This SUBADVISORY AGREEMENT ("Agreement") is made this
3rd day of
February, 2009, by and between Western Asset
Management Company, a
corporation organized under the laws of California
(the "Subadviser") and Western Asset Management
Company Ltd, a corporation organized under the laws
of Japan ("WESTERN JAPAN").
WHEREAS, the Subadviser has been retained by
Xxxx Xxxxx Partners Fund Advisor, LLC to provide
investment advisory, management, and administrative
services to WESTERN ASSET WORLDWIDE INCOME FUND INC.
(the "Fund"), a registered management investment
company under the Investment Company Act of 1940, as
amended (the "1940 Act"); and
WHEREAS, the Subadviser wishes to engage
WESTERN JAPAN to provide certain investment advisory
services to the Fund, and WESTERN JAPAN is willing to
furnish such services on the terms and conditions
hereinafter set forth;
NOW THEREFORE, in consideration of the
promises and mutual covenants herein contained, it is
agreed as follows:
1. In accordance with and subject to the
Subadvisory Agreement
between the Subadviser and Xxxx Xxxxx Partners Fund
Advisor, LLC with respect to the Fund (the
"Subadvisory Agreement"), the Subadviser hereby
appoints WESTERN JAPAN to act as a subadviser with
respect to the Fund for the period and on the terms
set forth in this Agreement. WESTERN JAPAN accepts
such appointment and agrees to render the services
herein set forth, for the compensation herein
provided.
2. The Subadviser shall cause WESTERN JAPAN
to be kept fully informed at all times with regard to
the securities owned by the Fund, its funds
available, or to become available, for investment,
and generally as to the condition of the Fund's
affairs. The Subadviser shall furnish WESTERN JAPAN
with such other documents and information with regard
to the Fund's affairs as WESTERN JAPAN may from time
to time reasonably request.
3. (a) Subject to the supervision of the
Fund's Board of Directors (the "Board"), Xxxx Xxxxx
Partners Fund Advisor, LLC and the Subadviser,
WESTERN JAPAN shall regularly provide the Fund with
respect to such portion of the Fund's assets as shall
be allocated to WESTERN JAPAN by the Subadviser from
time to time (the "Allocated Assets"), with
investment research, advice, management and
supervision and shall furnish a continuous investment
program for the Allocated Assets consistent with the
Fund's investment objectives, policies and
restrictions, as stated in the Fund's current
Prospectus and Statement of Additional Information.
WESTERN JAPAN shall, with respect to the Allocated
Assets, determine from time to time what securities
and other investments will be purchased (including,
as permitted in accordance with this paragraph, swap
agreements, options and futures), retained, sold or
exchanged by the Fund and what portion of the
Allocated Assets will be held in the various
securities and other investments in which the Fund
invests, and shall implement those decisions
(including the execution of investment
documentation), all subject to the provisions of the
Fund's Articles of Incorporation and By-Laws
(collectively, the "Governing Documents"), the 1940
Act, and the applicable rules and regulations
promulgated thereunder by the Securities and Exchange
Commission (the "SEC") and interpretive guidance
issued thereunder by the SEC staff and any other
applicable federal and state law, as well as the
investment objectives, policies and restrictions of
the Fund referred to above, and any other specific
policies adopted by the Board and disclosed to
WESTERN JAPAN. WESTERN JAPAN is authorized as the
agent of the Fund to give instructions with respect
to the Allocated Assets to the custodian of the Fund
as to deliveries of securities and other investments
and payments of cash for the account of the Fund.
Subject to applicable provisions of the 1940 Act, the
investment program to be provided hereunder may
entail the investment of all or substantially all of
the assets of the Fund in one or more investment
companies. WESTERN JAPAN will place orders pursuant
to its investment determinations for the Fund either
directly with the issuer or with any broker or
dealer, foreign currency dealer, futures commission
merchant or others selected by it. In connection with
the selection of such brokers or dealers and the
placing of such orders, subject to applicable law,
brokers or dealers may be selected who also provide
brokerage and research services (as those terms are
defined in Section 28(e) of the Securities Exchange
Act of 1934, as amended (the "Exchange Act")) to the
Fund and/or the other accounts over which WESTERN
JAPAN or its affiliates exercise investment
discretion. WESTERN JAPAN is authorized to pay a
broker or dealer who provides such brokerage and
research services a commission for executing a
portfolio transaction for the Fund which is in excess
of the amount of commission another broker or dealer
would have charged for effecting that transaction if
WESTERN JAPAN determines in good faith that such
amount of commission is reasonable in relation to the
value of the brokerage and research services provided
by such broker or dealer. This determination may be
viewed in terms of either that particular transaction
or the overall responsibilities which WESTERN JAPAN
and its affiliates have with respect to accounts over
which they exercise investment discretion. The Board
may adopt policies and procedures that modify and
restrict WESTERN JAPAN's authority regarding the
execution of the Fund's portfolio transactions
provided herein. WESTERN JAPAN shall exercise voting
rights, rights to consent to corporate action and any
other rights pertaining to the Allocated Assets
subject to such direction as the Board may provide,
and shall perform such other functions of investment
management and supervision as may be directed by the
Board.
