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Exhibit 5(b)
SUB-ADVISORY AGREEMENT
AGREEMENT dated as of ____________, 1998 between WARBURG PINCUS ASSET
MANAGEMENT, INC., a Delaware corporation (herein called the "Investment
Advisor") and BLACKROCK INSTITUTIONAL MANAGEMENT CORPORATION, a Delaware
corporation (herein called the "Sub-Advisor").
WHEREAS, the Investment Advisor is the investment advisor to WARBURG,
XXXXXX MONEY MARKET FUND, INC. (herein called the "Fund"), an open-end,
diversified, management investment company registered under the Investment
Company Act of 1940, as amended (the "1940 Act"); and
WHEREAS, the Investment Advisor wishes to retain the Sub-Advisor to assist
the Investment Advisor in providing investment advisory services to the Fund;
and
WHEREAS, the Sub-Advisor is willing to provide such services to the
Investment Advisor upon the conditions and for the compensation set forth below.
NOW, THEREFORE, in consideration of the premises and mutual covenants
herein contained, and intending to be legally bound hereby, it is agreed between
the parties hereto as follows:
1. Appointment. The Investment Advisor hereby appoints the Sub-Advisor
its sub-advisor with respect to the Fund as provided for in the Investment
Advisory Agreement between the Investment Advisor and the Fund dated as of
___________, 1998 (such Agreement or the most recent successor advisory
agreement between such parties is herein called the "Advisory Agreement").
The Sub-Advisor accepts such appointment and agrees to render the services
herein set forth for the compensation herein provided.
2. Delivery of Documents. The Investment Advisor shall provide to the
Sub-Advisor copies of the Fund's most recent prospectus and statement of
additional information (including any supplement thereto) which relate to any
class of shares representing interests in the Fund (each such prospectus and
statement of additional information as presently in effect, and as they shall
from time to time be amended and supplemented, is herein respectively called a
"Prospectus" and a "Statement of Additional Information").
3. Sub-Advisory Services to the Fund. Subject to the supervision of the
Investment Advisor, the Sub-Advisor will supervise the day-to-day operations of
the Fund and perform the following services: (i) provide investment research and
credit analysis concerning the Fund's investments, (ii) conduct a continual
program of investment of the Fund's assets, (iii) place
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orders for all purchases and sales of the investments made for the Fund and (iv)
maintain the books and records required in connection with its duties hereunder.
In addition, the Sub-Advisor will keep the Investment Advisor informed of
developments materially affecting the Fund. The Sub-Advisor will communicate to
the Investment Advisor on each day that a purchase or sale of a security is
effected for the Fund (i) the name of the issuer, (ii) the amount of the
purchase or sale, (iii) the name of the broker or dealer, if any, through which
the purchase or sale will be effected, (iv) the CUSIP number of the security, if
any, and (v) such other information as the Investment Advisor may reasonably
require for purposes of fulfilling its obligations to the Fund under the
Advisory Agreement. The Sub-Advisor will render to the Fund's Board of Directors
such periodic and special reports as the Investment Advisor may reasonably
request. The Sub-Advisor will provide the services rendered by it hereunder in
accordance with the Fund's investment objectives, policies and restrictions as
stated in the Prospectus and Statement of Additional Information.
4. Brokerage. The Sub-Advisor may place orders pursuant to its
investment determinations for the Fund either directly with the issuer or with
any broker or dealer. In placing orders, the Sub-Advisor will consider the
experience and skill of the firm's securities traders as well as the firm's
financial responsibility and administrative efficiency. The Sub-Advisor will
attempt to obtain the best price and the most favorable execution of its orders.
Consistent with these obligations, the Sub-Advisor may, subject to the approval
of the Board of Directors, select brokers on the basis of the research,
statistical and pricing services they provide to the Fund. A commission paid to
such brokers may be higher than that which another qualified broker would have
charged for effecting the same transaction, provided that the Sub-Advisor
determines in good faith that such transaction is reasonable in terms either of
the transaction or the overall responsibility of the Sub-Advisor to the Fund and
its other clients and that the total commissions paid by the Fund will be
reasonable in relation to the benefits to the Fund over the long-term. In no
instance will portfolio securities be purchased from or sold to the Fund's
principal distributor, the Investment Advisor, or any affiliate thereof, except
to the extent permitted by an exemptive order of the Securities and Exchange
Commission or by applicable law.
