For period ending October 31, 2007
File number 811-22078
Exhibit 77Q1:
The Funds Trust Instrument and By-Laws are incorporated by reference to
Exhibits (1)(b) and (2) to its N-1A Registration Statement filed on August 23,
2007 via XXXXX (accession no. 0000943663-07-000453).
For period ending October 31, 2007
File number 811-22078
Exhibit 77Q1:
MANAGEMENT CONTRACT
This management contract (Contract) made as of August 23, 2007
between MASTER TRUST, a Delaware statutory trust (Trust), and UBS GLOBAL
ASSET MANAGEMENT (AMERICAS) INC. (UBS Global AM), a Delaware corporation
registered as an investment adviser under the Investment Advisers Act
of 1940, as amended.
WHEREAS, the Trust is registered under the Investment Company
Act of 1940, as amended (1940 Act), as an open-end investment management
company with distinct series of shares of beneficial interest as listed
in Exhibit A (Series), each corresponding to a distinct portfolio; and
WHEREAS, the Trust desires to retain UBS Global AM as investment
adviser and administrator to furnish certain administrative, investment
advisory and portfolio management services to the Trust and each Series,
and UBS Global AM 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. The Trust hereby appoints UBS Global
AM as investment adviser and administrator of the Trust and each Series
for the period and on the terms set forth in this Contract. UBS Global
AM accepts such appointment and agrees to render the services herein set
forth, for the compensation herein provided.
2. Duties as Investment Adviser.
(a) Subject to the supervision of the Board of Trustees
(Board), UBS Global AM will provide a continuous investment program for
each Series, including investment research and management with respect
to all securities and investments and cash equivalents in each Series.
UBS Global AM will determine from time to time what securities and
other investments will be purchased, retained or sold by each Series.
(b) UBS Global AM 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 any Series, UBS Global AM 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 UBS Global AM may pay to those brokers in
return for brokerage and research services a higher commission than may
be charged by other brokers, subject to UBS Global AM determining in
good faith that such commission is reasonable in terms either of the
particular transaction or of the overall responsibility of UBS Global AM
to such Series and its other clients and that the total commissions paid
by such Series will be reasonable in relation to the benefits to the
Series over the long term. In no instance will portfolio securities be
purchased from or sold to UBS Global AM or any affiliated person thereof,
except in accordance with the federal securities laws and the rules and
regulations thereunder. Whenever UBS Global AM simultaneously places orders
to purchase or sell the same security on behalf of a Series and one or more
other accounts advised by UBS Global AM, such orders will be allocated as
to price and amount among all such accounts in a manner believed to be
equitable to each account. The Trust recognizes that in some cases this
procedure may adversely affect the results obtained for the Series.
(c) UBS Global AM will oversee the maintenance of all books
and records with respect to the securities transactions of each Series, and
will furnish the Board with such periodic and special reports as the Board
reasonably may request. In compliance with the requirements of Rule 31a-3
under the 1940 Act, UBS Global AM hereby agrees that all records which it
maintains for the Trust 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) UBS Global AM will oversee the computation of the net
asset value and the net income of each Series as described in the currently
effective registration statement of the Trust under the 1940 Act and any
supplements thereto (Registration Statement) or as more frequently
requested by the Board.
(e) The Trust hereby authorizes UBS Global AM and any
entity or person associated with UBS Global AM which is a member of a
national securities exchange to effect any transaction on such exchange
for the account of any Series, which transaction is permitted by Section
11(a) of the 1934 Act, and the Trust hereby consents to the retention of
compensation by UBS Global AM or any person or entity associated with
UBS Global AM.
3. Duties as Administrator. UBS Global AM will administer
the affairs of the Trust and each Series subject to the supervision of
the Board and the following understandings:
(a) UBS Global AM will supervise all aspects of the
operations of the Trust and each Series, including oversight of custodial
and accounting services, except as hereinafter set forth; provided,
however, that nothing herein contained shall be deemed to relieve or
deprive the Board of its responsibility for and control of the conduct
of the affairs of the Trust and each Series.
(b) UBS Global AM will provide the Trust and each Series
with such corporate, administrative and clerical personnel (including
officers of the Trust) and services as are reasonably deemed necessary or
advisable by the Board, including the maintenance of certain books and
records of the Trust and each Series.
(c) UBS Global AM will arrange for the periodic preparation,
updating, filing and dissemination (as applicable) of the Trusts Registration
Statement, proxy material, tax returns and required reports to each Series
shareholders and the Securities and Exchange Commission and other
appropriate federal or state regulatory authorities.
