Exhibit (4)(K)
SUBADVISORY AGREEMENT
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THIS AGREEMENT is made and entered into on this 1st day of
March, 2000, between AMERICAN GENERAL ASSET MANAGEMENT CORP. (the "Adviser"), a
Delaware corporation registered under the Investment Advisers Act of 1940, as
amended (the "Advisers Act"), and CREDIT SUISSE ASSET MANAGEMENT, LLC (the
"Subadviser"), a Delaware limited liability company also registered under the
Advisers Act.
W I T N E S S E T H :
WHEREAS, the Adviser has, pursuant to an Advisory Agreement
with the North American Funds, a Massachusetts business trust (the "Trust"),
dated as of March 1, 2000 (the "Advisory Agreement"), been retained to act as
investment adviser for the Emerging Growth Fund (the "Fund"), one of the Trust's
series of shares;
WHEREAS, the Trust is registered with the Securities and
Exchange Commission (the "SEC") as an open-end management investment company
under the Investment Company Act of 1940, as amended (the "1940 Act");
WHEREAS, the Advisory Agreement permits the Adviser to
delegate certain of its duties under the Advisory Agreement to other investment
advisers; and
WHEREAS, the Adviser desires to retain the Subadviser to
assist it in the provision of a continuous investment program for that portion
of the Fund's assets which the Adviser, from time to time, assigns to the
Subadviser (the "Subadviser Assets"), and the Subadviser is willing to render
such services subject to the terms and conditions set forth in this Agreement.
NOW, THEREFORE, the parties do mutually agree and promise as
follows:
1. Investment Description; Appointment as Subadviser. The Fund
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desires to employ its capital by investing and reinvesting in securities of the
kind and in accordance with the limitations specified in the Trust's Prospectus
and Statement of Additional Information relating to the Fund as may be in effect
from time to time (collectively, the "Prospectus") and which are filed with the
SEC as part of the Trust's Registration Statement on Form N-1A, as amended from
time to time, and in such manner and to such extent as may be approved by the
Board of Trustees of the Trust. A copy of the Prospectus, as currently in
effect, has been provided to the Subadviser. The Adviser hereby retains the
Subadviser to act as investment adviser for and to manage the Subadviser Assets
subject to the supervision of the Adviser and the Board of Trustees of the Trust
and subject to the terms of
this Agreement; and the Subadviser hereby accepts such employment. In such
capacity, the Subadviser shall be responsible for the investment management of
the Subadviser Assets. It is recognized that the Subadviser now acts, and that
from time to time hereafter may act, as investment adviser to one or more other
investment companies and to fiduciary or other managed accounts and that the
Adviser and the Trust have no objection to such activities.
2. Duties of the Subadviser
(a) Investments. The Subadviser is hereby authorized and
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directed and hereby agrees, subject to the stated investment policies
and restrictions of the Fund as set forth in the Prospectus and
subject to the directions of the Adviser and the Trust's Board of
Trustees, to purchase, hold and sell investments for the Subadviser
Assets ("Fund Investments") and to monitor on a continuous basis the
performance of such Fund Investments. Subject to the supervision of
the Board of Trustees and the Adviser and the terms and conditions
hereof, including without limitation Section 2(b), the Subadviser
will: (1) manage the Subadviser Assets in accordance with the Fund's
investment objective, policies and limitations as stated in the
Prospectus as they apply to the Subadviser Assets; (2) make investment
decisions for the Fund; (3) place purchase and sale orders for
portfolio transactions for the Fund; and (4) manage otherwise
uninvested cash assets included in the Subadviser Assets. In providing
these services, the Subadviser will formulate and implement a
continuous program of investment, evaluation and, if appropriate, sale
and reinvestment of the Subadviser Assets. The Adviser agrees to
provide to the Subadviser such assistance as may be reasonably
requested by the Subadviser in connection with its activities under
this Agreement, including, without limitation, information concerning
the Fund, its funds available, or to become available, for investment
and generally as to the conditions of the Fund's affairs.
(b) Compliance with Applicable Laws and Governing Documents.
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In the performance of its duties and obligations under this Agreement,
the Subadviser shall act in conformity with the Prospectus and with
the instructions and directions received in writing from the Adviser
or the Board of Trustees of the Trust and will comply with the
requirements of the 1940 Act, the Advisers Act, the Internal Revenue
Code of 1986, as amended (the "Code") (including the requirements for
qualification as a regulated investment company) and all other federal
and state laws and regulations applicable to its services hereunder.
