EX. 22(d)(XVIII)
EXECUTION COPY
SUB-ADVISORY AGREEMENT
PARAMETRIC PORTFOLIO ASSOCIATES LLC
THIS SUB-ADVISORY AGREEMENT is made as of the 27th day of January,
2004, among WT Investment Trust I, a Delaware business trust (the "Fund"),
Xxxxxx Square Management Corporation (the "Adviser"), a corporation organized
under the laws of the state of Delaware and Parametric Portfolio Associates LLC
a corporation organized under the laws of the state of Delaware (the
"Sub-Adviser").
WHEREAS, the Fund is registered under the Investment Company Act of
1940, as amended (the "1940 Act"), as an open-end management investment company
and offers for public sale distinct series of shares of beneficial interest; and
WHEREAS, the Large Cap Quantitative Series, the Mid Cap Quantitative
Series and the Small Cap Quantitative Series (collectively, the "Series") are
series of the Fund; and
WHEREAS, the Adviser acts as the investment adviser for the Series
pursuant to the terms of an Investment Advisory Agreement between the Fund and
the Adviser under which the Adviser is responsible for the coordination of
investment of the Series' assets in portfolio securities; and
WHEREAS, the Adviser is authorized under the Investment Advisory
Agreement to delegate its investment responsibilities to one or more persons or
companies;
NOW THEREFORE, in consideration of the promises and mutual covenants
herein contained, the Fund, the Adviser and the Sub-Adviser agree as follows:
1. APPOINTMENT OF SUB-ADVISER. The Adviser and the Fund hereby appoint and
employ the Sub-Adviser as a discretionary portfolio manager, on the terms and
conditions set forth herein, of those assets of the Series which the Adviser
determines to assign to the Sub-Adviser (those assets being referred to as the
"Series Account"). The Adviser may, from time to time, make additions to and
withdrawals, including cash and cash equivalents, from the Series Account.
2. ACCEPTANCE OF APPOINTMENT. The Sub-Adviser accepts its appointment as a
discretionary portfolio manager and agrees to use its professional judgment to
make investment decisions for the Series with respect to the investments of the
Series Account and to implement such decisions on a timely basis in accordance
with the provisions of this Agreement.
3. DELIVERY OF DOCUMENTS. The Adviser has furnished the Sub-Adviser with
copies properly certified or authenticated of each of the following and will
promptly provide the Sub-Adviser with copies properly certified or authenticated
of any amendment or supplement thereto:
a. The Series' Investment Advisory Agreement;
b. The Fund's most recent effective registration statement and
financial statements as filed with the Securities and Exchange Commission;
c. The Fund's Agreement and Declaration of Trust and By-Laws; and
d. Any policies, procedures or instructions adopted or approved by the
Fund's Board of Trustees relating to obligations and services provided by the
Sub-Adviser.
4. PORTFOLIO MANAGEMENT SERVICES OF THE SUB-ADVISER. The Sub-Adviser is
hereby employed and authorized to select portfolio securities for investment by
the Series, to purchase and to sell securities for the Series Account, and upon
making any purchase or sale decision, to place orders for the execution of such
portfolio transactions in accordance with Sections 6 and 7 hereof and Schedule A
hereto (as amended from time to time). In providing portfolio management
services to the Series Account, the Sub-Adviser shall be subject to and shall
conform to such investment restrictions as are set forth in the 1940 Act and the
rules thereunder, the Internal Revenue Code, applicable state securities laws,
applicable statutes and regulations of foreign jurisdictions, the supervision
and control of the Board of Trustees of the Fund, such specific instructions as
the Board of Trustees may adopt and communicate to the Sub-Adviser, the
investment objective, policies and restrictions of the Fund applicable to the
Series furnished pursuant to Section 5 of this Agreement, the provisions of
Schedule A and Schedule B hereto and other instructions communicated to the
Sub-Adviser by the Adviser. The Sub-Adviser is not authorized by the Fund to
take any action, including the purchase or sale of securities for the Series
Account, in contravention of any restriction, limitation, objective, policy or
instruction described in the previous sentence. The Sub-Adviser shall maintain
on behalf of the Fund the records listed in Schedule B hereto (as amended from
time to time). At the Fund's reasonable request, the Sub-Adviser will consult
with the Fund or with the Adviser with respect to any decision made by it with
respect to the investments of the Series Account.
