EXHIBIT 5.1
INVESTMENT SUB-ADVISORY AGREEMENT
This investment sub-advisory agreement made by and between HL
INVESTMENT ADVISORS, INC., a Connecticut corporation (the "Manager") and
Wellington Management Company, LLP, a limited liability partnership
("Wellington Management" or "Sub-Adviser").
WITNESSETH
WHEREAS, The Manager has entered into an agreement for the provision of
investment management services to Hartford MidCap Fund, Inc. (the "Fund") by
the Manager, and
WHEREAS, The Manager wishes to engage the services of Wellington
Management Company as Sub-Adviser of the Fund, and
WHEREAS, Wellington Management is willing to perform advisory services
on behalf of the Fund upon the terms and conditions and for the compensation
hereinafter set forth.
NOW, THEREFORE, in consideration of the promises and mutual agreements
herein contained, the parties hereto agree as follows:
1. The Manager hereby employs Wellington Management to serve as Sub-Adviser
with respect to the assets of the Fund under the management of the Manager
and to perform the services hereinafter set forth subject to the terms and
conditions of the investment objectives, policies and restrictions of the
Fund, and Wellington Management hereby accepts such employment and agrees
during such period to assume the obligations herein set forth for the
compensation herein provided.
2. Wellington Management shall provide an investment program to the Manager
for utilization by the Manager in rendering services to the Fund which
program shall be amended and updated from time to time as financial and
other economic conditions change.
3. Wellington Management will make all determinations with respect to the
investment of the assets of the Fund and the purchase or sale of portfolio
securities, and shall take such steps as may be necessary to implement the
same. Such determinations and services shall include advising the Fund's
Board of Directors of the manner in which voting rights, rights to consent
to corporate action, and any other non-investment decisions pertaining to
the Fund's portfolio securities should be exercised.
4. Wellington Management will regularly furnish reports to the Fund at
periodic meetings of the Fund's Board of Directors and at such other times
as may be reasonably requested by the Fund's Board of Directors, which
reports shall include Wellington Management's economic outlook and
investment strategy and a discussion of the portfolio activity and the
performance of the Fund since the last report. Copies of all such reports
shall be furnished to the Manager for examination and review within a
reasonable time prior to the presentation of such reports to the Fund's
Board of Directors.
5. Wellington Management will select the brokers or dealers that will execute
the purchases and sales of portfolio securities for the Fund and place, in
the name of the Fund or its nominees, all such orders. When placing such
orders, Wellington Management shall use its best efforts to obtain the best
net security price available for the Fund. Subject to and in accordance
with any directions that the Board of Directors may issue from time to
time, Wellington Management may also be authorized to effect individual
securities transactions at commission rates in excess of the minimum
commission rates available, if Wellington Management determines in good
faith that such amount of commission was reasonable in relation to the
value of the brokerage or research services provided by such broker or
dealer, viewed in terms of either that particular transaction or Wellington
Management's overall responsibilities with respect to the Fund and
Wellington Management's other advisory clients. The execution of such
transactions shall not be deemed to represent an unlawful act or breach of
any duty created by this agreement or otherwise. Wellington Management will
promptly communicate to the Board of Directors such information relating to
portfolio transactions as they may reasonably request.
6. (a) As compensation for the performance of the services by Wellington
Management hereunder, the Manager shall pay to Wellington Management,
as promptly as possible after the last day of each calendar year
quarter, a fee accrued daily and paid quarterly, based upon the
following annual rates and calculated based upon the average daily net
asset values of the Fund:
ASSETS ANNUAL FEE
On First $50 million .400%
On Next $100 million .300%
On Next $350 million .250%
Over $500 million .200%
Wellington Management shall waive its fees until the Fund's assets
(excluding assets contributed by companies affiliated with the
Manager) reach $20 million.
If it is necessary to calculate the fee for a period of time which is
not a calendar quarter, then the fee shall be (i) calculated at the
annual rates provided above but prorated for the number of days
elapsed in the period in question, as a percentage of the total number
of days in such period, (ii) based upon the average of the Fund's
daily net asset value on the close of business for the period in
question, and (iii) paid within a reasonable time after the close of
such period.
(b) Wellington Management will bear all expenses in connection with the
performance of its services under the agreement.
(c) Wellington Management will not be entitled to receive any payment for
the performance of its services hereunder from the Fund.
(d) Wellington Management agrees to notify the Manager of any change in
Wellington Management's general partners within a reasonable time
following the occurrence of such change.
7. Wellington Management shall not be liable for any loss or losses
sustained by reason of any investment including the purchase, holding
or sale of any security as long as Wellington Management shall have
acted in good faith and with due care; provided, however, that
Wellington Management shall be liable for its willful misfeasance, bad
faith or gross negligence in the performance of its duties or by
reason of its reckless disregard of its obligations and duties under
this agreement.
8. (a) This agreement shall become effective on
, 1997 and shall continue in effect for a period of two years
from that date. This agreement, unless sooner terminated in
accordance with 8(b) below, shall continue in effect from year to
year thereafter provided that its continuance is specifically
approved at least annually (1) by a vote of the majority of the
members of the Board of Directors of the Fund or by a vote of a
majority of the outstanding voting securities of the Fund, and(2)
in either event, by the vote of a majority of the members of the
Fund's Board of Directors 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 this agreement.
(b) This agreement (1) may be terminated at any time without the
payment of any penalty either by vote of the members of the Board
of Directors of the Fund or by a vote of a majority of the Fund's
outstanding voting securities, or by the Manager on sixty days'
prior written notice to Wellington Management, (2) shall
immediately terminate in the event of its assignment, (3) may be
terminated by Wellington Management on ninety days' prior written
notice to the Manager, but such termination will not be effective
until the Fund or the Manager shall have contracted with one or
more persons to serve as a successor Sub-Adviser for the Fund and
such person(s) shall have assumed such position, and (4) will
terminate automatically upon termination of the investment
management agreement between the Manager and the Fund of even
date herewith.
(c) As used in this agreement, the terms "assignment," "interested
parties" and "vote of a majority of the Fund's outstanding voting
securities" shall have the meanings set forth for such terms in
the Investment Company Act of 1940, as amended.
(d) Any notice under this agreement shall be given in writing,
addressed and delivered, or mailed postpaid, to the other party
or parties at the current office address of such party or
parties.
9. Nothing in this agreement shall limit or restrict the right of any partner,
officer, or employee of Wellington Management to engage in any 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, nor to limit or restrict the right of Wellington Management to
engage in any
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other business or to render services of any kind to any other
corporation, firm, individual or association.
10. The Manager agrees that neither it nor any affiliate of the Manager will
use Wellington Management's name or refer to Wellington Management or
Wellington Management's clients in marketing and promotional materials
without prior notification to and authorization by Wellington Management,
such authorization not to be unreasonably withheld.
11. 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.
IN WITNESS WHEREOF, the parties hereto have caused this agreement to be
executed on the day of , 1997.
HL INVESTMENT ADVISORS, INC.
---------------------------------
By: Xxxxxx X. Xxxxxx
Title: Managing Director
WELLINGTON MANAGEMENT COMPANY, LLP
---------------------------------
By: Xxxxxx X. XxXxxxxxx
Title: President
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