Notwithstanding
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the foregoing, the Adviser shall remain responsible for ensuring the
Fund's overall compliance with the 1940 Act, the Advisers Act, the
Code and all other applicable federal and state laws and regulations
and the Subadviser is only obligated to comply with subsection (b)
with respect to the Subadviser Assets.
The Adviser will provide the Subadviser with reasonable
advance notice of any change in the Fund's investment objectives,
policies and restrictions as stated in the Prospectus, and the
Subadviser shall, in the performance of its duties and obligations
under this Agreement, manage the Fund Investments consistent with such
changes. The Adviser acknowledges and agrees that the Prospectus will
at all times be in compliance with all disclosure requirements under
all applicable federal and state laws and regulations relating to the
Trust or the Fund, including, without limitation, the 1940 Act and the
rules and regulations thereunder, and that the Subadviser shall have
no liability in connection therewith, except as to the accuracy of
material information furnished in writing by the Subadviser to the
Fund or to the Adviser specifically for inclusion in the Prospectus.
The Subadviser hereby agrees to provide to the Adviser in a timely
manner such information relating to the Subadviser and its
relationship to, and actions for, the Fund as may be required to be
contained in the Prospectus.
In fulfilling these requirements and its other requirements
and obligations hereunder, the Subadviser shall be entitled to rely on
and act in accordance with (1) information, which is not clearly
inaccurate on its face, provided to it by the Trust's administrator,
fund accountant, custodian or other service provider and (2)
instructions, which may be standing instructions, from the Adviser.
The Adviser agrees to provide or cause to be provided to the
Subadviser on an ongoing basis upon request by the Subadviser, such
information as is requested by the Subadviser for the performance of
its obligations under this Agreement, and the Subadviser shall not be
in breach of any term of this Agreement or be deemed to have acted
negligently if the Adviser fails to provide or cause to be provided
such information and the Subadviser relies on the information most
recently provided to it.
(c) Voting of Proxies. The Subadviser shall have the power
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to vote, either in person or by proxy, all securities in which the
Subadviser Assets may be invested from time to time, and shall not be
required to seek instructions from, the Adviser or the Fund.
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(d) Agent. Subject to any other written instructions of the
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Adviser or the Trust, the Subadviser is hereby appointed the Adviser's
and the Trust's agent and attorney-in-fact for the limited purposes of
executing account documentation, agreements, contracts and other
documents as the Subadviser shall be requested by brokers, dealers,
counterparties and other persons in connection with its management of
the assets of the Fund. The Subadviser agrees to provide the Adviser
and the Trust with copies of any such agreements executed on behalf of
the Adviser or the Trust.
(e) Brokerage. The Subadviser is authorized, subject to the
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supervision of the Adviser and the Trust's Board of Trustees and in
accordance with the Prospectus or such other policies or practices as
may be established by the Trustees, to establish and maintain accounts
on behalf of the Fund with, and place orders for the purchase and sale
of the Fund Investments with or through, such persons, brokers or
dealers ("brokers") as Subadviser may elect and negotiate commissions
to be paid on such transactions. The Subadviser, however, is not
required to obtain the consent of the Adviser or the Trust's Board of
Trustees prior to establishing any such brokerage account. The
Subadviser shall place all orders for the purchase and sale of
portfolio investments for the Fund's account with brokers selected by
the Subadviser. In the selection of such brokers and the placing of
such orders, the Subadviser shall use its best efforts to seek 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 or spreads for brokerage and research services, as
provided below. In using its best efforts to obtain for the Fund 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 price, the size of the
transaction, the breadth and nature of the market for the security,
the difficulty of the execution, the amount of the commission or
spreads, if any, the timing of the transaction, market prices and
trends, the reputation, experience and financial stability of the
broker involved, and the quality of service rendered by the broker or
dealer in other transactions. Subject to such policies as the Trustees
may determine, including, without limitation, policies contained in
the Prospectus, or as may be mutually agreed to by the Adviser and the
Subadviser, and to the extent permitted by applicable law, the
Subadviser shall be allowed to select a broker that provides brokerage
and research services to the Subadviser who charges a commission or
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spread for effecting a Fund investment transaction that is in excess
of the amount of commission or spread that another broker would have
charged for effecting that transaction.
