EXHIBIT B
INVESTMENT SUB-ADVISORY AGREEMENT
BETWEEN
RETIREMENT SYSTEM INVESTORS INC.
AND
BANK OF IRELAND ASSET MANAGEMENT (U.S.) LIMITED
THIS AGREEMENT effective as of ______________2003, between
Retirement System Investors Inc., a Delaware corporation (the "Manager"), and
Bank of Ireland Asset Management (U.S.) Limited, Greenwich, Connecticut (the
"Sub-Adviser").
W I T N E S S E T H :
WHEREAS, RSI Retirement Trust ("Trust"), a trust organized and
existing pursuant to an Agreement and Declaration of Trust, made as of October
22, 1940, as amended from time to time ("Agreement and Declaration of Trust")
provides benefits for the employees (and their beneficiaries) of savings
institutions, related organizations and other corporate entities which have
established plans of participation and individual retirement accounts
("Unitholders") in the Trust;
WHEREAS, the Trust is an investment company registered under
the Investment Company Act of 1940, as amended (the "Act"); and
WHEREAS, the Trustees of the Trust ("Trustees") are vested
with authority for the management and control of the assets of the Trust in
accordance with the provisions of the Agreement and Declaration of Trust and in
furtherance of such authority are vested with the power to designate an
investment manager or managers (as defined in the Employee Retirement Income
Security Act of 1974, as amended ("ERISA")) to manage (including the power to
acquire and dispose of) the assets of any of the Investment Funds (as defined in
the Agreement and Declaration of Trust) of the Trust; and
WHEREAS, the Trust and the Manager have previously entered
into an Investment Management Agreement, pursuant to which the Manager may
designate Sub-Advisers to perform certain investment advisory functions under
the supervision of the Manager and the Trustees; and
WHEREAS, the Manager wishes to appoint the Sub-Adviser to
manage a portion of the assets of certain Investment Funds of the Trust, to act
in such capacity in the manner set forth in this Agreement, and the Sub-Adviser
is willing to act in such capacity in accordance with the provisions of this
Agreement;
NOW, THEREFORE, the Manager hereby agrees with the Sub-Adviser
as follows:
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1. Appointment of the Sub-Adviser
A. The Manager hereby designates, appoints, engages and
retains the Sub-Adviser as investment manager of the assets comprising the
Investment Fund of the Trust referred to on Schedule A hereto ("Investment
Fund"), or such portion thereof as shall be designated by the Manager
("Account").
B. The Manager represents and warrants that it has the
authority to enter into this Investment Sub-Advisory Agreement with the
Sub-Adviser pursuant to (i) the terms of the Investment Management Agreement
between the Manager and the Trust referred to above, (ii) the vote, cast in
person at a meeting called for the purpose of voting on such approval, of a
majority of the Trustees of the Trust who are not parties to this Agreement or
interested persons of any such party and (iii) the provisions of Rule 15a-4
under the Act. Continuation of this Agreement for a period after May 28, 1999
requires a vote of the majority of the outstanding shares (as defined in the
Act) of the Investment Fund.
C. The Sub-Adviser hereby accepts appointment to manage the
assets of the Account. The Sub-Adviser hereby represents and warrants that it is
a qualified investment manager, as defined in Section 3(38) of ERISA, without
regard to subpart (c) of said Section. The Sub-Adviser agrees that although it
may not be subject to the provisions of Title I of ERISA in carrying out its
duties and responsibilities under this Agreement, it shall act in accordance
with the requirements of Part 4 of ERISA as applicable to fiduciaries as defined
under ERISA. Notwithstanding anything contained herein to the contrary,
references to ERISA in this Agreement shall be deemed to contemplate all
judicial or administrative interpretations and all statutory and administrative
exemptions which would be applicable in the circumstances and to the parties in
question were this Agreement subject to ERISA.
D. The term of this Agreement shall commence on the date
hereof and shall remain in full force and effect for a period of more than two
years from its initial effective date and thereafter from year to year provided
that such continuance is specifically approved in the manner required by the
Act.
2. Assets of the Account
The Manager shall certify or cause to be certified to the
Sub-Adviser the assets comprising the Account as of the commencement of the term
of this Agreement. The Manager may add to the Account assets acceptable to the
Sub-Adviser or withdraw assets from the Account at any time or from time to time
by notification to the Sub-Adviser. The Account shall consist of the assets
certified to the Sub-Adviser as aforesaid, or any assets into which the same may
be converted from time to time, together with any income therefrom or any other
increment thereon and assets as aforesaid, less assets withdrawn as aforesaid.
