Exhibit 99.(4)(p)
FORM OF SUB-ADVISORY AGREEMENT
Agreement made as of April 1, 2006 between UBS GLOBAL ASSET MANAGEMENT
(AMERICAS) INC. ("UBS Global Americas"), a Delaware corporation, and OPUS
CAPITAL MANAGEMENT, INC. ("Sub Adviser"), an Ohio corporation (the
"Agreement").
RECITALS
(1) UBS Global Americas has entered into a Management Agreement dated
April 1, 2006 ("Management Agreement"), with UBS PACE Select Advisors Trust
(formerly known as Managed Accounts Services Portfolio Trust ("Trust")), an
open-end management investment company registered under the Investment
Company Act of 1940, as amended ("1940 Act"), with respect to UBS PACE
Small/Medium Co Value Equity Investments ("Portfolio").
(2) UBS Global Americas desires to retain the Sub-Adviser to furnish
certain investment advisory services to UBS Global Americas and the Portfolio
or a designated portion of the assets ("Segment") of the Portfolio; and
(3) The Sub-Adviser is willing to furnish such services;
NOW, THEREFORE, in consideration of the premises and mutual covenants
herein contained, UBS Global Americas and the Sub-Adviser agree as follows:
1. APPOINTMENT. UBS Global Americas hereby appoints the Sub Adviser
as an investment sub adviser with respect to the Portfolio or Segment for the
period and on the terms set forth in this Agreement. The Sub Adviser accepts
that appointment and agrees to render the services herein set forth, for the
compensation herein provided.
2. DUTIES AS SUB ADVISER.
(a) Subject to the supervision and direction of the Trust's Board of
Trustees (the "Board") and review by UBS Global Americas, and any written
guidelines adopted by the Board or UBS Global Americas, the Sub Adviser will
provide a continuous investment program for the Portfolio or Segment,
including investment research and discretionary management with respect to
all securities and investments and cash equivalents in the Portfolio or
Segment. The Sub Adviser will determine from time to time what investments
will be purchased, retained or sold by the Portfolio or Segment. The Sub
Adviser will be responsible for placing purchase and sell orders for
investments and for other related transactions for the Portfolio or Segment.
The Sub-Adviser understands that the Portfolio's assets need to be managed so
as to permit the Portfolio to qualify or to continue to qualify as a
regulated investment company under Subchapter M of the Internal Revenue Code,
as amended ("Code"). The Sub Adviser will provide services under this
Agreement in accordance with the Portfolio's investment objective, policies
and restrictions as stated in the Trust's currently effective registration
statement under the 1940 Act, and any amendments or supplements thereto
("Registration Statement").
(b) The Sub-Adviser agrees that it will not consult with any other
sub-adviser ("Other Sub-Adviser") for the Trust or Portfolio concerning any
transaction by the Portfolio or Segment in securities or other assets,
including (i) the purchase by the Portfolio or Segment of a security issued
by the Other Sub-Adviser, or an affiliate of the Other Sub-Adviser, to the
Trust or Portfolio except as permitted by the 1940 Act or (ii) transactions
by the Portfolio or Segment in any security for which the Other Sub-Adviser,
or its affiliate, is the principal underwriter.
(c) The Sub-Adviser agrees that it will be responsible for voting
proxies of issuers of securities held by the Portfolio or Segment. The
Sub-Adviser further agrees that it will adopt written proxy voting procedures
that shall comply with the requirements of the 1940 Act and the Investment
Advisers Act of 1940, as amended ("Advisers Act"), and that shall be
acceptable to the Board. The Sub-Adviser further agrees that it will provide
the Board on or before August 1st of each year, or more frequently as the
Board may reasonably request, with a written report of the proxies voted
during the most recent 12-month period ending June 30, or such other period
as the Board may designate, in a format that shall comply with the 1940 Act
and that shall be acceptable to the Board.
