SUBADVISORY AGREEMENT
This SUBADVISORY AGREEMENT ("Agreement") is made this 2nd day of
September, 2008, by and between Western Asset Management Company, a
corporation organized under the laws of California (the "Subadviser")
and Western Asset Management Company Pte. Ltd., a corporation
organized under the laws of Singapore ("Western Singapore").
WHEREAS, the Subadviser has been retained by Xxxx Xxxxx Partners
Fund Advisor, LLC to provide investment advisory, management, and
administrative services to Xxxx Xxxxx Partners Income Trust (the
"Trust"), a Maryland business trust registered as a management
investment company under the Investment Company Act of 1940, as
amended (the "1940 Act") to provide investment advisory, management,
and administrative services to the Trust with respect to the series of
the Trust designated in Schedule A annexed hereto (the "Fund"); and
WHEREAS, the Subadviser wishes to engage Western Singapore to
provide certain investment advisory services to the Fund, and Western
Singapore 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 Subadvisory Agreement
between the Subadviser and Xxxx Xxxxx Partners Fund Advisor, LLC with
respect to the Fund (the "Subadvisory Agreement"), the Subadviser
hereby appoints Western Singapore to act as a subadviser with respect
to the Fund for the period and on the terms set forth in this
Agreement. Western Singapore accepts such appointment and agrees to
render the services herein set forth, for the compensation herein
provided.
2. The Subadviser shall cause Western Singapore 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. The Subadviser
shall furnish Western Singapore with such other documents and
information with regard to the Fund's affairs as Western Singapore may
from time to time reasonably request.
3. (a) Subject to the supervision of the Trust's Board of
Trustees (the "Board"), Xxxx Xxxxx Partners Fund Advisor, LLC and the
Subadviser, Western Singapore shall regularly provide the Fund with
respect to such portion of the Fund's assets as shall be allocated to
Western Singapore by the Subadviser 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. Western Singapore shall, with respect to
the Allocated Assets, determine from time to time what securities and
other investments will be purchased (including, as permitted in
accordance with this paragraph, swap agreements, options and futures),
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 (including the execution of investment documentation), all
subject to the provisions of the Trust's Declaration of Trust 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 Western Singapore.
Western Singapore is authorized as the agent of the Trust 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 the Fund in one or more investment companies. Western
Singapore 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, as amended (the "Exchange Act")) to
the Fund and/or the other accounts over which Western Singapore or its
affiliates exercise investment discretion. Western Singapore is
authorized to pay a broker or dealer who provides such brokerage and
research services a commission for executing a portfolio transaction
for the Fund which is in excess of the amount of commission another
broker or dealer would have charged for effecting that transaction if
Western Singapore 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 Western Singapore
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 Western Singapore's authority
regarding the execution of the Fund's portfolio transactions provided
herein. Western Singapore 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. Western Singapore may
execute on behalf of the Fund certain agreements, instruments and
documents in connection with the services performed by it under this
Agreement. These may include, without limitation, brokerage
agreements, clearing agreements, account documentation, futures and
options agreements, swap agreements, other investment related
agreements, and any other agreements, documents or instruments Western
Singapore believes are appropriate or desirable in performing its
duties under this Agreement.
(b) The Fund hereby authorizes any entity or person
associated with Western Singapore 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
Exchange Act 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, Western Singapore 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 the Fund, nor will it purchase any
securities from an underwriting or selling group in which Western
Singapore or its affiliates is participating, or arrange for purchases
and sales of securities between the Fund and another account advised
by Western Singapore 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 the 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 Western Singapore and its directors and officers.
4. Western Singapore may delegate to any other one or more
companies that Western Singapore controls, is controlled by, or is
under common control with, or to specified employees of any such
companies, certain of Western Singapore's duties under this Agreement,
provided in each case Western Singapore will supervise the activities
of each such entity or employees thereof, that such delegation will
not relieve Western Singapore 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. Western Singapore 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 0000 Xxx,
Xxxxxxx Xxxxxxxxx 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.
Western Singapore 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) Western Singapore, at its expense, shall supply the
Board, the officers of the Trust, Xxxx Xxxxx Partners Fund Advisor,
LLC and the Subadviser with all information and reports reasonably
required by them and reasonably available to Western Singapore
relating to the services provided by Western Singapore hereunder.
(b) Western Singapore 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, Western Singapore 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 Trust or
Fund shall receive from the Trust 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 Western
Singapore or any affiliated company of Western Singapore, 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 Western Singapore's or any affiliated company's
staff.
8. As compensation for the services performed by Western
Singapore, including the services of any consultants retained by
Western Singapore, the Subadviser shall pay Western Singapore out of
the subadvisory 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
Western Singapore 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. Western Singapore 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
the Fund, provided that nothing in this Agreement shall protect
Western Singapore against any liability to the Subadviser, Xxxx Xxxxx
Partners Fund Advisor, LLC or the Fund to which Western Singapore
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 "Western Singapore"
shall include any affiliates of Western Singapore performing services
for the Trust or the Fund contemplated hereby and the partners,
shareholders, directors, officers and employees of Western Singapore
and such affiliates.
10. Nothing in this Agreement shall limit or restrict the right
of any director, officer, or employee of Western Singapore who may
also be a Board member, officer, or employee of the Trust 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 Western Singapore 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 the Fund or one or more other accounts of
Western Singapore is considered at or about the same time,
transactions in such securities will be allocated among the accounts
in a manner deemed equitable by Western Singapore. Such transactions
may be combined, in accordance with applicable laws and regulations,
and consistent with Western Singapore'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
Trust'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
until the second anniversary of the date of effectiveness..
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 Western
Singapore, or by Western Singapore upon not less than 90 days' written
notice to the Fund and the Subadviser, and will be terminated upon the
mutual written consent of the Subadviser and Western Singapore. This
Agreement shall terminate automatically in the event of its assignment
by Western Singapore and shall not be assignable by the Subadviser
without the consent of Western Singapore.
14. Western Singapore agrees that for any claim by it against
the Fund in connection with this Agreement or the services rendered
under the 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 Trust.
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.
WESTERN ASSET MANAGEMENT COMPANY
By: /s/W. Xxxxxxx Xxxxxxx, Xx. _
______________________________
Name: W. Xxxxxxx Xxxxxxx, Xx.
Title: Manager, US Legal and
Corporate Affairs
WESTERN ASSET MANAGEMENT COMPANY PTE.
LTD.
By: /s/ Xxxxxx X.
Giddings_______________________________
Name: Xxxxxx X. Giddings__
Title: Manager, International Legal
and Compliance
The foregoing is acknowledged:
The undersigned officer of the Trust has executed this Agreement
not individually but in his/her capacity as an officer of the Trust.
The Trust does not hereby undertake, on behalf of the Fund or
otherwise, any obligation to Western Asset Management Company Pte.
Ltd..
XXXX XXXXX PARTNERS INCOME TRUST
By: /s/ R. Jay
Gerken_______________________________
Name: R. Xxx Xxxxxx
Title: Chairman, President and Chief
Executive Officer
Xxxx Xxxxx Partners Global Income Fund Signature Page
SCHEDULE A
Xxxx Xxxxx Partners Global Income Fund Date: September 2, 2008
Fee:
The sub-advisory fee will be the following percentage of the Fund's
Allocated Assets: 0.30%
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