ASSIGNMENT AND ASSUMPTION OF CONTRACT
THIS ASSIGNMENT AND ASSUMPTION OF CONTRACT, dated as of the 1st day of
August 2003, between Citi Fund Management Inc., a Delaware corporation
("Assignor") and Citigroup Asset Management Ltd., a private Limited Company
incorporated in England and Wales ("Assignee").
WHEREAS Assignor is party to subadvisory agreements, each dated
February 14, 2000, by and among Xxxxx Xxxxxx Sector Series Inc. on behalf of
Xxxxx Xxxxxx Financial Services Fund, Xxxxx Xxxxxx Health Sciences Fund and
Xxxxx Xxxxxx Technology Fund, Xxxxx Xxxxxx Fund Management LLC and the Assignor
(each an "Agreement", collectively the "Agreements") and wishes to assign such
Agreements to the Assignee.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged and confirmed, the parties hereto
agree as follows:
1. Assignment. Assignor does hereby assign to Assignee all rights,
interests and benefits of the Assignor under the Agreement.
2. Assumption. Assignee hereby accepts the foregoing assignment of each
such Agreement and assumes and undertakes to discharge, perform and be liable
for such obligations of Assignor under the Agreement for the period beginning on
the date hereof.
3. Consents. If the parties the Agreement execute the acknowledgment on
the signature page hereto, such acknowledgment shall release Assignor from any
and all obligations under the Agreement for the period beginning on the date
hereof.
4. Miscellaneous. This Assignment and Assumption may be executed in
separate counterparts, each of which shall be deemed an original and all of
which taken together constitute one and the same instrument.
1
IN WITNESS WHEREOF, the parties hereto have duly executed this
Assignment and Assumption as of the date first written above.
CITIGROUP ASSET CITI FUND
MANAGEMENT LIMITED MANAGEMENT INC.
By:/s/ By:/s/
--------------------------------- ---------------------------------
Name: Name:
Title: Title:
Acknowledged and Agreed
as of the date hereof:
XXXXX XXXXXX SECTOR SERIES INC., on behalf of
Xxxxx Xxxxxx Financial Services Fund,
Xxxxx Xxxxxx Health Science Fund and
Xxxxx Xxxxxx Technology Fund
By: /s/
--------------------------------
Name:
Title:
XXXXX XXXXXX FUND MANAGEMENT LLC
By: /s/
--------------------------------
Name:
Title:
2
SUBADVISORY AGREEMENT
Xxxxx Xxxxxx Sector Series Inc.
Xxxxx Xxxxxx Financial Services Fund
February 14, 2000
Citibank, N.A.
Dear Sirs:
Xxxxx Xxxxxx Sector Series Inc. (the "Company"), a corporation organized under
the laws of the State of Maryland on behalf of the Xxxxx Xxxxxx Financial
Services Fund (the "Fund") and SSB Citi Fund Management LLC (the "Manager"),
each confirms its agreement with Citibank, N.A. (the "Sub-Adviser"), as follows:
1. Investment Description; Appointment
The Company desires to employ its capital relating to the Fund by investing and
reinvesting in investments of the kind and in accordance with the investment
objective(s), policies and limitations specified in the prospectus (the
"Prospectus") and the statement of additional information (the "Statement")
filed with the Securities and Exchange Commission as part of the Company's
Registration Statement on Form N-1A, as amended or supplemented from time to
time, and in the manner and to the extent as may from time to time be approved
by the Board of Directors of the Company (the "Board"). Copies of the
Prospectus, the Statement, the Company's Bylaws (the "Bylaws") and any policies
or procedures adopted by the Board and in effect from time-to-time related to
the Company and the Sub-Adviser (the "Procedures") have been or will be
submitted to the Sub-Adviser. The Company agrees promptly to provide copies of
all amendments and supplements to the current Prospectus, the Statement, the
Bylaws and Procedures to the Sub-Adviser on an on-going basis. Until the Company
delivers any such amendment or supplement to the Sub-Adviser, the Sub-Adviser
shall be fully protected in relying on the Prospectus, Statement, Bylaws and
Procedures as previously furnished to the Sub-Adviser. The Company employs the
Manager as the manager to the Portfolio pursuant to the Management Agreement
dated February 14, 2000 (the "Management Agreement"), and the Company and the
Manager desire to employ and hereby appoint the Sub-Adviser to act as the
sub-investment adviser to the Fund. The Sub-Adviser accepts the appointment and
agrees to furnish the services for the compensation set forth below.
3
2. Services as Sub-Adviser
Subject to the supervision, direction and approval of the Board of the Company
and the Manager, the Sub-Adviser shall conduct a continual program of
investment, evaluation and, if appropriate in the view of the Sub-Adviser, sale
and reinvestment of the Fund's assets. The Sub-Adviser is authorized, in its
sole discretion and without prior consultation with the Manager, to: (a) manage
the Fund's assets in accordance with the Fund's investment objective(s) and
policies as stated in the Prospectus and the Statement; (b) make investment
decisions for the Fund; (c) place purchase and sale orders for portfolio
transactions on behalf of the Fund; and (d) employ professional portfolio
managers and securities analysts who provide research services to the Fund.
In addition, (i) the Sub-Adviser shall furnish the Manager daily information
concerning portfolio transactions and quarterly and annual reports concerning
transactions and performance of the Fund in such form as may be mutually agreed
upon, and the Sub-Adviser agrees to review the Fund and discuss the management
of it with the Manager and the Board of Directors of the Company.
