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SUB-ADVISORY AGREEMENT
AGREEMENT dated August 8, 1983, between PROVIDENT NATIONAL
BANK, a national banking association (herein called "Provident"), and PROVIDENT
INSTITUTIONAL MANAGEMENT CORPORATION, a Delaware corporation registered as an
investment adviser under the Investment Advisers Act of 1940 and wholly-owned by
Provident (herein called "PIMC").
WHEREAS, PIMC is the investment adviser to Municipal Fund for
New York Investors, Inc. (the "Fund"), an open-end, diversified, management
investment company registered under the Investment Company Act of 1940; and
WHEREAS, PIMC wishes to retain Provident to provide it with
investment research, administrative, and statistical services in connection with
PIMC's advisory activities on behalf of the Fund; and
WHEREAS, Provident is willing to provide such services to PIMC
upon the conditions and for the compensation set forth below;
NOW, THEREFORE, in consideration of the premises and mutual
covenants herein contained, it is agreed between the parties hereto as follows:
1. Appointment. PIMC hereby appoints Provident its sub-adviser
as required by the Advisory Agreement between PIMC and the Fund dated August 8,
1983 (such Agreement or the most recent successor advisory agreement between
such parties is referred to herein as the "Advisory Agreement"). Provident
accepts such appointment and agrees to render the services herein set forth for
the compensation herein provided.
2. Sub-Advisory Services. Subject to the supervision of the
Board of Directors of the Fund, Provident, through its Trust Division and on
behalf of the Fund, will provide the Fund investment research and credit
analysis concerning prospective and existing Fund investments, make
recommendations with respect to the Fund's continuous investment program, supply
PIMC computer facilities and operating personnel, and provide such statistical
services as PIMC may from time to time reasonably request. Provident will
provide the services rendered by it hereunder in accordance with the Fund's
investment objective, policies and restrictions as stated in the Fund's
prospectus, as presently in effect and as it may be amended or supplemented from
time to time. Provident further agrees that it:
(a) will use the same skill and care in providing such
services as it uses in providing services to fiduciary accounts for
which it has investment responsibilities;
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(b) will conform with all applicable Rules and Regulations of
the Securities and Exchange Commission (hereinafter called the
"Rules"), and will in addition conduct its activities under this
Agreement in accordance with the regulations of the Board of Governors
of the Federal Reserve System pertaining to the investment advisory
activities of bank holding companies to the same extent as if such
regulations were by their terms applicable to its activities hereunder;
(c) will not invest its assets or assets of any fiduciary
account managed by it in shares of the Fund, make loans for purposes of
purchasing or carrying such shares, or make loans to the Fund;
(d) will maintain or cause PIMC to maintain books and records
with respect to the Fund's securities transactions;
(e) will render to the Fund's Board of Directors such periodic
and special reports as the Board may request; and
(f) will maintain its policy and practice of conducting its
Trust Division independently of its Commercial Division. In making
investment recommendations for the Fund, Trust Division personnel will
not inquire or take into consideration whether the issuer of securities
proposed for purchase or sale for the Fund's account are customers of
the Commercial Division. In dealing with commercial customers, the
Commercial Division will not inquire or take into consideration whether
securities of those customers are held by the Fund.
3. Services Not Exclusive. Provident's services hereunder are
not deemed to be exclusive, and Provident shall be free to render similar
services to others so long as its services under this Agreement are not impaired
thereby.
4. Books and Records. In compliance with the requirements of
Rule 31a-3 of the Rules, Provident hereby agrees that all records which it
maintains for the Fund are the property of the Fund and further agrees to
surrender promptly to the Fund any of such records upon the Fund's request.
Provident further agrees to preserve, or cause PIMC to preserve, for the periods
prescribed by Rule 31a-2, the records required to be maintained by Rule 31a-1 of
the Rules.
5. Expenses. During the term of this Agreement, Provident will
pay all expenses incurred by it in connection with its activities under this
Agreement.
6. Compensation. For the services which Provident will render
to PIMC under this Agreement, PIMC will pay to Provident a monthly fee equal to
75% of each month's advisory fee received by PIMC from the Fund pursuant to the
Advisory Agreement between PIMC and the Fund. Notwithstanding the foregoing, the
fee payable to Provident shall be adjusted each quarter as necessary to assure
that PIMC has income from all sources before application of Federal, State, or
other income taxes of at least $22,500 during each quarter. The sub-advisory fee
shall be paid by PIMC to Provident at least quarterly.
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7. Limitation on Liability. Provident will not be liable for
any error of judgment or mistake of law or for any loss suffered by PIMC or by
the Fund in connection with the matters to which this Agreement relates, except
a loss resulting from a breach of fiduciary duty with respect to the receipt of
compensation for services or a loss resulting from willful misfeasance, bad
faith or gross negligence on its part in the performance of its duties or from
reckless disregard by it of its obligations or duties under this Agreement.
8. Duration and Termination. This Agreement, unless sooner
terminated as provided herein, shall continue until July 31, 1985. Thereafter,
if not terminated, this Agreement shall continue for successive periods of 12
months each, provided, such continuance is specifically approved at least
annually (a) by the vote of a majority of those members of the Board of
Directors of the Fund who are not parties to this Agreement or interested
persons of the Fund or any such party, cast in person at a meeting called for
the purpose of voting on such approval, and (b) by the Board of Directors of the
Fund or by a vote of a majority of the outstanding voting securities of the
Fund, provided, however, that this Agreement may be terminated by the Fund at
any time, without the payment of any penalty, by the Board of Directors of the
Fund or by a vote of a majority of the outstanding voting securities of the
Fund, on 60 days' written notice to PIMC, and will be terminated upon any
termination of the Advisory Agreement between the Fund and PIMC. This Agreement
will also immediately terminate in the event of its assignment. (As used in this
Agreement, the terms "majority of the outstanding voting securities,"
"interested person" and "assignment" shall have the same meanings as such terms
have in the Investment Company Act of 1940.)
9. Amendment of this Agreement. No provision of this Agreement
may be changed, waived, discharged or terminated orally, but only by an
instrument in writing signed by the party against which enforcement of the
change, waiver, discharge or termination is sought, and no amendment of this
Agreement shall be effective until approved by vote of the holders of a majority
of the Fund's outstanding voting securities.
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10. Miscellaneous. The captions in this Agreement are included
for convenience of reference only and in no way define or delimit any of the
provisions hereof or otherwise affect their construction or effect. If any
provision of this Agreement shall be held or made invalid by a court decision,
statute, rule or otherwise, the remainder of this Agreement shall not be
affected thereby. This Agreement shall be binding upon and shall inure to the
benefit of the parties hereto and their respective successors and shall be
governed by Delaware law.
IN WITNESS WHEREOF, the parties have caused this instrument to
be executed by their officers designated below as of the day and year first
above written.
PROVIDENT NATIONAL BANK
Attest:
/s/Xxxx X Xxxxxx By:/s/ Xxxxxxx X. Xxxxxx
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Xxxx X. Xxxxxx, Xx. Xxxxxxx X. Xxxxxx, III
Vice President & Secretary
[Corporate Seal]
PROVIDENT INSTITUTIONAL
MANAGEMENT CORPORATION
Attest:
/s/Xxxx X. Xxxxxx By: /s/Xxxxxx X. Xxxxx
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Xxxx X. Xxxxxx, Xx. Xxxxxx X. Xxxxx
Vice President & Secretary
[Corporate Seal]
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