Exhibit 99 (4) (d)
SUB-ADVISORY AGREEMENT
Agreement made as of April 1, 2006 between UBS GLOBAL ASSET MANAGEMENT
(AMERICAS) INC. ("UBS GLOBAL Americas"), a Delaware corporation, and PACIFIC
INVESTMENT MANAGEMENT COMPANY LLC ("Sub-Adviser"), a Delaware general
partnership (the "Agreement").
RECITALS
(1) UBS GLOBAL Americas has entered into a Management Agreement dated April
1, 2006 ("Management Agreement") with UBS PACE Select Advisors Trust (formerly
known as Managed Accounts Services Portfolio Trust ("Trust")), an open-end
management investment company registered under the Investment Company Act of
1940, as amended ("1940 Act"), with respect to UBS PACE STRATEGIC FIXED INCOME
INVESTMENTS ("Portfolio"); and
(2) UBS GLOBAL Americas is authorized to retain one or more sub-advisers to
furnish certain investment advisory services to UBS GLOBAL Americas and the
Portfolio;
(3) UBS GLOBAL Americas is authorized to retain the Sub-Adviser to furnish
certain investment advisory services to UBS GLOBAL Americas and the Portfolio;
and
(4) The Sub-Adviser is willing to furnish such services;
NOW, THEREFORE, in consideration of the premises and mutual covenants
herein contained, UBS GLOBAL Americas and the Sub-Adviser agree as follows:
1. APPOINTMENT. UBS GLOBAL Americas hereby appoints the Sub-Adviser as an
investment sub-adviser with respect to the Portfolio for the period and on the
terms set forth in this Agreement. The Sub-Adviser accepts that appointment and
agrees to render the services herein set forth, for the compensation herein
provided.
2. DUTIES AS SUB-ADVISER.
(a) Subject to the supervision and direction of the Trust's Board of
Trustees ("Board") and review by UBS GLOBAL Americas, and any written guidelines
adopted by the Board or UBS GLOBAL Americas, the Sub-Adviser will provide a
continuous investment program for the Portfolio, including investment research
and management. The Sub-Adviser may from time to time seek research assistance
and may rely upon resources available to it through its affiliated companies to
the extent such actions would not constitute an "assignment" for purposes of the
1940 Act but in no case shall such assistance and/or reliance relieve the
Sub-Adviser of any of its obligations hereunder, nor shall the Portfolio or UBS
GLOBAL Americas be responsible for any additional fees or expenses hereunder as
a result. The Sub-Adviser will determine from time to time what investments will
be purchased, retained or sold by the Portfolio. The Sub-Adviser will be
responsible for placing purchase and sell orders for investments and for other
related transactions. The Sub-Adviser will be responsible for voting proxies of
issuers of securities held by the Portfolio. The Sub-Adviser understand that the
Portfolio's assets need to be managed so as to permit the Portfolio to qualify
or to continue to qualify as a regulated investment company under Subchapter M
of the Internal Revenue Code, as
amended ("Code"). The Sub-Adviser will provide services under this Agreement in
accordance with the Portfolio's investment objective, policies and restrictions
as stated in the Portfolio's Prospectus and in the Trust's currently effective
registration statement under the 1940 Act, and any amendments or supplements
thereto ("Registration Statement").
(b) The Sub-Adviser agrees that it will not consult with any other
sub-adviser ("Other Sub-Adviser") for the Trust or Portfolio concerning any
transaction by the Portfolio or Segment in securities or other assets,
including' (i) the purchase by the Portfolio or Segment of a security issued by
the Other Sub-Adviser, or an affiliate of the Other Sub-Adviser, to the Trust or
Portfolio except as permitted by the 1940 Act or (ii) transactions by the
Portfolio or Segment in any security for which the Other Sub-Adviser, or its
affiliate, is the principal underwriter.
