EXHIBIT 5(c)(ii)
INVESTMENT SUB-ADVISORY CONTRACT
FOR
XXXXXX INSIGHT EMERGING MARKETS FUND
WITH
XXXXXXXXXX GLOBAL INVESTORS, INC.
Xxxxxx Investment Management, Inc. (the "Portfolio Management Agent"),
a Delaware corporation registered as an investment adviser under the Investment
Advisers Act of 1940, as amended (the "Advisers Act"), and Xxxxxxxxxx Global
Investors, Inc. (the "Subadviser"), a Delaware corporation registered as an
investment adviser under the Advisers Act, agree as follows:
1. APPOINTMENT OF SUBADVISER. Subject to and in accordance with the
Portfolio Management Agreement between Xxxxxx Trust and Savings Bank, an
Illinois bank and the investment adviser to the portfolios of Xxxxxx Insight
Funds Trust (the "Trust") (the "Adviser"), and the Portfolio Management Agent,
the Portfolio Management Agent appoints the Subadviser to act as manager of the
assets of the Xxxxxx Insight Emerging Markets Fund (the "Fund"), a portfolio of
the Trust, said assets, including interest and dividends earned thereon and
capital accretions or other additions thereto (collectively, the "Assets"), to
be invested in accordance with the current Prospectus and Statement of
Additional Information of the Fund, as amended or supplemented from time to
time, and the Subadviser accepts that appointment for the period and on the
terms set forth below.
2. SERVICES OF SUBADVISER.
(a) INVESTMENT MANAGEMENT. Subject to the overall control of the Board
of Trustees of the Trust (the "Board of Trustees"), the Adviser and the
Portfolio Management Agent, the Subadviser shall have supervisory responsibility
for the general management and investment of the Assets of the Fund giving due
consideration to the investment policies and restrictions, portfolio transaction
policies and the other statements concerning the Fund in the Trust's Declaration
of Trust, by-laws and registration statements under the Investment Company Act
of 1940, as amended (the "1940 Act"), and the Securities Act of 1933, as amended
(the "1933 Act"), to the provisions of the 1933 Act and the 1940 Act and rules
and regulations thereunder, and to the provisions of the Internal Revenue Code
applicable to regulated investment companies and other applicable law (the
"Investment Policies and Restrictions"). The Subadviser shall not lend or pledge
any of the Assets without the prior written consent of the Portfolio Management
Agent.
Subject to the overall control of the Board of Trustees, the Adviser
and the Portfolio Management Agent, and unless otherwise instructed, the
Subadviser shall vote proxies solicited by issuers of securities held by the
Fund.
(b) MANAGEMENT SERVICES. In carrying out its obligations to manage and
invest the Assets, the Subadviser shall: (i) obtain and evaluate pertinent
economic, statistical, financial and other information affecting the economic
regions and individual national economies generally, together with information
specific to individual companies or industries, the securities of which are
included in the Fund's investment portfolio or may be under consideration for
inclusion therein; and (ii) formulate, recommend, and execute an ongoing program
of investment for the Fund consistent with the Fund's investment objective,
policies, strategy, and restrictions as set forth in the Fund's registration
statement.
(c) MONITORING SUBADVISER. The Portfolio Management Agent shall monitor
and evaluate the investment performance of the Subadviser; and shall monitor the
investment activities of the Subadviser to ensure compliance with the Investment
Policies and Restrictions.
(d) REPORTS AND INFORMATION. The Subadviser shall furnish to the
Portfolio Management Agent periodic reports on the investment strategy and
performance of the Fund and such additional reports and information as the
Portfolio Management Agent or the Board of Trustees or the officers of the Trust
may reasonably request.