(ii) Unless the Manager gives the Sub-Adviser written instructions to the
contrary, the Sub-Adviser shall use its good faith judgment in a manner which it
reasonably believes best serves the interests of the Fund's shareholders to vote
or abstain from voting all proxies solicited by or with respect to the issuers
of securities in which assets of the Fund may be invested.
(iii) The Sub-Adviser shall maintain and preserve such records related to the
Fund's transactions as shall be required under the Investment Company Act of
1940, as amended (the "1940 Act"). The Manager shall maintain and preserve all
books and other records not related to the Fund's transactions as required under
the 1940 Act and shall timely furnish to Sub-Adviser all information and copies
of books and records reasonably requested by Sub-Adviser to comply with any
request made in connection with a regulatory inspection. The Sub-Adviser shall
timely furnish to the Manager all information relating to the Sub-Adviser's
services hereunder reasonably requested by the Manager to keep and preserve the
books and records of the Fund. The Sub-Adviser agrees that all records which it
maintains for the Fund are the property of the Company and the Sub-Adviser will
surrender promptly to the Company copies of any of such records.
(iv) The Sub-Adviser shall maintain compliance procedures for the Fund that it
reasonably believes are adequate to ensure the Fund's compliance with (A) the
1940 Act and the rules and regulations promulgated thereunder and (B) the Fund's
investment objective(s) and policies as stated in the Prospectus and Statement.
(v) The Sub-Adviser has adopted a written code of ethics that it reasonably
believes complies with the requirements of Rule 17j-1 under the 1940 Act, which
it will provide to the Company. The Sub-Adviser has written policies and
procedures reasonably designed
4
to prevent the misuse of material, nonpublic information by the Sub-Adviser or
any person associated with the Sub-Adviser.
3. Brokerage
In selecting brokers or dealers (including, if permitted by applicable law,
Xxxxxxx Xxxxx Xxxxxx Inc. or any other broker or dealer affiliated with the
Manager or the Sub-Adviser) to execute transactions on behalf of the Fund, the
Sub-Adviser will seek the best overall terms available. In assessing the best
overall terms available for any transaction, the Sub-Adviser will consider
factors it deems relevant, including, but not limited to, the breadth of the
market in the security, the price of the security, the financial condition and
execution capability of the broker or dealer and the reasonableness of the
commission, if any, for the specific transaction and on a continuing basis. In
selecting brokers or dealers to execute a particular transaction, and in
evaluating the best overall terms available, the Sub-Adviser is authorized to
consider the brokerage and research services (as those terms are defined in
Section 28(e) of the Securities Exchange Act of 1934, as amended) provided to
the Fund and/or other accounts over which the Sub-Adviser or its affiliates
exercise investment discretion. Nothing in this paragraph shall be deemed to
prohibit the Sub-Adviser from paying an amount of commission for effecting a
securities transaction in excess of the amount of commission another member of
an exchange, broker, or dealer would have charged for effecting that
transaction, if the Sub-Adviser determined in good faith that such amount of
commission was reasonable in relation to the value of the brokerage and research
services provided by such member, broker, or dealer, viewed in terms of either
that particular transaction or its overall responsibilities with respect to the
Fund and/or other accounts over which the Sub-Adviser or its affiliates exercise
investment discretion. In making purchases or sales of securities or other
property for the account of the Fund, the Sub-Adviser may deal with itself or
its affiliates, or with the Fund's underwriter or distributor, to the extent
such actions are permitted by the 1940 Act.
4. Information Provided to the Company and the Manager
The Sub-Adviser shall keep the Company and the Manager informed of developments
materially affecting the Fund's holdings, and shall, on its own initiative,
furnish the Company and the Manager from time to time with whatever information
the Sub-Adviser believes is appropriate for this purpose.
5. Compensation
(i) In consideration of the services rendered pursuant to this Agreement, the
Manager will pay the Sub-Adviser an annual fee calculated at the rate of 0.50%
of the Fund's average daily net assets; the fee is calculated daily and paid
monthly. The Sub-Adviser shall have no right to obtain compensation directly
from the Company for services provided hereunder and agrees to look solely to
the Manager for payment of fees due. The fee for the period from the Effective
Date (defined below) of the Agreement to the end of the month during which the
Effective Date occurs shall be prorated according to the
5
proportion that such period bears to the full monthly period. Upon any
termination of this Agreement before the end of a month, the fee for such part
of that month shall be prorated according to the proportion that such period
bears to the full monthly period and shall be payable upon the date of
termination of this Agreement. For the purpose of determining fees payable to
the Sub-Adviser, the value of the Fund's net assets shall be computed at the
times and in the manner specified in the Prospectus and/or the Statement.
(ii) The Sub-Adviser agrees that, to the extent that the fee that is payable to
the Manager by the Fund is reduced by action of the Board, the fee payable to
the Sub-Adviser shall be reduced pro rata. Additionally, to the extent that any
part of the fee that is payable to the Manager is waived by the Manager, the
Sub-Adviser agrees to waive its fees proportionately. The Manager agrees to
consult with the Sub-Adviser prior to making a decision as to whether to waive
its fees.
6. Expenses
The Sub-Adviser shall bear all expenses (excluding brokerage costs, custodian
fees, auditors fees or other expenses to be borne by the Fund or the Company) in
connection with the performance of its services under this Agreement. The Fund
will bear certain other expenses to be incurred in its operation, including, but
not limited to, investment advisory fees, sub-advisory fees (other than
sub-advisory fees paid pursuant to this Agreement) and administration fees; fees
for necessary professional and brokerage services; costs relating to local
administration of securities; fees for any pricing services; the costs of
regulatory compliance; and pro rata costs associated with maintaining the
Company's legal existence and shareholder relations. All other expenses not
specifically assumed by the Sub-Adviser hereunder or by the Manager under the
Management Agreement are borne by the Fund or the Company.