5. Compliance with Laws; Confidentiality. The Sub-Advisor agrees that
it will comply with all applicable rules and regulations of all federal and
state regulatory agencies having jurisdiction over the Sub-Advisor in
performance of its duties hereunder (herein called the "Rules"). The Sub-Advisor
will treat confidentially and as proprietary information of the Fund all records
and information relative to the Fund, and will not
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use such records and information for any purpose other than performance of its
responsibilities and duties hereunder, except after prior notification to and
approval in writing by the Fund, which approval shall not be unreasonably
withheld and may not be withheld where the Sub-Advisor may be exposed to civil
or criminal contempt proceedings for failure to comply, when requested to
divulge such information by duly constituted authorities, or when so requested
by the Fund.
6. Control by the Fund's Board of Directors. Any recommendations
concerning the Fund's investment program proposed by the Sub-Advisor to the Fund
and the Investment Advisor pursuant to this Agreement, as well as any other
activities undertaken by the Sub-Advisor on behalf of the Fund pursuant thereto,
shall at all times be subject to any applicable directives of the Board of
Directors of the Fund.
7. Services Not Exclusive. The Sub-Advisor's services hereunder are not
deemed to be exclusive, and the Sub-Advisor shall be free to render similar
services to others so long as its services under this Agreement are not impaired
thereby.
8. Books and Records. In compliance with the requirements of Rule 31a-3
under the 1940 Act, the Sub-Advisor 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. The
Sub-Advisor further agrees to preserve for the periods prescribed by Rule 31a-2
under the 1940 Act, the records required to be maintained by the Sub-Advisor
hereunder pursuant to Rule 31a-1 under the 1940 Act.
9. Expenses. During the term of this Agreement, the Sub-Advisor will
bear all expenses in connection with the performance of its services under this
Agreement. The Sub-Advisor shall not bear certain other expenses related to the
operation of the Fund including, but not limited to: taxes, interest, brokerage
fees and commissions and any extraordinary expense items.
10. Compensation. For the services which the Sub-Advisor will render to
the Investment Advisor under this Agreement, the Investment Advisor will pay to
the Sub-Advisor on the first day of each month, a fee for the previous month
calculated daily, at an annual rate of [.06%] of the Fund's average daily net
assets.
11. Limitation on Liability. The Sub-Advisor will not be liable for any
error of judgment or mistake of law or for any loss suffered by the Investment
Advisor or by the Fund in connection with the matters to which this Agreement
relates,
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except that it shall be liable to the Investment Advisor and the Fund for a loss
resulting from a breach of fiduciary duty with respect to the receipt of
compensation for services or 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 or duties under this Agreement.
12. Duration and Termination. This Agreement shall become effective with
respect to the Fund upon approval of this Agreement by vote of a majority of the
outstanding voting securities of the Fund and, unless sooner terminated as
provided herein, shall continue with respect to the Fund until April 17, 2000.
Thereafter, if not terminated, this Agreement shall continue in effect for
successive annual periods ending on April 17th, provided such continuance is
specifically approved at least annually (a) by the vote of a majority of those
members of the Board of Directors of the Fund who are not interested persons of
the Fund or any party to this Agreement, cast in person at a meeting called for
the purpose of voting on such approval, and (b) by the Board of Directors of the
Fund or by vote of a majority of the outstanding voting securities of the Fund.
Notwithstanding the foregoing, this Agreement may be terminated at any time,
without the payment of any penalty, by the Fund (by vote of the Board of
Directors of the Fund or by vote of a majority of the outstanding voting
securities of the Fund), or by the Investment Advisor or the Sub-Advisor on
sixty (60) days' written notice. This Agreement will immediately terminate in
the event of its assignment. (As used in this Agreement, 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.)
13. Amendment of this Agreement. No provision of this Agreement may be
changed, discharged or terminated orally, but only by an instrument in writing
signed by the party against which enforcement of the change, discharge or
termination is sought, and no amendment of this Agreement affecting the Fund
shall be effective until approved by vote of the holders of a majority of the
outstanding voting securities of the Fund.
14. Miscellaneous. The captions in this Agreement are included for
convenience of reference only and in no way define or delimit any 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 and shall be governed by Delaware
law.
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IN WITNESS WHEREOF, the parties hereto have caused this instrument to be
executed by their officers designated below as of the day and year first above
written.
WARBURG PINCUS ASSET MANAGEMENT, INC.
By: _________________________
Title:
BLACKROCK INSTITUTIONAL
MANAGEMENT CORPORATION
By: _________________________
Title:
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