or Manager; (vii) taxes (including
any income or franchise taxes) and governmental fees; (viii) costs of any
liability, uncollectible items of deposit and other insurance and fidelity
bonds; (ix) any costs, expenses or losses arising out of a liability of or
claim for damages or other relief asserted against the Fund or Series for
violation of any law and any indemnification relating thereto; (x) legal,
accounting and auditing expenses, including legal fees of special counsel
for those Trustees of the Fund who are not interested persons of the Fund;
(xi) charges of custodians, transfer agents and other agents; (xii) costs
of preparing share certificates; (xiii) expenses of
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setting in type and printing prospectuses and supplements thereto,
statements of additional information and supplements thereto, reports and
proxy materials for existing shareholders; (xiv) costs of mailing
prospectuses and supplements thereto, statements of additional information
and supplements thereto, reports and proxy materials to existing
shareholders; (xv) any extraordinary expenses (including fees and
disbursements of counsel, costs of actions, suits or proceedings to which
the Fund is a party and the expenses the Fund may incur as a result of its
legal obligation to provide indemnification to its officers, Trustees,
agents and shareholders or to Manager) incurred by the Fund or Series;
(xvi) fees, voluntary assessments and other expenses incurred in connection
with membership in investment company organizations; (xvii) cost of mailing
and tabulating proxies and costs of meetings of shareholders, the Board and
any committees thereof; (xviii) the cost of investment company literature
and other publications provided by the Fund to its Trustees and officers;
(xix) costs of mailing, stationery and communications equipment; (xx)
expenses incident to any dividend, withdrawal or redemption options; (xxi)
charges and expenses of any outside pricing service used to value portfolio
securities and (xxii) interest on borrowings of the Fund.
(c) Manager will assume the cost of any compensation for services
provided to the Fund received by the officers of the Fund and by those
Trustees who are interested persons of the Fund.
(d) The payment or assumption by Manager of any expenses of the Fund
or a Series that Manager is not required by this Contract to pay or assume
shall not obligate Manager to pay or assume the same or any similar expense
of the Fund or a Series on any subsequent occasion.
8. Compensation.
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(a) For the services provided and the expenses assumed pursuant to
this Contract with respect to the Connecticut Series, New Jersey Series and
New York Series, the Fund will pay to Manager a fee, computed daily and
paid monthly, at an annual rate of .50% of each such Series' average daily
net assets.
(b) For the services provided and the expenses assumed pursuant to
this Contract with respect to any Series hereafter established, the Trust
will pay to Manager from the assets of such Series a fee in an amount to be
agreed upon in a written fee agreement ("Fee Agreement") executed by the
Fund on behalf of such Series and by Manager. All such Fee Agreements
shall provide that they are subject to all terms and conditions of this
Contract.
(c) The fee shall be computed daily and paid monthly to Manager on or
before the first business day of the next succeeding calendar month.
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(d) If this Contract becomes effective or terminates before the end
of any month, the fee for the period from the effective day to the end of
the month or from the beginning of such month to the date of termination,
as the case may be, shall be prorated according to the proportion which
such period bears to the full month in which such effectiveness or
termination occurs.
9. Limitation of Liability of Manager. Manager and its delegates,
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including any Sub-Adviser or Sub-Administrator to the Fund, shall not be
liable for any error of judgment or mistake of law or for any loss suffered
by any Series, the Fund or any of its shareholders, in connection with the
matters to which this Contract relates, except to the extent that such a
loss results 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 Contract. Any person, even though
also an officer, director, employee, or agent of Manager, who may be or
become an officer, Trustee, employee or agent of the Fund shall be deemed,
when rendering services to any Series or the Fund or acting with respect to
any business of such Series or the Fund, to be rendering such service to or
acting solely for the Series or the Fund and not as an officer, director,
employee, or agent or one under the control or direction of Manager even
though paid by it.