(c) The Sub-Adviser 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 Portfolio, the Sub-Adviser may, in its discretion, use
brokers who provide the Sub-Adviser with research, analysis, advice and similar
services to execute portfolio transactions on behalf of the Portfolio, and the
Sub-Adviser may pay to those brokers in return for brokerage and research
services a higher commission than may be charged by other brokers, subject to
the Sub-Adviser's determination in good faith that such commission is reasonable
in terms either of the particular transaction or of the overall responsibility
of the Sub-Adviser to the Portfolio and its other clients and that the total
commissions paid by the Portfolio will be reasonable in relation to the benefits
to the Portfolio over the long term. In no instance will portfolio securities be
purchased from or sold to UBS GLOBAL Americas or the Sub-Adviser, or any
affiliated person thereof, except in accordance with the federal securities laws
and the rules and regulations thereunder. The Sub-Adviser may aggregate sales
and purchase orders with respect to the assets of the Portfolio with similar
orders being made simultaneously for other accounts advised by the Sub-Adviser
or its affiliates. Whenever the Sub-Adviser simultaneously places orders to
purchase or sell the same security on behalf of the Portfolio and one or more
other accounts advised by the Sub-Adviser, the orders will be allocated as to
price and amount among all such accounts in a manner believed to be equitable
over time to each account. UBS GLOBAL Americas recognizes that in some cases
this procedure may adversely affect the results obtained for the Portfolio.
(d) The Sub-Adviser will maintain all books and records required to be
maintained pursuant to the 1940 Act and the rules and regulations promulgated
thereunder with respect to transactions by the Sub-Adviser on behalf of the
Portfolio, and will furnish the Board and UBS GLOBAL Americas with such periodic
and special reports as the Board or UBS GLOBAL Americas reasonably may request.
In compliance with the requirements of Rule 31 a-3 under the 1940 Act, the
Sub-Adviser hereby agrees that all records which it maintains for the Portfolio
are the property of the Trust, agrees to preserve for the periods prescribed by
Rule 31 a-2 under the 1940 Act any records that it maintains for the Portfolio
and that 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 Portfolio upon request by the Trust.
(e) At such times as shall be reasonably requested by the Board or UBS
GLOBAL Americas, the Sub-Adviser will provide the Board and UBS GLOBAL Americas
with economic and investment analyses and reports as well as quarterly reports
setting forth the Portfolio's
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performance and make available to the Board and UBS GLOBAL Americas any
economic, statistical and investment services that the Sub-Adviser normally
makes available to its institutional or other customers.
(f) In accordance with procedures adopted by the Board, as amended from
time to time, the Sub-Adviser is responsible for assisting in the fair valuation
of all portfolio securities and will use its reasonable efforts to arrange for
the provision of a price(s) from a party(ies) independent of the Sub-Adviser for
each portfolio security for which the custodian does not obtain prices in the
ordinary course of business from an automated pricing service.
3. FURTHER DUTIES. In all matters relating to the performance of this
Agreement, the Sub-Adviser will seek to act in conformity with the Trust's Trust
Instrument, By-Laws and Registration Statement with the written instructions and
written directions of the Board and UBS GLOBAL Americas; and will comply with
the requirements of the 1940 Act, and the Investment Advisers Act of 1940, as
amended ("Advisers Act"), and the rules under each, the Code, and all other
federal and state laws and regulations applicable to the Trust and the
Portfolio. UBS GLOBAL Americas agrees to provide to the Sub-Adviser copies of
the Trust's Trust Instrument, By-Laws, Registration Statement, written
instructions and directions of the Board and UBS GLOBAL Americas, and any
amendments or supplements to any of these materials as soon as practicable after
such materials become available; and further agrees to identify to the
Sub-Adviser in writing any broker-dealers that are affiliated with UBS GLOBAL
Americas (other than UBS Financial Services Inc. and UBS GLOBAL Americas
itself).
4. EXPENSES. During the term of this Agreement, the Sub-Adviser will bear
all expenses incurred by it in connection with its services under this
Agreement. The Sub-Adviser shall not be responsible for any expenses incurred by
the Trust, the Portfolio or UBS GLOBAL Americas.
5. COMPENSATION.
(a) For the services provided and the expenses assumed by the Sub-Adviser
pursuant to this Agreement, UBS GLOBAL Americas, not the Portfolio, will pay to
the Sub-Adviser a fee, computed daily and payable monthly, at an annual rate of
0.25% of the Portfolio's average daily net assets (computed in the manner
specified in the Management Agreement), and will provide the Sub-Adviser with a
schedule showing the manner in which the fee was computed.
(b) The fee shall be accrued daily and payable monthly to the Sub-Adviser
on or before the last business day of the next succeeding calendar month.
