Exhibit (5)(b)
THE GABELLI MONEY MARKET FUNDS
SUB-ADVISORY AGREEMENT
Agreement, made as of this 16th day of December, 1994
among Gabelli Funds, Inc, a New York corporation (the
"Manager"), Xxxxxxx-X'Xxxxxx Fixed Income Mutual Funds
Management Company (the "Sub-Adviser") and The Gabelli Money
Market Funds (the "Trust").
WHEREAS, the Manager has entered into a Management
Agreement, dated December 16, 1994 (the "Management
Agreement"), with the Trust, a Delaware business trust and a
diversified, open-end management investment company
registered under the Investment Company Act of 1940 (the
"1940 Act"), pursuant to which the Manager will act as
Manager of the Trust;
WHEREAS, the shares of beneficial interest of the
Trust are divided into one or more separate series; and
WHEREAS, the Manager desires to retain the Sub-Adviser
to provide investment advisory services to each series of
the Trust set forth in Appendix A as it may be amended from
time to time (each, a "Series") in connection with the
management of the Trust and the Sub-Adviser is willing to
render such investment advisory services;
NOW, THEREFORE, the parties agree as follows:
1. (a) Subject to the supervision of the Manager
and of the Trustees of the Trust, the Sub-Adviser shall
manage the investments of each Series of the Trust and the
composition of the portfolio of each Series, including the
purchase, retention and disposition of securities and other
investments of each Series, in accordance with the Trust's
investment objectives, policies and restrictions of each
such Series as stated in the Prospectus (such Prospectus and
Statement of Additional Information as currently in effect
and as amended or supplemented from time to time, being
herein called the "Prospectus"), and subject to the
following understandings:
(i) The Sub-Adviser shall provide management of each
Series' investments and determine from time to time what
investments and securities will be purchased, retained, sold
or loaned by each Series of the Trust, and what portion of
the assets will be invested or held uninvested as cash.
(ii) In the performance of its duties and obligations
under this Agreement, the Sub-Adviser shall act in
conformity with the Declaration of Trust, By-Laws and
Prospectus of the Trust and with the instructions and
directions of the Manager and of the Trustees of the Trust
and will conform to and comply with the requirements of the
1940 Act, the Internal Revenue Code of 1986, as amended, and
all other applicable federal and state laws and regulations.
(iii) The Sub-Adviser shall determine the securities
to be purchased or sold by each Series of the Trust and will
place orders with or through such persons, brokers or
dealers to carry out the policy with respect to brokerage as
set forth in the Trust's Registration Statement and
Prospectus or as the Trustees may direct from time to time.
In providing the Trust with investment management, it is
recognized that the Sub-Adviser will give primary
consideration to securing the most favorable price and
efficient execution. Within the framework of this policy,
the Sub-Adviser may consider the financial responsibility,
research and investment information and other services
provided by brokers or dealers who may effect or be a party
to any such transaction or other transactions to which the
Sub-Adviser's other clients may be a party. It is also
understood that it is desirable for the Trust that the
Sub-Adviser have access to supplemental investment and
market research and security and economic analysis provided
by brokers who may execute brokerage transactions at a
higher cost to the Trust than may result when allocating
brokerage to other brokers on the basis of seeking the most
favorable price and efficient execution. Therefore, the
Sub-Adviser is authorized to place orders for the purchase
and sale of securities for each Series of the Trust with
such brokers subject to review by the Trust's Trustees from
time to time with respect to the extent and continuation of
this practice. It is understood that the services provided
by such brokers may be useful to the Sub-Adviser in
connection with the Sub-Adviser's services to other clients.
On occasions when the Sub-Adviser deems the purchase
or sale of a security to be in the best interest of the
Trust as well as other clients of the Sub-Adviser, the
Sub-Adviser, to the extent permitted by applicable laws and
regulations, may, but shall be under no obligation to,
aggregate the securities to be sold or purchased in order to
obtain the most favorable price or lower brokerage
commissions and efficient execution. In such event,
allocation of the securities or futures contracts so
purchased or sold, as well as the expenses incurred in the
transaction, will be made by the Sub-Adviser in the manner
the Sub-Adviser considers to be the most equitable and
consistent with its fiduciary obligations to the Trust (and
each Series of the Trust) and to such other clients.
(iv) The Sub-Adviser shall maintain all books and
records with respect to the Trust's portfolio transactions
required by subparagraphs (b)(5), (6), (7), (9), (10) and
(11) and paragraph (f) of Rule 31a-1 under the 1940 Act and
shall render to the Trust's Trustees such periodic and
special reports as the Trustees may reasonably request.
(v) The Sub-Adviser shall provide the Trust's
Custodian on each business day with information relating to
all transactions concerning the Trust's assets and shall
provide the Manager with such information upon request of
the Manager.
