BUSDOCS/1515926.1
SUBADVISORY AGREEMENT
This SUBADVISORY AGREEMENT (Agreement) is made this 1st day
of December, 2005, by and between Xxxxx Xxxxxx Fund Management
LLC, a Delaware limited liability company (the Manager) and
Citigroup Asset Management Limited, a corporation organized under
the laws of England and Wales (the Subadviser).
WHEREAS, the Manager has been retained by Xxxxx Xxxxxx Sector
Series Inc. (the Corporation), a registered management investment
company under the Investment Company Act of 1940, as amended (the
0000 Xxx) to provide investment advisory, management, and
administrative services to the Corporation with respect to a
series of the Corporation;
WHEREAS, the Manager wishes to engage the Subadviser to
provide certain investment advisory services to the Corporation
with respect to the series of the Corporation designated in
Schedule A annexed hereto (the Fund) and Subadviser is willing to
furnish such services on the terms and conditions hereinafter set
forth;
NOW THEREFORE, in consideration of the promises and mutual
covenants herein contained, it is agreed as follows:
1. In accordance with and subject to the Management Agreement
between the Corporation and the Manager with respect to the Fund
(the Management Agreement), the Manager hereby appoints the
Subadviser to act as Subadviser with respect to the Fund for the
period and on the terms set forth in this Agreement. The
Subadviser accepts such appointment and agrees to render the
services herein set forth, for the compensation herein provided.
2. The Manager shall cause the Subadviser to be kept fully
informed at all times with regard to the securities owned by the
Fund, its funds available, or to become available, for
investment, and generally as to the condition of the Fund's
affairs. Manager shall furnish the Subadviser with such other
documents and information with regard to the Fund's affairs as
the Subadviser may from time to time reasonably request.
3. (a) Subject to the supervision of the Corporation's Board
of Directors (the Board) and the Manager, Subadviser shall
regularly provide the Fund with respect to such portion of the
Fund's assets as shall be allocated to the Subadviser by the
Manager from time to time (the Allocated Assets) with investment
research, advice, management and supervision and shall furnish a
continuous investment program for the Allocated Assets consistent
with the Fund's investment objectives, policies and restrictions,
as stated in the Fund's current Prospectus and Statement of
Additional Information. The Subadviser shall, with respect to the
Allocated Assets, determine from time to time what securities and
other investments will be purchased, retained, sold or exchanged
by the Fund and what portion of the Allocated Assets will be held
in the various securities and other investments in which the Fund
invests, and shall implement those decisions, all subject to the
provisions of the Corporation's Corporation's Articles of
Incorporation and By-Laws (collectively, the Governing
Documents), the 1940 Act, and the applicable rules and
regulations promulgated thereunder by the Securities and Exchange
Commission (the SEC) and interpretive guidance issued thereunder
by the SEC staff and any other applicable federal and state law,
as well as the investment objectives, policies and restrictions
of the Fund referred to above, and any other specific policies
adopted by the Board and disclosed to the Subadviser. The
Subadviser is authorized as the agent of the Corporation to give
instructions with respect to the Allocated Assets to the
custodian of the Fund as to deliveries of securities and other
investments and payments of cash for the account of the Fund.
Subject to applicable provisions of the 1940 Act, the investment
program to be provided hereunder may entail the investment of all
or substantially all of the assets of a Fund in one or more
investment companies. The Subadviser will place orders pursuant
to its investment determinations for the Fund either directly
with the issuer or with any broker or dealer, foreign currency
dealer, futures commission merchant or others selected by it. In
connection with the selection of such brokers or dealers and the
placing of such orders, subject to applicable law, brokers or
dealers may be selected who also provide brokerage and research
services (as those terms are defined in Section 28(e) of the
Securities Exchange Act of 1934) to the Funds and/or the other
accounts over which the Subadviser or its affiliates exercise
investment discretion. The Subadviser is authorized to pay a
broker or dealer who provides such brokerage and research
services a commission for executing a portfolio transaction for a
Fund which is in excess of the amount of commission another
broker or dealer would have charged for effecting that
transaction if the Subadviser determines in good faith that such
amount of commission is reasonable in relation to the value of
the brokerage and research services provided by such broker or
dealer. This determination may be viewed in terms of either that
particular transaction or the overall responsibilities which the
Subadviser and its affiliates have with respect to accounts over
which they exercise investment discretion. The Board may adopt
policies and procedures that modify and restrict the Subadviser's
authority regarding the execution of the Fund's portfolio
transactions provided herein. The Subadviser shall exercise
voting rights, rights to consent to corporate action and any
other rights pertaining to the Allocated Assets subject to such
direction as the Board may provide, and shall perform such other
functions of investment management and supervision as may be
directed by the Board.
(b) The Fund hereby authorizes any entity or person
associated with the Subadviser which is a member of a national
securities exchange to effect any transaction on the exchange for
the account of the Fund which is permitted by Section 11(a) of
the Securities Exchange Act of 1934, as amended, and Rule 11a2-
2(T) thereunder, and the Fund hereby consents to the retention of
compensation for such transactions in accordance with Rule 11a2-
2(T)(a)(2)(iv). Notwithstanding the foregoing, the Subadviser
agrees that it will not deal with itself, or with members of the
Board or any principal underwriter of the Fund, as principals or
agents in making purchases or sales of securities or other
property for the account of a Fund, nor will it purchase any
securities from an underwriting or selling group in which the
Subadviser or its affiliates is participating, or arrange for
purchases and sales of securities between a Fund and another
account advised by the Subadviser or its affiliates, except in
each case as permitted by the 1940 Act and in accordance with
such policies and procedures as may be adopted by a Fund from
time to time, and will comply with all other provisions of the
Governing Documents and the Fund's then-current Prospectus and
Statement of Additional Information relative to the Subadviser
and its directors and officers.
