FORM OF SUB-ADVISORY CONTRACT
XXXXX FARGO BANK, N.A.
000 Xxxxxx Xxxxxx
Xxx Xxxxxxxxx, XX 00000
January 1, 1996
Barclays Global Fund Advisors
00 Xxxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
Dear Sirs:
This will confirm the agreement by and among Xxxxx Fargo Bank, N.A. (the
"Adviser"), Life & Annuity Trust (the "Trust") on behalf of the U.S. Government
Allocation Fund (the "Fund"), and Barclays Global Fund Advisors (the "Sub-
Adviser") as follows:
1. The Trust is a registered open-end management investment company
currently consisting of four investment portfolios, but which may from time to
time consist of a greater or lesser number of investment portfolios. The Trust
proposes to engage in the business of investing and reinvesting the assets of
the Fund in the manner and in accordance with the investment objective and
restrictions specified in the Trust's currently effective Registration
Statement, as amended from time to time (the "Registration Statement"), filed by
the Trust under the Investment Company Act of 1940 (the "Act") and the
Securities Act of 1933. Copies of the Registration Statement have been
furnished to the Sub-Adviser. Any amendments to the Registration Statement
shall be furnished to the Sub-Adviser promptly.
2. The Trust has engaged the Adviser to manage the investing and
reinvesting of the assets of the Fund and to provide the advisory services
specified in the Advisory Contract between the Trust and the Adviser, dated
March 31, 1994, subject to the overall supervision of the Board of Trustees of
the Trust. Pursuant to an administration agreement between the Trust, on behalf
of the Fund, and an administrator (the "Administrator"), the Trust has engaged
the Administrator to provide the administrative services specified therein.
3. (a) The Adviser hereby employs the Sub-Adviser to perform for the
Fund certain advisory services and the Sub-Adviser hereby accepts such
employment. The Adviser shall retain the authority to establish and modify from
time to time the investment strategies and approaches to be followed by the Sub-
Adviser, subject, in all respects, to the supervision and direction of the
Trust's Board of Trustees and subject to compliance with the investment
objectives, policies and restrictions set forth in the Registration Statement.
(b) Subject to the overall supervision and control of the Adviser and
the Trust, the Sub-Adviser shall be responsible for investing and reinvesting
the Fund's assets
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consistent with the investment strategies and approaches referenced in
subparagraph (a), above. In this regard, the Sub-Adviser shall be responsible
for implementing and monitoring the performance of the investment model employed
with respect to the Fund, in accordance with the investment objective, policies
and restrictions set forth in the Registration Statement, the Act and the
provisions of the Internal Revenue Code of 1986 relating to investment companies
and shall furnish to the Adviser periodic reports on the investment activity and
performance of the Fund. The Sub-Adviser shall also furnish such additional
reports and information as the Adviser and the Trust's Board of Trustees and
officers shall reasonably request.
(c) The Sub-Adviser shall, at its expense, employ or associate with
itself such persons as the Sub-Adviser believes appropriate to assist it in
performing its obligations under this contract.
4. The Adviser shall be responsible for fees paid to the Sub-Adviser
for its services hereunder. The Sub-Adviser agrees that it shall have no claim
against the Trust or the Fund respecting compensation under this contract. In
consideration of the services to be rendered by the Sub-Adviser under this
contract, the Adviser shall pay the Sub-Adviser a fee on the first business day
of each calendar month, at the annual rate of 0.05% of the average daily value
(as determined on each day that such value is determined for the Fund at the
time set forth in the Registration Statement for determining net asset value per
share) of the first $75 million of the Fund's net assets for the preceding
month; 0.04% of the next $75 million of net assets, and 0.03% of net assets over
$150 million. If the fee payable to the Sub-Adviser pursuant to this Paragraph
4 begins to accrue on a day after the first day of any month or if this contract
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 that month to
the termination date, shall be prorated according to the proportion that such
period bears to the full month in which the effectiveness or termination occurs.
For purposes of calculating the monthly fee, the value of a Fund's net assets
shall be computed in the manner specified in the Registration Statement and the
Trust's Declaration of Trust for the computation of the value of a Fund's net
assets in connection with the determination of the net asset value of Fund
shares.
5. The Sub-Adviser shall give the Trust the benefit of the Sub-
Adviser's best judgment and efforts in rendering services under this contract.
As consideration and an inducement to the Sub-Adviser's undertaking to render
these services, the Trust and the Adviser agree that the Sub-Adviser shall not
be liable under this contract for any mistake in judgment or in any other event
whatsoever except for lack of good faith, provided that nothing in this contract
shall be deemed to protect or purport to protect the Sub-Adviser against any
liability to the Adviser, the Trust or its holders of interests of the Fund to
which the Sub-Adviser would otherwise be subject by reason of willful
misfeasance, bad faith or gross negligence in the performance of the Sub-
Adviser's duties under this contract or by reason of reckless disregard of its
obligations and duties hereunder.
6. This contract shall become effective as of its execution date and
shall thereafter continue in effect, provided that this contract shall continue
in effect for a period of more than two years from the date hereof only so long
as the continuance is specifically approved at least
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annually (a) by the vote of a majority of the Fund's outstanding voting
securities (as defined in the Act) or by the Trust's Board of Trustees and (b)
by the vote, cast in person at a meeting called for the purpose of continuing
this Sub-Advisory Contract, of a majority of the Trust's Trustees who are not
parties to this contract or "interested persons" (as defined in the Act) of any
such party. This contract may be terminated at any time by the Trust, without
the payment of any penalty, by a vote of a majority of the Fund's outstanding
voting securities (as defined in the Act) or by a vote of a majority of the
Trust's entire Board of Trustees on 60 days' written notice to the Sub-Adviser,
or by the Sub-Adviser on 60 days' written notice to the Trust. This contract
shall terminate automatically in the event of its assignment (as defined in the
Act).
7. Except to the extent necessary to perform the Sub-Adviser's
obligations under this contract, nothing herein shall be deemed to limit or
restrict the right of the Sub-Adviser, or any affiliate of the Sub-Adviser, or
any employee of the Sub-Adviser, to engage in any other business or to devote
time and attention to the management or other aspects of any other business,
whether of a similar or dissimilar nature, or to render services of any kind to
any other corporation, firm, individual or association.
8. The Trust shall own and control all records generated on behalf of
the Trust as a result of services provided under this contract. In addition,
the Trust shall have the right to inspect, audit, and/or copy all records
pertaining to the performance of services under this contract.
9. This contract shall be governed by and construed in accordance with
the laws of the State of California.
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If the foregoing correctly sets forth the agreement by and among the
Adviser, the Trust and the Sub-Adviser, please so indicate by signing and
returning to the Trust the enclosed copy hereof.
Very truly yours,
XXXXX FARGO BANK, N.A.
By: _____________________________________________
Name: ___________________________________________
Title: __________________________________________
By: _____________________________________________
Name: ___________________________________________
Title: __________________________________________
AGREED to as of the date set forth above,
and as amended on October 30, 1997,
January 29, 1998 and April 30, 1998:
BARCLAYS GLOBAL FUND ADVISORS
By: _____________________________________________
Name: ___________________________________________
Title: __________________________________________
ACCEPTED as of the date set forth above,
and as amended on October 30, 1997,
January 29, 1998 and April 30, 1998:
LIFE & ANNUITY TRUST
on behalf of U.S. Government Allocation Fund
By: ____________________________________________
Xxxxxxx X. Xxxxx, Xx.
Chief Operating Officer
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