3. Investment Powers
A. Subject to the provisions of paragraph B of this Section 3,
the Sub-Adviser shall have exclusive authority and discretion, subject to and
consistent with the investment objectives and policies of the Investment Fund as
set forth in the current Prospectus of the Trust delivered to the Sub-Adviser
("Prospectus") and as specified in writing from time to time by the
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Trustees or the Manager and accepted by the Sub-Adviser, to manage (including
the power to acquire and dispose of) the assets of the Account, and, without
limiting the generality of the foregoing, to direct the Trustees in the exercise
of the powers relating to the Account which are specified in the Agreement and
Declaration of Trust as subject to such direction.
B. Notwithstanding the provisions of paragraph A of this
Section 3, it is understood and agreed that an investment manager other than the
Sub-Adviser may lend securities from the Account and may invest assets of the
Account on a temporary basis pending permanent investment or distribution, and,
to the extent not inconsistent with ERISA, the Sub-Adviser shall have no
liability or responsibility with respect to the exercise of such authority by
such other investment manager; provided, however, that the Sub-Adviser shall
coordinate the exercise of its authority hereunder which may be affected by the
exercise of such authority by the other investment manager in such manner
appropriate to the exercise of its authority as shall be agreed upon by the
Sub-Adviser and such other investment manager. The Trustees will advise the
Manager, and the Manager will advise the Sub-Adviser, of any arrangement with
respect to any proposed lending of securities from the Account.
C. The Sub-Adviser shall consult with the Manager or the
Trustees at such times as the Manager or the Trustees shall reasonably request
with respect to the overall investment policy of the Account.
4. Standard of Care
A. The Sub-Adviser shall invest the assets of the Account in
the manner provided herein and shall have no duty or responsibility with respect
to the diversification of the assets of the Trust, except with respect to the
diversification of the assets of the Account as contemplated by the Prospectus.
B. Except as provided in ERISA, the Sub-Adviser will be under
no liability or obligation to anyone with respect to any failure on the part of
the Manager or any other investment manager to perform any of their obligations
under any agreement affecting the Account or under the terms of this Agreement
or for any error or omission whatsoever on the part of the Manager or any other
investment manager. The Manager shall indemnify and hold harmless the
Sub-Adviser from and against any and all claims, losses, liabilities or damages
(including reasonable attorney's fees and other related expenses) howsoever
arising from or in connection with any failure on the part of the Manager or any
other investment manager to perform any of their obligations under any agreement
affecting the Account or under the terms of this Agreement or for any error or
omission whatsoever on the part of the Manager or any other investment manager.
However, in no case (i) is this indemnity to be deemed to protect the
Sub-Adviser against any liability to which such Sub-Adviser would otherwise be
subject by reason of willful misfeasance, bad faith, negligence, or gross
negligence in the performance of its duties or by reason of reckless disregard
of its obligations and duties under this Agreement, or (ii) is the Manager to be
liable under this indemnity with respect to any claim made against the
Sub-Adviser unless such Sub-Adviser shall have notified the Manager in writing,
within a reasonable time after the summons or other first legal process giving
information of the nature of the claim shall have been served upon the
Sub-Adviser.
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C. The Sub-Adviser shall not be liable for the making,
retention or sale of any investment or reinvestment made by it as herein
provided, nor for any loss to or diminution of the value of the property of the
Account; provided, however, that the Sub-Adviser has acted in the premises with
the care, skill, prudence, and diligence under the circumstances then prevailing
that a prudent man acting in like capacity and familiar with such matters would
use in the conduct of any enterprise of a like character and with like aims and
in accordance with such other requirements of ERISA as applicable generally to
fiduciaries under ERISA; provided, further, however, that nothing in this
Agreement shall protect the Sub-Adviser against any liability to the Manager,
the Trust or Unitholders to which the Sub-Adviser would otherwise be subject by
reason of willful misfeasance, bad faith or gross negligence in the performance
of its duties hereunder or by reason of its reckless disregard of its
obligations and duties hereunder.