(d) UBS Global AM will provide the Trust and each
Series with, or obtain for it, adequate office space and all necessary
office equipment and services, including telephone service, heat,
utilities, stationery supplies and similar items.
(e) UBS Global AM will provide the Board on a regular
basis with economic and investment analyses and reports and make
available to the Board upon request any economic, statistical and
investment services normally available to institutional or other
customers of UBS Global AM.
4. Further Duties. In all matters relating to the
performance of this Contract, UBS Global AM will act in conformity with
the Trust Instrument, By-Laws and Registration Statement of the Trust
and with the instructions and directions of the Board and will comply
with the requirements of the 1940 Act, the rules thereunder, and
all other applicable federal and state laws and regulations.
5. Delegation of UBS Global AMs Duties as
Investment Adviser and Administrator. With respect to any or all
Series, UBS Global AM may enter into one or more contracts (Sub-Advisory
or Sub-Administration Contract) with a sub-adviser or sub-administrator
in which UBS Global AM) delegates to such sub-adviser or sub-administrator
any or all its duties specified in Paragraphs 2 and 3 of this Contract,
provided that each Sub-Advisory or Sub-Administration Contract imposes
on the sub-adviser or sub-administrator bound thereby all applicable
duties and conditions to which UBS Global AM is subject by Paragraphs
2, 3 and 4 of this Contract, and further provided that each Sub-Advisory
or Sub-Administration Contract meets all requirements of the 1940 Act
and rules thereunder.
6. Services Not Exclusive. The services furnished
by UBS Global AM hereunder are not to be deemed exclusive and UBS Global
AM 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, officer or
employee of UBS Global AM 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.
7. Expenses.
(a) UBS Global AM will bear all expenses incurred in
the operation of each Series to which this Contract is applicable,
including the Series allocable share of the expenses of the Trust,
other than (i) the fee payable under this Contract, (ii) the fees
payable pursuant to any Shareholder Service Plan adopted by the Trust
with respect to the Series or a class of shares of the Series, (iii)
fees and expenses of the Independent Trustees (defined in paragraph
10(a) below), including counsel fees of the Independent Trustees, (iv)
interest, taxes and the cost (including brokerage commissions and
other transaction costs, if any) of securities purchased or sold by
the Series and any losses incurred in connection therewith and (v)
extraordinary expenses (such as costs of litigation to which the Trust
or a Series is a party and of indemnifying officers and Trustees of the
Trust), which will be borne by the Trust or Series, as applicable.
(b) The expenses to be borne by UBS Global AM include
the following (or each Series proportionate share of the following):
(i) expenses of organizing the Trust and the Series; (ii) filing fees
and expenses relating to the registration and qualification of the
Series shares and the Trust under federal and/or state securities laws
and maintaining such registration and qualifications; (iii) fees and
salaries payable to the Trusts Trustees and officers; (iv) all expenses
incurred in connection with the services of Trustees other than the
Independent Trustees, including travel expenses; (v) costs of any liability,
uncollectible items of deposit and other insurance and fidelity bonds;
(vi) legal, accounting and auditing expenses, other than the legal fees
of special counsel for the Independent Trustees; (vii) charges of
custodians, transfer agents and other agents (including any lending
agent); (viii) costs of preparing share certificates; (ix) expenses of
setting in type and printing prospectuses and supplements thereto,
statements of additional information and supplements thereto,
reports and proxy materials for existing shareholders; (x) cost of
mailing prospectuses and supplements thereto, statements of additional
information and supplements thereto, reports and proxy materials to
existing shareholders; (xi) fees, voluntary assessments and other
expenses incurred in connection with membership in investment company
organizations; (xii) the cost of mailing and tabulating proxies and costs
of meetings of shareholders, the Board and any committees thereof; (xiii)
the cost of investment company literature and other publications provided
by the Trust to its Trustees and officers; (xiv) costs of mailing, stationery
and communications equipment; (xv) expenses incident to any dividend,
withdrawal or redemption options; (xvi) charges and expenses of any
outside pricing service used to value portfolio securities; and (xvii)
interest on borrowings of each Series.
(c) The payment or assumption by UBS Global AM of any
expenses of the Trust or a Series that UBS Global AM is not required by this
Contract to pay or assume shall not obligate UBS Global AM to pay or assume
the same or any similar expense of the Trust or a Series on any subsequent
occasion.