It is recognized that the services provided by such brokers
may be useful to the Subadviser in connection with the Subadviser's
services to other clients. On occasions when the Subadviser deems the
purchase or sale of a security to be in the best interests of the Fund
as well as other clients of the Subadviser, the Subadviser, to the
extent permitted by applicable laws and regulations, may, but shall be
under no obligation to, aggregate the securities to be sold or
purchased in order to obtain the most favorable price or lower
brokerage commissions and efficient execution. In such event,
allocation of securities so sold or purchased, as well as the expenses
incurred in the transaction, will be made by the Subadviser in the
manner the Subadviser considers to be the most equitable and
consistent with its fiduciary obligations to the Fund and to such
other clients over time. It is recognized that in some cases, this
procedure may adversely affect the price paid or received by the Fund
or the size of the position obtainable for, or disposed of by, the
Fund.
(f) Securities Transactions. The Subadviser and any
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affiliated person of the Subadviser will not purchase securities or
other instruments from or sell securities or other instruments to the
Fund; provided, however, the Subadviser may purchase securities or
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other instruments from or sell securities or other instruments to the
Fund if such transaction is permissible under applicable laws and
regulations, including, without limitation, the 1940 Act and the
Advisers Act and the rules and regulations promulgated thereunder.
The Subadviser, including its Access Persons (as defined in
subsection (e) of Rule 17j-l under the 1940 Act), agrees to observe
and comply with Rule 17j-l and its Code of Ethics (which shall comply
in all material respects with Rule 17j-l, as the same may be amended
from time to time). On a quarterly basis, the Subadviser will either
(i) certify to the Adviser that the Subadviser and its Access Persons
have complied with the Subadviser's Code of Ethics with respect to the
Subadviser Assets or (ii) identify any material violations which have
occurred with respect to the Subadviser Assets. In addition, the
Subadviser will report at least annually to the Adviser concerning any
other violations of the Subadviser's Code of Ethics
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which required significant remedial action and which were not
previously reported.
(g) Books and Records. Pursuant both to the 1940 Act and the
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Advisers Act and the rules and regulations promulgated thereunder, the
Subadviser shall maintain separate books and records of all matters
pertaining to the Subadviser Assets. The Fund's books and records
(relating to the Subadviser Assets) shall be available to the Adviser
at any time upon reasonable request during normal business hours and
shall be available for telecopying without unreasonable delay to the
Adviser during any day that the Fund is open for business.
(h) Information Concerning Fund Investments and Subadviser.
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From time to time (but no less often than quarterly) as the Adviser or
the Fund may reasonably request, the Subadviser will furnish the
requesting party reports on portfolio transactions and reports on Fund
Investments held in the portfolio, all in such detail as the Adviser
or the Fund may reasonably request. The Subadviser will also inform
the Adviser promptly of changes in portfolio managers responsible for
Subadviser Assets or of changes in the control of the Subadviser. The
Subadviser will make available its officers and employees to meet with
the Trust's Board of Trustees in person annually on reasonable notice
to review the Fund Investments and the Subadviser will report to the
Board of Trustees in writing on the Fund Investments quarterly. Under
normal circumstances, employees of the Subadviser shall not be
obligated to attend in person more than one Board meeting per year.
(i) Custody Arrangements. The Subadviser shall on each
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business day provide the Adviser and the Trust's custodian such
information as the Adviser and the Trust's custodian may reasonably
request relating to all transactions concerning the Fund Investments
including, without limitation, recommendations, in accordance with
policies and procedures established by the Trustees, of the fair value
of securities for which market quotes are not available.
3. Independent Contractor. In the performance of its duties hereunder,
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the Subadviser is and shall be an independent contractor and unless otherwise
expressly provided herein or otherwise authorized in writing, shall have no
authority to act for or represent the Fund or the Adviser in any way or
otherwise be deemed an agent of the Fund or the Adviser.
4. Expenses. During the term of this Agreement, Subadviser will pay
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all expenses incurred by it in connection with its activities under this
Agreement other than the cost of securities, commodities and other investments
(including
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brokerage fees and commissions and other transaction charges, if any) purchased
for the Fund. The Subadviser shall not be responsible for any expenses of the
operations of the Fund including, without limitation, brokerage fees and
commissions and other transaction charges, if any. The Subadviser shall not be
responsible for the Trust's, the Fund's or the Adviser's expenses.