D. The Sub-Adviser may not consult with any other subadviser
of the Investment Fund, including any other subadviser that is a principal
underwriter or an affiliated person of a principal underwriter, concerning
transactions of the Investment Fund in securities or other assets.
5. General Provisions
A. Compensation for the services of the Sub-Adviser will be as
set forth in Schedule A hereto.
B. With respect to securities in the Account, the Sub-Adviser
shall purchase such securities from or through and sell such securities to or
through such persons, brokers or dealers as the Sub-Adviser shall deem
appropriate to carry out the policy with respect to brokerage as set forth in
the Prospectus or as the Manager or the Trustees of the Trust may direct from
time to time. It is understood that it is desirable for the Trust that the
Sub-Adviser have access to supplemental research and security and economic
analysis and statistical services and information with respect to the
availability of securities or purchasers or sellers of securities provided by
brokers and of use to the Trust although such access may require the allocation
of brokerage business to brokers who execute transactions at a higher cost to
the Trust than other brokers who provide only execution of portfolio
transactions. Therefore, the Sub-Adviser is authorized to place orders for the
purchase and sale of securities with such brokers, subject to review by the
Manager 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 its services to other clients.
C. This Agreement shall automatically terminate in the event
of its "assignment" (as that term is defined in the Act).
D. This Agreement may be terminated, without the payment of
any penalty, by either party hereto or by the Trust on not more than sixty (60)
days' nor less than thirty (30) days' written notice delivered or mailed by
registered mail, postage prepaid, to the other party; any such termination on
behalf of the Trust to be pursuant to a vote of the Trustees or by a vote of a
majority of the outstanding voting securities of the Trust.
E. The Sub-Adviser may rely on the authenticity, truth and
accuracy of, and will be fully protected in acting upon:
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(a) Any notice, direction, certification, approval or
other writing of the Manager, if evidenced by an
instrument signed by the President, a Vice President,
the Treasurer or the Assistant Treasurer of the
Manager;
(b) Any copy of a resolution of the Trustees, if
certified by the Secretary of the Trust;
(c) Any notification or information provided by the
custodian of the assets in the Account, if evidenced
by an instrument signed by an officer of the
custodian;
(d) Any oral notice or instruction reasonably believed to
be genuine and to be given by the Manager or the
Trustees or its or their authorized delegate or by
the custodian or any other investment manager.
The Manager shall indemnify and hold harmless the Sub-Adviser from and against
any and all claims, losses, liabilities or damages (including reasonable
attorney's fees and other related expenses) howsoever arising from or in
connection with the Sub-Adviser's reliance on the authenticity, truth and
accuracy of any of the foregoing notices, directions, certifications, approvals,
writings of the Manager, copies information provided by the custodian, or oral
notices or instructions given by the Manager or the Trustees or its or their
authorized delegates, the custodian or any other investment manager. However, in
no case (i) is this indemnity to be deemed to protect the Sub-Adviser against
any liability to which such Sub-Adviser would otherwise be subject by reason of
willful misfeasance, bad faith, negligence, or gross negligence in the
performance of its duties or by reason of reckless disregard of its obligations
and duties under this Agreement, or (ii) is the Manager to be liable under this
indemnity with respect to any claim made against the Sub-Adviser unless such
Sub-Adviser shall have notified the Manager in writing, within a reasonable time
after the summons or other first legal process giving information of the nature
of the claim shall have been served upon the Sub-Adviser.
F. The Sub-Adviser may rely on, and will be fully protected
with respect to any action taken or omitted in reliance on, any information,
statement or certificate delivered to the Sub-Adviser by the Manager or the
Trustees with respect to any matter concerning the Trust and the operation and
administration of the Account. The Sub-Adviser is expressly authorized to
consult with the Manager with respect to any matters arising in the
administration of the Account and to act on the advice of the Manager, provided
nothing herein shall limit the full responsibility of the Sub-Adviser for the
management of the assets of the Account as provided herein. The Manager shall
indemnify and hold harmless the Sub-Adviser from and against any and all claims,
losses, liabilities or damages (including reasonable attorney's fees and other
related expenses) howsoever arising from or in connection with the Sub-Adviser's
actions taken or omissions made in reliance on any information, statement or
certificate delivered to Sub-Adviser by the Manager or the Trustees, with
respect to any matter concerning the Trust and the operation and administration
of the Account, which information, statement or certificate contains an untrue
statement of a material fact or which omits to state a material fact necessary
to make the statements therein not misleading. However, in no case (i) is this
indemnity to be deemed to protect the Sub-Adviser against any liability to which
such Sub-Adviser would otherwise be subject by reason of willful misfeasance,
bad faith, negligence, or gross negligence in the
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performance of its duties or by reason of reckless disregard of its obligations
and duties under this Agreement, or (ii) is the Manager to be liable under this
indemnity with respect to any claim made against the Sub-Adviser unless such
Sub-Adviser shall have notified the Manager in writing, within a reasonable time
after the summons or other first legal process giving information of the nature
of the claim shall have been served upon the Sub-Adviser.