(c) For those periods in which UBS GLOBAL Americas has agreed to waive all
or a portion of its management fee, UBS GLOBAL Americas may ask the Sub-Adviser
to waive the same proportion of its fees, but the Sub-Adviser is under no
obligation to do so.
(d) If this Agreement becomes effective or terminates before the end of any
month, the fee for the period from the effective date 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 pro-rated according to the proportion which such period bears to the
full month in that such effectiveness or termination occurs.
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6. LIMITATION OF LIABILITY. The Sub-Adviser, shall not be liable for any
error of judgment or mistake of law or for any loss suffered by the Portfolio,
the Trust or its shareholders or by UBS GLOBAL Americas in connection with the
matters to which this Agreement relates, except 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. Nothing in this paragraph shall be deemed a limitation or waiver of
any obligation or duty that may not by law be limited or waived.
7. REPRESENTATIONS OF SUB-ADVISER. The Sub-Adviser represents, warrants and
agrees as follows:
(a) The Sub-Adviser (i) is registered as an investment adviser under the
Advisers Act and will continue to be so registered for so long as this Agreement
remains in effect; (ii) is not prohibited by the 1940 Act or the Advisers Act
from performing the services contemplated by this Agreement; (iii) has met, and
will seek to continue to meet for so long as this Agreement 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 Agreement; (iv) has
the authority to enter into and perform the services contemplated by this
Agreement; and (v) will promptly notify UBS GLOBAL Americas of the occurrence of
any event that would disqualify the Sub-Adviser from serving as an investment
adviser of an investment company pursuant to Section 9(a) of the 1940 Act or
otherwise.
(b) The Sub-Adviser has adopted a written code of ethics complying with the
requirements of Rule 17j-1 under the 1940 Act and will provide UBS GLOBAL
Americas and the Board with a copy of such code of ethics, together with
evidence of its adoption. Within fifteen days of the end of the last calendar
quarter of each year that this Agreement is in effect, the president or a
vice-president of the Sub-Adviser shall certify to UBS GLOBAL Americas that the
Sub-Adviser has complied with the requirements of Rule 17j-1 during the previous
year and that there has been no violation of the Sub-Adviser'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 UBS GLOBAL Americas, the
Sub-Adviser shall permit UBS GLOBAL Americas, its employees or its agents to
examine the reports required to be made by the Sub-Adviser pursuant to Rule
17j-1 and all other records relevant to the Sub-Adviser's code of ethics.
(c) The Sub-Adviser has provided UBS GLOBAL Americas with a copy of its
Form ADV, as most recently filed with the Securities and Exchange Commission
("SEC"), and promptly will furnish a copy of all amendments to UBS GLOBAL
Americas at least annually.
(d) The Sub-Adviser shall provide notice to UBS GLOBAL Americas within a
reasonable time after being informed or learning of the death or withdrawal of
any if its partners, upon the admission of any new partners or upon any other
change in its membership.
(e) The Sub-Adviser will notify UBS GLOBAL Americas of any change of
control of the Sub-Adviser, including any change of its general partners or 25%
shareholders, as applicable, and any changes in the key personnel who are either
the portfolio manager(s) of the Portfolio or senior management of the
Sub-Adviser, in each case prior to or promptly after such change.
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(f) The Sub-Adviser agrees that neither it, nor any of its affiliates, will
in any way refer directly or indirectly to its relationship with the Trust, the
Portfolio, UBS GLOBAL Americas or any of their respective affiliates in
offering, marketing or other promotional materials without the express written
consent of UBS GLOBAL Americas.
8. REPRESENTATIONS OF UBS GLOBAL AMERICAS. UBS GLOBAL Americas represents
that (i) the Trust was duly organized as a Delaware business trust under the
laws of Delaware; (ii) the appointment of the Sub-Adviser has been duly
authorized and (iii) the Trust has acted and will continue to act in conformity
with the 1940 Act and other applicable laws.
9. SERVICES NOT EXCLUSIVE. The services furnished by the Sub-Adviser
hereunder are not to be deemed exclusive, and except as the Sub-Adviser may
otherwise agree in writing, the Sub-Adviser shall be free to furnish similar
services to others so long as its services under this Agreement are not impaired
thereby. Nothing in this Agreement shall limit or restrict the right of any
director, officer or employee of the Sub-Adviser, who may also be a trustee,
officer or employee of the Trust, 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.