(e) UNDERTAKINGS OF SUBADVISER. The Subadviser further agrees that it
will:
(i) At all times be duly registered as an investment adviser
under the Advisers Act and be duly registered and qualified under other
securities legislation in each jurisdiction where such registration or
qualification is required, whether as portfolio manager, investment counsel or
such other category as may be required;
(ii) Comply with the 1940 Act and with all applicable rules
and regulations of the Securities and Exchange Commission, the provisions of the
Internal Revenue Code relating to regulated investment companies, applicable
banking laws and regulations and policy decisions and procedures adopted by the
Board of Trustees from time to time;
(iii) In the name of the Fund, place or direct the placement
of orders for the execution of portfolio transactions in accordance with the
policies with respect thereto, as set forth in the Fund's then current
Prospectus and Statement of Additional Information, as amended from time to
time, and under the 1933 Act and the 1940 Act. In placing orders or directing
the placement of orders for the execution of portfolio transactions, the
Subadviser shall select brokers and dealers for the execution of the Fund's
transactions. In selecting brokers or dealers to execute such orders, the
Subadviser is expressly authorized to consider the fact that a broker or dealer
has furnished statistical, research or other information or services which
enhance the Subadviser's investment research and portfolio management capability
generally. It is further understood in accordance with Section 28(e) of the
Securities Exchange Act of 1934, as amended, that the Subadviser may negotiate
with and assign to a broker a commission which may exceed the commission which
another broker would have charged for effecting the transaction if the
Subadviser determines in good faith that the amount of commission charged was
reasonable in relation to the value of brokerage and/or research services (as
defined in
Section 28(e)) provided by such broker, viewed in terms either of the Fund's or
the Subadviser's overall responsibilities to the Subadviser's discretionary
accounts;
(iv) Maintain books and records with respect to the securities
transactions of the Fund;
(v) Notify the Portfolio Management Agent within five business
days of any change in the Subadviser's directors and senior officers, and of any
anticipated action that would constitute an "assignment" of this Agreement under
the 1940 Act; and
(vi) Treat confidentially and as proprietary information of
the Trust all records and other information relative to the Trust or to prior,
present or potential shareholders, and not use such records or information for
any purpose other than in the performance of its responsibilities and duties
hereunder, except (A) after prior notification to and approval in writing by the
Trust, which approval shall not be unreasonably withheld, (B) when so requested
by the Trust, (C) as required by tax authorities or (D) pursuant to applicable
law, a judicial request, requirement or order, provided that the Subadviser
takes reasonable steps to provide the Trust with prior notice in order to allow
the Trust to contest such request, requirement or order.
(f) BOOKS AND RECORDS. In compliance with the requirements of Rule
31a-3 under the 1940 Act, the Subadviser agrees that all records that it
maintains for the Trust are the property of the Trust and further agrees to
surrender promptly to the Trust any of such records upon the Trust's request.
The Subadviser further agrees to preserve for the periods prescribed by Rule
31a-2 under the 1940 Act the records required to be maintained by Rule 31a-1
under the 1940 Act.
(g) INDEPENDENT CONTRACTOR. The Subadviser shall for all purposes
herein be deemed to be an independent contractor and not an agent of the Trust
or the Portfolio Management Agent and shall, unless otherwise expressly provided
or authorized, have no authority to act for or represent the Trust or the
Portfolio Management Agent in any way.
3. UNDERTAKINGS OF PORTFOLIO MANAGEMENT AGENT. The Portfolio Management
Agent will:
(a) Furnish to the Subadviser promptly a copy of the Trust's
Declaration of Trust and By-Laws, each amendment to the registration statement
of the Trust under the 1940 Act and the 1933 Act, of each Prospectus and
Statement of Additional Information relating to the Fund and any supplement
thereto, all governing documents of the Fund and all Board-adopted procedures of
the Fund;
(b) Inform the principal custodian of the Fund (the "Custodian")
(currently PNC Bank, N.A.) of the appointment of the Subadviser as investment
subadviser in the provision of custodial services to the Fund;
(c) Instruct the Custodian to cooperate with the Subadviser in the
provision of custodial services to the Fund; and
(d) Provide the Subadviser with all information that the Subadviser may
reasonably require insofar as it relates to the custodial arrangements in
connection with this Agreement.
4. EXPENSES BORNE BY SUBADVISER. The Subadviser at its own expense
shall furnish personnel, office space and office facilities and equipment
reasonably required to render its services pursuant to this Agreement.
5. COMPENSATION OF SUBADVISER. For the services to be rendered and the
expenses to be assumed and to be paid by the Portfolio Management Agent under
this Agreement, the Portfolio Management Agent shall pay to the Subadviser a
monthly fee, computed and accrued on each day on which the Fund's net asset
value is determined, and payable in arrears on the first business day of each
month, at the annual rate of 0.75% of the first $100 million of the average net
asset value of the Assets, and 0.50% of such net asset value in excess of $100
million. The fee payable under this Agreement shall be reduced proportionately
during any month in which this Agreement is not in effect for the entire month.