5. INVESTMENT OBJECTIVE, POLICIES AND RESTRICTIONS. The Fund will provide the
Sub-Adviser with the statement of investment objective, policies and
restrictions applicable to the Series Account as contained in the Series'
Prospectus and Statement of Additional Information, all amendments or
supplements to the Prospectus and Statement of Additional Information, and any
instructions adopted by the Board of Trustees supplemental thereto. The Fund
agrees, on an ongoing basis, to notify the Sub-Adviser in writing of each change
in the fundamental and non-fundamental investment policies of the Series Account
and will provide the Sub-Adviser with such further information concerning the
investment objective, policies, restrictions and such other information
applicable thereto as the Sub-Adviser may from time to time reasonably request
for performance of its obligations under this Agreement. The Fund retains the
right, on written notice to the Sub-Adviser or the Adviser, to modify any such
objective, policies or restrictions in accordance with applicable laws, at any
time.
6. TRANSACTION PROCEDURES. All transactions will be consummated by payment to
or delivery by the custodian designated by the Fund (the "Custodian"), or such
depositories or agents as may be designated by the Custodian in writing, of all
cash and/or securities due to or from the Series Account, and the Sub-Adviser
shall not have possession or custody thereof. The Sub-Adviser shall advise the
Custodian and confirm in writing to the Fund and to the administrator designated
by the Fund or any other designated agent of the Fund, all investment orders for
the Series Account placed by it with brokers and dealers at the time and in the
manner set forth in Schedule B hereto (as amended from time to time). The Fund
shall issue to the Custodian such instructions as may be appropriate in
connection with the settlement of any
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transaction initiated by the Sub-Adviser. The Fund shall be responsible for all
custodial arrangements and the payment of all custodial charges and fees, and,
upon giving proper instructions to the Custodian, the Sub-Adviser shall have no
responsibility or liability with respect to custodial arrangements or the acts,
omissions or other conduct of the Custodian, except that it shall be the
responsibility of the Sub-Adviser to take appropriate action if the Custodian
fails to confirm in writing proper execution of the instructions.
7. ALLOCATION OF BROKERAGE. The Sub-Adviser shall have authority and
discretion to select brokers and dealers (including brokers that may be
affiliates of the Sub-Adviser to the extent permitted by Section 7(c) hereof) to
execute portfolio transactions initiated by the Sub-Adviser, and for the
selection of the markets on or in which the transactions will be executed,
subject to the following and subject to conformance with the policies and
procedures disclosed in the Fund's Prospectus and Statement of Additional
Information and the policies and procedures adopted by the Fund's Board of
Trustees.
a. In executing portfolio transactions, the Sub-Adviser will give
primary consideration to securing the best price and execution. Consistent with
this policy, the Sub-Adviser may consider the financial responsibility, research
and investment information and other services provided by brokers or dealers who
may effect or be a party to any such transaction or other transactions to which
other clients of the Sub-Adviser may be a party. It is understood that neither
the Fund, the Adviser nor the Sub-Adviser has adopted a formula for allocation
of the Fund's investment transaction business. It is also understood that it is
desirable for the Fund that the Sub-Adviser have access to supplemental
investment and market research and security and economic analyses provided by
certain brokers who may execute brokerage transactions at a higher commission to
the Fund than may result when allocating brokerage to other brokers on the basis
of seeking the lowest commission. Therefore, the Sub-Adviser is authorized to
place orders for the purchase and sale of securities for the Series with certain
such brokers, subject to review by the Fund's Board of Trustees from time to
time with respect to the extent and continuation of this practice. It is
understood that the services provided by such brokers may be useful to the
Sub-Adviser in connection with its services to other clients of the Sub-Adviser.