(d) The Sub Adviser agrees that, in placing orders with brokers, it
will obtain the best net result in terms of price and execution; provided
that, on behalf of the Portfolio or Segment, the Sub Adviser may, in its
discretion, use brokers that provide the Sub Adviser with research, analysis,
advice and similar services to execute portfolio transactions on behalf of
the Portfolio or Segment, and the Sub Adviser may pay to those brokers in
return for brokerage and research services a higher commission than may be
charged by other brokers, subject to the Sub Adviser's determination in good
faith that such commission is reasonable in terms either of the particular
transaction or of the overall responsibility of the Sub Adviser to the
Portfolio or Segment and its other clients and that the total commissions
paid by the Portfolio or Segment will be reasonable in relation to the
benefits to the Portfolio or Segment over the long term. In no instance will
portfolio securities be purchased from or sold to UBS Global Americas or the
Sub Adviser, or any affiliated person thereof, except in accordance with the
federal securities laws and the rules and regulations thereunder. The Sub
Adviser may aggregate sales and purchase orders with respect to the assets of
the Portfolio or Segment with similar orders being made simultaneously for
other accounts advised by the Sub Adviser or its affiliates. Whenever the
Sub Adviser simultaneously places orders to purchase or sell the same
security on behalf of the Portfolio or Segment and one or more other accounts
advised by the Sub Adviser, the orders will be allocated as to price and
amount among all such accounts in a manner believed to be equitable over time
to each account. UBS Global Americas recognizes that in some cases this
procedure may adversely affect the results obtained for the Portfolio or
Segment.
Subject to the Sub-Adviser's obligations to seek best execution, UBS
Global Americas agrees that the Sub-Adviser, in its sole discretion, may place
transactions on behalf of the Portfolio and the Trust with any broker-dealer
deemed to be an affiliate of the Sub-Adviser (the "Affiliated Broker-Dealers")
so long as such transactions are effected in conformity with the requirements
(including any applicable exemptions and administrative interpretations set
forth in Part II of the Sub-Adviser's Form ADV Registration Statement on file
with the Securities and Exchange Commission ("Form ADV")) of Section
11(a)(1)(H) of the Securities Exchange Act of 1934. In all such dealings, the
Affiliated Broker-Dealers shall be authorized and entitled to
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retain any commissions, remuneration or profits which may be made in such
transactions and shall not be liable to account for the same to UBS Global
Americas, the Portfolio or the Trust.
UBS Global Americas further authorizes the Sub-Adviser and its
Affiliated Broker-Dealers to execute agency cross transactions (the "Cross
Transactions") on behalf of the Portfolio and the Trust. Cross Transactions
are transactions which may be effected by the Affiliated Broker-Dealers
acting for both the Portfolio or the Trust and the counterparty to the
transaction. Cross Transactions enable the Sub-Adviser to purchase or sell a
block of securities for the Portfolio or the Trust at a set price and
possibly avoid an unfavorable price movement that may be created through
entrance into the market with such purchase or sale order. As such, the
Sub-Adviser believes that Cross Transactions can provide meaningful benefits
for the Portfolio and the Trust and its clients generally. UBS Global
Americas, the Portfolio and the Trust should be aware, however, that in a
Cross Transaction an Affiliated Broker-Dealer will be receiving commissions
from both sides of the trade and, therefore, there is a potentially
conflicting division of loyalties and responsibilities.
(e) The Sub Adviser will maintain all books and records required to be
maintained pursuant to Rule 31a-1(b)(2)(ii), (3), (5), (6), (7), (9) and (10)
under the 1940 Act and the rules and regulations promulgated thereunder with
respect to transactions by the Sub Adviser on behalf of the Portfolio or
Segment, and will furnish the Board and UBS Global Americas with such
periodic and special reports as the Board or UBS Global Americas reasonably
may request. In compliance with the requirements of Rule 31a 3 under the
1940 Act, the Sub Adviser hereby agrees that all records which it maintains
for the Portfolio or Segment are the property of the Trust, agrees to
preserve for the periods prescribed by Rule 31a 2 under the 1940 Act any
records that it maintains for the Portfolio or Segment and that 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
Portfolio or Segment upon request by the Trust.