4. The Subadviser may delegate to any other one or more
companies that the Subadviser controls, is controlled by, or is
under common control with, or to specified employees of any such
companies, certain of the Subadviser's duties under this
Agreement, provided in each case the Subadviser will supervise
the activities of each such entity or employees thereof, that
such delegation will not relieve the Subadviser of any of its
duties or obligations under this Agreement and provided further
that any such arrangements are entered into in accordance with
all applicable requirements of the 1940 Act.
5. The Subadviser agrees that it will keep records relating
to its services hereunder in accordance with all applicable laws,
and in compliance with the requirements of Rule 31a-3 under the
1940 Act, the Subadviser hereby agrees that any records that it
maintains for the Fund are the property of the Fund, and further
agrees to surrender promptly to the Fund any of such records upon
the Fund's request. The Subadviser further agrees to arrange for
the preservation of the records required to be maintained by Rule
31a-1 under the 1940 Act for the periods prescribed by Rule 31a-2
under the 1940 Act.
6. (a) The Subadviser, at its expense, shall supply the
Board, the officers of the Corporation, and the Manager with all
information and reports reasonably required by them and
reasonably available to the Subadviser relating to the services
provided by the Subadviser hereunder.
(b) The Subadviser shall bear all expenses, and shall
furnish all necessary services, facilities and personnel, in
connection with its responsibilities under this Agreement. Other
than as herein specifically indicated, the Subadviser shall not
be responsible for the Fund's expenses, including, without
limitation, advisory fees; distribution fees; interest; taxes;
governmental fees; voluntary assessments and other expenses
incurred in connection with membership in investment company
organizations; organization costs of the Fund; the cost
(including brokerage commissions, transaction fees or charges, if
any) in connection with the purchase or sale of the Fund's
securities and other investments and any losses in connection
therewith; fees and expenses of custodians, transfer agents,
registrars, independent pricing vendors or other agents; legal
expenses; loan commitment fees; expenses relating to share
certificates; expenses relating to the issuing and redemption or
repurchase of the Fund's shares and servicing shareholder
accounts; expenses of registering and qualifying the Fund's
shares for sale under applicable federal and state law; expenses
of preparing, setting in print, printing and distributing
prospectuses and statements of additional information and any
supplements thereto, reports, proxy statements, notices and
dividends to the Fund's shareholders; costs of stationery;
website costs; costs of meetings of the Board or any committee
thereof, meetings of shareholders and other meetings of the Fund;
Board fees; audit fees; travel expenses of officers, members of
the Board and employees of the Fund, if any; and the Fund's pro
rata portion of premiums on any fidelity bond and other insurance
covering the Fund and its officers, Board members and employees;
litigation expenses and any non-recurring or extraordinary
expenses as may arise, including, without limitation, those
relating to actions, suits or proceedings to which the Fund is a
party and the legal obligation which the Fund may have to
indemnify the Fund's Board members and officers with respect
thereto.
7. No member of the Board, officer or employee of the
Corporation or Fund shall receive from the Corporation or Fund
any salary or other compensation as such member of the Board,
officer or employee while he is at the same time a director,
officer, or employee of the Subadviser or any affiliated company
of the Subadviser, except as the Board may decide. This paragraph
shall not apply to Board members, executive committee members,
consultants and other persons who are not regular members of the
Subadviser's or any affiliated company's staff.
8. As compensation for the services performed by the
Subadviser, including the services of any consultants retained by
the Subadviser, the Manager shall pay the Subadviser out of the
management fee it receives with respect to the Fund, and only to
the extent thereof, as promptly as possible after the last day of
each month, a fee, computed daily at an annual rate set forth on
Schedule A annexed hereto. The first payment of the fee shall be
made as promptly as possible at the end of the month succeeding
the effective date of this Agreement, and shall constitute a full
payment of the fee due the Subadviser for all services prior to
that date. If this Agreement is terminated as of any date not the
last day of a month, such fee shall be paid as promptly as
possible after such date of termination, shall be based on the
average daily net assets of the Fund or, if less, the portion
thereof comprising the Allocated Assets in that period from the
beginning of such month to such date of termination, and shall be
that proportion of such average daily net assets as the number of
business days in such period bears to the number of business days
in such month. The average daily net assets of the Fund or the
portion thereof comprising the Allocated Assets shall in all
cases be based only on business days and be computed as of the
time of the regular close of business of the New York Stock
Exchange, or such other time as may be determined by the Board.
9. The Subadviser assumes no responsibility under this
Agreement other than to render the services called for hereunder,
in good faith, and shall not be liable for any error of judgment
or mistake of law, or for any loss arising out of any investment
or for any act or omission in the execution of securities
transactions for a Fund, provided that nothing in this Agreement
shall protect the Subadviser against any liability to the Manager
or the Fund to which the Subadviser would otherwise be subject by
reason of 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 hereunder. As used in
this Section 9, the term Subadviser shall include any affiliates
of the Subadviser performing services for the Corporation or the
Fund contemplated hereby and the partners, shareholders,
directors, officers and employees of the Subadviser and such
affiliates.
10. Nothing in this Agreement shall limit or restrict the
right of any director, officer, or employee of the Subadviser who
may also be a Board member, officer, or employee of the
Corporation or the Fund, to engage in any other business or to
devote his 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 the
Subadviser to engage in any other business or to render services
of any kind, including investment advisory and management
services, to any other fund, firm, individual or association. If
the purchase or sale of securities consistent with the investment
policies of a Fund or one or more other accounts of the
Subadviser is considered at or about the same time, transactions
in such securities will be allocated among the accounts in a
manner deemed equitable by the Subadviser. Such transactions may
be combined, in accordance with applicable laws and regulations,
and consistent with the Subadviser's policies and procedures as
presented to the Board from time to time.