The Sub-Adviser is also authorized to place orders with certain brokers for
services deemed by the Adviser to be beneficial for the Fund; and the
Sub-Adviser shall follow the directions of the Adviser or the Fund in this
regard.
b. On occasions when the Sub-Adviser deems the purchase or sale of a
security to be in the best interest of the Series Account as well as other
clients of the Sub-Adviser, the Sub-Adviser, to the extent permitted by
applicable laws and regulations, may, but shall be under no obligation to,
aggregate the securities to be sold or purchased in order to obtain the best
price and execution. In such event, allocation of the securities so purchased or
sold, as well as expenses incurred in the transaction, will be made by the
Sub-Adviser in the manner it considers to be the most equitable and consistent
with its fiduciary obligations to the Fund in respect of the Series and to such
other clients.
c. The Sub-Adviser agrees that it will not execute any portfolio
transactions for the Series Account with a broker or dealer which is (i) an
affiliated person of the Fund, including the Adviser or any Sub-Adviser for any
Series of the Fund; (ii) a principal underwriter of the Fund's shares; or (iii)
an affiliated person of such an affiliated person or principal underwriter,
unless
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such transactions are executed (x) with the prior written approval of the
Adviser or (y) in accordance with Rule 17e-1 of the 1940 Act and the Fund's Rule
17e-1 procedures, as adopted in accordance with Rule 17e-1. The Adviser agrees
that it will provide the Sub-Adviser with a list of such brokers and dealers.
d. The Adviser shall render regular reports to the Fund of the total
brokerage business placed and the manner in which the allocation has been
accomplished.
8. PROXIES. The Sub-Adviser will vote all proxies solicited by or with
respect to issuers of securities in which assets of the Series Account may be
invested from time to time. At the request of the Sub-Adviser, the Adviser shall
provide the Sub-Adviser with its recommendations as to the voting of such
proxies.
9. REPORTS TO THE SUB-ADVISER. The Fund will provide the Sub-Adviser with
such periodic reports concerning the status of the Series Account as the
Sub-Adviser may reasonably request.
10. FEES FOR SERVICES. The compensation of the Sub-Adviser for its services
under this Agreement shall be calculated and paid by the Fund in accordance with
the attached Schedule C.
11. OTHER INVESTMENT ACTIVITIES OF THE SUB-ADVISER. The Fund acknowledges that
the Sub-Adviser or one or more of its affiliated persons may have investment
responsibilities or render investment advice to or perform other investment
advisory services for other individuals or entities and that the Sub-Adviser,
its affiliated persons or any of its or their directors, officers, agents or
employees may buy, sell or trade in any securities for its or their own
respective accounts ("Affiliated Accounts"). Subject to the provisions of
Section 7(b) hereof, the Fund agrees that the Sub-Adviser or its affiliated
persons may give advice or exercise investment responsibility and take such
other action with respect to other Affiliated Accounts which may differ from the
advice given or the timing or nature of action taken with respect to the Series
Account, provided that the Sub-Adviser acts in good faith, and provided further,
that it is the Sub-Adviser's policy to allocate, within its reasonable
discretion, investment opportunities to the Series Account over a period of time
on a fair and equitable basis relative to the Affiliated Accounts, taking into
account the investment objective and policies of the Series Account and any
specific investment restrictions applicable thereto. The Fund acknowledges that
one or more of the Affiliated Accounts may at any time hold, acquire, increase,
decrease, dispose of or otherwise deal with positions in investments in which
the Series Account may have an interest from time to time, whether in
transactions which involve the Series Account or otherwise. The Sub-Adviser
shall have no obligation to acquire for the Series Account a position in any
investment which any Affiliated Account may acquire, and the Fund shall have no
first refusal, co-investment or other rights in respect of any such investment,
either for the Series Account or otherwise.
12. CERTIFICATE OF AUTHORITY. The Fund, the Adviser and the Sub-Adviser shall
furnish to each other from time to time certified copies of the resolutions of
their Boards of Trustees/Directors or executive committees, as the case may be,
evidencing the authority of officers and employees who are authorized to act on
behalf of the Fund, a Series Account, the Adviser and/or the Sub-Adviser.