G. In the event that the Manager provides indemnification to
the Sub-Adviser under the provisions of this Agreement with respect to claims,
losses, liabilities or damages (including reasonable attorney's fees and other
related expenses) howsoever arising from or in connection with any action or
omission by a third party, then the Manager shall be subrogated to all of the
claims and rights of the Sub-Adviser as against such third party until the full
amount that the Manager has paid under the indemnity has been recovered by the
Manager.
H. Communications from the Sub-Adviser to the Manager shall be
addressed to:
Retirement System Investors Inc.
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Attn.: C. Xxxx Xxxxxxxxxx
Communications to the Sub-Adviser from the Manager or the Trustees shall be
addressed to the address set forth in Schedule A hereto. In the event of a
change of address, communications shall be addressed to such new address as
designated in a written notice from the Manager, the Trustees or the
Sub-Adviser, as the case may be. All communications addressed in the above
manner and by ordinary mail, registered mail or delivered by hand shall be
sufficient under this Agreement.
I. All agreements hereunder will be governed by the laws of
the State of New York, without reference to such State's conflict of law rules.
J. No term or provision of this Agreement may be amended,
modified or waived without the affirmative vote or action by written consent of
the Trustees and the written agreement of the Manager and the Sub-Adviser and in
accordance with the Act.
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IN WITNESS WHEREOF, the Manager and the Sub-Adviser have
executed this Agreement, effective as of the date of this Agreement first set
forth above.
RETIREMENT SYSTEM INVESTORS INC.
By:
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President
BANK OF IRELAND ASSET MANAGEMENT (U.S.) LIMITED
By:
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Title:
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BANK OF IRELAND ASSET MANAGEMENT (U.S.) LIMITED
By:
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Title:
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SCHEDULE A
RSI RETIREMENT TRUST
INVESTMENT SUB-ADVISORY AGREEMENT
Name of Sub-Adviser: Bank of Ireland Asset Management (U.S.) Limited
Address: 00 Xxxxxxxxx Xxxx
Xxxxxxxxx, Xxxxxxxxxxx 00000
Attention: Director of Client Services
Investment Fund: International Equity Fund
Compensation Terms:
Terms used herein shall have the meaning used in the Investment Sub-Advisory
Agreement between the Manager and the Sub-Adviser ("Agreement"). The Manager
agrees to pay to the Sub-Adviser, as full compensation and reimbursement for the
services to be rendered pursuant to the Agreement and any expenses incurred in
connection therewith, a fee at the end of each fiscal quarter of the Trust,
computed by applying the following rate to that portion of the assets of the RSI
Retirement Trust's International Equity Fund portfolio managed by the
Sub-Adviser:
Effective _________, 2003, 0.75% on the first $20 million of assets,
0.5% on the next $30 million of assets, and 0.35% of assets in excess
of $50 million.
Billing is done for each quarter on the basis of services performed during that
particular quarter. The quarterly fee is calculated on the basis of the average
of the asset value as of the last day of each month of each calendar quarter,
equal to one-fourth of the annual rate.
If the Agreement commences on a date other than on the beginning of any such
quarterly period or terminates on a date other than the end of any such
quarterly period, the fee payable hereunder shall be proportionately reduced
according to the number of days during such period services were rendered by the
Sub-Adviser.
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IN WITNESS WHEREOF, the parties to the Agreement, effective as of
_____________,2003 have executed this Schedule A, effective as of the same
dates.
RETIREMENT SYSTEM INVESTORS INC.
BY:
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BANK OF IRELAND ASSET MANAGEMENT (U.S.) LIMITED
BY:
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TITLE:
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BANK OF IRELAND ASSET MANAGEMENT (U.S.) LIMITED
BY:
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TITLE:
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