7. Standard of Care
The Sub-Adviser shall exercise its best judgment and shall act in good faith in
rendering the services listed in paragraphs 2 and 3 above. The Sub-Adviser shall
not be liable for any error of judgment or mistake of law or for any loss
suffered by the Fund or the Manager in connection with the matters to which this
Agreement relates as well as in connection with the performance of its
obligations under this Agreement, provided that nothing in this Agreement shall
be deemed to protect or purport to protect the Sub-Adviser against any liability
to the Manager, the Company or to the shareholders of the Fund to which the
Sub-Adviser would otherwise be subject by reason of willful misfeasance, bad
faith or gross negligence on its part in the performance of its duties or by
reason of the Sub-Adviser's reckless disregard of its obligations and duties
under this Agreement.
8. Term and Amendments of Agreement
This Agreement shall become effective February 14, 2000 (the "Effective Date")
and shall continue for an initial two-year term. This Agreement shall continue
thereafter so
6
long as such continuance is specifically approved at least annually as required
by the 1940 Act. This Agreement is terminable, without penalty, on 60 days'
written notice, by the Board of the Company or by vote of holders of a majority
(as defined in the 1940 Act and the rules thereunder) of the outstanding voting
securities of the Fund, or upon 60 days' written notice by the Sub-Adviser
except as otherwise agreed by the Manager and the Sub-Adviser. This Agreement
will also terminate automatically in the event of its assignment (as defined in
the 1940 Act and the rules thereunder). This Agreement may be amended only if
such amendment is approved by the vote of a majority of the outstanding voting
securities of the Fund (except for any amendment as may be effected in the
absence of such approval without violating the 1940 Act).
9. Services to Other Companies or Accounts
The Company understands that the Sub-Adviser now acts, and may act in the
future, unless otherwise agreed to by the parties, as investment manager,
adviser, or sub-adviser to other investment companies and/or managed accounts,
including offshore entities. Sub-Adviser agrees that whenever the Portfolio and
one or more other accounts managed or advised by the Sub-Adviser have available
funds for investment, investments suitable and appropriate for each will be
allocated in accordance with a process designed by the Sub-Adviser to provide
equitable treatment to each company and account. The Company recognizes that in
some cases this procedure may adversely affect the size of the position
obtainable for the Fund. In addition, the Company understands that the persons
employed by the Sub-Adviser to assist in the performance of the Sub-Adviser's
duties under this Agreement will not devote their full time to such service.
10. Representations
The Company and Fund represent that (i) a copy of the Company's Articles of
Incorporation, dated July 16, 1986 together with all amendments thereto, is on
file with the Secretary of the State of Maryland, (ii) the appointment of the
Manager has been duly authorized, (iii) the appointment of the Sub-Adviser has
been duly authorized, and (iv) they have acted, and will continue to act, in
conformity with the 1940 Act and other applicable laws.
The Sub-Adviser represents that it is authorized to perform the services
described herein.
Each of the parties hereto represents that the Agreement has been duly
authorized, executed and delivered by all required corporate action.
11. Materials
The Manager shall not publish or distribute or allow the Company or the Fund to
publish or distribute any information, including but not limited to registration
statements, advertising or promotional materials, specifically describing the
Sub-Adviser, without prior written consent of the Sub-Adviser, which consent
shall not be unreasonably withheld or delayed. If the Sub-Adviser has not
notified the Manager of its disapproval
7
of sample materials within three (3) business days after its receipt thereof,
such materials shall be deemed approved. Materials substantially similar to
materials approved on an earlier occasion shall also be deemed approved.
12. Governing Law
This Agreement shall be governed by the internal laws of the State of Maryland,
without regard to the conflict of law principles thereof; provided, however,
that to the extent that anything herein is inconsistent with the 1940 Act, the
1940 Act shall control.
13. Notice
Any notice, advice or report to be given pursuant to this Agreement shall be
deemed sufficient if delivered or mailed by registered, certified or overnight
mail, postage prepaid addressed by the party giving notice to the other party at
the last address furnished by the other party:
To the Company at:
Xxxxx Xxxxxx Sector Series Inc.
000 Xxxxxxxxx Xxxxxx
00xx Xxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxx X. XxXxxxxx
To the Manager at:
SSB Citi Fund Management LLC
000 Xxxxxxxxx Xxxxxx
00xx Xxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxx X. XxXxxxxx
To the Sub-Adviser at:
Citibank, N.A.
Attention: Xxxxxxxx X. Xxxxxxxx
000 Xxxxx Xxxxxxxx Xxxxx
Xxxxxxxx, XX 00000
8
14. Counterparts
This Agreement may be executed in any number of counterparts, each of which
shall be deemed to be an original, but such counterparts shall, together,
constitute only one instrument.
If the foregoing is in accordance with your understanding, kindly indicate your
acceptance of this Agreement by signing and returning the enclosed copy of this
Agreement.
Very truly yours:
SSB CITI FUND MANAGEMENT LLC.
_____________________________
By:
XXXXX XXXXXX SECTOR SERIES INC.
On behalf of the
Xxxxx Xxxxxx Financial Services Fund
_____________________________
By:
Accepted:
CITIBANK, N.A.
______________________________
By:
9
SUBADVISORY AGREEMENT
Xxxxx Xxxxxx Sector Series Inc.
Xxxxx Xxxxxx Health Sciences Fund
February 14, 2000
Citibank, N.A.