11. For the purposes of this Agreement, the Fund's net assets
shall be determined as provided in the Fund's then-current
Prospectus and Statement of Additional Information and the terms
assignment, interested person, and majority of the outstanding
voting securities shall have the meanings given to them by
Section 2(a) of the 1940 Act, subject to such exemptions as may
be granted by the SEC by any rule, regulation or order.
12. This Agreement will become effective with respect to the
Fund on the date set forth opposite the Fund's name on Schedule A
annexed hereto, provided that it shall have been approved by the
Corporation's Board and, if so required by the 1940 Act, by the
shareholders of the Fund in accordance with the requirements of
the 1940 Act and, unless sooner terminated as provided herein,
will continue in effect for two years from the above written
date. Thereafter, if not terminated, this Agreement shall
continue in effect with respect to the Fund, so long as such
continuance is specifically approved at least annually (i) by the
Board or (ii) by a vote of a majority of the outstanding voting
securities of the Fund, provided that in either event the
continuance is also approved by a majority of the Board members
who are not interested persons of any party to this Agreement, by
vote cast in person at a meeting called for the purpose of voting
on such approval.
13. This Agreement is terminable with respect to the Fund
without penalty by the Board or by vote of a majority of the
outstanding voting securities of the Fund, in each case on not
more than 60 days' nor less than 30 days' written notice to the
Subadviser, or by the Subadviser upon not less than 90 days'
written notice to the Fund and the Manager, and will be
terminated upon the mutual written consent of the Manager and the
Subadviser. This Agreement shall terminate automatically in the
event of its assignment by the Subadviser and shall not be
assignable by the Manager without the consent of the Subadviser.
14. The Subadviser agrees that for any claim by it against
the Fund in connection with this Agreement or the services
rendered under this Agreement, it shall look only to assets of
the Fund for satisfaction and that it shall have no claim against
the assets of any other portfolios of the Xxxxx Xxxxxx Sector
Series Inc.Corporation.
15. 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 which enforcement of the
change, waiver, discharge or termination is sought, and no
material amendment of the Agreement shall be effective until
approved, if so required by the 1940 Act, by vote of the holders
of a majority of the Fund's outstanding voting securities.
16. This Agreement, and any supplemental terms contained on
Annex I hereto, if applicable, embodies the entire agreement and
understanding between the parties hereto, and supersedes all
prior agreements and understandings relating to the subject
matter hereof. Should any part of this Agreement 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 on and shall inure to the benefit of
the parties hereto and their respective successors.
17. This Agreement shall be construed and the provisions
thereof interpreted under and in accordance with the laws of the
State of New York.
[signature page to follow]
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed by their officers thereunto duly
authorized.
XXXXX XXXXXX FUND MANAGEMENT LLC
By:_______________________________
Name: Xxxxxx Xxxxxxx
Title: Director
CITIGROUP ASSET MANAGEMENT LIMITED
By:_______________________________
Name:
Title:
The foregoing is acknowledged:
The undersigned officer of the Corporation has executed this
Agreement not individually but in his/her capacity as an officer
of the Corporation. The Corporation does not hereby undertake, on
behalf of the Fund or otherwise, any obligation to the
Subadviser.
XXXXX XXXXXX SECTOR SERIES INC.
By:_______________________________
Name: R. Xxx Xxxxxx
Title: Chairman
ANNEX I
This Annex I forms a part of the Subadvisory Agreement dated
as of December 1, 2005 by and between Xxxxx Xxxxxx Fund
Management LLC, a Delaware limited liability company, and
Citigroup Asset Management Limited (the Subadviser), an entity
authorized and regulated in the United Kingdom by the Financial
Services Authority (the FSA).
1. The Subadviser represents, warrants and covenants that it
is authorized and regulated by the FSA.
2. The Subadviser has classified the Corporation as an
Intermediate Customer as defined by the FSA Rules.
SCHEDULE A
Xxxxx Xxxxxx Financial Services Fund
Fee:
The following percentage of the Fund's average daily net assets:
0.50
SUBADVISORY AGREEMENT
This SUBADVISORY AGREEMENT (Agreement) is made this 1st day
of December, 2005, by and between Xxxxx Xxxxxx Fund Management
LLC, a Delaware limited liability company (the Manager) and
Citigroup Asset Management Limited, a corporation organized under
the laws of England and Wales (the Subadviser).
WHEREAS, the Manager has been retained by Xxxxx Xxxxxx Sector
Series Inc. (the Corporation), a registered management investment
company under the Investment Company Act of 1940, as amended (the
0000 Xxx) to provide investment advisory, management, and
administrative services to the Corporation with respect to a
series of the Corporation;
WHEREAS, the Manager wishes to engage the Subadviser to
provide certain investment advisory services to the Corporation
with respect to the series of the Corporation designated in
Schedule A annexed hereto (the Fund) and Subadviser is willing to
furnish such services on the terms and conditions hereinafter set
forth;
NOW THEREFORE, in consideration of the promises and mutual
covenants herein contained, it is agreed as follows:
1. In accordance with and subject to the Management Agreement
between the Corporation and the Manager with respect to the Fund
(the Management Agreement), the Manager hereby appoints the
Subadviser to act as Subadviser with respect to the Fund for the
period and on the terms set forth in this Agreement. The
Subadviser accepts such appointment and agrees to render the
services herein set forth, for the compensation herein provided.
2. The Manager shall cause the Subadviser to be kept fully
informed at all times with regard to the securities owned by the
Fund, its funds available, or to become available, for
investment, and generally as to the condition of the Fund's
affairs. Manager shall furnish the Subadviser with such other
documents and information with regard to the Fund's affairs as
the Subadviser may from time to time reasonably request.