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13. LIMITATION OF LIABILITY. The Sub-Adviser shall not be liable for any
action taken, omitted or suffered to be taken by it in its reasonable judgment,
in good faith and believed by it to be authorized or within the discretion or
rights or powers conferred upon it by this Agreement, or in accordance with (or
in the absence of) specific directions or instructions from the Fund or the
Adviser, provided, however, that such acts or omissions shall not have resulted
from the Sub-Adviser's willful misfeasance, bad faith, gross negligence or a
reckless disregard of duty. Nothing in this Section 13 shall be construed in a
manner inconsistent with Section 17(i) of the 1940 Act.
14. CONFIDENTIALITY. Subject to the duty of the Sub-Adviser, the Adviser and
the Fund to comply with applicable law, including any demand of any regulatory
or taxing authority having jurisdiction, the parties hereto shall treat as
confidential all material non-public information pertaining to the Series
Account and the actions of the Sub-Adviser, the Adviser and the Fund in respect
thereof.
15. ASSIGNMENT. This Agreement shall terminate automatically in the event of
its assignment. The Sub-Adviser shall notify the Fund and the Adviser in writing
sufficiently in advance of any proposed change of control within the meaning of
the 1940 Act to enable the Fund and the Adviser to take the steps necessary to
enter into a new contract with the Sub-Adviser.
16. REPRESENTATIONS, WARRANTIES AND AGREEMENTS OF THE FUND. The Fund
represents, warrants and agrees that:
a. The Sub-Adviser has been duly appointed by the Board of Trustees of
the Fund to provide investment services to the Series Account as contemplated
hereby.
b. The Fund will deliver to the Sub-Adviser a true and complete copy of
its then current Prospectus and Statement of Additional Information as effective
from time to time and such other documents or instruments governing the
investment of the Series Account and such other information as is necessary for
the Sub-Adviser to carry out its obligations under this Agreement.
c. The Fund is currently in compliance and shall at all times continue
to comply with the requirements imposed upon the Fund by applicable law and
regulations.
17. REPRESENTATIONS, WARRANTIES AND AGREEMENTS OF THE ADVISER. The Adviser
represents, warrants and agrees that:
a. The Adviser has been duly authorized by the Board of Trustees of the
Fund to delegate to the Sub-Adviser the provision of investment services to the
Series Account as contemplated hereby.
b. The Adviser is currently in compliance and shall at all times
continue to comply with the requirements imposed upon the Adviser by applicable
law and regulations.
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18. REPRESENTATIONS. WARRANTIES AND AGREEMENTS OF THE SUB-ADVISER. The
Sub-Adviser represents, warrants and agrees that:
a. The Sub-Adviser is registered as an "investment adviser" under the
Investment Advisers Act of 1940 ("Advisers Act") or is a "bank" as defined in
Section 202(a)(2) of the Advisers Act.
b. The Sub-Adviser will maintain, keep current and preserve on behalf
of the Fund, in the manner required or permitted by the 1940 Act, the records
identified in Schedule B. The Sub-Adviser agrees that such records (unless
otherwise indicated on Schedule B) are the property of the Fund, and will be
surrendered to the Fund promptly upon request. The Sub-Adviser agrees to keep
confidential all records of the Fund and information relating to the Fund,
unless the release of such records or information is otherwise consented to in
writing by the Fund or the Adviser. The Fund and the Adviser agree that such
consent shall not be unreasonably withheld and may not be withheld where the
Sub-Adviser may be exposed to civil or criminal contempt proceedings or when
required to divulge such information or records to duly constituted authorities.
c. The Sub-Adviser will complete such reports concerning purchases or
sales of securities on behalf of the Series Account as the Adviser or the Fund
may from time to time require to ensure compliance with the 1940 Act, the
Internal Revenue Code, applicable state securities laws and applicable statutes
and regulations of foreign jurisdictions.
d. The Sub-Adviser has adopted a written code of ethics complying with
the requirements of Rule 17j-1 under the 1940 Act and Section 204A of the
Advisers Act and has provided the Fund with a copy of the code of ethics and
evidence of its adoption. Within forty-five (45) days of the end of the last
calendar quarter of each year while this Agreement is in effect, the president
or a vice president or general partner of the Sub-Adviser shall certify to the
Fund that the Sub-Adviser has complied with the requirements of Rule 17j-1 and
Section 204A during the previous year and that there has been no material
violation of the Sub-Adviser's code of ethics or, if such a material violation
has occurred, that appropriate action was taken in response to such violation.