6. NON-EXCLUSIVITY. The Portfolio Management Agent understands that the
Subadviser now acts, will continue to act, or may act in the future, as
investment adviser or investment subadviser to fiduciary and other managed
accounts, including other investment companies and the Portfolio Management
Agent has no objection to the Subadviser so acting, provided that the Subadviser
duly performs all obligations under this Agreement. If the availability of any
particular investment security is limited and that security meets the investment
objective, policies and current strategy of the Fund and also those of one or
more of the Subadviser's other managed accounts, such security will be allocated
among such accounts on an equitable basis, having regard to whether the security
is currently held in any of the relevant investment portfolios, the relevant
size and rate of growth of each of the Fund and the other managed accounts, and
other reasonable factors. The Portfolio Management Agent also understands that
the Subadviser may give advice and take action with respect to any of its other
clients or for its own account which may differ from the timing or nature of
action taken by the Subadviser, with respect to the Fund. Nothing in this
Agreement shall impose upon the Subadviser any obligation to purchase or sell or
to recommend for purchase or sale, with respect to the Fund, any security which
the Subadviser or its shareholder, directors, officers, employees or affiliates
may purchase or sell for its or their own account(s) or for the account of any
other client, provided however, that the Subadviser and its personnel will
comply with the code of ethics applicable to them as approved by the Board of
Trustees of the Trust.
Except to the extent necessary to perform its obligations hereunder,
nothing herein shall be deemed to limit or restrict the right of the Subadviser,
or the right of any of its officers, directors or employees who may also be an
officer, director or employee of the Fund, or person otherwise affiliated with
the Fund (within the meaning of the 1940 Act) 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 trust, corporation, firm, individual or association.
7. STANDARD OF CARE. Neither the Subadviser, nor any of its directors,
officers, agents or employees shall be liable or responsible to the Trust or its
shareholders for any error of judgment, or any loss arising out of any
investment, or for any other act or omission in the performance by the
Subadviser of its duties under this Agreement, except for liability resulting
from willful misfeasance, bad faith or gross negligence on its part or from
reckless disregard of its obligations and duties under this Agreement.
8. INSPECTION. The Portfolio Management Agent (or any authorized agent
of the Portfolio Management Agent as advised in writing to the Subadviser) shall
have a right to audit, inspect and photocopy documents (and remove such
photocopies) relating to investment subadvisory and portfolio management
services performed under this Agreement, during normal business hours of the
Subadviser.
9. REPRESENTATIONS OF THE PORTFOLIO MANAGEMENT AGENT AND SUBADVISER.
The Portfolio Management Agent represents that (i) it is authorized to perform
the services herein; (ii) the appointment of the Subadviser has been duly
authorized; and (iii) it will act in conformity with the 1940 Act, and other
applicable laws.
The Subadviser represents that (i) a copy of its Articles of
Incorporation, together with all amendments thereto, is on file in the office of
the Secretary of the State of Delaware; (ii) it will act in conformity with the
1940 Act and other applicable laws; and (iii) is authorized to perform the
services described herein.
10. AUTHORIZED PERSONS.
(a) The Subadviser is authorized to accept instructions and directions
with respect to this Agreement signed by any Director or Senior Director of the
Portfolio Management Agent. The Portfolio Management Agent will notify the
Subadviser of any changes in its officers empowered to act under this Agreement.
Until actual written notice of any such changes is received by the Subadviser,
Subadviser may continue to accept instructions and directions from those
officers previously designated by the Portfolio Management Agent.
(b) The Portfolio Management Agent is authorized to accept instructions
and directions with respect to this Agreement signed by any authorized persons
of the Subadviser as listed in Schedule A of this Agreement. The Subadviser will
notify the Portfolio Management Agent of any changes in its officers empowered
to act under this Agreement.
(c) The Subadviser will advise the Custodian of the names of persons
from whom the Custodian is authorized to accept instructions regarding
investment transactions.
11. USE OF SUBADVISER'S NAME AND MARKS. The Subadviser grants to the
Portfolio Management Agent and the Trust the limited and non-exclusive right to
use, in marketing, promotional and advertising materials of the Portfolio
Management Agent or the Trust, any registered trademarks, logos or other marks
that the Subadviser uses in advertising and publicizing itself and its services
as a portfolio manager or investment counsel. Any such material shall be subject
to the prior written approval by the Subadviser as to form and content prior to
its use by the Portfolio Management Agent or the Trust, which approval shall not
unreasonably be withheld. The Subadviser consents to the disclosure, in
documents relating to the Fund, of its name as the investment subadviser and
portfolio manager of the Assets of the Fund.