3. (a) Subject to the supervision of the Corporation's Board
of Directors (the Board) and the Manager, Subadviser shall
regularly provide the Fund with respect to such portion of the
Fund's assets as shall be allocated to the Subadviser by the
Manager from time to time (the Allocated Assets) with investment
research, advice, management and supervision and shall furnish a
continuous investment program for the Allocated Assets consistent
with the Fund's investment objectives, policies and restrictions,
as stated in the Fund's current Prospectus and Statement of
Additional Information. The Subadviser shall, with respect to the
Allocated Assets, determine from time to time what securities and
other investments will be purchased, retained, sold or exchanged
by the Fund and what portion of the Allocated Assets will be held
in the various securities and other investments in which the Fund
invests, and shall implement those decisions, all subject to the
provisions of the Corporation's Corporation's Articles of
Incorporation and By-Laws (collectively, the Governing
Documents), the 1940 Act, and the applicable rules and
regulations promulgated thereunder by the Securities and Exchange
Commission (the SEC) and interpretive guidance issued thereunder
by the SEC staff and any other applicable federal and state law,
as well as the investment objectives, policies and restrictions
of the Fund referred to above, and any other specific policies
adopted by the Board and disclosed to the Subadviser. The
Subadviser is authorized as the agent of the Corporation to give
instructions with respect to the Allocated Assets to the
custodian of the Fund as to deliveries of securities and other
investments and payments of cash for the account of the Fund.
Subject to applicable provisions of the 1940 Act, the investment
program to be provided hereunder may entail the investment of all
or substantially all of the assets of a Fund in one or more
investment companies. The Subadviser will place orders pursuant
to its investment determinations for the Fund either directly
with the issuer or with any broker or dealer, foreign currency
dealer, futures commission merchant or others selected by it. In
connection with the selection of such brokers or dealers and the
placing of such orders, subject to applicable law, brokers or
dealers may be selected who also provide brokerage and research
services (as those terms are defined in Section 28(e) of the
Securities Exchange Act of 1934) to the Funds and/or the other
accounts over which the Subadviser or its affiliates exercise
investment discretion. The Subadviser is authorized to pay a
broker or dealer who provides such brokerage and research
services a commission for executing a portfolio transaction for a
Fund which is in excess of the amount of commission another
broker or dealer would have charged for effecting that
transaction if the Subadviser determines in good faith that such
amount of commission is reasonable in relation to the value of
the brokerage and research services provided by such broker or
dealer. This determination may be viewed in terms of either that
particular transaction or the overall responsibilities which the
Subadviser and its affiliates have with respect to accounts over
which they exercise investment discretion. The Board may adopt
policies and procedures that modify and restrict the Subadviser's
authority regarding the execution of the Fund's portfolio
transactions provided herein. The Subadviser shall exercise
voting rights, rights to consent to corporate action and any
other rights pertaining to the Allocated Assets subject to such
direction as the Board may provide, and shall perform such other
functions of investment management and supervision as may be
directed by the Board.
(b) The Fund hereby authorizes any entity or person
associated with the Subadviser which is a member of a national
securities exchange to effect any transaction on the exchange for
the account of the Fund which is permitted by Section 11(a) of
the Securities Exchange Act of 1934, as amended, and Rule 11a2-
2(T) thereunder, and the Fund hereby consents to the retention of
compensation for such transactions in accordance with Rule 11a2-
2(T)(a)(2)(iv). Notwithstanding the foregoing, the Subadviser
agrees that it will not deal with itself, or with members of the
Board or any principal underwriter of the Fund, as principals or
agents in making purchases or sales of securities or other
property for the account of a Fund, nor will it purchase any
securities from an underwriting or selling group in which the
Subadviser or its affiliates is participating, or arrange for
purchases and sales of securities between a Fund and another
account advised by the Subadviser or its affiliates, except in
each case as permitted by the 1940 Act and in accordance with
such policies and procedures as may be adopted by a Fund from
time to time, and will comply with all other provisions of the
Governing Documents and the Fund's then-current Prospectus and
Statement of Additional Information relative to the Subadviser
and its directors and officers.
4. The Subadviser may delegate to any other one or more
companies that the Subadviser controls, is controlled by, or is
under common control with, or to specified employees of any such
companies, certain of the Subadviser's duties under this
Agreement, provided in each case the Subadviser will supervise
the activities of each such entity or employees thereof, that
such delegation will not relieve the Subadviser of any of its
duties or obligations under this Agreement and provided further
that any such arrangements are entered into in accordance with
all applicable requirements of the 1940 Act.
5. The Subadviser agrees that it will keep records relating
to its services hereunder in accordance with all applicable laws,
and in compliance with the requirements of Rule 31a-3 under the
1940 Act, the Subadviser hereby agrees that any records that it
maintains for the Fund are the property of the Fund, and further
agrees to surrender promptly to the Fund any of such records upon
the Fund's request. The Subadviser further agrees to arrange for
the preservation of the records required to be maintained by Rule
31a-1 under the 1940 Act for the periods prescribed by Rule 31a-2
under the 1940 Act.
6. (a) The Subadviser, at its expense, shall supply the
Board, the officers of the Corporation, and the Manager with all
information and reports reasonably required by them and
reasonably available to the Subadviser relating to the services
provided by the Subadviser hereunder.
