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UBS PRIVATE INVESTOR FUNDS, INC.
on behalf of
UBS TAX EXEMPT BOND FUND
INVESTMENT ADVISORY AGREEMENT
Agreement, made this day of 1996, between
UBS Private Investor Funds, Inc., a Maryland corporation (the "Company"),
on behalf of its series known as UBS Tax Exempt Bond Fund (the "Fund"), and
Union Bank of Switzerland, New York Branch (the "Adviser").
WHEREAS, the Company is an open-end management investment
company registered under the Investment Company Act of 1940 (the "1940
Act"); and
WHEREAS, the Fund, a diversified mutual fund, desires to retain
the Adviser to render investment advisory and certain related
administrative services, and the Adviser is willing to render such
services;
NOW, THEREFORE, this Agreement
W I T N E S S E T H:
that in consideration of the premises and mutual promises hereinafter set
forth, the parties hereto agree as follows:
1. The Fund hereby appoints the Adviser to act as investment
adviser to the Fund for the period and on the terms set forth in this
Agreement. The Adviser accepts such appointment and agrees to render the
services herein set forth, for the compensation herein provided.
2. Subject to the general supervision of the Directors of
the Company, the Adviser shall manage the investment operations of the Fund
and the composition of the Fund's holdings of securities and other
investments, including commodities and commodities contracts, cash, the
purchase, retention and disposition thereof and agreements relating
thereto, in accordance with the Fund's investment objective and policies as
stated in the Registration Statement (as defined in paragraph 3(d) of this
Agreement) and subject to the following understandings:
(a) the Adviser shall furnish a continuous investment
program for the Fund and determine from time to time the securities,
commodities, commodity contracts and other investments to be
purchased,
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retained, sold or lent by the Fund, and the portion of the assets to be
invested or held uninvested as cash;
(b) the Adviser shall use the same skill and care in
the management of the Fund's investments as it uses in the
administration of other accounts for which it has investment
responsibility as agent;
(c) the Adviser, in the performance of its duties and
obligations under this Agreement, shall act in conformity with the
Charter, Bylaws and Registration Statement of the Company and with
the instructions and directions of the Directors of the Company and
will conform to and comply with the requirements of the 1940 Act and
all other applicable federal and state laws and regulations;
(d) the Adviser shall determine the securities to be
purchased, sold or lent by the Fund and as agent for the Fund will
effect portfolio transactions pursuant to its determinations either
directly with the issuer or with any broker and/or dealer in such
securities, commodities or commodities contracts; in placing orders,
the Adviser will select the brokers and/or dealers as it shall deem
appropriate in conformity with the policy with respect to brokerage
as set forth in the Registration Statement; and the Adviser shall
also determine whether or not the Fund shall enter into repurchase or
reverse repurchase agreements;
On occasions when the Adviser deems the purchase or sale
of a security, commodity or commodity contract to be in the best
interest of the Fund as well as other customers of the Adviser and to
the extent permitted by applicable law, the Adviser may, but shall
not be obligated to, aggregate the securities to be so sold or
purchased in order to obtain best execution, including lower
brokerage commissions, if applicable. In such event, allocation of
the securities so purchased or sold, as well as the expenses incurred
in the transaction, will be made by the Adviser in the manner it
considers to be the most equitable and consistent with its fiduciary
obligations to the Fund;
The Adviser may execute the Fund's brokerage (but not
principal) transactions through an affiliate, provided that such
transactions are effected in accordance with Rule 17e-1 under the
1940 Act and the Company's procedures adopted thereunder as such may
be amended from time to time;
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(e) the Adviser shall maintain records with respect to
the Fund's securities transactions as required by Section 31 of the
1940 Act and the rules and regulations thereunder, to the extent such
records are necessary or appropriate to record the Adviser's
transactions with respect to the Fund;
(f) the Adviser shall establish performance standards
for the Fund's third-party service providers and oversee and evaluate
the performance of such entities, provide and present quarterly
management reports to the Directors and supervise the preparation of
reports for Fund shareholders; establish voluntary expense
limitations for the Fund (if any) and provide any resultant expense
reimbursement to the Fund; and provide such other related services as
the Company may reasonably request, to the extent permitted by
applicable law. The Adviser shall provide all personnel and
facilities necessary in order for it to provide the services
contemplated by this paragraph. The Adviser assumes no liabilities or
responsibilities for the performance of the third-party service
providers it is overseeing or any other responsibilities under this
Agreement other than to render the services called for hereunder, on
the terms and conditions provided herein; and
(g) the investment management services of the Adviser
to the Fund under this Agreement are not to be deemed exclusive, and
the Adviser shall be free to render similar services to others.