10. Duration and Termination.
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(a) This Contract shall become effective upon the date hereabove
written provided that, with respect to any Series, this Contract shall not
take effect unless it has first been approved (i) by a vote of a majority
of those Trustees of the Fund who are not parties to this Contract or
interested persons of any such party cast in person at a meeting called for
the purpose of voting on such approval, and (ii) by vote of a majority of
that Series' outstanding voting securities.
(b) Unless sooner terminated as provided herein, this Contract shall
continue in effect for two years from the above written date. Thereafter,
if not terminated, this Contract shall continue automatically for
successive periods of twelve months each, provided that such continuance is
specifically approved at least annually (i) by a vote of a majority of
those Trustees of the Fund who are not parties to this Contract or
interested persons of any such party, cast in person at a meeting called
for the purpose of voting on such approval, and (ii) by the Board or by
vote of a majority of the outstanding voting securities of a Series with
respect to that Series.
(c) Notwithstanding the foregoing, with respect to any Series this
Contract may be terminated at any time, without the payment of any penalty,
by vote of the Board or by a vote of a majority of the
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outstanding voting securities of such Series on sixty days' written notice
to Manager or by Manager at any time, without the payment of any penalty,
on sixty days' written notice to the Fund. Termination of this Contract
with respect to any given Series shall in no way affect the continued
validity of this Contract or the performance thereunder with respect to any
other Series. This Contract will automatically terminate in the event of
its assignment.
11. Amendment of this Contract. No provision of this Contract may be
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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 material amendment of
this Contract as to any given Series shall be effective until approved by
vote of a majority of such Series' outstanding voting securities.
12. Governing Law. This Contract shall be construed in accordance
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with the laws of the State of Delaware, without giving effect to the
conflicts of laws principles thereof, and in accordance with the 1940 Act,
provided, however, that Section 13 below will be construed in accordance
with the laws of the Commonwealth of Massachusetts. To the extent that the
applicable laws of the State of Delaware or the Commonwealth of
Massachusetts conflict with the applicable provisions of the 1940 Act, the
latter shall control.
13. Limitation of Liability of the Trustees and Shareholders of the
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Trust. No Trustee, shareholder, officer, employee or agent of any Series
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shall be liable for any obligations of any Series or the Fund under this
Contract, and Manager agrees that, in asserting any rights or claims under
this Contract, it shall look only to the assets and property of the Fund in
settlement of such right or claim, and not to such Trustee, shareholder,
officer, employee or agent. The Fund represents that a copy of its
Declaration of Trust is on file with the Secretary of the Commonwealth of
Massachusetts and the Boston City Clerk.
14. Miscellaneous. The captions in this Contract are included for
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convenience of reference only and in no way define or delimit any of the
provisions hereof or otherwise affect their construction or effect. If any
provision of this Contract shall be held or made invalid by a court
decision, statute, rule or otherwise, the remainder of this Contract shall
not be affected thereby. This Contract shall be binding upon and shall
inure to the benefit of the parties hereto and their respective successors.
As used in this Contract, the terms "majority of the outstanding voting
securities", "affiliated person", "interested person", "assignment",
"broker", "investment adviser", "national securities exchange", "net
assets", "prospectus", "sale", "sell" and "security" shall have the same
meaning as such terms have in the
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1940 Act, subject to such exemption as may be granted by the Securities and
Exchange Commission by any rule, regulation or order. Where the effect of
a requirement of the 1940 Act reflected in any provision of this Contract
is affected by a rule, regulation or order of the Securities and Exchange
Commission, whether of special or general application, such provision shall
be deemed to incorporate the effect of such rule, regulation or order.
IN WITNESS WHEREOF, the parties hereto have caused this instrument to
be executed by their officers designated as of the day and year first above
written.
Attest: PAINEWEBBER INCORPORATED
By _____________________________________
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Attest: PAINEWEBBER/XXXXXX, XXXXXXX MUNICIPAL
MONEY MARKET SERIES
By _____________________________________
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