(b) The Subadviser shall bear all expenses, and shall
furnish all necessary services, facilities and personnel, in
connection with its responsibilities under this Agreement. Other
than as herein specifically indicated, the Subadviser shall not
be responsible for the Fund's expenses, including, without
limitation, advisory fees; distribution fees; interest; taxes;
governmental fees; voluntary assessments and other expenses
incurred in connection with membership in investment company
organizations; organization costs of the Fund; the cost
(including brokerage commissions, transaction fees or charges, if
any) in connection with the purchase or sale of the Fund's
securities and other investments and any losses in connection
therewith; fees and expenses of custodians, transfer agents,
registrars, independent pricing vendors or other agents; legal
expenses; loan commitment fees; expenses relating to share
certificates; expenses relating to the issuing and redemption or
repurchase of the Fund's shares and servicing shareholder
accounts; expenses of registering and qualifying the Fund's
shares for sale under applicable federal and state law; expenses
of preparing, setting in print, printing and distributing
prospectuses and statements of additional information and any
supplements thereto, reports, proxy statements, notices and
dividends to the Fund's shareholders; costs of stationery;
website costs; costs of meetings of the Board or any committee
thereof, meetings of shareholders and other meetings of the Fund;
Board fees; audit fees; travel expenses of officers, members of
the Board and employees of the Fund, if any; and the Fund's pro
rata portion of premiums on any fidelity bond and other insurance
covering the Fund and its officers, Board members and employees;
litigation expenses and any non-recurring or extraordinary
expenses as may arise, including, without limitation, those
relating to actions, suits or proceedings to which the Fund is a
party and the legal obligation which the Fund may have to
indemnify the Fund's Board members and officers with respect
thereto.
7. No member of the Board, officer or employee of the
Corporation or Fund shall receive from the Corporation or Fund
any salary or other compensation as such member of the Board,
officer or employee while he is at the same time a director,
officer, or employee of the Subadviser or any affiliated company
of the Subadviser, except as the Board may decide. This paragraph
shall not apply to Board members, executive committee members,
consultants and other persons who are not regular members of the
Subadviser's or any affiliated company's staff.
8. As compensation for the services performed by the
Subadviser, including the services of any consultants retained by
the Subadviser, the Manager shall pay the Subadviser out of the
management fee it receives with respect to the Fund, and only to
the extent thereof, as promptly as possible after the last day of
each month, a fee, computed daily at an annual rate set forth on
Schedule A annexed hereto. The first payment of the fee shall be
made as promptly as possible at the end of the month succeeding
the effective date of this Agreement, and shall constitute a full
payment of the fee due the Subadviser for all services prior to
that date. If this Agreement is terminated as of any date not the
last day of a month, such fee shall be paid as promptly as
possible after such date of termination, shall be based on the
average daily net assets of the Fund or, if less, the portion
thereof comprising the Allocated Assets in that period from the
beginning of such month to such date of termination, and shall be
that proportion of such average daily net assets as the number of
business days in such period bears to the number of business days
in such month. The average daily net assets of the Fund or the
portion thereof comprising the Allocated Assets shall in all
cases be based only on business days and be computed as of the
time of the regular close of business of the New York Stock
Exchange, or such other time as may be determined by the Board.
9. The Subadviser assumes no responsibility under this
Agreement other than to render the services called for hereunder,
in good faith, and shall not be liable for any error of judgment
or mistake of law, or for any loss arising out of any investment
or for any act or omission in the execution of securities
transactions for a Fund, provided that nothing in this Agreement
shall protect the Subadviser against any liability to the Manager
or the Fund to which the Subadviser would otherwise be subject by
reason of 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 hereunder. As used in
this Section 9, the term Subadviser shall include any affiliates
of the Subadviser performing services for the Corporation or the
Fund contemplated hereby and the partners, shareholders,
directors, officers and employees of the Subadviser and such
affiliates.
10. Nothing in this Agreement shall limit or restrict the
right of any director, officer, or employee of the Subadviser who
may also be a Board member, officer, or employee of the
Corporation or the Fund, to engage in any other business or to
devote his 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 the
Subadviser to engage in any other business or to render services
of any kind, including investment advisory and management
services, to any other fund, firm, individual or association. If
the purchase or sale of securities consistent with the investment
policies of a Fund or one or more other accounts of the
Subadviser is considered at or about the same time, transactions
in such securities will be allocated among the accounts in a
manner deemed equitable by the Subadviser. Such transactions may
be combined, in accordance with applicable laws and regulations,
and consistent with the Subadviser's policies and procedures as
presented to the Board from time to time.
11. For the purposes of this Agreement, the Fund's net assets
shall be determined as provided in the Fund's then-current
Prospectus and Statement of Additional Information and the terms
assignment, interested person, and majority of the outstanding
voting securities shall have the meanings given to them by
Section 2(a) of the 1940 Act, subject to such exemptions as may
be granted by the SEC by any rule, regulation or order.
12. This Agreement will become effective with respect to the
Fund on the date set forth opposite the Fund's name on Schedule A
annexed hereto, provided that it shall have been approved by the
Corporation's Board and, if so required by the 1940 Act, by the
shareholders of the Fund in accordance with the requirements of
the 1940 Act and, unless sooner terminated as provided herein,
will continue in effect for two years from the above written
date. Thereafter, if not terminated, this Agreement shall
continue in effect with respect to the Fund, so long as such
continuance is specifically approved at least annually (i) by the
Board or (ii) by a vote of a majority of the outstanding voting
securities of the Fund, provided that in either event the
continuance is also approved by a majority of the Board members
who are not interested persons of any party to this Agreement, by
vote cast in person at a meeting called for the purpose of voting
on such approval.
13. This Agreement is terminable with respect to the Fund
without penalty by the Board or by vote of a majority of the
outstanding voting securities of the Fund, in each case on not
more than 60 days' nor less than 30 days' written notice to the
Subadviser, or by the Subadviser upon not less than 90 days'
written notice to the Fund and the Manager, and will be
terminated upon the mutual written consent of the Manager and the
Subadviser. This Agreement shall terminate automatically in the
event of its assignment by the Subadviser and shall not be
assignable by the Manager without the consent of the Subadviser.
14. The Subadviser agrees that for any claim by it against
the Fund in connection with this Agreement or the services
rendered under this Agreement, it shall look only to assets of
the Fund for satisfaction and that it shall have no claim against
the assets of any other portfolios of the Xxxxx Xxxxxx Sector
Series Inc.Corporation.