(vi) The investment management services provided by
the Sub-Adviser hereunder are not to be deemed exclusive,
and the Sub-Adviser shall be free to render similar services
to others.
(vii) The Sub-Adviser shall provide the Trust's
Administrator with such information concerning the
investment management of the Trust as the Administrator
shall reasonably require.
(b) The Sub-Adviser shall authorize and permit
any of its directors, officers and employees who may be
elected as Trustees or officers of the Trust to serve in the
capacities in which they are elected. Services to be
furnished by the Sub-Adviser under this Agreement may be
furnished through the medium of any of such directors,
officers or employees.
(c) The Sub-Adviser shall keep the Trust's books and
records required to be maintained by the Sub-Adviser
pursuant to paragraph l(a) hereof and shall timely furnish
to the Manager all information relating to the Sub-Adviser's
services hereunder needed by the Manager to keep the other
books and records of the Trust required by Rule 31a-1 under
the 1940 Act. The Sub-Adviser agrees that all records which
it maintains for the Trust are the property of the Trust and
the Sub-Adviser will surrender promptly to the Trust any of
such records upon the Trust's request, provided, however,
that the Sub-Adviser may retain a copy of such records. The
Sub-Adviser further agrees to preserve for the periods
prescribed by Rule 31a-2 of the Commission under the 1940
Act any such records as are required to be maintained by it
pursuant to paragraph l(a) hereof.
2. The Manager shall continue to have
responsibility for all services to be provided to the Trust
pursuant to the Management Agreement and shall oversee and
review the Sub-Adviser's performance of its duties under
this Agreement.
3. For the services provided and the expenses
assumed pursuant to this Agreement, the Manager will pay the
Sub-Adviser as full compensation therefor a fee calculated
as a percentage of the average daily net assets of each
Series. Such fee, which will be computed daily and paid
monthly, shall be calculated at the annual percentage rate
set forth for the particular Series in Appendix B to this
Agreement.
4. The Sub-Adviser shall not be liable for any
error of judgment or for any loss suffered by the Trust or
the Manager in connection with the matters to which this
Agreement relates, except a loss resulting from willful
misfeasance, bad faith or gross negligence on the
Sub-Adviser's part in the performance of its duties or from
its reckless disregard of its obligations and duties under
this Agreement.
5. 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 with respect to each Series in conformity with the
requirements of the 1940 Act; provided, however, that this
Agreement may be terminated with respect to any Series by
the Trust at any time, without the payment of any penalty,
by the Trustees of the Trust or by vote of a majority of the
outstanding voting securities (as defined in the 0000 Xxx)
of the Trust, or by the Manager or the Sub-Adviser at any
time, without the payment of any penalty, on not more than
60 days' nor less than 30 days' written notice to the other
party. This Agreement shall terminate automatically in the
event of its assignment (as defined in the 0000 Xxx) or upon
the termination of the Management Agreement.
6. Nothing in this Agreement shall limit or
restrict the right of any of the Sub-Adviser's directors,
officers, or employees who may also be a Trustee, officer or
employee of the Trust to engage in any other business or to
devote his or her time and attention in part to the
management or other aspects of any business, whether of a
similar or a dissimilar nature, nor limit or restrict the
Sub-Adviser's right to engage in any other business or to
render services of any kind to any other corporation, firm,
individual or association.
7. During the term of this Agreement, the Manager
agrees to furnish the Sub-Adviser at its principal office
all prospectuses, proxy statements, reports to shareholders,
sales literature or other material prepared for distribution
to shareholders of the Trust or the public, which refer to
the Sub-Adviser in any way, prior to use thereof and not to
use material if the Sub-Adviser reasonably objects in
writing five business days (or such other time as may be
mutually agreed) after receipt thereof. Sales literature
may be furnished to the Sub-Adviser hereunder by first class
or overnight mail, facsimile transmission equipment or hand
delivery.
8. This Agreement may be amended by mutual consent,
but the consent of each Series of the Trust must be obtained
in conformity with the requirements of the 1940 Act.
9. This Agreement shall be governed by 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 and Year first above written.
GABELLI FUNDS, INC.
BY /s/ X. Xxxxxxxx Xxxxxxxx
XXXXXXX-X'XXXXXX FIXED INCOME
MUTUAL FUNDS MANAGEMENT
COMPANY
BY /s/ Xxxxxx X. X'Xxxxxx
THE GABELLI MONEY MARKET FUNDS
BY /s/ Xxxxx X. Xxxxxx
APPENDIX A
Series Covered by Sub-Advisory Agreement
The Gabelli U.S. Treasury Money Market Fund
December 16, 0000
XXXXXXXX X
Annual rate of Sub-Advisory fees, expressed as a
percentage of the average net asset value of the Series:
Annual Percentage
Name of Series Rate of Sub-Advisory Fee
The Gabelli U.S. Treasury 0.08%
Money Market Fund
December 16, 1994
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