Dear Sirs:
Xxxxx Xxxxxx Sector Series Inc. (the "Company"), a corporation organized under
the laws of the State of Maryland on behalf of the Xxxxx Xxxxxx Health Sciences
Fund (the "Fund") and SSB Citi Fund Management LLC (the "Manager"), each
confirms its agreement with Citibank, N.A. (the "Sub-Adviser"), as follows:
1. Investment Description; Appointment
The Company desires to employ its capital relating to the Fund by investing and
reinvesting in investments of the kind and in accordance with the investment
objective(s), policies and limitations specified in the prospectus (the
"Prospectus") and the statement of additional information (the "Statement")
filed with the Securities and Exchange Commission as part of the Company's
Registration Statement on Form N-1A, as amended or supplemented from time to
time, and in the manner and to the extent as may from time to time be approved
by the Board of Directors of the Company (the "Board"). Copies of the
Prospectus, the Statement, the Company's Bylaws (the "Bylaws") and any policies
or procedures adopted by the Board and in effect from time-to-time related to
the Company and the Sub-Adviser (the "Procedures") have been or will be
submitted to the Sub-Adviser. The Company agrees promptly to provide copies of
all amendments and supplements to the current Prospectus, the Statement, the
Bylaws and Procedures to the Sub-Adviser on an on-going basis. Until the Company
delivers any such amendment or supplement to the Sub-Adviser, the Sub-Adviser
shall be fully protected in relying on the Prospectus, Statement, Bylaws and
Procedures as previously furnished to the Sub-Adviser. The Company employs the
Manager as the manager to the Portfolio pursuant to the Management Agreement
dated February 14, 2000 (the "Management Agreement"), and the Company and the
Manager desire to employ and hereby appoint the Sub-Adviser to act as the
sub-investment adviser to the Fund. The Sub-Adviser accepts the appointment and
agrees to furnish the services for the compensation set forth below.
10
2. Services as Sub-Adviser
Subject to the supervision, direction and approval of the Board of the Company
and the Manager, the Sub-Adviser shall conduct a continual program of
investment, evaluation and, if appropriate in the view of the Sub-Adviser, sale
and reinvestment of the Fund's assets. The Sub-Adviser is authorized, in its
sole discretion and without prior consultation with the Manager, to: (a) manage
the Fund's assets in accordance with the Fund's investment objective(s) and
policies as stated in the Prospectus and the Statement; (b) make investment
decisions for the Fund; (c) place purchase and sale orders for portfolio
transactions on behalf of the Fund; and (d) employ professional portfolio
managers and securities analysts who provide research services to the Fund.
In addition, (i) the Sub-Adviser shall furnish the Manager daily information
concerning portfolio transactions and quarterly and annual reports concerning
transactions and performance of the Fund in such form as may be mutually agreed
upon, and the Sub-Adviser agrees to review the Fund and discuss the management
of it with the Manager and the Board of Directors of the Company.
(ii) Unless the Manager gives the Sub-Adviser written instructions to the
contrary, the Sub-Adviser shall use its good faith judgment in a manner which it
reasonably believes best serves the interests of the Fund's shareholders to vote
or abstain from voting all proxies solicited by or with respect to the issuers
of securities in which assets of the Fund may be invested.
(iii) The Sub-Adviser shall maintain and preserve such records related to the
Fund's transactions as shall be required under the Investment Company Act of
1940, as amended (the "1940 Act"). The Manager shall maintain and preserve all
books and other records not related to the Fund's transactions as required under
the 1940 Act and shall timely furnish to Sub-Adviser all information and copies
of books and records reasonably requested by Sub-Adviser to comply with any
request made in connection with a regulatory inspection. The Sub-Adviser shall
timely furnish to the Manager all information relating to the Sub-Adviser's
services hereunder reasonably requested by the Manager to keep and preserve the
books and records of the Fund. The Sub-Adviser agrees that all records which it
maintains for the Fund are the property of the Company and the Sub-Adviser will
surrender promptly to the Company copies of any of such records.
(iv) The Sub-Adviser shall maintain compliance procedures for the Fund that it
reasonably believes are adequate to ensure the Fund's compliance with (A) the
1940 Act and the rules and regulations promulgated thereunder and (B) the Fund's
investment objective(s) and policies as stated in the Prospectus and Statement.
(v) The Sub-Adviser has adopted a written code of ethics that it reasonably
believes complies with the requirements of Rule 17j-1 under the 1940 Act, which
it will provide to the Company. The Sub-Adviser has written policies and
procedures reasonably designed
11
to prevent the misuse of material, nonpublic information by the Sub-Adviser or
any person associated with the Sub-Adviser.
3. Brokerage
In selecting brokers or dealers (including, if permitted by applicable law,
Xxxxxxx Xxxxx Xxxxxx Inc. or any other broker or dealer affiliated with the
Manager or the Sub-Adviser) to execute transactions on behalf of the Fund, the
Sub-Adviser will seek the best overall terms available. In assessing the best
overall terms available for any transaction, the Sub-Adviser will consider
factors it deems relevant, including, but not limited to, the breadth of the
market in the security, the price of the security, the financial condition and
execution capability of the broker or dealer and the reasonableness of the
commission, if any, for the specific transaction and on a continuing basis. In
selecting brokers or dealers to execute a particular transaction, and in
evaluating the best overall terms available, the Sub-Adviser is authorized to
consider the brokerage and research services (as those terms are defined in
Section 28(e) of the Securities Exchange Act of 1934, as amended) provided to
the Fund and/or other accounts over which the Sub-Adviser or its affiliates
exercise investment discretion. Nothing in this paragraph shall be deemed to
prohibit the Sub-Adviser from paying an amount of commission for effecting a
securities transaction in excess of the amount of commission another member of
an exchange, broker, or dealer would have charged for effecting that
transaction, if the Sub-Adviser determined in good faith that such amount of
commission was reasonable in relation to the value of the brokerage and research
services provided by such member, broker, or dealer, viewed in terms of either
that particular transaction or its overall responsibilities with respect to the
Fund and/or other accounts over which the Sub-Adviser or its affiliates exercise
investment discretion. In making purchases or sales of securities or other
property for the account of the Fund, the Sub-Adviser may deal with itself or
its affiliates, or with the Fund's underwriter or distributor, to the extent
such actions are permitted by the 1940 Act.