3. The Fund has delivered copies of each of the following
documents to the Adviser and will promptly notify and deliver to it all
future amendments and supplements, if any:
(a) Articles of Incorporation of the Company (such
Articles of Incorporation, as presently in effect and as amended from
time to time, are herein called the "Charter");
(b) Bylaws of the Company (such Bylaws, as presently in
effect and as amended from time to time, are herein called the
"Bylaws");
(c) Certified resolutions of the Directors of the
Company authorizing the appointment of the Adviser and approving the
form of this Agreement;
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(d) The Company's Notification of Registration on
Form N-8A under the 1940 Act and its Registration Statement on
Form N-1A (No. 811-____) under the Securities Act of 1933 and the
1940 Act (the "Registration Statement"), each as filed with the
Commission on November 17, 1995, and all amendments and supplements
thereto.
4. The Adviser agrees that all records that it maintains for
the Fund pursuant to paragraphs 2(e) and 2(f) of this Agreement are the
property of the Fund and it will promptly surrender copies of any of such
records to the Fund upon the Fund's request.
5. During the term of this Agreement the Adviser will pay
all expenses incurred by it in connection with its activities under this
Agreement, other than the cost of securities and investments purchased or
sold for the Fund (including taxes and brokerage commissions, if any).
6. For the services provided and the expenses borne pursuant
to this Agreement, the Fund will pay to the Adviser as full compensation
therefor a fee at an annual rate equal to .45% of the Fund's average daily
net assets. This fee will be computed daily and payable monthly.
7. The Company shall not use the name of the Adviser or any
of its affiliates in any prospectus, statement of additional information,
sales literature or other material relating to the Fund in a manner not
approved by the Adviser prior thereto in writing; provided, however, that
the approval of the Adviser shall not be required for any use of its or any
affiliate's name that merely refers in accurate and factual terms to the
Adviser's appointment hereunder or as shareholder servicing agent to the
Company or that is required by the Securities and Exchange Commission or
any state securities authority or any other appropriate regulatory,
governmental or judicial authority; provided, further, that in no event
shall such approval be unreasonably withheld or delayed.
8. The Adviser shall not be liable for any error of judgment
or mistake of law or for any loss suffered by the Fund in connection with
the matters to which this Agreement relates, except a loss resulting from a
breach of fiduciary duty with respect to the receipt of compensation for
services (in which case any award of damages shall be limited to the period
and the amount set forth in Section 36(b)(3) of the 0000 Xxx) or a loss
resulting from willful misfeasance, bad faith or gross negligence on its
part in the performance of its duties or from reckless
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disregard by it of its obligations and duties under this Agreement.
9. This Agreement shall continue in effect for a period of
more than two years from the date hereof only so long as such continuance
is specifically approved at least annually in conformity with the
requirements of the 1940 Act; provided, however, that this Agreement may be
terminated by the Company on behalf of the Fund at any time, without the
payment of any penalty, by vote of a majority of all the Directors of the
Company or by "vote of a majority of the outstanding voting securities" of
the Fund (as defined in the 1940 Act and a rule thereunder) on 60 days'
written notice to the Adviser, or by the Adviser at any time, without the
payment of any penalty, on 60 days' written notice to the Company. This
Agreement will automatically and immediately terminate in the event of its
"assignment" (as defined in the 1940 Act).
10. The Adviser shall for all purposes herein be deemed to be
an independent contractor and shall, unless otherwise expressly provided
herein or authorized by the Directors of the Company from time to time,
have no authority to act for or represent the Fund in any way or otherwise
be deemed an agent of the Fund.
11. Notices of any kind to be given to the Adviser by the
Company shall be in writing and shall be duly given if mailed or delivered
to the Adviser at 000 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention:
General Counsel, with a copy to Xxxxxxx X. Xxxxxxxx, or at such other
address or to such other individual as shall be specified by the Adviser to
the Company. Notices of any kind to be given to the Company by the Adviser
shall be in writing and shall be duly given if mailed or delivered to the
Company c/o Signature Financial Group Inc., 0 Xx. Xxxxx Xxxxxx, Xxxxxx,
Xxxxxxxxxxxxx 00000 or at such other address or to such other individual as
shall be specified by the Company to the Adviser.
12. This Agreement may be executed in one or more
counterparts, each of which shall be deemed to be an original.
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13. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York.
IN WITNESS WHEREOF, the parties hereto have caused this
instrument to be executed by their officers designated below as of the
day of 1996.
UBS PRIVATE INVESTOR FUNDS,
INC.
on behalf of
UBS TAX EXEMPT BOND FUND
By: __________________________
UNION BANK OF SWITZERLAND,
NEW YORK BRANCH
By: __________________________
By: __________________________