5. Compensation. For the services provided and the expenses assumed
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with respect to the Fund pursuant to this Agreement, the Subadviser will be
entitled to a fee, computed and accrued daily and payable monthly in arrears no
later than the seventh (7th) business day following the end of each month, from
the Adviser or the Trust, calculated at the annual rate set forth in Exhibit I.
The method of determining net assets of the Fund for purposes hereof
shall be the same as the method of determining net assets for purposes of
establishing the offering and redemption price of the shares of the Fund as
described in the Prospectus. If this Agreement shall be effective for only a
portion of a month, the aforesaid fee shall be prorated for the portion of such
month during which this Agreement is in effect.
Notwithstanding any other provision of this Agreement, the Subadviser
may from time to time agree not to impose all or a portion of its fee otherwise
payable hereunder (in advance of the time such fee or portion thereof would
otherwise accrue). Any such fee reduction may be discontinued or modified by the
Subadviser at any time.
6. Representation and Warranties of Subadviser. The Subadviser
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represents and warrants to the Adviser and the Fund as follows:
(a) The Subadviser is registered as an investment adviser
under the Advisers Act;
(b) The Subadviser is a corporation duly organized and
validly existing under the laws of the State of Delaware with the
power to own and possess its assets and carry on its business as it is
now being conducted;
(c) The execution, delivery and performance by the
Subadviser of this Agreement are within the Subadviser's powers and
have been duly authorized by its Board of Directors or shareholders,
and no action by or in respect of, or filing with, any governmental
body, agency or official is required on the part of the Subadviser for
the execution, delivery and performance by the Subadviser of this
Agreement, and the execution, delivery and performance by the
Subadviser of this Agreement do not contravene or constitute a default
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under (i) any provision of applicable law, rule or regulation, (ii)
the Subadviser's governing instruments, or (iii) any material
agreement, judgment, injunction, order, decree or other instrument
binding upon the Subadviser;
(d) The Form ADV of the Subadviser previously provided to
the Adviser is a true and complete copy of the form filed with the SEC
and the information contained therein is accurate and complete in all
material respects.
7. Representations and Warranties of Adviser. The Adviser represents
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and warrants to the Subadviser as follows:
(a) The Adviser is registered as an investment adviser under
the Advisers Act;
(b) The Adviser is a corporation duly organized and validly
existing under the laws of the State of Delaware with the power to own
and possess its assets and carry on its business as it is now being
conducted;
(c) The execution, delivery and performance by the Adviser
of this Agreement are within the Adviser's powers and have been duly
authorized by its Board of Directors or shareholders, and no action by
or in respect of, or filing with, any governmental body, agency or
official is required on the part of the Adviser for the execution,
delivery and performance by the Adviser of this Agreement, and the
execution, delivery and performance by the Adviser of this Agreement
do not contravene or constitute a default under (i) any provision of
applicable law, rule or regulation, (ii) the Adviser's governing
instruments, or (iii) any material agreement, judgment, injunction,
order, decree or other instrument binding upon the Adviser;
(d) The Form ADV of the Adviser previously provided to the
Subadviser is a true and complete copy of the form filed with the SEC
and the information contained therein is accurate and complete in all
material respects;
(e) The Adviser acknowledges that it has received a copy of
the Subadviser's Form ADV prior to the execution of this Agreement;
(f) The Trust is in compliance in all material respects, and
during the term of this Agreement will remain in compliance in all
material respects, with all federal and state laws, rules and
regulations applicable to the Trust and the operation of its
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business (other than those related to investment objectives, policies
and restrictions over which the Subadviser has discretion pursuant to
the terms hereof), including, without limitation, applicable
disclosure and filing obligations for prospectuses, statements of
additional information, registration statements, periodic reports to
shareholders and regulatory bodies, proxy statements and promotional
materials and advertisements; and
(g) The Trust is in compliance in all material respects, and
during the term of this Agreement will remain in compliance in all
material respects, with the terms and conditions of the Prospectus
(other than those related to investment objectives, policies and
restrictions over which the Subadviser has discretion pursuant to the
terms hereof), including, without limitation, provisions relating to
the computation of the Trust's net asset value and those relating to
processing purchase, exchange and redemption requests.
8. Survival of Representations and Warranties; Duty to Update
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Information. All representations and warranties made by the Subadviser and the
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Adviser pursuant to Sections 6 and 7, respectively, shall survive for the
duration of this Agreement and the parties hereto shall promptly notify each
other in writing upon becoming aware that any of the foregoing representations
and warranties are no longer true.
