EXHIBIT H
SUB-ADVISORY AGREEMENT
SUB-ADVISORY AGREEMENT, dated _______________, 1999, between
Xxxxxxx Xxxxxxx Trees & Xxxxx, Inc., a New York corporation (the "Adviser") and
Xxxxxxx Xxxxxxx Trees & Xxxxx, a corporation organized under the laws of the
United Kingdom (the "Sub-Adviser").
In consideration of the mutual agreements herein made, the
parties hereto agree as follows:
1. Attorney-in-Fact. The Adviser appoints the Sub-Adviser as
its attorney-in-fact to invest and reinvest the assets of the Worldwide-Hedged
Portfolio (the "Portfolio") of FFTW Funds, Inc. (the "Fund"), as fully as the
Adviser could do. The Sub-Adviser hereby accepts this appointment.
2. Duties of the Sub-Adviser. (a) The Sub-Adviser shall be
responsible for coordinating with the Adviser in managing the investment
portfolio of the Portfolio, including, without limitation, providing investment
research, advice and supervision, determining with the Adviser which portfolio
securities shall be purchased or sold by the Portfolio, purchasing and selling
securities on behalf of the Portfolio and determining with the Adviser how
voting and other rights with respect to portfolio securities of the Portfolio
shall be exercised, subject in each case to the control of the Board of
Directors of the Fund (the "Board") and in accordance with the objectives,
policies and principles of the Portfolio set forth in the Registration
Statement, as amended, of the Fund, the requirements of the Investment Company
Act of 1940, as amended, (the "Act") and other applicable law. In performing
such duties, the Sub-Adviser shall provide such office space, and such executive
and other personnel as shall be necessary for the operations of the Portfolio.
In managing the Portfolio in accordance with the requirements set forth in this
paragraph 2, the Sub-Adviser shall be entitled to act upon advice of counsel to
the Fund, counsel to the Adviser or counsel to the Sub-Adviser.
(b) Subject to Section 36 of the Act, the Sub-Adviser shall
not be liable to the Adviser or the Fund for any error of judgment or mistake of
law or for any loss arising out of any investment or for any act or omission in
the management of the Portfolio and the performance of its duties under this
Agreement except for losses arising out of the Sub-Adviser's bad faith, willful
misfeasance or gross negligence in the performance of its duties or by reason of
its reckless disregard of its obligations and duties under this Agreement. It is
agreed that the Sub-Adviser shall have no responsibility or liability for the
accuracy or completeness of the Fund's Registration Statement under the Act and
the Securities Act of 1933 except for information supplied by the Sub-Adviser
for inclusion therein about the Sub-Adviser. The Adviser agrees to indemnify the
Sub-Adviser for any claims, losses, costs, damages, or expenses (including fees
and disbursements of counsel, but excluding the ordinary expenses of the
Sub-Adviser arising from the performance of its duties and obligations under
this Agreement) whatsoever arising out of the performance of this Agreement
except for those claims, losses, costs, damages and expenses resulting from the
Sub-Adviser's bad faith, willful misfeasance or gross negligence in the
performance of its duties or by reason of its reckless disregard of its
obligations and duties under this Agreement.
(c) The Sub-Adviser and its officers may act and continue to
act as investment advisers and managers for others (including, without
limitation, other investment companies), and nothing in this Agreement will in
any way be deemed to restrict the right of the Sub-Adviser to perform investment
management or other services for any other person or entity, and the performance
of such services for others will not be deemed to violate or give rise to any
duty or obligation to the Fund.