15. 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 which enforcement of the
change, waiver, discharge or termination is sought, and no
material amendment of the Agreement shall be effective until
approved, if so required by the 1940 Act, by vote of the holders
of a majority of the Fund's outstanding voting securities.
16. This Agreement, and any supplemental terms contained on
Annex I hereto, if applicable, embodies the entire agreement and
understanding between the parties hereto, and supersedes all
prior agreements and understandings relating to the subject
matter hereof. Should any part of this Agreement 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 on and shall inure to the benefit of
the parties hereto and their respective successors.
17. This Agreement shall be construed and the provisions
thereof interpreted under and in accordance with the laws of the
State of New York.
[signature page to follow]
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed by their officers thereunto duly
authorized.
XXXXX XXXXXX FUND MANAGEMENT LLC
By:_______________________________
Name: Xxxxxx Xxxxxxx
Title: Director
CITIGROUP ASSET MANAGEMENT LIMITED
By:_______________________________
Name:
Title:
The foregoing is acknowledged:
The undersigned officer of the Corporation has executed this
Agreement not individually but in his/her capacity as an officer
of the Corporation. The Corporation does not hereby undertake, on
behalf of the Fund or otherwise, any obligation to the
Subadviser.
XXXXX XXXXXX SECTOR SERIES INC.
By:_______________________________
Name: R. Xxx Xxxxxx
Title: Chairman
ANNEX I
This Annex I forms a part of the Subadvisory Agreement dated
as of December 1, 2005 by and between Xxxxx Xxxxxx Fund
Management LLC, a Delaware limited liability company, and
Citigroup Asset Management Limited (the Subadviser), an entity
authorized and regulated in the United Kingdom by the Financial
Services Authority (the FSA).
1. The Subadviser represents, warrants and covenants that it
is authorized and regulated by the FSA.
2. The Subadviser has classified the Corporation as an
Intermediate Customer as defined by the FSA Rules.
SCHEDULE A
Xxxxx Xxxxxx Health Sciences Fund
Fee:
The following percentage of the Fund's average daily net assets:
0.50
SUBADVISORY AGREEMENT
This SUBADVISORY AGREEMENT (Agreement) is made this 1st day
of December, 2005, by and between Xxxxx Xxxxxx Fund Management
LLC, a Delaware limited liability company (the Manager) and
Citigroup Asset Management Limited, a corporation organized under
the laws of England and Wales (the Subadviser).
WHEREAS, the Manager has been retained by Xxxxx Xxxxxx Sector
Series Inc. (the Corporation), a registered management investment
company under the Investment Company Act of 1940, as amended (the
0000 Xxx) to provide investment advisory, management, and
administrative services to the Corporation with respect to a
series of the Corporation;
WHEREAS, the Manager wishes to engage the Subadviser to
provide certain investment advisory services to the Corporation
with respect to the series of the Corporation designated in
Schedule A annexed hereto (the Fund) and Subadviser is willing to
furnish such services on the terms and conditions hereinafter set
forth;
NOW THEREFORE, in consideration of the promises and mutual
covenants herein contained, it is agreed as follows:
1. In accordance with and subject to the Management Agreement
between the Corporation and the Manager with respect to the Fund
(the Management Agreement), the Manager hereby appoints the
Subadviser to act as Subadviser with respect to the Fund for the
period and on the terms set forth in this Agreement. The
Subadviser accepts such appointment and agrees to render the
services herein set forth, for the compensation herein provided.
2. The Manager shall cause the Subadviser to be kept fully
informed at all times with regard to the securities owned by the
Fund, its funds available, or to become available, for
investment, and generally as to the condition of the Fund's
affairs. Manager shall furnish the Subadviser with such other
documents and information with regard to the Fund's affairs as
the Subadviser may from time to time reasonably request.
3. (a) Subject to the supervision of the Corporation's Board
of Directors (the Board) and the Manager, Subadviser shall
regularly provide the Fund with respect to such portion of the
Fund's assets as shall be allocated to the Subadviser by the
Manager from time to time (the Allocated Assets) with investment
research, advice, management and supervision and shall furnish a
continuous investment program for the Allocated Assets consistent
with the Fund's investment objectives, policies and restrictions,
as stated in the Fund's current Prospectus and Statement of
Additional Information. The Subadviser shall, with respect to the
Allocated Assets, determine from time to time what securities and
other investments will be purchased, retained, sold or exchanged
by the Fund and what portion of the Allocated Assets will be held
in the various securities and other investments in which the Fund
invests, and shall implement those decisions, all subject to the
provisions of the Corporation's Corporation's Articles of
Incorporation and By-Laws (collectively, the Governing
Documents), the 1940 Act, and the applicable rules and
regulations promulgated thereunder by the Securities and Exchange
Commission (the SEC) and interpretive guidance issued thereunder
by the SEC staff and any other applicable federal and state law,
as well as the investment objectives, policies and restrictions
of the Fund referred to above, and any other specific policies
adopted by the Board and disclosed to the Subadviser. The
Subadviser is authorized as the agent of the Corporation to give
instructions with respect to the Allocated Assets to the
custodian of the Fund as to deliveries of securities and other
investments and payments of cash for the account of the Fund.
