EXHIBIT (b)(5)(b)
THE AAL MUTUAL FUNDS
SUB-ADVISORY AGREEMENT
AGREEMENT made this 12th day of July 1995 by and among THE AAL MUTUAL
FUNDS (the "Trust"), a Massachusetts Business Trust, AAL CAPITAL MANAGEMENT
CORPORATION (the "Adviser"), a Delaware corporation and SOCIETE GENERALE ASSET
MANAGEMENT CORP. (the "Sub-Adviser"), a Delaware corporation.
WITNESSETH:
In consideration of the mutual promises and agreements herein contained
and other good and valuable consideration, the receipt of which is hereby
acknowledged, it is hereby agreed by and among the parties hereto as follows:
1. In General
The Sub-Adviser agrees, as more fully set forth herein, to act as
Sub-Adviser to the Trust with respect to the investment and reinvestment of the
assets of the Trust's series of shares described as The AAL International Fund
(the "Fund"). It is understood that the Trust may create one or more additional
Fund series from time to time and that this Agreement may be amended by the
mutual written agreement of the parties to include such additional Fund(s) under
the terms to this Agreement.
2. Duties and Obligations of the Sub-Adviser with Respect to Investment of
Assets of The AAL International Fund
(a) Subject to the succeeding provisions of this section and subject to the
oversight and review of the Adviser and the direction and control of the Board
of Trustees of the Trust, the Sub-Adviser, as agent and attorney-in-fact with
respect to the Trust, is authorized, in its discretion and within prior
consultation with the Trust to: (i) Buy, sell, exchange, convert, lend and
otherwise trade in any stocks, bonds, and any other securities or assets; (ii)
Place orders and negotiate the commissions (if any) for the execution of
transactions in securities or other assets with or through such brokers,
dealers, underwriters or issuers as the Sub-Advisers may select; including
brokers and dealers that may be affiliate of the Sub-Adviser, and (iii) Provide
the Adviser and the Trustees with such reports as may reasonably be requested in
connection with the discharge of the foregoing responsibilities and the
discharge of the Adviser's responsibilities under the Investment Advisory
Agreement with the Trust and those of AAL Capital Management Corporation (the
"Distributor") under the Distribution Agreement with the Trust. Written
procedures with respect to (i), (ii) and (iii) above may be set forth as agreed
to among the Trust, the Adviser and Sub-Adviser.
(b) Any investment purchases or sales made by the Sub-Adviser under this
section shall at all times conform to, and be in accordance with, any
requirements imposed by: (1) the provisions of the Investment Company Act of
1940 (the "Act") and of any rules or regulations in force thereunder; (2) any
other applicable provisions of law; (3) the provisions of the Declaration of
Trust and By-Laws of the Trust as amended from time to time; (4) any policies
and determinations of the Board of Trustees of the Trust; and (5) the
fundamental policies of the Trust, as reflected in its Registration Statement
under the Act, or as amended by the shareholders of the Trust provided that
copies of the items referred to in clauses (3), (4) and (5) shall have been
furnished to the Sub-Adviser.
(c) The Sub-Adviser shall give the Trust the benefit of its best judgment
and effort in rendering services hereunder. In the absence of willful
misfeasance, bad faith, gross negligence or reckless disregard of its
obligations and duties ("disabling conduct") hereunder on the part of the
Sub-Adviser (and its officers, directors, agents, employees, controlling
persons, shareholders and any other person or entity affiliated with the
Sub-Adviser) the Sub-Adviser shall not be subject to liability to the Trust or
to any shareholder of the Trust for any act or omission in the course of, or
connected with rendering services hereunder, including without limitation, any
error of judgment or mistake of law or for any loss suffered by any of them in
connection with the matters to which this Agreement relates, except to the
extent specified in Section 36 (b) of the Act concerning loss resulting from a
breach of fiduciary duty with respect to the receipt of compensation for
services. Except for such disabling conduct, the Trust shall indemnify the
Sub-Adviser (and its officers, directors, agents, employees, controlling
persons, shareholders and any other person or entity affiliated with the
Sub-Adviser) against any liability arising from the Sub-Adviser's conduct under
this Agreement to the extent permitted by the Declaration of Trust and
applicable law.
(d) Nothing in this Agreement shall prevent the Sub-Adviser or any
"affiliated person" (as defined in the Act) of the Sub-Adviser from acting as
investment adviser or manager for any other person, firm or corporation and
shall not in any way limit or restrict the Sub-Adviser or any such affiliated
person from buying, selling or trading any securities for its or their own
accounts or for the accounts of others for whom it or they may be acting,
provided, however, that the Sub-Adviser expressly represents that it will
undertake no activities which, in its judgment will adversely affect the
performance of its obligations to the Trust under this Agreement. It is agreed
that the Sub-Adviser shall have no responsibility or liability for the accuracy
or completeness of the Trust's Registration Statement under the Act and the
Securities Act of 1933 except for information supplied by the Sub-Adviser for
inclusion therein. The Sub-Adviser provided or authorized, have no authority to
act or represent the Trust in any way or otherwise be deemed an agent of the
Trust.