(d) Except as provided in Paragraph 5, nothing in this
Agreement will limit or restrict the Sub-Adviser or any of its officers,
affiliates or employees from buying, selling or trading in any securities for
its or their own account or accounts. The Adviser acknowledges that the
Sub-Adviser and its officers, affiliates or employees, and its other clients may
at any time have, acquire, increase, decrease or dispose of positions in
investments which are at the same time being acquired or disposed of for the
account of the Portfolio. The Sub-Adviser will have no obligation to acquire for
the Portfolio a position in any investment which the Sub-Adviser, its officers,
affiliates or employees may acquire for its or their own accounts or for the
account of another client, if in the sole discretion of the Sub-Adviser, it is
not feasible or desirable to acquire a position in such investment for the
account of the Portfolio.
3. Expenses. The Sub-Adviser shall pay all of its expenses
arising from the performance of its obligations under this Agreement except as
provided in Section 2(b) of this Agreement.
4. Compensation. (a) As compensation for the services
performed and the facilities and personnel provided by the Sub-Adviser pursuant
to this Agreement, the Adviser will pay to the Sub-Adviser promptly at the end
of each calendar month, a fee, calculated on each day during such month, at an
annual rate of 0.40% of the Portfolio's average daily net assets. The
Sub-Adviser shall be entitled to receive during any month such interim payments
of its fee hereunder as the Sub-Adviser shall request, provided that no such
payment shall exceed 50% of the amount of such fee then accrued on the books of
the Adviser and unpaid.
(b) If the Sub-Adviser shall serve hereunder for less than the
whole of any month, the fee payable hereunder shall be prorated.
(c) For purposes of this Section 4, the "average daily net
assets" of the Portfolio shall mean the average of the values placed on the
Portfolio's net assets on each day pursuant to the applicable provisions of the
Fund's Registration Statement, as amended.
5. Purchase and Sale of Securities. The Sub-Adviser shall
purchase securities from or through and sell securities to or through such
persons, brokers or dealers as the Sub-Adviser shall deem appropriate in order
to carry out the policy with respect to the allocation of portfolio transactions
as set forth in the Registration Statement of the Fund, as amended, or as the
Board may direct from time to time. The Sub-Adviser will use its reasonable best
efforts to execute all purchases and sales with dealers and banks on a best net
price basis. Neither the Sub-Adviser nor any of its officers, affiliates, or
employees will act as principal or receive any compensation from the Portfolio
in connection with the purchase or sale of investments for the Portfolio other
than the fee referred to in Paragraph 4 hereof.
6. Term of Agreement. This Agreement shall continue in full
force and effect until two years from the date hereof, and will continue in
effect from year to year thereafter if such continuance is approved in the
manner required by the Act, provided that this Agreement is not otherwise
terminated. The Sub-Adviser and the Adviser may terminate this Agreement at any
time, without payment of penalty, upon 60 days' written notice to any other
party hereto. The Fund may terminate this Agreement with respect to the
Portfolio at any time, without payment of penalty, on 60 days' written notice to
the Sub-Adviser by vote of either the Board or a majority of the outstanding
stockholders of the Portfolio. This Agreement will automatically terminate in
the event of its assignment (as defined by the Act).
7. Fee Waivers. The Sub-Adviser agrees to waive all or a
portion of its fee to the extent necessary to meet the expense cap stated in the
Fund's Registration Statement, as amended, based on a formula whereby the
Adviser, Sub-Adviser and Administrator share in the waiving of fees on a pro
rata basis (based on their relative fee schedules) so long as the Adviser and
Administrator continues to voluntarily waive its fees.
8. Miscellaneous. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York. Anything herein
to the contrary notwithstanding, this Agreement shall not be construed to
require or to impose any duty upon either of the parties to do anything in
violation of any applicable laws or regulations.
IN WITNESS WHEREOF, the Adviser and the Sub-Adviser have
caused this Agreement to be executed by their duly authorized officers as of the
date first written above.
ATTEST XXXXXXX XXXXXXX TREES & XXXXX
By: By:
Xxxxx X. Hard General Manager
ATTEST XXXXXXX XXXXXXX TREES & XXXXX, INC.
By: By:
Xxxxxxx Xxxxxxx Xxxxxxx X. Xxxxxx
CFO