(b) The Fund hereby authorizes any entity or
person associated
with WESTERN JAPAN which is a member of a national
securities exchange to effect any transaction on the
exchange for the account of the Fund which is
permitted by Section 11(a) of the Exchange Act and
Rule 11a2-2(T) thereunder, and the Fund hereby
consents to the retention of compensation for such
transactions in accordance with Rule 11a2-
2(T)(a)(2)(iv). Notwithstanding the foregoing,
WESTERN JAPAN agrees that it will not deal with
itself, or with members of the Board or any principal
underwriter of the Fund, as principals or agents in
making purchases or sales of securities or other
property for the account of the Fund, nor will it
purchase any securities from an underwriting or
selling group in which WESTERN JAPAN or its
affiliates is participating, or arrange for purchases
and sales of securities between the Fund and another
account advised by WESTERN JAPAN or its affiliates,
except in each case as permitted by the 1940 Act and
in accordance with such policies and procedures as
may be adopted by the Fund from time to time, and
will comply with all other provisions of the
Governing Documents and the Fund's then-current
Prospectus and Statement of Additional Information
relative to WESTERN JAPAN and its directors and
officers.
4. WESTERN JAPAN may delegate to any other
one or more companies that WESTERN JAPAN controls, is
controlled by, or is under common control with, or to
specified employees of any such companies, certain of
WESTERN JAPAN's duties under this Agreement, provided
in each case WESTERN JAPAN will supervise the
activities of each such entity or employees thereof,
that such delegation will not relieve WESTERN JAPAN
of any of its duties or obligations under this
Agreement and provided further that any such
arrangements are entered into in accordance with all
applicable requirements of the 1940 Act.
5. WESTERN JAPAN agrees that it will keep
records relating to its services hereunder in
accordance with all applicable laws, and in
compliance with the requirements of Rule 31a-3 under
the 1940 Act, WESTERN JAPAN hereby agrees that any
records that it maintains for the Fund are the
property of the Fund, and further agrees to surrender
promptly to the Fund any of such records upon the
Fund's request. WESTERN JAPAN further agrees to
arrange for the preservation of the records required
to be maintained by Rule 31a-1 under the 1940 Act for
the periods prescribed by Rule 31a-2 under the 1940
Act.
6. (a)WESTERN JAPAN, at its expense, shall
supply the Board, the officers of the Fund, Xxxx
Xxxxx Partners Fund Advisor, LLC and the
Subadviser with all information and reports
reasonably required by them
and reasonably available to WESTERN JAPAN relating to
the services provided by WESTERN JAPAN hereunder.
(b)WESTERN JAPAN shall bear all expenses,
and shall furnish all necessary services, facilities
and personnel, in connection with its
responsibilities under this Agreement. Other than as
herein specifically indicated, WESTERN JAPAN shall
not be responsible for the Fund's expenses,
including, without limitation, advisory fees;
distribution fees; interest; taxes; governmental
fees; voluntary assessments and other expenses
incurred in connection with membership in investment
company organizations; organization costs of the
Fund; the cost (including brokerage commissions,
transaction fees or charges, if any) in connection
with the purchase or sale of the Fund's securities
and other investments and any losses in connection
therewith; fees and expenses of custodians, transfer
agents, registrars, independent pricing vendors or
other agents; legal expenses; loan commitment fees;
expenses relating to share certificates; expenses
relating to the issuing and redemption or repurchase
of the Fund's shares and servicing shareholder
accounts; expenses of registering and qualifying the
Fund's shares for sale under applicable federal and
state law; expenses of preparing, setting in print,
printing and distributing prospectuses and statements
of additional information and any supplements
thereto, reports, proxy statements, notices and
dividends to the Fund's shareholders; costs of
stationery; website costs; costs of meetings of the
Board or any committee thereof, meetings of
shareholders and other meetings of the Fund; Board
fees; audit fees; travel expenses of officers,
members of the Board and employees of the Fund, if
any; and the Fund's pro rata portion of premiums on
any fidelity bond and other insurance covering the
Fund and its officers, Board members and employees;
litigation expenses and any non-recurring or
extraordinary expenses as may arise, including,
without limitation, those relating to actions, suits
or proceedings to which the Fund is a party and the
legal obligation which the Fund may have to indemnify
the Fund's Board members and officers with respect
thereto.