Upon the written request of the Fund, the Sub-Adviser shall permit the Fund, its
employees or its agents to examine the reports required to be made to the
Sub-Adviser by Rule 17j-1(d)(1).
e. The Sub-Adviser will promptly after filing with the Securities and
Exchange Commission an amendment to its Form ADV furnish a copy of such
amendment to the Fund and the Adviser.
f. The Sub-Adviser will immediately notify the Fund and the Adviser of
the occurrence of any event which would disqualify the Sub-Adviser from serving
as an investment adviser of an investment company pursuant to Section 9 of the
1940 Act or otherwise. The Sub-Adviser will also immediately notify the Fund and
the Adviser if it is served or otherwise receives notice of any action, suit,
proceeding, inquiry or investigation, at law or in equity, before or by any
court, public board or body, involving the affairs of the Series.
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19. AMENDMENT. This Agreement may be amended at any time, but only by written
agreement among the Sub-Adviser, the Adviser and the Fund, which amendment,
other than amendments to Schedules A and B, is subject to the approval of the
Board of Trustees and, to the extent required by the 1940 Act, the shareholders
of the Series in the manner required by the 1940 Act and the rules thereunder,
subject to any applicable orders of exemption issued by the Securities and
Exchange Commission.
20. EFFECTIVE DATE; TERM. This Agreement shall become effective on the date
first written above and shall remain in force for a period of time of two years
from such date, and from year to year thereafter but only so long as such
continuance is specifically approved at least annually by the vote of a majority
of the Trustees who are not interested persons of the Fund, the Adviser or the
Sub-Adviser, cast in person at a meeting called for the purpose of voting on
such approval, and by a vote of the Board of Trustees or of a majority of the
outstanding voting securities of the Series. The aforesaid requirement that this
Agreement may be continued "annually" shall be construed in a manner consistent
with the 1940 Act and the rules and regulations thereunder.
21. TERMINATION.
a. This Agreement may be terminated by the Fund (by a vote of the Board
of Trustees of the Fund or by a vote of a majority of the outstanding voting
securities of the Series), without the payment of any penalty, immediately upon
written notice to the other parties hereto, in the event of a material breach of
any provision thereof by the party so notified or otherwise by the Fund, upon
sixty (60) days' written notice to the other parties hereto, but any such
termination shall not affect the status, obligations or liabilities of any party
hereto to the others.
b. This Agreement may also be terminated by the Adviser or the
Sub-Adviser, without the payment of any penalty immediately upon written notice
to the other parties hereto, in the event of a material breach of any provision
thereof by the party so notified if such breach shall not have been cured within
a 20-day period after notice of such breach or otherwise by the Adviser or the
Sub-Adviser upon sixty (60) days' written notice to the other parties hereto,
but any such termination shall not affect the status, obligations or liabilities
of any party hereto to the others.
22. DEFINITIONS. As used in this Agreement, the terms "affiliated person,"
"assignment," "control," "interested person," "principal underwriter" and "vote
of a majority of the outstanding voting securities" shall have the meanings set
forth in the 1940 Act and the rules and regulations thereunder, subject to any
applicable orders of exemption issued by the Securities and Exchange Commission.
23. NOTICE. Any notice under this Agreement shall be given in writing
addressed and delivered or mailed, postage prepaid, to the other parties to this
Agreement at their principal place of business.
24. SEVERABILITY. 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.
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25. GOVERNING LAW. To the extent that state law is not preempted by the
provisions of any law of the United States heretofore or hereafter enacted, as
the same may be amended from time to time, this Agreement shall be administered,
construed and enforced according to the laws of the State of Delaware.
26. ENTIRE AGREEMENT. This Agreement and the Schedules attached hereto
embodies the entire agreement and understanding between the parties.
[Signature Page Follows]
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be executed, as of the day and year first written above.
