HERITAGE SERIES TRUST
EAGLE INTERNATIONAL EQUITY PORTFOLIO
SUBADVISORY AGREEMENT
This Subadvisory Agreement is made as of February 14, 1995,
between Eagle Asset Management, Inc., a Florida corporation (the
"Manager"), and Xxxxxx Xxxxxx Inc., a New York corporation (the
"Subadviser").
WHEREAS, the Manager has by separate contract agreed to serve as
the investment adviser to Eagle International Equity Portfolio ("Fund"),
an investment portfolio of Heritage Series Trust ("Trust"), a
Massachusetts business trust registered under the Investment Company Act
of 1940, as amended ("1940 Act"), as an open-end diversified management
investment company consisting of one or more investment series of shares,
each having its own assets and investment policies;
WHEREAS, the Manager's contract with the Trust allows it to
delegate certain investment advisory services to other parties; and
WHEREAS, the Manager desires to retain the Subadviser to perform
certain investment advisory services for the Trust with respect to the
Fund, and the Subadviser is willing to perform such services;
NOW, THEREFORE, in consideration of the premises and mutual
covenants herein contained, it is agreed between the parties hereto as
follows:
1. SERVICES TO BE RENDERED BY THE SUBADVISER TO THE TRUST.
(a) Investment Program. Subject to the control and
supervision of the Board of Trustees of the Trust and the
Manager, the Subadviser shall, at its expense, continuously
furnish to the Fund an investment program for such portion, if
any, of Fund assets that is allocated to it by the Manager from
time to time. With respect to such assets, the Subadviser will
make investment decisions and will place all orders for the
purchase and sale of portfolio securities. In the performance of
its duties, the Subadviser will act in the best interests of the
Fund and will comply with (i) applicable laws and regulations,
including, but not limited to, the 1940 Act, (ii) the terms of
this Agreement, (iii) the stated investment objective, policies
and restrictions of the Fund, as stated in the then-current
Registration Statement of the Trust, and (iv) such other
guidelines as the Trustees or Manager may establish. The Manager
shall be responsible for providing the Subadviser with current
copies of the materials specified in Subsections (a)(iii) and
(iv) of this Section 1. At such times as may be reasonably
requested by the Board or the Manager, the Subadviser will
provide them with economic and investment analysis and reports,
and make available to the Board any economical, statistical, or
investment services normally available to similar investment
company clients of the Subadviser.
(b) Availability of Personnel. The Subadviser, at
its expense, will make available to the Trustees and the Manager
at reasonable times its portfolio managers and other appropriate
personnel in order to review investment policies of the Fund and
to consult with the Trustees and the Manager regarding the
investment affairs of the Fund, including economic, statistical
and investment matters relevant to the Subadviser's duties
hereunder, and will provide periodic reports to the Manager
relating to the portfolio strategies it employs.
(c) Salaries and Facilities. The Subadviser, at its
expense, will pay for all salaries of personnel and facilities
required for it to execute its duties under this Agreement.
(d) Compliance Reports. The Subadviser, at its
expense, will provide the Manager with such compliance reports
relating to its duties under this Agreement as may be agreed upon
by such parties from time to time.
(e) Valuation. The Subadviser, at its expense, will
provide the Trust's custodian with market price information
relating to the assets of the Fund at such times as the parties
hereto may agree upon from time to time.