(f) At such times as shall be reasonably requested by the Board or UBS
Global Americas, the Sub Adviser will provide the Board and UBS Global
Americas with economic and investment analyses and reports as well as
quarterly reports setting forth the performance of the Portfolio or Segment
and make available to the Board and UBS Global Americas any economic,
statistical and investment services that the Sub-Adviser normally makes
available to its institutional or other customers.
(g) In accordance with procedures adopted by the Board, as amended
from time to time, the Sub Adviser is responsible for assisting in the fair
valuation of all portfolio securities in the Portfolio or Segment and will
use its reasonable efforts to arrange for the provision of a price or prices
from one or more parties independent of the Sub Adviser for each portfolio
security for which the custodian does not obtain prices in the ordinary
course of business from an automated pricing service.
3. FURTHER DUTIES. In all matters relating to the performance of this
Agreement, the Sub Adviser will seek to act in conformity with the Trust's
Trust Instrument, By Laws and Registration Statement and with the written
instructions and written directions of the Board and UBS Global Americas; and
will comply with the requirements of the 1940 Act, and the Advisers Act, and
the rules under each, the Code, and all other federal and state laws and
regulations
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applicable to the Trust and the Portfolio. UBS Global Americas agrees to
provide to the Sub Adviser copies of the Trust's Trust Instrument, By Laws,
Registration Statement, written instructions and directions of the Board
and UBS Global Americas, and any amendments or supplements to any of these
materials as soon as practicable after such materials become available; and
further agrees to identify to the Sub-Adviser in writing any broker-dealers
that are affiliated with UBS Global Americas (other than UBS Financial
Services Inc. and UBS Global Americas itself).
4. EXPENSES. During the term of this Agreement, the Sub Adviser
will bear all expenses incurred by it in connection with its services under
this Agreement. The Sub Adviser shall not be responsible for any expenses
incurred by the Trust, the Portfolio or UBS Global Americas.
5. COMPENSATION.
(a) For the services provided and the expenses assumed by the Sub
Adviser pursuant to this Agreement, UBS Global Americas, not the Portfolio,
will pay to the Sub Adviser a fee, computed daily and payable monthly, at
an annual rate of 0.50% up to $75 million and 0.45% on assets in excess of
$75 million of the average daily net assets of the Portfolio or Segment
allocated to its management (computed in the manner specified in the
Management Agreement), and will provide the Sub-Adviser with a schedule
showing the manner in which the fee was computed. If the Sub-Adviser is
managing a Segment, its fees will be based on the value of the assets of
the Portfolio within the Sub-Adviser's Segment.
(b) The fee shall be accrued daily and payable monthly to the Sub
Adviser on or before the last business day of the next succeeding calendar
month.
(c) If this Agreement becomes effective or terminates before the end
of any month, the fee for the period from the effective date 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 pro-rated according to the proportion which
such period bears to the full month in that such effectiveness or
termination occurs.
6. LIMITATION OF LIABILITY.
(a) The Sub Adviser shall not be liable for any error of judgment or
mistake of law or for any loss suffered by the Portfolio, the Trust or its
shareholders or by UBS Global Americas in connection with the matters to
which this Agreement relates, 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 Agreement.
(b) In no event will the Sub-Adviser have any responsibility for any
other portfolio of the Trust, for any portion of the Portfolio not managed by
the Sub-Adviser or for the acts or omissions of any Other Sub-Adviser to the
Trust or Portfolio.
In particular, in the event the Sub-Adviser shall manage only a Segment
of the Portfolio, the Sub-Adviser shall have no responsibility for the
Portfolio's being in violation of any applicable law or regulation or
investment policy or restriction applicable to the Portfolio as a whole or
for the Portfolio's failing to qualify as a regulated investment company
under the Code, if the securities and
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other holdings of the Segment of the Portfolio managed by the Sub-Adviser are
such that such Segment would not be in such violation or fail to so qualify
if such Segment were deemed a separate series of the Trust or a separate
"regulated investment company" under the Code.