12. AMENDMENT. This Agreement may not be amended without the
affirmative votes (a) of a majority of the Trustees of the Trust, including a
majority of those Trustees who are not "interested persons" of the Trust, the
Investment Adviser, the Portfolio Management Agent or the Subadviser and (b) of
a "majority of the outstanding shares" of such Fund. The terms "interested
person" and "vote of a majority of the outstanding shares" shall be construed in
accordance with their respective definitions in Sections 2(a)(19) and 2(a)(42)
of the 1940 Act and, with respect to the latter term, in accordance with Rule
18f-2 under the 1940 Act.
13. TERMINATION. This Agreement may be terminated, at any time, without
payment of any penalty, by the Board of Trustees, or by a vote of a majority of
the outstanding shares of the Fund, upon at least 60 days' written notice to the
Portfolio Management Agent and the Subadviser. This Agreement may be terminated
by the Portfolio Management Agent and the Subadviser at any time upon at least
60 days' written notice to the Trust. This Agreement shall terminate
automatically in the event of its "assignment" (as defined in Section 2(a)(4) of
the 1940 Act). Unless terminated as hereinbefore provided, this Agreement shall
continue in effect with respect to the Fund from the date hereof until February
23, 1999 and thereafter from year to year only so long as such continuance is
specifically approved at least annually (a) by a majority of those Trustees who
are not interested persons of the Trust, the Investment Adviser, the Portfolio
Management Agent or the Subadviser, voting in person at a meeting called for the
purpose of voting on such approval, and (b) by either the Board of Trustees or
by a vote of a majority of the outstanding shares of the Fund.
14. NOTICE. Any notice, demand, change of address or other
communication to be given in connection with this Agreement shall be given in
writing and shall be given by personal delivery, by registered or certified mail
or by transmittal by facsimile or other electronic medium addressed to the
recipient as follows:
To the Subadviser: Xxxxxxxxxx Global Investors, Inc.
000 Xxxx Xxx Xxxx Xxxx., Xxxxx 0000
Xxxx Xxxxxxxxxx, Xxxxxxx 00000
Attention: General Counsel
Telephone: (000) 000-0000
Fax: (000) 000-0000
To the Portfolio
Management Agent: Xxxxxx Investment Management, Inc.
000 Xxxxx XxXxxxx Xxxxxx
Xxxxxxx, XX 00000
Telephone: (000) 000-0000
Fax: (000) 000-0000
To the Trust: Xxxxxx Insight Funds Trust
00 Xxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, XX 00000
Telephone: (000) 000-0000
Fax: (000) 000-0000
All notices shall be conclusively deemed to have been given on the day
of actual delivery thereof and, if given by registered or certified mail, on the
fifth business day following the deposit thereof in the mail and, if given by
facsimile or other electronic medium, on the day of transmittal thereof.
15. THIRD PARTY BENEFICIARIES. This Agreement is intended for the
benefit of the Trust, which shall have all rights against the Subadviser as
would pertain to it if this Agreement were directly between the Trust and the
Subadviser.
16. GOVERNING LAW. This Agreement shall be construed and interpreted in
accordance with the laws of the State of Illinois and the laws of the United
States of America applicable to contracts executed and to be performed therein.
17. REFERENCES AND HEADINGS. In this Agreement and in any such
amendment, references to this Agreement and all expressions such as "herein,"
"hereof," and "under this Agreement" shall be deemed to refer to this Agreement
or this Agreement as amended or affected by any such amendments. Headings are
placed herein for convenience of reference only and shall not be taken as a part
hereof or control or affect the meaning, construction or effect of this
Agreement. This Agreement constitutes the entire agreement between the parties
hereto. This Agreement may be executed in any number of counterparts, each of
which shall be deemed an original.
Dated: September ____, 1997
XXXXXX INVESTMENT MANAGEMENT, INC.
By:
------------------------------
Name:
Title:
ATTEST:
______________________, Secretary
XXXXXXXXXX GLOBAL INVESTORS, INC.
By:
------------------------------
Name:
Title:
ATTEST:
______________________, Secretary
AGREED AND ACCEPTED:
XXXXXX INSIGHT FUNDS TRUST
By:
------------------------------
Name:
Title:
ATTEST:
______________________, Secretary
XXXXXX TRUST AND SAVINGS BANK
By:
------------------------------
Name:
Title:
ATTEST:
______________________, Secretary
SCHEDULE A
SUBADVISER'S AUTHORIZED PERSONS