4. Information Provided to the Company and the Manager
The Sub-Adviser shall keep the Company and the Manager informed of developments
materially affecting the Fund's holdings, and shall, on its own initiative,
furnish the Company and the Manager from time to time with whatever information
the Sub-Adviser believes is appropriate for this purpose.
5. Compensation
(i) In consideration of the services rendered pursuant to this Agreement, the
Manager will pay the Sub-Adviser an annual fee calculated at the rate of 0.50%
of the Fund's average daily net assets; the fee is calculated daily and paid
monthly. The Sub-Adviser shall have no right to obtain compensation directly
from the Company for services provided hereunder and agrees to look solely to
the Manager for payment of fees due. The fee for the period from the Effective
Date (defined below) of the Agreement to the end of the month during which the
Effective Date occurs shall be prorated according to the
12
proportion that such period bears to the full monthly period. Upon any
termination of this Agreement before the end of a month, the fee for such part
of that month shall be prorated according to the proportion that such period
bears to the full monthly period and shall be payable upon the date of
termination of this Agreement. For the purpose of determining fees payable to
the Sub-Adviser, the value of the Fund's net assets shall be computed at the
times and in the manner specified in the Prospectus and/or the Statement.
(ii) The Sub-Adviser agrees that, to the extent that the fee that is payable to
the Manager by the Fund is reduced by action of the Board, the fee payable to
the Sub-Adviser shall be reduced pro rata. Additionally, to the extent that any
part of the fee that is payable to the Manager is waived by the Manager, the
Sub-Adviser agrees to waive its fees proportionately. The Manager agrees to
consult with the Sub-Adviser prior to making a decision as to whether to waive
its fees.
6. Expenses
The Sub-Adviser shall bear all expenses (excluding brokerage costs, custodian
fees, auditors fees or other expenses to be borne by the Fund or the Company) in
connection with the performance of its services under this Agreement. The Fund
will bear certain other expenses to be incurred in its operation, including, but
not limited to, investment advisory fees, sub-advisory fees (other than
sub-advisory fees paid pursuant to this Agreement) and administration fees; fees
for necessary professional and brokerage services; costs relating to local
administration of securities; fees for any pricing services; the costs of
regulatory compliance; and pro rata costs associated with maintaining the
Company's legal existence and shareholder relations. All other expenses not
specifically assumed by the Sub-Adviser hereunder or by the Manager under the
Management Agreement are borne by the Fund or the Company.
7. Standard of Care
The Sub-Adviser shall exercise its best judgment and shall act in good faith in
rendering the services listed in paragraphs 2 and 3 above. The Sub-Adviser shall
not be liable for any error of judgment or mistake of law or for any loss
suffered by the Fund or the Manager in connection with the matters to which this
Agreement relates as well as in connection with the performance of its
obligations under this Agreement, provided that nothing in this Agreement shall
be deemed to protect or purport to protect the Sub-Adviser against any liability
to the Manager, the Company or to the shareholders of the Fund to which the
Sub-Adviser would otherwise be subject by reason of willful misfeasance, bad
faith or gross negligence on its part in the performance of its duties or by
reason of the Sub-Adviser's reckless disregard of its obligations and duties
under this Agreement.
8. Term and Amendments of Agreement
This Agreement shall become effective February 14, 2000 (the "Effective Date")
and shall continue for an initial two-year term. This Agreement shall continue
thereafter so
13
long as such continuance is specifically approved at least annually as required
by the 1940 Act. This Agreement is terminable, without penalty, on 60 days'
written notice, by the Board of the Company or by vote of holders of a majority
(as defined in the 1940 Act and the rules thereunder) of the outstanding voting
securities of the Fund, or upon 60 days' written notice by the Sub-Adviser
except as otherwise agreed by the Manager and the Sub-Adviser. This Agreement
will also terminate automatically in the event of its assignment (as defined in
the 1940 Act and the rules thereunder). This Agreement may be amended only if
such amendment is approved by the vote of a majority of the outstanding voting
securities of the Fund (except for any amendment as may be effected in the
absence of such approval without violating the 1940 Act).
9. Services to Other Companies or Accounts
The Company understands that the Sub-Adviser now acts, and may act in the
future, unless otherwise agreed to by the parties, as investment manager,
adviser, or sub-adviser to other investment companies and/or managed accounts,
including offshore entities. Sub-Adviser agrees that whenever the Portfolio and
one or more other accounts managed or advised by the Sub-Adviser have available
funds for investment, investments suitable and appropriate for each will be
allocated in accordance with a process designed by the Sub-Adviser to provide
equitable treatment to each company and account. The Company recognizes that in
some cases this procedure may adversely affect the size of the position
obtainable for the Fund. In addition, the Company understands that the persons
employed by the Sub-Adviser to assist in the performance of the Sub-Adviser's
duties under this Agreement will not devote their full time to such service.