Subject to applicable provisions of the 1940 Act, the investment
program to be provided hereunder may entail the investment of all
or substantially all of the assets of a Fund in one or more
investment companies. The Subadviser will place orders pursuant
to its investment determinations for the Fund either directly
with the issuer or with any broker or dealer, foreign currency
dealer, futures commission merchant or others selected by it. In
connection with the selection of such brokers or dealers and the
placing of such orders, subject to applicable law, brokers or
dealers may be selected who also provide brokerage and research
services (as those terms are defined in Section 28(e) of the
Securities Exchange Act of 1934) to the Funds and/or the other
accounts over which the Subadviser or its affiliates exercise
investment discretion. The Subadviser is authorized to pay a
broker or dealer who provides such brokerage and research
services a commission for executing a portfolio transaction for a
Fund which is in excess of the amount of commission another
broker or dealer would have charged for effecting that
transaction if the Subadviser determines in good faith that such
amount of commission is reasonable in relation to the value of
the brokerage and research services provided by such broker or
dealer. This determination may be viewed in terms of either that
particular transaction or the overall responsibilities which the
Subadviser and its affiliates have with respect to accounts over
which they exercise investment discretion. The Board may adopt
policies and procedures that modify and restrict the Subadviser's
authority regarding the execution of the Fund's portfolio
transactions provided herein. The Subadviser shall exercise
voting rights, rights to consent to corporate action and any
other rights pertaining to the Allocated Assets subject to such
direction as the Board may provide, and shall perform such other
functions of investment management and supervision as may be
directed by the Board.
(b) The Fund hereby authorizes any entity or person
associated with the Subadviser which is a member of a national
securities exchange to effect any transaction on the exchange for
the account of the Fund which is permitted by Section 11(a) of
the Securities Exchange Act of 1934, as amended, and Rule 11a2-
2(T) thereunder, and the Fund hereby consents to the retention of
compensation for such transactions in accordance with Rule 11a2-
2(T)(a)(2)(iv). Notwithstanding the foregoing, the Subadviser
agrees that it will not deal with itself, or with members of the
Board or any principal underwriter of the Fund, as principals or
agents in making purchases or sales of securities or other
property for the account of a Fund, nor will it purchase any
securities from an underwriting or selling group in which the
Subadviser or its affiliates is participating, or arrange for
purchases and sales of securities between a Fund and another
account advised by the Subadviser or its affiliates, except in
each case as permitted by the 1940 Act and in accordance with
such policies and procedures as may be adopted by a Fund from
time to time, and will comply with all other provisions of the
Governing Documents and the Fund's then-current Prospectus and
Statement of Additional Information relative to the Subadviser
and its directors and officers.
4. The Subadviser may delegate to any other one or more
companies that the Subadviser controls, is controlled by, or is
under common control with, or to specified employees of any such
companies, certain of the Subadviser's duties under this
Agreement, provided in each case the Subadviser will supervise
the activities of each such entity or employees thereof, that
such delegation will not relieve the Subadviser of any of its
duties or obligations under this Agreement and provided further
that any such arrangements are entered into in accordance with
all applicable requirements of the 1940 Act.
5. The Subadviser agrees that it will keep records relating
to its services hereunder in accordance with all applicable laws,
and in compliance with the requirements of Rule 31a-3 under the
1940 Act, the Subadviser hereby agrees that any records that it
maintains for the Fund are the property of the Fund, and further
agrees to surrender promptly to the Fund any of such records upon
the Fund's request. The Subadviser further agrees to arrange for
the preservation of the records required to be maintained by Rule
31a-1 under the 1940 Act for the periods prescribed by Rule 31a-2
under the 1940 Act.
6. (a) The Subadviser, at its expense, shall supply the
Board, the officers of the Corporation, and the Manager with all
information and reports reasonably required by them and
reasonably available to the Subadviser relating to the services
provided by the Subadviser hereunder.
(b) The Subadviser shall bear all expenses, and shall
furnish all necessary services, facilities and personnel, in
connection with its responsibilities under this Agreement. Other
than as herein specifically indicated, the Subadviser shall not
be responsible for the Fund's expenses, including, without
limitation, advisory fees; distribution fees; interest; taxes;
governmental fees; voluntary assessments and other expenses
incurred in connection with membership in investment company
organizations; organization costs of the Fund; the cost
(including brokerage commissions, transaction fees or charges, if
any) in connection with the purchase or sale of the Fund's
securities and other investments and any losses in connection
therewith; fees and expenses of custodians, transfer agents,
registrars, independent pricing vendors or other agents; legal
expenses; loan commitment fees; expenses relating to share
certificates; expenses relating to the issuing and redemption or
repurchase of the Fund's shares and servicing shareholder
accounts; expenses of registering and qualifying the Fund's
shares for sale under applicable federal and state law; expenses
of preparing, setting in print, printing and distributing
prospectuses and statements of additional information and any
supplements thereto, reports, proxy statements, notices and
dividends to the Fund's shareholders; costs of stationery;
website costs; costs of meetings of the Board or any committee
thereof, meetings of shareholders and other meetings of the Fund;
Board fees; audit fees; travel expenses of officers, members of
the Board and employees of the Fund, if any; and the Fund's pro
rata portion of premiums on any fidelity bond and other insurance
covering the Fund and its officers, Board members and employees;
litigation expenses and any non-recurring or extraordinary
expenses as may arise, including, without limitation, those
relating to actions, suits or proceedings to which the Fund is a
party and the legal obligation which the Fund may have to
indemnify the Fund's Board members and officers with respect
thereto.
7. No member of the Board, officer or employee of the
Corporation or Fund shall receive from the Corporation or Fund
any salary or other compensation as such member of the Board,
officer or employee while he is at the same time a director,
officer, or employee of the Subadviser or any affiliated company
of the Subadviser, except as the Board may decide. This paragraph
shall not apply to Board members, executive committee members,
consultants and other persons who are not regular members of the
Subadviser's or any affiliated company's staff.
8. As compensation for the services performed by the
Subadviser, including the services of any consultants retained by
the Subadviser, the Manager shall pay the Subadviser out of the
management fee it receives with respect to the Fund, and only to
the extent thereof, as promptly as possible after the last day of
each month, a fee, computed daily at an annual rate set forth on
Schedule A annexed hereto. The first payment of the fee shall be
made as promptly as possible at the end of the month succeeding
the effective date of this Agreement, and shall constitute a full
payment of the fee due the Subadviser for all services prior to
that date. If this Agreement is terminated as of any date not the
last day of a month, such fee shall be paid as promptly as
possible after such date of termination, shall be based on the
average daily net assets of the Fund or, if less, the portion
thereof comprising the Allocated Assets in that period from the
beginning of such month to such date of termination, and shall be
that proportion of such average daily net assets as the number of
business days in such period bears to the number of business days
in such month. The average daily net assets of the Fund or the
portion thereof comprising the Allocated Assets shall in all
cases be based only on business days and be computed as of the
time of the regular close of business of the New York Stock
Exchange, or such other time as may be determined by the Board.