Nothing in this section shall be deemed a limitation or waiver of any
obligation or duty that may not by law be limited or waived.
7. REPRESENTATIONS OF SUB ADVISER. The Sub Adviser represents,
warrants and agrees as follows:
(a) The Sub Adviser (i) is registered as an investment adviser under
the Advisers Act and will continue to be so registered for so long as this
Agreement remains in effect; (ii) is not prohibited by the 1940 Act or the
Advisers Act from performing the services contemplated by this Agreement;
(iii) has met, and will seek to continue to meet for so long as this
Agreement remains in effect, any other applicable federal or state
requirements, or the applicable requirements of any regulatory or industry
self regulatory agency, necessary to be met in order to perform the services
contemplated by this Agreement; (iv) has the authority to enter into and
perform the services contemplated by this Agreement; and (v) will promptly
notify UBS Global Americas of the occurrence of any event that would
disqualify the Sub Adviser from serving as an investment adviser of an
investment company pursuant to Section 9(a) of the 1940 Act or otherwise.
(b) The Sub Adviser has adopted a written code of ethics complying
with the requirements of Rule 17j-1 under the 1940 Act and will provide UBS
Global Americas and the Board with a copy of such code of ethics, together
with evidence of its adoption. Within fifteen days of the end of the last
calendar quarter of each year that this Agreement is in effect, a duly
authorized officer of the Sub Adviser shall certify to UBS Global Americas
that the Sub Adviser has complied with the requirements of Rule 17j-1 during
the previous year and that there has been no material violation of the Sub
Adviser's code of ethics or, if such a violation has occurred, that
appropriate action was taken in response to such violation. Upon the written
request of UBS Global Americas, the Sub Adviser shall permit UBS Global
Americas, its employees or its agents to examine the reports required to be
made by the Sub Adviser pursuant to Rule 17j-1 and all other records relevant
to the Sub Adviser's code of ethics.
(c) The Sub Adviser has provided UBS Global Americas with a copy of
its Form ADV, as most recently filed with the Securities and Exchange
Commission ("SEC"), and promptly will furnish a copy of all amendments to UBS
Global Americas at least annually.
(d) The Sub Adviser will notify UBS Global Americas of any change of
control of the Sub Adviser, including any change of its general partners or
25% shareholders or 25% limited partners, as applicable, and any changes in
the key personnel who are either the portfolio manager(s) of the Portfolio or
senior management of the Sub Adviser, in each case prior to or promptly after
such change.
(e) UBS Global Americas and the Sub-Adviser agree that neither of them
nor any of their affiliates, will in any way refer directly or indirectly to
their relationship with one another or any of their respective affiliates in
offering, marketing or other promotional materials without the
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express written consent of the other, which consent will be promptly provided
and not unreasonably withheld.
8. SERVICES NOT EXCLUSIVE. The services furnished by the Sub-Adviser
hereunder are not to be deemed exclusive, and except as the Sub-Adviser may
otherwise agree in writing, the Sub-Adviser shall be free to furnish similar
services to others so long as its services under this Agreement are not
impaired thereby. Nothing in this Agreement shall limit or restrict the
right of any director, officer or employee of the Sub-Adviser, 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.
9. DURATION AND TERMINATION.
(a) This Agreement shall become effective upon the date first above
written, provided that this Agreement 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 Agreement 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 the
Portfolio's outstanding voting securities, unless UBS Global Americas has
authority to enter into this Agreement pursuant to exemptive relief from the
SEC without a vote of the Portfolio's outstanding voting securities.
(b) Unless sooner terminated as provided herein, this Agreement shall
continue in effect for two years from its effective date. Thereafter, if not
terminated, this Agreement 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 by vote of a majority of the
outstanding voting securities of the Portfolio.