(e) In connection with its duties to arrange for the purchase and sale of
the Fund's portfolio securities and other assets, the Sub-Adviser shall follow
the principles set forth in any investment advisory agreement in effect from
time to time between the Trust and the Adviser, provided that a copy of any such
agreement shall have been provided to the Sub-Adviser. The Sub-Adviser will
promptly communicate to the Adviser and to the officers and the Trustees of the
Trust such information relating to portfolio transactions as they may reasonably
request.
(f) The Sub-Adviser shall be responsible for 13F reporting for the
securities held by The AAL International Fund.
3. Allocation of Expenses
The Sub-Adviser agrees that it will furnish the Trust, at the Sub-Adviser's
expense, with all office space, facilities, equipment, and clerical personnel
necessary for carrying out its duties under this Agreement. The Sub-Adviser will
pay all compensation of those of the Trust's officers and employees, if any, and
of those Trustees, if any, who is each case are affiliated persons of the
Sub-Adviser.
4. Certain Records
Any records required to be maintained and preserved pursuant to the
provisions of Rule 31a-1 and Rule 31a-2 under the Act which are prepared or
maintained by the Sub-Adviser on behalf of the Trust are the property of the
Trust and will be surrendered promptly tot he Trust or Adviser on request.
5. Reference to the Sub-Adviser
Neither the Trust, the Adviser or any affiliate or agent thereof shall make
reference to or use the name of the Sub-Adviser or any of its affiliates in any
advertising or promotional materials without the prior approval of the
Sub-Adviser, which approval shall not be unreasonably withheld.
6. Compensation of the Sub-Adviser
The Adviser agrees to pay the Sub-Adviser and the Sub-Adviser agrees to
accept as full compensation for all services rendered by the Sub-Adviser as
such, a management fee, payable quarterly in arrears and computed on the average
daily net asset value of The AAL International Fund at rates shown on Exhibit A
attached hereto.
7. Duration and Termination
(a) This Agreement shall go into effect for The AAL International Fund on
August 1, 1995, and shall, unless terminated as hereinafter provided, continue
in effect thereafter from year to year, but only so long as such continuance is
specifically approved at least annually by a majority of the Trust's Board of
Trustees, or by the vote of the holders of a "majority" (as defined in the Act)
of the outstanding voting securities of the Fund, and, in either case, a
majority of the Trustees who are not parties to this Agreement or "interested
persons" (as defined in the Act) of any such party cast in person at a meeting
called for the purpose of voting on such approval.
(b) This Agreement may be terminated by the Sub-Adviser at any time without
penalty upon giving the Trust and the Adviser sixty (60) days' written notice
(which notice may be waived by the Trust and Adviser) and may be terminated by
the Trust or the Adviser at any time without penalty upon giving the Sub-Adviser
sixty (60) days' written notice (which notice may be waived by the Sub-Adviser),
provided that such termination by the Trust shall be directed or approved by the
vote of a majority of all of the Trustees in office at the time or by the vote
of the holders of a majority (as defined in the Act) of the voting securities of
the Trust, or with respect to any Fund by the vote of a majority of the
outstanding shares of such Fund. This Agreement shall automatically terminate in
the event of its "assignment" (as defined in the Act). This Agreement will also
terminate in the event that the Investment Advisory Agreement is terminated.
8. Agreement Binding Only On Trust Property
The Sub-Adviser understands that the obligations of this Agreement are
not binding upon any shareholder of the Trust personally, but bind only the
Trust's property; the Sub-Adviser represents that it has notice of the
provisions of the Trust's Declaration of Trust disclaiming shareholder liability
for acts or obligations of the Trust.
9. Action By Individual Fund
The provisions of this Agreement and any amendments hereto with respect to
a Fund may be approved by the shareholders of that Fund and become effective
with respect to the assets of that Fund without the necessity of approval
thereof by shareholders of any other Fund. The Adviser represents that the
holders of a majority (as defined in the "Act") of the Fund, will approve the
entry into this Agreement on behalf of the Fund.
10. Notices
(a) The Sub-Adviser agrees to promptly notify the Adviser of the occurrence
of any of the following events:
(1) any change in any of the Sub-Adviser's office or portfolio
managers;
(2) the Sub-Advisers fails to be registered as an investment adviser
under the Advisers Act or under the laws of any jurisdiction in
which the Sub-Adviser is required to be registered as an
investment adviser in order to perform its obligations under this
Agreement;
(3) the Sub-Adviser is the subject of any action, suit, proceeding,
inquiry or investigation at law or in equity before any court,
public board or body, involving the affairs of the Fund; or
(4) any change in ownership or control of the Sub-Adviser.