9. The Subadviser assumes no responsibility under this
Agreement other than to render the services called for hereunder,
in good faith, and shall not be liable for any error of judgment
or mistake of law, or for any loss arising out of any investment
or for any act or omission in the execution of securities
transactions for a Fund, provided that nothing in this Agreement
shall protect the Subadviser against any liability to the Manager
or the Fund to which the Subadviser would otherwise be subject by
reason of 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 hereunder. As used in
this Section 9, the term Subadviser shall include any affiliates
of the Subadviser performing services for the Corporation or the
Fund contemplated hereby and the partners, shareholders,
directors, officers and employees of the Subadviser and such
affiliates.
10. Nothing in this Agreement shall limit or restrict the
right of any director, officer, or employee of the Subadviser who
may also be a Board member, officer, or employee of the
Corporation or the Fund, to engage in any other business or to
devote his 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 the
Subadviser to engage in any other business or to render services
of any kind, including investment advisory and management
services, to any other fund, firm, individual or association. If
the purchase or sale of securities consistent with the investment
policies of a Fund or one or more other accounts of the
Subadviser is considered at or about the same time, transactions
in such securities will be allocated among the accounts in a
manner deemed equitable by the Subadviser. Such transactions may
be combined, in accordance with applicable laws and regulations,
and consistent with the Subadviser's policies and procedures as
presented to the Board from time to time.
11. For the purposes of this Agreement, the Fund's net assets
shall be determined as provided in the Fund's then-current
Prospectus and Statement of Additional Information and the terms
assignment, interested person, and majority of the outstanding
voting securities shall have the meanings given to them by
Section 2(a) of the 1940 Act, subject to such exemptions as may
be granted by the SEC by any rule, regulation or order.
12. This Agreement will become effective with respect to the
Fund on the date set forth opposite the Fund's name on Schedule A
annexed hereto, provided that it shall have been approved by the
Corporation's Board and, if so required by the 1940 Act, by the
shareholders of the Fund in accordance with the requirements of
the 1940 Act and, unless sooner terminated as provided herein,
will continue in effect for two years from the above written
date. Thereafter, if not terminated, this Agreement shall
continue in effect with respect to the Fund, so long as such
continuance is specifically approved at least annually (i) by the
Board or (ii) by a vote of a majority of the outstanding voting
securities of the Fund, provided that in either event the
continuance is also approved by a majority of the Board members
who are not interested persons of any party to this Agreement, by
vote cast in person at a meeting called for the purpose of voting
on such approval.
13. This Agreement is terminable with respect to the Fund
without penalty by the Board or by vote of a majority of the
outstanding voting securities of the Fund, in each case on not
more than 60 days' nor less than 30 days' written notice to the
Subadviser, or by the Subadviser upon not less than 90 days'
written notice to the Fund and the Manager, and will be
terminated upon the mutual written consent of the Manager and the
Subadviser. This Agreement shall terminate automatically in the
event of its assignment by the Subadviser and shall not be
assignable by the Manager without the consent of the Subadviser.
14. The Subadviser agrees that for any claim by it against
the Fund in connection with this Agreement or the services
rendered under this Agreement, it shall look only to assets of
the Fund for satisfaction and that it shall have no claim against
the assets of any other portfolios of the Xxxxx Xxxxxx Sector
Series Inc.Corporation.
15. 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 which enforcement of the
change, waiver, discharge or termination is sought, and no
material amendment of the Agreement shall be effective until
approved, if so required by the 1940 Act, by vote of the holders
of a majority of the Fund's outstanding voting securities.
16. This Agreement, and any supplemental terms contained on
Annex I hereto, if applicable, embodies the entire agreement and
understanding between the parties hereto, and supersedes all
prior agreements and understandings relating to the subject
matter hereof. Should any part of this Agreement 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 on and shall inure to the benefit of
the parties hereto and their respective successors.
17. This Agreement shall be construed and the provisions
thereof interpreted under and in accordance with the laws of the
State of New York.
[signature page to follow]
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed by their officers thereunto duly
authorized.
XXXXX XXXXXX FUND MANAGEMENT LLC
By:_______________________________
Name: Xxxxxx Xxxxxxx
Title: Director
CITIGROUP ASSET MANAGEMENT LIMITED
By:_______________________________
Name:
Title:
The foregoing is acknowledged:
The undersigned officer of the Corporation has executed this
Agreement not individually but in his/her capacity as an officer
of the Corporation. The Corporation does not hereby undertake, on
behalf of the Fund or otherwise, any obligation to the
Subadviser.
XXXXX XXXXXX SECTOR SERIES INC.
By:_______________________________
Name: R. Xxx Xxxxxx
Title: Chairman
ANNEX I
This Annex I forms a part of the Subadvisory Agreement
dated as of December 1, 2005 by and between Xxxxx Xxxxxx
Fund Management LLC, a Delaware limited liability company,
and Citigroup Asset Management Limited (the Subadviser), an
entity authorized and regulated in the United Kingdom by the
Financial Services Authority (the FSA).
1. The Subadviser represents, warrants and covenants
that it is authorized and regulated by the FSA.
2. The Subadviser has classified the Corporation as an
Intermediate Customer as defined by the FSA Rules.
SCHEDULE A
Xxxxx Xxxxxx Technology Fund
Fee:
The following percentage of the Fund's average daily net
assets:
0.55