(c) Notwithstanding the foregoing, this Agreement 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 the Portfolio on
30 days' written notice to the Sub Adviser. This Agreement may also be
terminated, without the payment of any penalty, by UBS Global Americas: (i)
upon 120 days' written notice to the Sub Adviser; (ii) upon material breach
by the Sub Adviser of any of the representations, warranties and agreements
set forth in Paragraph 7 of this Agreement; or (iii) immediately if, in the
reasonable judgment of UBS Global Americas, the Sub Adviser becomes unable to
discharge its duties and obligations under this Agreement, including
circumstances such as financial insolvency of the Sub Adviser or other
circumstances that could adversely affect the Portfolio. The Sub Adviser may
terminate this Agreement at any time, without the payment of any penalty, on
120 days' written notice to UBS Global Americas. This Agreement will
terminate automatically in the event of its assignment or upon termination of
the Management Agreement, as it relates to this Portfolio.
10. AMENDMENT OF THIS AGREEMENT. No provision of this Agreement may
be changed, waived, discharged or terminated orally, but only by an
instrument in writing signed by the party against whom enforcement of the
change, waiver, discharge or termination is sought. To the extent required
by applicable law, no amendment of this Agreement shall be effective until
approved (i) by
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a vote of a majority of the Independent Trustees, and (ii) if the terms of
this Agreement shall have changed, by a vote of a majority of the Portfolio's
outstanding voting securities (except in the case of (ii), pursuant to the
terms and conditions of the SEC order permitting it to modify the Agreement
without such vote).
11. GOVERNING LAW. This Agreement shall be construed in accordance
with the 1940 Act and the laws of the State of New York, without giving
effect to the conflicts of laws principles thereof. To the extent that the
applicable laws of the State of New York conflict with the applicable
provisions of the 1940 Act, the latter shall control.
12. MISCELLANEOUS. The captions in this Agreement 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 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. This Agreement shall be binding upon and shall inure
to the benefit of the parties hereto and their respective successors. As used
in this Agreement, the terms "majority of the outstanding voting securities,"
"affiliated person," "interested person," "assignment," "broker," "investment
adviser," "net assets," "sale," "sell" and "security" shall have the same
meanings as such terms have in the 1940 Act, subject to such exemption as may
be granted by the SEC by any rule, regulation or order. Where the effect of a
requirement of the federal securities laws reflected in any provision of this
Agreement is made less restrictive by a rule, regulation or order of the SEC,
whether of special or general application, such provision shall be deemed to
incorporate the effect of such rule, regulation or order. This Agreement may
be signed in counterpart.
13. NOTICES. Any notice herein required is to be in writing and is
deemed to have been given to the Sub-Adviser or UBS Global Americas upon
receipt of the same at their respective addresses set forth below. All
written notices required or permitted to be given under this Agreement will
be delivered by personal service, by postage mail return receipt requested or
by facsimile machine or a similar means of same delivery which provides
evidence of receipt (with a confirming copy by mail as set forth herein).
All notices provided to UBS Global Americas will be sent to the attention of:
General Counsel, UBS Global Asset Management (Americas) Inc., 0 Xxxxx Xxxxxx
Xxxxx, Xxxxxxx, Xxxxxxxx 00000. All notices provided to the Sub-Adviser will
be sent to the attention of: Xx. Xxx Xxxxxxxx, President, Opus Capital
Management, Inc., 0 Xxxx 0xx Xxxxxx, Xxxxx 000, Xxxxxxxxxx, XX 00000-0000
(fax: 000-000-0000).
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IN WITNESS WHEREOF, the parties hereto have caused this instrument to be
executed by their duly authorized signatories as of the date and year first
above written.
UBS GLOBAL ASSET
MANAGEMENT (AMERICAS) INC.
0 Xxxxx Xxxxxx Xxxxx
Xxxxxx: Xxxxxxx, Xxxxxxxx 00000
By: By:
----------------------------- -----------------------------
Name: Name:
Title: Title:
OPUS CAPITAL MANAGEMENT, INC.
0 Xxxx 0xx Xxxxxx, Xxxxx 000
Xxxxxxxxxx, XX 00000-0000
Attest:
By: By:
----------------------------- -----------------------------
Name: Name:
Title: Title:
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