WT INVESTMENT TRUST I
on behalf of the Large Cap Quantitative
Series, Mid Cap Quantitative Series and
the Small Cap Quantitative Series
By: /s/ Xxxx X. Xxxxx
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Name: Xxxx X. Xxxxx
Title: Vice President
Parametric Portfolio Associates LLC
By: /s/ Xxxxx X. Xxxxxxxxx
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Name: Xxxxx X. Xxxxxxxxx
Title: Chief Financial Officer
XXXXXX SQUARE MANAGEMENT
CORPORATION
By: /s/ Xxxxxx X. Xxxxxxxxx
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Name: Xxxxxx X. Xxxxxxxxx
Xxxxx: President
SCHEDULE A
OPERATING PROCEDURES
From time to time the Adviser shall issue written Operating
Procedures which shall govern reporting of transactions and other matters so as
to facilitate (i) the monitoring of the Fund's compliance with the restrictions
and limitations applicable to the operations of a registered investment company
and (ii) the preparation of reports to the Board of Trustees, regulatory
authorities and shareholders.
SUBSTANTIVE LIMITATIONS
A. The Sub-Adviser will manage the Series Account as if the Series Account
were a registered investment company subject to the investment objective,
policies and limitations applicable to the Series stated in the Fund's
Prospectus and Statement of Additional Information, as from time to time
in effect, included in the Fund's registration statement or a supplement
thereto under the Securities Act of 1933 and the Investment Company Act of
1940 (the "1940 Act"), as each may be amended from time to time; provided,
however, that if a more stringent restriction or limitation than any of
the foregoing is stated in Section B of this Schedule, the more stringent
restriction or limitation shall apply to the Series Account.
B. The Sub-Adviser shall not, without the written approval of the Adviser, on
behalf of the Series Account:
1. purchase securities of any issuer if such purchase would cause more
than 10 % of the voting securities of such issuer to be held in the
Series Account (1940 Act section 5(b)(1); IRC
section 851(b)(4)(a)(ii));
2. purchase securities if such purchase would cause:
a. more than 3% of the outstanding voting stock of any other
investment company to be held in the Series Account (1940 Act
section 12(d)(1)(A)(i)),
b. securities issued by any other investment company having an
aggregate value in excess of 5% of the value of the total
assets in the Series Account to be held in the Series Account
(1940 Act section 12(d)(1)(A)(ii)),
c. securities issued by all other investment companies (other
than Treasury Stock) having an aggregate value in excess of
10% of the value of the total assets of the Series Account to
be held in the Series Account (1940 Act
section 12(d)(1)(A)(iii)),
d. more than 10% of the outstanding voting stock of any
registered closed-end investment company to be held in the
Series Account, and by any other investment company having as
its investment adviser any of the Sub-Advisers, the Adviser,
or any other investment adviser to the Fund (1940 Act
section 12(d)(1)(C));
3. purchase securities of any insurance company if such purchase would
cause more than 10% of the outstanding voting securities of any
insurance company to be held in the Series Account (1940 Act
section 12(d)(2)); or
4. purchase securities of or any interest in any person who is a
broker, a dealer, is engaged in the business of underwriting, is an
investment adviser to an investment company or is a registered
investment adviser under the Investment Advisers Act of 1940 unless
a. such purchase is of a security of any issuer that, in its most
recent fiscal year, derived 15% or less of its gross revenues
from securities-related activities (1940 Act Rule 12d3-l(a)),
or
b. despite the fact that such purchase is of any security of any
issuer that derived more than 15% of its gross revenues from
securities-related activities:
(1) immediately after the purchase of any equity security,
the Series Account would not own more than 5% of
outstanding securities of that class of the issuer's
equity securities (1940 Act Rule 12d3-1(b)(1));
(2) immediately after the purchase of any debt security, the
Series Account would not own more than 10% of the
outstanding principal amount of the issuer's debt
securities (1940 Act Rule 12d3-1(b)(2)); and
(3) immediately after the purchase, not more than 5% of the
value of the Series Account's total assets would be
invested in the issuer's securities (1940 Act Rule
12d3-1(b)(3)).