10. Representations
The Company and Fund represent that (i) a copy of the Company's Articles of
Incorporation, dated July 16, 1986 together with all amendments thereto, is on
file with the Secretary of the State of Maryland, (ii) the appointment of the
Manager has been duly authorized, (iii) the appointment of the Sub-Adviser has
been duly authorized, and (iv) they have acted, and will continue to act, in
conformity with the 1940 Act and other applicable laws.
The Sub-Adviser represents that it is authorized to perform the services
described herein.
Each of the parties hereto represents that the Agreement has been duly
authorized, executed and delivered by all required corporate action.
11. Materials
The Manager shall not publish or distribute or allow the Company or the Fund to
publish or distribute any information, including but not limited to registration
statements, advertising or promotional materials, specifically describing the
Sub-Adviser, without prior written consent of the Sub-Adviser, which consent
shall not be unreasonably withheld or delayed. If the Sub-Adviser has not
notified the Manager of its disapproval
14
of sample materials within three (3) business days after its receipt thereof,
such materials shall be deemed approved. Materials substantially similar to
materials approved on an earlier occasion shall also be deemed approved.
12. Governing Law
This Agreement shall be governed by the internal laws of the State of Maryland,
without regard to the conflict of law principles thereof; provided, however,
that to the extent that anything herein is inconsistent with the 1940 Act, the
1940 Act shall control.
13. Notice
Any notice, advice or report to be given pursuant to this Agreement shall be
deemed sufficient if delivered or mailed by registered, certified or overnight
mail, postage prepaid addressed by the party giving notice to the other party at
the last address furnished by the other party:
To the Company at:
Xxxxx Xxxxxx Sector Series Inc.
000 Xxxxxxxxx Xxxxxx
00xx Xxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxx X. XxXxxxxx
To the Manager at:
SSB Citi Fund Management LLC
000 Xxxxxxxxx Xxxxxx
00xx Xxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxx X. XxXxxxxx
To the Sub-Adviser at:
Citibank, N.A.
Attention: Xxxxxxxx X. Xxxxxxxx
000 Xxxxx Xxxxxxxx Xxxxx
Xxxxxxxx, XX 00000
15
14. Counterparts
This Agreement may be executed in any number of counterparts, each of which
shall be deemed to be an original, but such counterparts shall, together,
constitute only one instrument.
If the foregoing is in accordance with your understanding, kindly indicate your
acceptance of this Agreement by signing and returning the enclosed copy of this
Agreement.
Very truly yours:
SSB CITI FUND MANAGEMENT LLC.
_____________________________
By:
XXXXX XXXXXX SECTOR SERIES INC.
On behalf of the
Xxxxx Xxxxxx Health Sciences Fund
_____________________________
By:
Accepted:
CITIBANK, N.A.
______________________________
By:
16
SUBADVISORY AGREEMENT
Xxxxx Xxxxxx Sector Series Inc.
Xxxxx Xxxxxx Technology Fund
February 14, 2000
Citibank, N.A.
Dear Sirs:
Xxxxx Xxxxxx Sector Series Inc. (the "Company"), a corporation organized under
the laws of the State of Maryland on behalf of the Xxxxx Xxxxxx Technology Fund
(the "Fund") and SSB Citi Fund Management LLC (the "Manager"), each confirms its
agreement with Citibank, N.A. (the "Sub-Adviser"), as follows:
1. Investment Description; Appointment
The Company desires to employ its capital relating to the Fund by investing and
reinvesting in investments of the kind and in accordance with the investment
objective(s), policies and limitations specified in the prospectus (the
"Prospectus") and the statement of additional information (the "Statement")
filed with the Securities and Exchange Commission as part of the Company's
Registration Statement on Form N-1A, as amended or supplemented from time to
time, and in the manner and to the extent as may from time to time be approved
by the Board of Directors of the Company (the "Board"). Copies of the
Prospectus, the Statement, the Company's Bylaws (the "Bylaws") and any policies
or procedures adopted by the Board and in effect from time-to-time related to
the Company and the Sub-Adviser (the "Procedures") have been or will be
submitted to the Sub-Adviser. The Company agrees promptly to provide copies of
all amendments and supplements to the current Prospectus, the Statement, the
Bylaws and Procedures to the Sub-Adviser on an on-going basis. Until the Company
delivers any such amendment or supplement to the Sub-Adviser, the Sub-Adviser
shall be fully protected in relying on the Prospectus, Statement, Bylaws and
Procedures as previously furnished to the Sub-Adviser. The Company employs the
Manager as the manager to the Portfolio pursuant to the Management Agreement
dated February 14, 2000 (the "Management Agreement"), and the Company and the
Manager desire to employ and hereby appoint the Sub-Adviser to act as the
sub-investment adviser to the Fund. The Sub-Adviser accepts the appointment and
agrees to furnish the services for the compensation set forth below.
17
2. Services as Sub-Adviser
Subject to the supervision, direction and approval of the Board of the Company
and the Manager, the Sub-Adviser shall conduct a continual program of
investment, evaluation and, if appropriate in the view of the Sub-Adviser, sale
and reinvestment of the Fund's assets. The Sub-Adviser is authorized, in its
sole discretion and without prior consultation with the Manager, to: (a) manage
the Fund's assets in accordance with the Fund's investment objective(s) and
policies as stated in the Prospectus and the Statement; (b) make investment
decisions for the Fund; (c) place purchase and sale orders for portfolio
transactions on behalf of the Fund; and (d) employ professional portfolio
managers and securities analysts who provide research services to the Fund.
In addition, (i) the Sub-Adviser shall furnish the Manager daily information
concerning portfolio transactions and quarterly and annual reports concerning
transactions and performance of the Fund in such form as may be mutually agreed
upon, and the Sub-Adviser agrees to review the Fund and discuss the management
of it with the Manager and the Board of Directors of the Company.
