Exhibit No. 4(a)
INVESTMENT ADVISORY AND ADMINISTRATION CONTRACT
Agreement made as of May 9, 2001, between UBS PAINEWEBBER CASHFUND,
INC., a Maryland corporation (the "Fund"), and UBS PAINEWEBBER INC.
("UBS PaineWebber");
WHEREAS the Fund is engaged in business as an open-end management
investment company and is so registered under the Investment Company Act of
1940, as amended (the "1940 Act"); and
WHEREAS the Fund desires to retain UBS PaineWebber as investment
adviser and administrator to furnish certain administrative and investment
advisory and portfolio management services to the Fund and UBS PaineWebber 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 Fund hereby appoints UBS PaineWebber as investment
adviser and administrator of the Fund for the period and on the terms set forth
in this Contract. UBS PaineWebber accepts such appointment and agrees to render
the services herein set forth, for the compensation herein provided.
2. Duties as Investment Adviser. Subject to the supervision of the
Fund's board of directors, UBS PaineWebber will provide a continuous investment
program for the Fund's portfolio, including investment research and management
with respect to all securities and investments and cash equivalents in the
portfolio and will determine from time to time what securities and other
investments will be purchased, retained or sold by the Fund. UBS PaineWebber
will provide the services under this Contract in accordance with the Fund's
investment objective, policies and restrictions as stated in the Fund's current
prospectus and Statement of Additional Information (the "Prospectus").
UBS PaineWebber further agrees that it:
(a) will conform with all applicable rules and regulations of the
Securities and Exchange Commission ("SEC");
(b) will place orders pursuant to its investment determinations for
the Fund either directly with the issuer or with any broker or
dealer. In placing orders with brokers and dealers UBS
PaineWebber will attempt to obtain the best net price and the
most favorable execution of its orders. Consistent with this
obligation, when the execution and price offered by two or more
brokers or dealers are comparable, UBS PaineWebber may, in its
discretion, purchase and sell portfolio securities to and from
brokers and dealers who provide the Fund with research, advice
and other services. In no instance will portfolio securities be
purchased from or sold to UBS PaineWebber, Xxxxxxx Advisors, Inc.
("Xxxxxxx Advisors")
or any affiliated person thereof except in accordance with the
rules and regulations promulgated by the SEC pursuant to the 1940
Act;
(c) will maintain all books and records with respect to the Fund's
securities transactions, will keep its books of account and will
furnish the Fund's board of directors such periodic and special
reports as the board may request; and
(d) will compute the net asset value and the net income of the Fund
as described in the Prospectus or as more frequently requested by
the Fund;
provided, however, that the functions specified in subparagraphs (b), (c) and
(d) hereof may be performed by Xxxxxxx Advisors or another appropriate party.
3. Duties as Administrator. UBS PaineWebber will assist in
administering the Fund's affairs subject to the supervision of the Fund's board
of directors and the following understandings:
(a) UBS PaineWebber will supervise all aspects of the Fund's
operation except as hereinafter set forth; provided, however,
that nothing herein contained shall be deemed to relieve or
deprive the board of directors of the Fund of its responsibility
for and control of the conduct of the Fund's affairs;
(b) In all matters relating to the performance of this Contract, UBS
PaineWebber will act in conformity with the Articles of
Incorporation, By-Laws and the Prospectus and Statement of
Additional Information of the Fund and with the instructions and
directions of the Fund's board of directors and will conform to
and comply with the requirements of the 1940 Act and all other
applicable Federal or state laws or regulations;
(c) UBS PaineWebber will provide the Fund with such administrative
and clerical services as are deemed necessary or advisable by the
Fund's board of directors, including the maintenance of certain
of the Fund's corporate books and records;
(d) UBS PaineWebber will arrange, but not pay for, the periodic
updating of prospectuses, statements of additional information
and supplements thereto, proxy materials, tax returns and reports
to the Fund's shareholders and the SEC;
(e) UBS PaineWebber will provide the Fund 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;
(f) UBS PaineWebber will provide the board of directors of the Fund
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 PaineWebber;
(g) UBS PaineWebber will hold itself available to receive orders for
the purchase of shares and will accept or reject such orders on
behalf of the Fund in accordance with the Prospectus, and will
transmit such orders as are so accepted to the Fund's
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transfer agent as promptly as practicable; provided, however,
that UBS PaineWebber is not obligated to sell any certain number
of the shares; and
(h) UBS PaineWebber will make itself available to receive requests
for redemption from holders of shares and will transmit such
redemption requests to the transfer agent of the Fund as promptly
as practicable.
4. Services Not Exclusive. The services furnished by UBS PaineWebber
hereunder are not to be deemed exclusive and UBS PaineWebber shall be free to
furnish similar services to others so long as its services under this Contract
are not impaired thereby.
5. Books and Records. In compliance with the requirements of Rule 31a-3
under the 1940 Act, UBS PaineWebber hereby agrees that all records which it
maintains for the Fund are the property of the Fund and further agrees to
surrender promptly to the Fund any such records upon the Fund's request. UBS
PaineWebber 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.