10. DURATION AND TERMINATION.
(a) This Agreement shall become effective upon the date first above
written, provided that this Agreement shall not take effect unless it has first
been approved (i) by a vote of a majority of those trustees of the Trust who are
not parties to this Agreement 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 Portfolio's outstanding voting securities, unless
UBS GLOBAL Americas has authority to enter into this Agreement pursuant to
exemptive relief from the SEC without a vote of the Portfolio's outstanding
voting securities.
(b) Unless sooner terminated as provided herein, this Agreement shall
continue in effect for two years from its effective date. Thereafter, if not
terminated, this Agreement 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 Trust who
are not parties to this Agreement 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 the Portfolio.
(c) Notwithstanding the foregoing, this Agreement 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 Portfolio on 30 days'
written notice to the Sub-Adviser. This Agreement may also be terminated,
without the payment of any penalty, by UBS GLOBAL Americas: (i) upon 120 days'
written notice to the Sub-Adviser; (ii) upon material breach by the Sub-Adviser
of any of the representations, warranties and agreements set forth in Paragraph
7 of this Agreement, or (iii) immediately if, in the reasonable judgment of UBS
GLOBAL Americas, the Sub-Adviser becomes unable to discharge its duties and
obligations under this Agreement, including circumstances such as financial
insolvency of the Sub-Adviser or other circumstances that could adversely affect
the Portfolio. The Sub-Adviser may terminate this Agreement at any
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time, without the payment of any penalty, on 120:days' written notice to UBS
GLOBAL Americas. This Agreement will terminate automatically in the event of its
assignment or upon termination of the Management Agreement, as it relates to
this Portfolio.
11. AMENDMENT OF THIS AGREEMENT. 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 whom enforcement of the change, waiver,
discharge or termination is sought. To the extent required by applicable law, no
amendment of this Agreement shall be effective until approved (i) by a vote of a
majority of those trustees of the Trust who are not parties to this Agreement or
interested persons of any such party, and (ii) if the terms of this Agreement
shall have changed, by a vote of a majority of the Portfolio's outstanding
voting securities (except in the case of (ii), pursuant to the terms and
conditions of the SEC order permitting it to modify the Agreement without such
vote).
12. GOVERNING LAW. This Agreement shall be construed in accordance with the
1940 Act and the laws of the State of Delaware, without giving effect to the
conflicts of laws principles thereof. To the extent that the applicable laws of
the State of Delaware conflict with the applicable provisions of the 1940 Act,
the latter shall control.
13. MISCELLANEOUS. The captions in this Agreement are included for
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 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. This Agreement shall be binding upon and shall inure to the
benefit of the parties hereto and their respective successors. As used in this
Agreement, the terms "majority of the outstanding voting securities,"
"affiliated person," "interested person," "assignment," "broker," "investment
adviser," "net assets," "sale," "sell" and "security" shall have the same
meanings 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
Agreement is made less restrictive by a rule, regulation or order of the SEC,
whether of special or general application, such provision shall be deemed to
incorporate the effect of such rule, regulation or order. This Agreement may be
signed in counterpart.
14. NOTICES. Any notice herein required is to be in writing and is deemed
to have been given to the Sub-Adviser or UBS GLOBAL Americas upon receipt of the
same at their respective addresses set forth below. All written notices required
or permitted to be given under this Agreement will be delivered by personal
service, by postage mail return receipt requested or by facsimile machine or a
similar means of same delivery which provides evidence of receipt (with a
confirming copy by mail as set forth herein). All notices provided to UBS GLOBAL
Americas will be sent to the attention of the General Counsel. All notices
provided to the Sub-Adviser will be sent to the attention of Senior Counsel.
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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.
UBS GLOBAL ASSET
MANAGEMENT (AMERICAS) INC.
00 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Attest:
By: /s/ Xxxx Xxxxxxx By: /s/ Xxxxx X. Xxxxxx
-------------------------------- ------------------------------------
Name: Xxxx Xxxxxxx Name: Xxxxx X. Xxxxxx
Title: Director Title: Executive Director
PACIFIC INVESTMENT MANAGEMENT
COMPANY LLC
000 Xxxxxxx Xxxxxx Xxxxx
Xxxxxxx Xxxxx, Xxxxxxxxxx 00000
By: /s/ Xxxxx X. Xxxxxx
------------------------------------
Name: Xxxxx X. Xxxxxx
Title: Managing Director
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