7. No member of the Board, officer or employee
of the Fund shall
receive from the Fund any salary or other
compensation as such member of the Board, officer or
employee while he is at the same time a director,
officer, or employee of WESTERN JAPAN or any
affiliated company of WESTERN JAPAN, except as the
Board may decide. This paragraph shall not apply to
Board members, executive committee members,
consultants and other persons who are not regular
members of WESTERN JAPAN's or any affiliated
company's staff.
8. As compensation for the services performed
by WESTERN JAPAN,
including the services of any consultants retained by
WESTERN JAPAN, the Subadviser shall pay WESTERN JAPAN
out of the subadvisory fee it receives with respect
to the Fund, and only to the extent thereof, as
promptly as possible after the last day of each
month, a fee, computed daily at an annual rate set
forth on Schedule A annexed hereto. The first payment
of the fee shall be made as promptly as possible at
the end of the month succeeding the effective date of
this Agreement, and shall constitute a full payment
of the fee due WESTERN JAPAN for all services prior
to that date. If this Agreement is terminated as of
any date not the last day of a month, such fee shall
be paid as promptly as possible after such date of
termination, shall be based on the average daily net
assets of the Fund or, if less, the portion thereof
comprising the Allocated Assets in that period from
the beginning of such month to such date of
termination, and shall be that proportion of such
average daily net assets as the number of business
days in such period bears to the number of business
days in such month. The average daily net assets of
the Fund or the portion thereof comprising the
Allocated Assets shall in all cases be based only on
business days and be computed as of the time of the
regular close of business of the New York Stock
Exchange, or such other time as may be determined by
the Board.
9. WESTERN JAPAN assumes no responsibility
under this Agreement other than to render the
services called for hereunder, in good faith, and
shall not be liable for any error of judgment or
mistake of law, or for any loss arising out of any
investment or for any act or omission in the
execution of securities transactions for the Fund,
provided that nothing in this Agreement shall protect
WESTERN JAPAN against any liability to the
Subadviser, Xxxx Xxxxx Partners Fund Advisor, LLC or
the Fund to which WESTERN JAPAN would otherwise be
subject by reason of willful misfeasance, bad faith,
or gross negligence in the performance of its duties
or by reason of its reckless disregard of its
obligations and duties hereunder. As used in this
Section 0, xxx xxxx "XXXXXXX XXXXX" shall include any
affiliates of WESTERN JAPAN performing services for
the Fund contemplated hereby and the partners,
shareholders, directors, officers and employees of
WESTERN JAPAN and such affiliates.
10. Nothing in this Agreement shall limit or
restrict the right of any director, officer, or
employee of WESTERN JAPAN who may also be a Board
member, officer, or employee of the Fund, to engage
in any other business or to devote his time and
attention in part to the management or other aspects
of any other business, whether of a similar nature or
a dissimilar nature, nor to limit or restrict the
right of WESTERN JAPAN to engage in any other
business or to render services of any kind, including
investment advisory and management services, to any
other fund, firm, individual or association. If the
purchase or sale of securities consistent with the
investment policies of the Fund or
one or more other accounts of WESTERN JAPAN is
considered at or about the same time, transactions in
such securities will be allocated among the accounts
in a manner deemed equitable by WESTERN JAPAN. Such
transactions may be combined, in accordance with
applicable laws and regulations, and consistent with
WESTERN JAPAN's policies and procedures as presented
to the Board from time to time.
11. For the purposes of this Agreement, the
Fund's "net assets"
shall be determined as provided in the Fund's then-
current Prospectus and Statement of Additional
Information and the terms "assignment," "interested
person," and "majority of the outstanding voting
securities" shall have the meanings given to them by
Section 2(a) of the 1940 Act, subject to such
exemptions as may be granted by the SEC by any rule,
regulation or order.
