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SUB-INVESTMENT ADVISORY CONTRACT
Contract made as of the 10th day of November, 1995, between SAFECO
ASSET MANAGEMENT COMPANY ("▇▇▇") a Washington corporation, and BANK OF IRELAND
ASSET MANAGEMENT (U.S.) LIMITED ("BIAM"), a company incorporated in the Republic
of Ireland.
WHEREAS, ▇▇▇ has entered into an Investment Advisory Contract dated as
of the date hereof ("Advisory Contract") with SAFECO Common Stock Trust (the
"Trust"), an open-end investment company registered under the Investment Company
Act of 1940, as amended ("1940 Act"); and
WHEREAS, ▇▇▇ wishes to retain BIAM as sub-investment adviser to furnish
certain investment advisory services to ▇▇▇ and the SAFECO International Fund
series ("Series") of the Trust, and BIAM 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. ▇▇▇ hereby appoints BIAM as its investment
sub-investment adviser with respect to the Series for the period and on the
terms set forth in this Contract. BIAM accepts such appointment and agrees to
render the services herein set forth, for the compensation herein provided.
2. Duties of BIAM.
(a) Subject to the supervision of the Trust's Board of Trustees
("Board") and ▇▇▇, BIAM will provide a continuous investment program for the
Series, including investment research and management. BIAM will determine from
time to time what investments will be purchased, retained or sold by the Series.
BIAM will be responsible for placing purchase and sell orders for investments
and for other related transactions. BIAM will provide services under this
Contract in accordance with the Series' investment objective, policies and
restrictions as stated in the Series' Prospectus.
(b) BIAM 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 the Series, BIAM 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 BIAM may pay to those brokers in
return for brokerage and research services a higher commission than may be
charged by other brokers, subject to BIAM's determining in good faith that such
commission is reasonable in terms either of the particular transaction or of the
overall responsibility of BIAM and its affiliates to the Series and its other
clients and that the total commissions paid by the Series will be reasonable in
relation to the benefits to the Series over
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the long term. In no instance will portfolio securities be purchased from or
sold to BIAM, or any affiliated person thereof, except in accordance with United
States securities laws and the rules and regulations thereunder. Whenever BIAM
simultaneously places orders to purchases or sell the same security on behalf of
the Series and one or more other accounts advised by BIAM, such orders will be
allocated as to price and amount among all such accounts in a manner believed to
be equitable to each account. ▇▇▇ recognizes that in some cases this procedure
may adversely affect the results obtained for the Series.
(c) BIAM will maintain all books and records required to be maintained
by BIAM pursuant to the 1940 Act and the rules and regulations promulgated
thereunder with respect to transactions on behalf of the Series, and will
furnish the Board and ▇▇▇ with such periodic and special reports as the Board of
▇▇▇ reasonably may request. In compliance with the requirements of Rule 31a-3
under the 1940 Act, BIAM hereby agrees that all records which it maintains for
the Series are the property of the Trust, agrees to preserve for the periods
prescribed by Rule 31a-2 under the 1940 Act any records which it maintains for
the Trust and which are required to be maintained by Rule 31a-1 under the 1940
Act, and further agrees to surrender promptly to the Trust any records which it
maintains for the Trust upon request by the Trust.
(d) At such times as shall be reasonably requested by the Board or ▇▇▇,
BIAM will provide the Board and ▇▇▇ with economic and investment analyses and
reports and make available to the Board and ▇▇▇ any economic, statistical and
investment services normally available to similar investment company customers
of BIAM.
3. Further Duties. In all matters relating to the performance
of this Contract, BIAM will act in conformity with the Trust's Declaration of
Trust, By-laws and currently effective registration statement under the 1940 Act
and any amendments or supplements thereto ("Registration Statement") and with
the written instructions and directions of the Board and ▇▇▇ and comply with the
requirements of the 1940 Act, the Investment Advisers Act of 1940 ("Advisers
Act"), the rules thereunder, and all other applicable federal and state laws and
regulations. ▇▇▇ agrees to provide to BIAM copies of the Trust's Declaration of
Trust, Bylaws, Registration Statement, written instructions and directions of
the Board and ▇▇▇, and any amendments or supplements to any of them as soon as
practicable after such materials become available.
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4. Services Not Exclusive. The services furnished by BIAM
hereunder are not to be deemed exclusive, and BIAM 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, officers or employee of BIAM 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.
5. Expenses. During the term of this Contract, BIAM will bear all
expenses incurred by it in connection with its services under this Contract.
6. Compensation.
(a) For the services provided and the expenses assumed by BIAM pursuant
to the Contract, ▇▇▇ will pay to BIAM a fee, computed daily and payable monthly,
at an annual rate specified below (in United States dollars) as a percentage of
the net assets of the Series:
Net Assets Fee
---------- ---
For assets up to and including .60 of 1%
$50,000,000
For assets in excess of $50,000,000 .50 of 1%
and up to and including $100,000,000
For assets in excess of $100,000,000 .40 of 1%
(b) "Net assets" shall include the assets of the Series and the assets
of any other series of any other trust managed by ▇▇▇ and sub-managed by BIAM.