(ii) Unless the Manager gives the Sub-Adviser written instructions to the
contrary, the Sub-Adviser shall use its good faith judgment in a manner which it
reasonably believes best serves the interests of the Fund's shareholders to vote
or abstain from voting all proxies solicited by or with respect to the issuers
of securities in which assets of the Fund may be invested.
(iii) The Sub-Adviser shall maintain and preserve such records related to the
Fund's transactions as shall be required under the Investment Company Act of
1940, as amended (the "1940 Act"). The Manager shall maintain and preserve all
books and other records not related to the Fund's transactions as required under
the 1940 Act and shall timely furnish to Sub-Adviser all information and copies
of books and records reasonably requested by Sub-Adviser to comply with any
request made in connection with a regulatory inspection. The Sub-Adviser shall
timely furnish to the Manager all information relating to the Sub-Adviser's
services hereunder reasonably requested by the Manager to keep and preserve the
books and records of the Fund. The Sub-Adviser agrees that all records which it
maintains for the Fund are the property of the Company and the Sub-Adviser will
surrender promptly to the Company copies of any of such records.
(iv) The Sub-Adviser shall maintain compliance procedures for the Fund that it
reasonably believes are adequate to ensure the Fund's compliance with (A) the
1940 Act and the rules and regulations promulgated thereunder and (B) the Fund's
investment objective(s) and policies as stated in the Prospectus and Statement.
(v) The Sub-Adviser has adopted a written code of ethics that it reasonably
believes complies with the requirements of Rule 17j-1 under the 1940 Act, which
it will provide to the Company. The Sub-Adviser has written policies and
procedures reasonably designed
18
to prevent the misuse of material, nonpublic information by the Sub-Adviser or
any person associated with the Sub-Adviser.
3. Brokerage
In selecting brokers or dealers (including, if permitted by applicable law,
Xxxxxxx Xxxxx Xxxxxx Inc. or any other broker or dealer affiliated with the
Manager or the Sub-Adviser) to execute transactions on behalf of the Fund, the
Sub-Adviser will seek the best overall terms available. In assessing the best
overall terms available for any transaction, the Sub-Adviser will consider
factors it deems relevant, including, but not limited to, the breadth of the
market in the security, the price of the security, the financial condition and
execution capability of the broker or dealer and the reasonableness of the
commission, if any, for the specific transaction and on a continuing basis. In
selecting brokers or dealers to execute a particular transaction, and in
evaluating the best overall terms available, the Sub-Adviser is authorized to
consider the brokerage and research services (as those terms are defined in
Section 28(e) of the Securities Exchange Act of 1934, as amended) provided to
the Fund and/or other accounts over which the Sub-Adviser or its affiliates
exercise investment discretion. Nothing in this paragraph shall be deemed to
prohibit the Sub-Adviser from paying an amount of commission for effecting a
securities transaction in excess of the amount of commission another member of
an exchange, broker, or dealer would have charged for effecting that
transaction, if the Sub-Adviser determined in good faith that such amount of
commission was reasonable in relation to the value of the brokerage and research
services provided by such member, broker, or dealer, viewed in terms of either
that particular transaction or its overall responsibilities with respect to the
Fund and/or other accounts over which the Sub-Adviser or its affiliates exercise
investment discretion. In making purchases or sales of securities or other
property for the account of the Fund, the Sub-Adviser may deal with itself or
its affiliates, or with the Fund's underwriter or distributor, to the extent
such actions are permitted by the 1940 Act.
4. Information Provided to the Company and the Manager
The Sub-Adviser shall keep the Company and the Manager informed of developments
materially affecting the Fund's holdings, and shall, on its own initiative,
furnish the Company and the Manager from time to time with whatever information
the Sub-Adviser believes is appropriate for this purpose.
5. Compensation
(i) In consideration of the services rendered pursuant to this Agreement, the
Manager will pay the Sub-Adviser an annual fee calculated at the rate of 0.65%
of the Fund's average daily net assets; the fee is calculated daily and paid
monthly. The Sub-Adviser shall have no right to obtain compensation directly
from the Company for services provided hereunder and agrees to look solely to
the Manager for payment of fees due. The fee for the period from the Effective
Date (defined below) of the Agreement to the end of the month during which the
Effective Date occurs shall be prorated according to the
19
proportion that such period bears to the full monthly period. Upon any
termination of this Agreement before the end of a month, the fee for such part
of that month shall be prorated according to the proportion that such period
bears to the full monthly period and shall be payable upon the date of
termination of this Agreement. For the purpose of determining fees payable to
the Sub-Adviser, the value of the Fund's net assets shall be computed at the
times and in the manner specified in the Prospectus and/or the Statement.
(ii) The Sub-Adviser agrees that, to the extent that the fee that is payable to
the Manager by the Fund is reduced by action of the Board, the fee payable to
the Sub-Adviser shall be reduced pro rata. Additionally, to the extent that any
part of the fee that is payable to the Manager is waived by the Manager, the
Sub-Adviser agrees to waive its fees proportionately. The Manager agrees to
consult with the Sub-Adviser prior to making a decision as to whether to waive
its fees.