C. The Sub-Adviser will manage the Series Account so that no more than 10% of
the gross income of the Series Account is derived from any source other than
dividends, interest, payments with respect to securities loans (as defined in
IRC section 512(a)(5)), and gains from the sale or other disposition of stock or
securities (as defined in the 1940 Act section 2(a)(36)) or foreign currencies,
or other income (including, but not limited to, gains from options, futures, or
forward contracts) derived with respect to the Series' business of investing in
such stock, securities, or currencies (IRC section 851(b)(2)).
Dated: January 27, 2004
SCHEDULE B
RECORD KEEPING REQUIREMENTS
Records To Be Maintained by the Sub-Adviser:
A. (Rule 31a-l(b)(5) and (6)). A record of each brokerage order, and all
other portfolio purchases and sales, given by the Sub-Adviser on behalf of
the Series Account for, or in connection with, the purchase or sale of
securities, whether executed or unexecuted. Such records shall include:
1. the name of the broker;
2. the terms and conditions of the order and of any modification or
cancellation thereof;
3. the time of entry or cancellation;
4. the price at which executed;
5. the time of receipt of a report of execution; and
6. the name of the person who placed the order on behalf of the
Series Account.
B. (Rule 31a-l(b)(9)). A record for each fiscal quarter, completed within ten
(10) days after the end of the quarter, showing specifically the basis or
bases (e.g. execution ability, execution and research) upon which the
allocation of orders for the purchase and sale of portfolio securities to
named brokers or dealers was effected, and the division of brokerage
commissions or other compensation on such purchase and sale orders. Such
record:
1. shall include the consideration given to:
a. the sale of shares of the Fund by brokers or dealers;
b. the supplying of services or benefits by brokers or dealers
to:
(1) the Fund,
(2) the Adviser,
(3) the Sub-Adviser, and
(4) any person other than the foregoing; and
c. any other consideration other than the technical
qualifications of the brokers and dealers as such;
2. shall show the nature of the services or benefits made available;
3. shall describe in detail the application of any general or specific
formula or other determinant used in arriving at such allocation of
purchase and sale orders and such division of brokerage commissions
or other compensation; and
4. shall show the name of the person responsible for making the
determination of such allocation and such division of brokerage
commissions or other compensation.
C. (Rule 31a-l(b)(10)). A record in the form of an appropriate memorandum
identifying the person or persons, committees or groups authorizing the
purchase or sale of portfolio securities. Where an authorization is made
by a committee or group, a record shall be kept of the names of its
members who participate in the authorization. There shall be retained as
part of this record: any memorandum, recommendation or instruction
supporting or authorizing the purchase or sale of portfolio securities and
such other information as is appropriate to support the authorization.
D. (Rule 31a-1(f)). Such accounts, books and other documents as are required
to be maintained by registered investment advisers by rule adopted under
Section 204 of the Investment Advisers Act of 1940, to the extent such
records are necessary or appropriate to record the Sub-Adviser's
transactions with respect to the Series Account.
Dated: January 27, 2004
SCHEDULE C
FEE SCHEDULE
For the services to be provided to the Series pursuant to the
attached Sub-Advisory Agreement, the Fund shall pay the Sub-Adviser an annual
fee calculated on the average daily asset value of the Series Account as
follows:
25 basis points (0.25%) on the first $20 million
22.5 basis points (0.225%) on the next $20 million
20 basis points (0.20%) on amounts greater than $40 million
The fee shall be calculated and paid monthly in arrears based on the
average daily net asset value of the Series Account.
The fee for the Sub-Adviser is payable monthly in arrears, promptly after
the end of each month, and is calculated for each month at one-twelfth the
annual rate, as indicated above, of the total market value of the assets under
management in the Series Account at the end of such month. During the first
twelve months from the date of this Agreement, the minimum monthly fee payable
shall be $833.33. For each month following the first twelve months of this
Agreement, the minimum monthly fee payable shall be $2,083.33.
The fee for any period that does not constitute a full month shall be
prorated based on the number of days for which investment advisory services have
been provided by the Sub-Adviser.
Dated: January 27, 2004