6. Expenses. During the term of this Contract, the Fund will bear all
expenses, not specifically assumed by UBS PaineWebber, incurred in its
operations and the offering of shares. That is, the Fund will pay (a) the cost
(including brokerage commissions, if any) of securities purchased or sold by the
Fund or any losses incurred in connection therewith; (b) fees payable to and
expenses incurred on behalf of the Fund by UBS PaineWebber; (c) filing fees and
expenses relating to the registration and qualification of the Fund's shares
under Federal or State securities laws and maintaining such registrations and
qualifications; (d) fees and salaries payable to the Fund's directors and
officers who are not officers or employees of UBS PaineWebber or interested
persons (as defined in the 0000 Xxx) of any investment adviser or underwriter of
the Fund; (e) taxes (including any income or franchise taxes) and governmental
fees; (f) costs of any liability, uncollectible items of deposit and other
insurance or fidelity bonds; (g) any costs, expenses or losses arising out of
any liability of or claim for damage or other relief asserted against the Fund
for violation of any law; (h) legal, accounting and auditing expenses, including
legal fees of special counsel for the Independent Directors; (i) charges of
custodians, transfer agents and other agents; (j) costs of preparing Share
certificates; (k) expenses of setting in type and printing prospectuses,
statements of additional information and supplements thereto for existing
shareholders, reports and statements to shareholders and proxy materials; (l)
any extraordinary expenses (including fees and disbursements of counsel)
incurred by the Fund; and (m) fees and other expenses incurred in connection
with membership in investment company organizations.
The Fund may pay directly any expense incurred by it in its normal
operations and, if any such payment is consented to by UBS PaineWebber and
acknowledged as otherwise payable by UBS PaineWebber pursuant to this Contract,
the Fund may reduce the fee payable to UBS PaineWebber pursuant to paragraph 7
hereof by such amount. To the extent that such deductions exceed the fee payable
to UBS PaineWebber on any monthly payment date, such excess shall be carried
forward and deducted in the same manner from the fee payable on succeeding
monthly payment dates.
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In addition, if the expenses borne by the Fund in any fiscal year
exceed the applicable expense limitations imposed by the securities regulations
of any state in which shares are registered or qualified for sale to the public,
UBS PaineWebber will reimburse the Fund for any excess up to the amount of the
fee payable to it during that fiscal year pursuant to paragraph 7 hereof.
7. Compensation. For the services provided and the expenses assumed
pursuant to this Contract, the Fund will pay to UBS PaineWebber a fee, computed
daily and paid monthly, at the following annual rates of the Fund's average net
assets:
Fund's Average Fee As %
Net Assets of Fund's Average
In Billions Net Assets
----------- ----------
Up to $500 million .......................................... .500%
In excess of $500 million up to $1.0 billion ................ .425%
In excess of $1.0 billion up to $1.5 billion ................ .390%
In excess of $1.5 billion up to $2.0 billion ................ .380%
In excess of $2.0 billion up to $2.5 billion ................ .350%
In excess of $2.5 billion up to $3.5 billion ................ .345%
In excess of $3.5 billion up to $4.0 billion ................ .325%
In excess of $4.0 billion up to $4.5 billion ................ .315%
In excess of $4.5 billion up to $5.0 billion ................ .300%
In excess of $5.0 billion up to $5.5 billion ................ .290%
In excess of $5.5 billion ................................... .280%
8. Limitation of Liability of UBS PaineWebber. UBS PaineWebber shall
not be liable for any error of judgment or mistake of law or for any loss
suffered by the Fund in connection with the matters to which this Contract
relates (including any loss arising out of the receipt by UBS PaineWebber of
inadequate consideration in connection with an order to purchase shares whether
in the form of fraudulent check, draft or wire; a check returned for
insufficient funds; or any other inadequate consideration (hereinafter "Check
Loss"), 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 Contract provided,
however, that the Fund shall not be liable for Check Loss resulting from willful
misfeasance, bad faith or negligence on the part of UBS PaineWebber. Any person,
even though also an officer, partner, employee, or agent of UBS PaineWebber, who
may be or become an officer, Director, employee or agent of the Fund shall be
deemed, when rendering services to any Fund or acting in any business of the
Fund, to be rendering such services to or acting solely for the Fund and not as
an officer, partner, employee, or agent or one under the control or direction of
UBS PaineWebber even though paid by it.
9. Duration and Termination. This Contract, unless sooner terminated as
provided herein, shall continue in effect for two years from the above written
date. Thereafter, if not terminated, this Contract shall continue automatically
for periods of twelve months each, provided, such continuance is specifically
approved at least annually (a) by a vote of a majority of those members of the
Fund's board of directors who are not parties to the Contract or interested
persons of any such party, cast in person at a meeting called for the purpose of
voting on such approval, and (b) by the Fund's board of directors or by vote of
a majority of the
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outstanding voting securities of the Fund. Notwithstanding the foregoing, this
Contract may be terminated by the Fund at any time, without the payment of any
penalty, by vote of the Fund's board of directors or by vote of a majority of
the outstanding voting securities of the Fund on 60 days' written notice to UBS
PaineWebber or by UBS PaineWebber at any time, without the payment of any
penalty, on 90 days written notice to the Fund. This Contract will automatically
and immediately terminate in the event of its assignment. (As used in this
Contract, the terms "majority of the outstanding voting securities," "interested
person" and "assignment" shall have the same meaning as such terms have in the
1940 Act.)
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 the holders of a majority of the Fund's
outstanding voting securities.
11. Name of Fund. The Fund may use the name "UBS PaineWebber Cashfund,
Inc." or any name derived from the name "UBS PaineWebber Inc." only for so long
as this contract or any extension, renewal or amendment hereof remains in
effect, including any similar agreement with any organization which shall have
succeeded to the business of UBS PaineWebber. At such time as such an agreement
shall no longer be in effect, the Fund will (to the extent that it lawfully can)
cease to use such a name or any other name connected with UBS PaineWebber or any
organization which shall have so succeeded to the business of UBS PaineWebber.
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 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.
IN WITNESS WHEREOF, the parties hereto have caused this instrument to
be executed by their officers designated as of the day and year first above
written.
UBS PAINEWEBBER INC. UBS PAINEWEBBER INC.
By By
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Name: Name:
Title: Title:
UBS PAINEWEBBER CASHFUND, INC. UBS PAINEWEBBER CASHFUND, INC.
By By
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Name: Name:
Title: Title:
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