(f) Executing Portfolio Transactions. The Subadviser
will place orders pursuant to its investment determinations for
the Fund either directly with the issuer or through brokers. In
the selection of brokers and the placement of orders for the
purchase and sale of portfolio investments for the Fund, the
Subadviser shall use its best efforts to obtain for the Fund the
most favorable price and execution available, except to the
extent it may be permitted to pay higher brokerage commissions
for brokerage and research services as described below. In using
its best efforts to obtain the most favorable price and execution
available, the Subadviser, bearing in mind the Fund's best
interests at all times, shall consider all factors it deems
relevant, including by way of illustration, price, the size of
the transaction, the nature of the market for the security, the
amount of the commission, the timing of the transaction taking
into account market prices and trends, the reputation, experience
and financial stability of the broker involved and the quality of
service rendered by the broker in other transactions. Subject to
such policies as the Board of Trustees may determine, the
Subadviser shall not be deemed to have acted unlawfully or to
have breached any duty created by this Agreement or otherwise
solely by reason of its having caused the Fund to pay a broker
that provides brokerage and research services to the Subadviser
an amount of commission for effecting a portfolio investment
transaction in excess of the amount of commission another broker
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would have charged for effecting that transaction if the
Subadviser determines in good faith that such amount of
commission was reasonable in relation to the value of the
brokerage and research services provided by such broker, viewed
in terms of either that particular transaction or the
Subadviser's overall responsibilities with respect to the Trust
and to other clients of the Subadviser as to which the Subadviser
exercises investment discretion. In no instance will portfolio
securities of the Fund be purchased from or sold to the
Subadviser or any affiliated person of the Subadviser. The Trust
agrees that any entity or person associated with the Manager or
the Subadviser which is a member of a national securities
exchange is authorized to effect any transaction on such exchange
for the account of the Trust which is permitted by Section 11(a)
of the Securities Exchange Act of 1934, as amended, and the Trust
consents to the retention of compensation for such transactions.
(g) Expenses. The Subadviser shall not be obligated
to pay any expenses of or for the Trust or the Fund not expressly
assumed by the Subadviser pursuant to this Agreement.
2. Books and Records. Pursuant to Rule 31a-3 under the 1940
Act, the Subadviser agrees that: (a) all records it maintains for the
Trust are the property of the Trust; (b) it will surrender promptly to the
Trust or the Manager any such records upon the Trust's or Manager's
request; (c) it will maintain for the Trust the records that the Trust is
required to maintain pursuant to Rule 31a-1 insofar as such records relate
to the investment affairs of the Fund; and (d) it will preserve for the
periods prescribed by Rule 31a-2 under the 1940 Act the records it
maintains for the Trust.
3. Other Agreements. The Subadviser and persons controlled
by or under common control with the Subadviser have and may have advisory,
management service or other agreements with other organizations and
persons, and may have other interests and businesses. Nothing in this
Agreement is intended to preclude such other business relationships.
4. Compensation. The Manager will pay to the Subadviser as
compensation for the Subadviser's services rendered pursuant to this
Agreement a subadvisory fee equal to .50% of the Fund's average daily net
assets on the first $100 million of net assets and .40% thereafter. Such
fees shall be paid by the Manager (and not by the Trust) without regard to
any reduction in the fees paid to the Manager as a result of any statutory
or regulatory limitation on investment company expenses. Such fees shall
be payable for each month within 15 business days after the end of such
month. If the Subadviser shall serve for less than the whole of a month,
the compensation as specified shall be prorated.
5. Amendment of Agreement. This Agreement shall not be
materially amended unless such amendment is approved by the affirmative
vote of a majority of the outstanding shares of the Fund, and by the vote,
cast in person at a meeting called for the purpose of voting on such
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approval, of a majority of the members of the Board of Trustees who are
not interested persons of the Trust, the Manager or the Subadviser (the
"Independent Trustees"). The Subadviser agrees to notify the Manager of
any anticipated change in control of the Subadviser as soon as such change
is anticipated and, in any event, prior to such change.
6. Duration and Termination of the Agreement. This
Agreement shall become effective upon its execution; provided, however,
that this Agreement shall not become effective unless it has first been
approved (a) by a vote of the Independent Trustees, cast in person at a
meeting called for the purpose of voting on such approval, and (b) by an
affirmative vote of a majority of the outstanding voting shares of the
Fund. This Agreement shall remain in full force and effect continuously
thereafter, except as follows:
(a) By vote of a majority of the (i) Independent
Trustees, or (ii) outstanding voting shares of the Fund, the
Trust may at any time terminate this Agreement, without the
payment of any penalty, by providing not more than 60 days'
written notice delivered or mailed by registered mail, postage
prepaid, to the Manager and the Subadviser.