(b) Any notice given hereunder shall be in writing and may be served by
being sent by telex, facsimile or other electronic transmission, or sent by
registered mail or by courier to the address set forth below for the party for
which it is intended. A notice served by mail shall be deemed served seven days
after mailing and in the case of telex, facsimile or other electronic
transmission, twelve hours after dispatch thereof. Addresses for notice may be
changed by written notice to the other party.
The Adviser
Xxxxxx X. Same, Sr. Vice President
AAL CAPITAL MANAGEMENT CORPORATION
000 Xxxx Xxxxxxx Xxxxxx
Xxxxxxxx, XX 00000
The Sub-Adviser
Xxxx-Xxxxx Xxxxxxxxx, President
SOCIETE GENERALE ASSET MANAGEMENT CORP.
0000 Xxxxxx xx xxx Xxxxxxxx, Xxxxxx Xxxxx
Xxx Xxxx, XX 00000
Fax (000) 000-0000
IN WITNESS WHEREOF, the parties hereto have caused the foregoing
instrument to be executed by their duly authorized officers and their seals to
be hereunto affixed, all as of the day and year first above written.
ATTEST: THE AAL MUTUAL FUNDS
/s/ Xxxxxx X. Same /s/ Xxxx X. Xxxxxx
----------------------------- -------------------------------
Xxxxxx X. Same, Secretary Xxxx X. Xxxxxx, President
ATTEST: AAL CAPITAL MANAGEMENT
CORPORATION
/s/ Xxxxxx X. Same /s/ H. Xxxxxxx Xxxxxx
----------------------------- -------------------------------
Xxxxxx X. Same, Secretary H. Xxxxxxx Xxxxxx, President
ATTEST: SOCIETE GENERALE ASSET
MANAGEMENT CORP
/s/ Xxxxxx X. Xxxxxxx /s/ Xxxx-Xxxxx Xxxxxxxxx
----------------------------- -------------------------------
Xxxxxx X. Xxxxxxx, Secretary Xxxx-Xxxxx Xxxxxxxxx, President
EXHIBIT A
TO
THE AAL MUTUAL FUNDS SUB-ADVISORY AGREEMENT
(Dated August 1, 1995)
1. The AAL International Fund (effective August 1, 1995)
The management fee for this Fund payable to the Sub-Adviser by the Adviser,
calculated in accordance with paragraph 6 of The AAL Mutual Funds Sub-Advisory
Agreement, shall be at the annual rate of:
.75 of 1% of the Fund's average daily net assets
Amendment No. 1
to
THE AAL MUTUAL FUNDS SUB-ADVISORY AGREEMENT
(Dated July 12, 1995)
The Sub-Advisory Agreement between The AAL Mutual Funds, AAL Capital
Management Corporation (the "Adviser") and Societe Generale Asset Management
Corp. (the "Sub-Adviser"), effective August 1, 1995, is hereby amended,
effective December 1, 1997, as follows:
1. Schedule A attached to the Sub-Advisory Agreement (effective August 1,
1995) is modified to revise the fee schedule for The International
Fund. An amended Schedule A, effective December 1, 1997, is attached
hereto.
IN WITNESS WHEREOF the parties hereto have caused this Amendment to be signed by
the respective officers effective as of December 1, 1997.
ATTEST: THE AAL MUTUAL FUNDS
/s/ Xxxxxx X. Same /s/Xxxxxx X. Xxxxxxxx
----------------------------- -------------------------------
Xxxxxx X. Same, Secretary Xxxxxx X. Xxxxxxxx, President
ATTEST: AAL CAPITAL MANAGEMENT
CORPORATION
/s/ Xxxxxx X. Same /s/Xxxxxx X. Xxxxxxxx
----------------------------- -------------------------------
Xxxxxx X. Same, Secretary Xxxxxx X. Xxxxxxxx, President
ATTEST: SOCIETE GENERALE ASSET
MANAGEMENT CORP
/s/ Xxxxxx X. Xxxxxxx /s/ Xxxx-Xxxxx Xxxxxxxxx
----------------------------- -------------------------------
Xxxxxx X. Xxxxxxx, Secretary Xxxx-Xxxxx Xxxxxxxxx, President
EXHIBIT A
AMENDMENT NO. 1
TO
THE AAL MUTUAL FUNDS SUB-ADVISORY AGREEMENT
(Dated December 1, 1997)
1. The AAL International Fund (effective December 1, 1997)
The management fee for this Fund payable to the Sub-Adviser by the
Adviser, calculated in accordance with paragraph 6 of The AAL Mutual Funds
Sub-Advisory Agreement, shall be at the annual rate of :
.55 of 1% of the Fund's average daily net assets.