8. Compensation.
(a) For the services provided and the expenses assumed
pursuant to this Contract, each series of the Trust will pay to UBS Global
AM a fee, computed daily and paid monthly, at the following annual rates of
such Series average daily net assets:
Average Net Assets
Fee as a Percentage of Average Net Assets
$0 - $30 billion
0.1000%
Above $30 billion up to $40 billion
0.0975%
Above $40 billion up to $50 billion
0.0950%
Above $50 billion up to $60 billion
0.0925%
Above $60 billion
0.0900%
(b) The fee shall be computed daily and paid monthly to UBS
Global AM on or before the first business day of the next succeeding calendar
month.
(c) If this Contract becomes effective or terminates before
the end of any month, the fee for the period from the effective day 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 prorated according to the
proportion which such period bears to the full month in which such
effectiveness or termination occurs.
9. Limitation of Liability of UBS Global AM. UBS Global
AM and its delegates, including any Sub-Adviser or Sub-Administrator to any
Series or the Trust, shall not be liable for any error of judgment or mistake
of law or for any loss suffered by any Series, the Trust or any of its
shareholders, 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. Any person, even though also an officer, director, employee,
or agent of UBS Global AM, who may be or become an officer, Trustee,
employee or agent of the Trust shall be deemed, when rendering services
to any Series or the Trust or acting with respect to any business of such
Series or the Trust, to be rendering such service to or acting solely for
the Series or the Trust and not as an officer, director, employee, or
agent or one under the control or direction of UBS Global AM even though
paid by it.
10. Duration and Termination.
(a) This Contract shall become effective upon the date
hereabove written provided that, with respect to any Series, this Contract
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
Contract or interested persons of any such party (Independent Trustees)
cast in person at a meeting called for the purpose of voting on such
approval, and (ii) by vote of a majority of that Series outstanding
voting securities.
(b) Unless sooner terminated as provided herein, this
Contract shall continue in effect for two years from the above written
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 annually (i)
by a vote of a majority of the Independent Trustees, cast in person at
a meeting called for the purpose of voting on such approval, and (ii)
by the Board or, with respect to any given Series, by vote of a
majority of the outstanding voting securities of such Series.
(c) Notwithstanding the foregoing, with respect to
any Series, 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 such Series on
sixty days written notice to UBS Global AM or by UBS Global AM at
any time, without the payment of any penalty, on sixty days written
notice to the Trust. Termination of this Contract with respect to
any given Series shall in no way affect the continued validity of this
Contract or the performance thereunder with respect to any other Series.
This Contract will automatically terminate in the event of its assignment.
11. Limitation of Liability of the Trustees, Officers
and Shareholders of the Trust. The Trustees and officers of the Trust
and the shareholders of any Series shall not be liable for any obligations
of any Series or the Trust under this Contract, and UBS Global AM agrees
that, in asserting any rights or claims under this Contract, it shall look
only to the assets and property of the Trust in settlement of such right
or claim, and not to such Trustees, officers or shareholders.
12. 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 as to any given Series shall be
effective until approved by vote of a majority of such Series outstanding
voting securities.
13. Governing Law. This Contract shall be construed in
accordance with the laws of the State of Delaware, without giving effect
to the conflicts of laws principles thereof, and in accordance with the 1940
Act. 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.
14. Miscellaneous. The captions in this Contract 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 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, interested person, assignment, broker,
investment adviser, national securities exchange, net assets, prospectus,
sale, sell and security shall have the same meaning as such terms have in
the 1940 Act and the rules and regulations thereunder, subject to such
exemptions as may be granted by the Securities and Exchange Commission.
Where the effect of a requirement of the 1940 Act reflected in any
provision of this Contract is relaxed by a rule, regulation, order or
other action of the Securities and Exchange Commission, whether of special
or general application, such provision shall be deemed to
incorporate the effect of such rule, regulation, order or other action.
IN WITNESS WHEREOF, the parties hereto have caused this instrument
to be executed by their officers and delivered as of the day and year first
above written.
MASTER TRUST, on behalf of its Series
Attest: /s/ Xxxxx X. Xxxxxx
By: /s/ Xxxxxx Xxxxxxx
Name: Xxxxx X. Xxxxxx
Name: Xxxxxx Xxxxxxx
Title: Assistant Treasurer
Title: Vice President and Treasurer
UBS GLOBAL ASSET MANAGEMENT
(AMERICAS) INC.
Attest: /s/ Xxxx Xxxxxxx
By: /s/ Xxxxx X. Xxxxxx
Name: Xxxx Xxxxxxx
Name: Xxxxx X. Xxxxxx
Title: Director and Associate General Counsel
Title: Executive Director and Senior Associate
General Counsel
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