6. Expenses
The Sub-Adviser shall bear all expenses (excluding brokerage costs, custodian
fees, auditors fees or other expenses to be borne by the Fund or the Company) in
connection with the performance of its services under this Agreement. The Fund
will bear certain other expenses to be incurred in its operation, including, but
not limited to, investment advisory fees, sub-advisory fees (other than
sub-advisory fees paid pursuant to this Agreement) and administration fees; fees
for necessary professional and brokerage services; costs relating to local
administration of securities; fees for any pricing services; the costs of
regulatory compliance; and pro rata costs associated with maintaining the
Company's legal existence and shareholder relations. All other expenses not
specifically assumed by the Sub-Adviser hereunder or by the Manager under the
Management Agreement are borne by the Fund or the Company.
7. Standard of Care
The Sub-Adviser shall exercise its best judgment and shall act in good faith in
rendering the services listed in paragraphs 2 and 3 above. The Sub-Adviser shall
not be liable for any error of judgment or mistake of law or for any loss
suffered by the Fund or the Manager in connection with the matters to which this
Agreement relates as well as in connection with the performance of its
obligations under this Agreement, provided that nothing in this Agreement shall
be deemed to protect or purport to protect the Sub-Adviser against any liability
to the Manager, the Company or to the shareholders of the Fund to which the
Sub-Adviser would otherwise be subject by reason of willful misfeasance, bad
faith or gross negligence on its part in the performance of its duties or by
reason of the Sub-Adviser's reckless disregard of its obligations and duties
under this Agreement.
8. Term and Amendments of Agreement
This Agreement shall become effective February 14, 2000 (the "Effective Date")
and shall continue for an initial two-year term. This Agreement shall continue
thereafter so
20
long as such continuance is specifically approved at least annually as required
by the 1940 Act. This Agreement is terminable, without penalty, on 60 days'
written notice, by the Board of the Company or by vote of holders of a majority
(as defined in the 1940 Act and the rules thereunder) of the outstanding voting
securities of the Fund, or upon 60 days' written notice by the Sub-Adviser
except as otherwise agreed by the Manager and the Sub-Adviser. This Agreement
will also terminate automatically in the event of its assignment (as defined in
the 1940 Act and the rules thereunder). This Agreement may be amended only if
such amendment is approved by the vote of a majority of the outstanding voting
securities of the Fund (except for any amendment as may be effected in the
absence of such approval without violating the 1940 Act).
9. Services to Other Companies or Accounts
The Company understands that the Sub-Adviser now acts, and may act in the
future, unless otherwise agreed to by the parties, as investment manager,
adviser, or sub-adviser to other investment companies and/or managed accounts,
including offshore entities. Sub-Adviser agrees that whenever the Portfolio and
one or more other accounts managed or advised by the Sub-Adviser have available
funds for investment, investments suitable and appropriate for each will be
allocated in accordance with a process designed by the Sub-Adviser to provide
equitable treatment to each company and account. The Company recognizes that in
some cases this procedure may adversely affect the size of the position
obtainable for the Fund. In addition, the Company understands that the persons
employed by the Sub-Adviser to assist in the performance of the Sub-Adviser's
duties under this Agreement will not devote their full time to such service.
10. Representations
The Company and Fund represent that (i) a copy of the Company's Articles of
Incorporation, dated July 16, 1986 together with all amendments thereto, is on
file with the Secretary of the State of Maryland, (ii) the appointment of the
Manager has been duly authorized, (iii) the appointment of the Sub-Adviser has
been duly authorized, and (iv) they have acted, and will continue to act, in
conformity with the 1940 Act and other applicable laws.
The Sub-Adviser represents that it is authorized to perform the services
described herein.
Each of the parties hereto represents that the Agreement has been duly
authorized, executed and delivered by all required corporate action.
11. Materials
The Manager shall not publish or distribute or allow the Company or the Fund to
publish or distribute any information, including but not limited to registration
statements, advertising or promotional materials, specifically describing the
Sub-Adviser, without prior written consent of the Sub-Adviser, which consent
shall not be unreasonably withheld or delayed. If the Sub-Adviser has not
notified the Manager of its disapproval
21
of sample materials within three (3) business days after its receipt thereof,
such materials shall be deemed approved. Materials substantially similar to
materials approved on an earlier occasion shall also be deemed approved.
12. Governing Law
This Agreement shall be governed by the internal laws of the State of Maryland,
without regard to the conflict of law principles thereof; provided, however,
that to the extent that anything herein is inconsistent with the 1940 Act, the
1940 Act shall control.
13. Notice
Any notice, advice or report to be given pursuant to this Agreement shall be
deemed sufficient if delivered or mailed by registered, certified or overnight
mail, postage prepaid addressed by the party giving notice to the other party at
the last address furnished by the other party:
To the Company at:
Xxxxx Xxxxxx Sector Series Inc.
000 Xxxxxxxxx Xxxxxx
00xx Xxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxx X. XxXxxxxx
To the Manager at:
SSB Citi Fund Management LLC
000 Xxxxxxxxx Xxxxxx
00xx Xxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxx X. XxXxxxxx
To the Sub-Adviser at:
Citibank, N.A.
Attention: Xxxxxxxx X. Xxxxxxxx
000 Xxxxx Xxxxxxxx Xxxxx
Xxxxxxxx, XX 00000
22
14. Counterparts
This Agreement may be executed in any number of counterparts, each of which
shall be deemed to be an original, but such counterparts shall, together,
constitute only one instrument.
If the foregoing is in accordance with your understanding, kindly indicate your
acceptance of this Agreement by signing and returning the enclosed copy of this
Agreement.
Very truly yours:
SSB CITI FUND MANAGEMENT LLC.
_____________________________
By:
XXXXX XXXXXX SECTOR SERIES INC.
On behalf of the
Xxxxx Xxxxxx Technology Fund
_____________________________
By:
Accepted:
CITIBANK, N.A.
______________________________
By:
23