(b) This Agreement will terminate automatically,
without the payment of any penalty, unless within two years after
its initial effectiveness and at least annually thereafter, the
continuance of the Agreement is specifically approved by (i) the
Board of Trustees or the shareholders of the Fund by the
affirmative vote of a majority of the outstanding shares of the
Fund, and (ii) a majority of the Independent Trustees, by vote
cast in person at a meeting called for the purpose of voting on
such approval. If the continuance of this Agreement is submitted
to the shareholders of the Fund for their approval and such
shareholders fail to approve such continuance as provided herein,
the Subadviser may continue to serve hereunder in a manner
consistent with the 1940 Act and the rules and regulations
thereunder.
(c) The Manager may at any time terminate this
Agreement, without the payment of any penalty, by not less than
60 days' written notice delivered or mailed by registered mail,
postage prepaid, to the Subadviser, and the Subadviser may at any
time, without the payment of any penalty, terminate this
Agreement by not less than 90 days' written notice delivered or
mailed by registered mail, postage prepaid, to the Manager.
(d) This Agreement automatically and immediately
shall terminate, without the payment of any penalty, in the event
of its assignment or if the Investment Advisory Agreement between
the Manager and the Trust shall terminate for any reason.
(e) Any notice of termination served on the
Subadviser by the Manager shall be without prejudice to the
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obligation of the Subadviser to complete transactions already
initiated or acted upon with respect to the Fund. Upon
termination without reasonable notice by the Manager, the
Subadviser will be paid certain previously agreed upon expenses
the Subadviser necessarily incurs in terminating the Agreement.
Upon termination of this Agreement, the duties of the Manager
delegated to the Subadviser under this Agreement automatically shall
revert to the Manager.
7. Notification of the Manager. The Subadviser promptly
shall notify the Manager in writing of the occurrence of any of the
following events:
(a) the Subadviser shall fail to be registered as an
investment adviser under the Investment Advisers Act of 1940, as
amended, and under the laws of any jurisdiction in which the
Subadviser is required to be registered as an investment adviser
in order to perform its obligations under this Agreement;
(b) the Subadviser shall have been served or
otherwise have notice of any action, suit, proceeding, inquiry or
investigation, at law or in equity, before or by any court,
public board or body, involving the affairs of the Trust or any
Portfolio; or
(c) any other occurrence that might affect the
ability of the Subadviser to provide the services provided for
under this Agreement.
8. Definitions. For the purposes of this Agreement, the
terms "vote of a majority of the outstanding shares," "affiliated person,"
"control," "interested person" and "assignment" shall have their
respective meanings as defined in the 1940 Act and the rules and
regulations thereunder subject, however, to such exemptions as may be
granted by the Securities and Exchange Commission under said Act; and
references to annual approvals by the Board of Trustees shall be construed
in a manner consistent with the 1940 Act and the rules and regulations
thereunder.
9. Liability of the Subadviser. In the absence of its bad
faith, negligence or disregard of its obligations and duties hereunder,
the Subadviser shall not be subject to any liability to the Manager, the
Trust or their directors, Trustees, officers or shareholders, for any act
or omission in the course of, or connected with, rendering services
hereunder. However, the Subadviser shall indemnify and hold harmless such
parties from any and all claims, losses, expenses, obligations and
liabilities (including reasonable attorneys fees) which arise or result
from the Subadviser's bad faith, negligence or disregard of its duties
hereunder.
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10. Governing Law. This Agreement shall be construed in
accordance with the laws of the State of Florida, without giving effect to
the conflicts of laws principles thereof, and in accordance with the 1940
Act. To the extent that the applicable laws of the State of Florida
conflict with the applicable provisions of the 1940 Act, the latter shall
control.
11. Severability. 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.
12. 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.
Where the effect of a requirement of the 1940 Act reflected in any
provision of this Agreement is made less restrictive by a rule, regulation
or order of the Securities and Exchange Commission, whether of special or
general application, such provision shall be deemed to incorporate the
effect of such rule, regulation or order.
IN WITNESS WHEREOF, Eagle Asset Management, Inc. and Xxxxxx
Xxxxxx Inc. have each caused this instrument to be signed in duplicate on
its behalf by its duly authorized representative, all as of the day and
year first above written.
Attest: EAGLE ASSET MANAGEMENT, INC.
By:_____________________ By:_________________________
Attest: XXXXXX XXXXXX INC.
By:_____________________ By:_________________________
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