12. This Agreement will become effective with
respect to the Fund on the date set forth opposite
the Fund's name on Schedule A annexed hereto,
provided that it shall have been approved by the
Fund's Board and, if so required by the 1940 Act, by
the shareholders of the Fund in accordance with the
requirements of the 1940 Act and, unless sooner
terminated as provided herein, will continue in
effect through November 30, 2007. Thereafter, if not
terminated, this Agreement shall continue in effect
with respect to the Fund, so long as such continuance
is specifically approved at least annually (i) by the
Board or (ii) by a vote of a majority of the
outstanding voting securities of the Fund, provided
that in either event the continuance is also
approved by a majority of the Board members who are
not interested persons of any party to this
Agreement, by vote cast in person at a meeting called
for the purpose of voting on such approval.
13. This Agreement is terminable with respect
to the Fund without penalty by the Board or by vote
of a majority of the outstanding voting securities of
the Fund, in each case on not more than 60 days" nor
less than 30 days" written notice to WESTERN JAPAN,
or by WESTERN JAPAN upon not less than 90 days"
written notice to the Fund and the Subadviser, and
will be terminated upon the mutual written consent of
the Subadviser and WESTERN JAPAN. This Agreement
shall terminate automatically in the event of its
assignment by WESTERN JAPAN and shall not be
assignable by the Subadviser without the consent of
WESTERN JAPAN.
14. WESTERN JAPAN agrees that for any claim by
it against the Fund in connection with this Agreement
or the services rendered under the Agreement, it
shall look only to assets of the Fund for
satisfaction and that it shall have no claim against
the assets of any other portfolios of the Fund.
15. 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 material
amendment of the Agreement shall be effective until
approved, if so required by the 1940 Act, by vote of
the holders of a majority of the Fund's outstanding
voting securities.
16. This Agreement, and any supplemental terms
contained on Annex I hereto, if applicable, embodies
the entire agreement and understanding between the
parties hereto, and supersedes all prior agreements
and understandings relating to the subject matter
hereof. Should any part of this Agreement be held or
made invalid by a court decision, statute, rule or
otherwise, the remainder of this Agreement shall not
be affected thereby. This Agreement shall be binding
on and shall inure to the benefit of the parties
hereto and their respective successors.
17. This Agreement shall be construed and the
provisions thereof
interpreted under and in accordance with the laws of
the State of New York.
[signature page to follow]
IN WITNESS WHEREOF, the parties hereto have caused
this Agreement to be
executed by their officers thereunto duly authorized.
WESTERN ASSET
MANAGEMENT COMPANY
By: /s/W. Xxxxxxx
Xxxxxxx, Xx.
Name: W. Xxxxxxx
Xxxxxxx, Xx.
Title: Manager, US
Legal and Corporate Affairs
WESTERN ASSET
MANAGEMENT COMPANY LTD.
By: /s/ Xxxxxx X.
Xxxxxxxx
Name: Xxxxxx X.
Xxxxxxxx
Title: Manager,
International Legal and Compliance
The foregoing is acknowledged:
The undersigned officer of the Fund has
executed this Agreement not individually but in
his/her capacity as an officer of the Fund. The Fund
does not hereby undertake, on behalf of the Fund or
otherwise, any obligation to Western Asset Management
Company Ltd.
WESTERN ASSET WORLDWIDE
INCOME FUND INC.
By:/s/ R. Xxx Xxxxxx
_______________________________
Name: R. Xxx Xxxxxx
Title: Chairman,
President and Chief Executive Officer
ANNEX I
This Annex I forms a part of the Subadvisory
Agreement dated as of
February 3, 2009, by and between Western Asset
Management Company, a
California corporation, and Western Asset Management
Company Ltd
("WESTERN JAPAN":
The Japanese subadviser, WESTERN JAPAN, is regulated
by the Japanese Securities and Exchange Surveillance
Commission, a commission established by the Japanese
Financial Services Agency, and is subject to
applicable local laws and regulation. The
performance of Western Asset Management Company Ltd's
obligations under the Subadvisory Agreement dated as
of February 3, 2009, will not, however, subject
WESTERN ASSET WORLDWIDE INCOME FUND INC. (the "Fund")
to any statute, law, rule or regulation or the
jurisdiction of any court, or agency,or body, other
than those to which the Fund was previously subject.
SCHEDULE A
WESTERN ASSET WORLDWIDE INCOME FUND INC.
February 3, 2009
Fee:
The sub-advisory fee will be the following percentage
of Allocated Assets: 0.30%
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conformed Agreements\WA Worldwide Income Fund Inc.
(SBW) SUBADVISORY
AGREEMENT.Japan.doc