(c) The fee shall be accrued daily and payable monthly to BIAM on or
before the last business day of the next succeeding calendar month.
7. Limitation of Liability. BIAM shall not be liable for any
error of judgment or mistake of law or for any loss suffered by the Series, the
Trust or its shareholders or by ▇▇▇ 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.
8. Representations of BIAM. BIAM represents, warrants and agrees as
follows:
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(a) BIAM: (i) is registered as an investment adviser under the Advisers
Act and will continue to be so registered for so long as this Contract remains
in effect; (ii) is not prohibited by the 1940 Act or the Advisers Act from
performing the services contemplated by this Contract; (iii) has met, and will
continue to meet for so long as this Contract remains in effect, any other
applicable federal or state requirements, or the applicable requirements of any
regulatory or industry self-regulatory agency, necessary to be met in order to
perform the services contemplated by this Contract; (iv) has the authority to
enter into and perform the services contemplated by this Contract; and (v) will
immediately notify ▇▇▇ of the occurrence of any event that would disqualify BIAM
from serving as an investment adviser of an investment company pursuant to
Section 9(a) of the 1940 Act or otherwise.
(b) BIAM has adopted a written code of ethics complying with the
requirements of Rule 17j-1 under the 1940 Act and will provide ▇▇▇ with a copy
of such code of ethics, together with evidence of its adoption and enforcement
by BIAM. Within 45 days after the end of the last calendar quarter of each year
that this Contract is in effect, the president or a vice president of BIAM shall
certify to ▇▇▇ that BIAM has complied with the requirements of Rule 17j-1 during
the previous year and that there has been no violation of BIAM's code of ethics
or, if such a violation has occurred, that appropriate action was taken in
response to such violation. Upon the written request of ▇▇▇, BIAM shall permit
▇▇▇, its employees or its agents to examine the reports required to be made to
BIAM by Rule 17j-1(c)(1) and all other records relevant to BIAM's code of
ethics.
(c) BIAM has provided ▇▇▇ with a copy of its Form ADV as most recently
filed with the Securities and Exchange Commission ("SEC") and will, promptly
after filing any amendment to its Form ADV with the SEC, furnish a copy of such
amendment to ▇▇▇.
(d) BIAM will notify ▇▇▇ of any change in the identity or control of
its shareholders promptly after such change.
9. Duration and Termination.
(a) This Contract shall become effective upon the date first above
written, provided that this Contract shall not take effect unless it has first
been approved (1) by a vote of a majority of those trustees of the Trust 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 the Series' outstanding voting securities.
(b) Unless sooner terminated as provided herein, this Contract shall
continue in effect for two years from its effective 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
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annually (i) by a vote of a majority of those trustees of the Trust 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 by
the Board or (ii) by vote of a majority of the outstanding voting securities of
the Series.
(c) Notwithstanding the foregoing, 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 outstanding voting securities of the Series on 60 days'
written notice to BIAM. This Contract may also be terminated by ▇▇▇: (i) on 120
days' written notice to BIAM, without the payment of any penalty; (ii) upon
material breach by BIAM of any of the representations and warranties set forth
in Paragraph 8 of this Contract, if such breach shall not have been cured within
a 20 day period after notice of such breach; or (iii) if BIAM becomes unable to
discharge its duties and obligations under this Contract. BIAM may terminate
this Contract at any time, without the payment of any penalty, on 120 days'
notice to ▇▇▇. This Contract will terminate automatically in the event of its
assignment or upon termination of the Advisory Contract.
10. Amendment of this Contract. No provision of this Contract
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
Contract shall be effective until approved by vote of a majority of the Series'
outstanding voting securities.
11. Governing Law. This Contract shall be construed in
accordance with the laws of the State of Washington without giving effect to the
conflicts of laws principles thereof and the 1940 Act. To the extent that the
applicable laws of the State of Washington conflict with the applicable
provisions of the 1940 Act, the latter shall control.
12. Miscellaneous. The captions in this Contract are included for
convenience of reference only and in no way define or delimit any of the
provisions thereof 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,"
"control," "interested person," "assignment," "broker," "investment adviser,"
"net assets," "sale," "sell" and "security" shall have the same meaning as such
terms have in the 1940 Act, subject to such exemption as may be granted by the
SEC by any rule, regulation or order. Where the effect of a requirement of the
federal securities laws reflected in any provision of this Contract is made less
restrictive by a rule, regulation or order of the SEC, whether of
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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 duly authorized signatories as of the date and year first
above written.
ATTEST: SAFECO ASSET MANAGEMENT COMPANY
__________________________ By: ____________________________
▇▇▇▇ ▇. ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇
Secretary President
ATTEST: By: BANK OF IRELAND ASSET
MANAGEMENT (U.S.) LIMITED
___________________________ By: ____________________________
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
Senior Vice President President