9. Liability. Except as may otherwise be provided by the 1940 Act or
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other federal securities laws, in the absence of willful misfeasance, bad faith
or gross negligence on the part of the Subadviser or a reckless disregard of its
duties hereunder, the Subadviser, any affiliated person of the Subadviser and
each person, if any, who within the meaning of the Securities Act of 1933, as
amended, controls the Subadviser ("Controlling Persons") shall not be subject to
any liability to the Adviser, the Trust or the Fund or any of the Fund's
shareholders, and, in the absence of willful misfeasance, bad faith or gross
negligence on the part of the Adviser or a reckless disregard of its duties
hereunder, the Adviser, any affiliated person of the Adviser and each of its
Controlling Persons shall not be subject to any liability to the Subadviser, for
any act or omission in the case of, or connected with, rendering services
hereunder or for any losses that may be sustained in the purchase, holding or
sale of Fund Investments.
10. Duration and Termination.
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(a) Duration. This Agreement shall become effective as of
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March 1, 2000. This Agreement will continue for an initial period of
two years and thereafter shall continue automatically for successive
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annual periods, provided such continuance is specifically approved at
least annually by the Trust's Board of Trustees or vote of a majority
of the outstanding voting securities of the Fund; provided that in
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either event its continuance also is approved by a majority of the
Trust's Trustees who are not "interested persons" (as defined in the
0000 Xxx) of any party to this Agreement, by vote cast in person at a
meeting called for the purpose of voting on such approval.
(b) Termination. Notwithstanding whatever may be provided
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herein to the contrary, this Agreement may be terminated at any time,
without payment of any penalty:
(i) By vote of a majority of the Trust's Board of
Trustees, or by vote of a majority of the outstanding voting
securities of the Fund, or by the Adviser, in each case,
upon sixty (60) days' written notice to the Subadviser;
(ii) By any party hereto immediately upon written
notice to the other parties in the event of a material
breach of any provision of this Agreement by the other
party; or
(iii) By the Subadviser upon sixty (60) days
written notice to the Adviser and the Trust.
This Agreement shall not be assigned (as such term is defined in the
0000 Xxx) and shall terminate automatically in the event of its
assignment or upon the termination of the Advisory Agreement. In the
event this Agreement is terminated or is not approved in the foregoing
manner, the provisions contained in Section 9 shall remain in effect.
11. Reference to Subadviser. Neither the Adviser, the Trust nor any
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affiliated person or agent of the Adviser or the Trust shall make reference to
or use the name of "Warburg Pincus" or "Credit Suisse" or "CSAM" or any
derivative thereof or logo associated with that name, except references
concerning the identity of and services provided by the Subadviser to the Fund,
which references shall not differ in substance from those included in the
Prospectus and this Agreement, in any advertising or promotional materials
without the prior approval of the Subadviser, which approval shall not be
unreasonably withheld or delayed.
Upon termination of this Agreement in accordance with Section 10(b)
hereof, the Adviser, the Trust and the Fund and their affiliates shall cease to
make such reference or use such name (or derivative or logo).
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12. Amendment. This Agreement may be amended by written amendment
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signed by the parties, provided that the terms of any material amendment shall
be approved by: (a) the Trust's Board of Trustees or by a vote of a majority of
the outstanding voting securities of the Fund and (b) the vote of a majority of
those Trustees of the Trust who are not "interested persons" of either party to
this Agreement cast in person at a meeting called for the purpose of voting on
such approval, if such approval is required by applicable law.
13. Confidentiality. Subject to the duties of the Subadviser to comply
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with applicable law, including any demand of any regulatory or taxing authority
having jurisdiction, the Subadviser shall treat as confidential all records and
other information pertaining to the Fund or the Adviser which the Subadviser
maintains or receives as a result of its responsibilities under this Agreement.
In addition, subject to the duties to comply with any applicable law, the
Adviser agrees to treat as confidential any information concerning the
Subadviser, including its investment policies or objectives, which the Adviser
receives as the result of its actions under this Agreement.
14. Notice. Any notice that is required to be given by the parties to
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each other under the terms of this Agreement shall be in writing, delivered, or
mailed postpaid to the other parties at the following addresses, which may from
time to time be changed by the parties by notice to the other parties:
(a) If to the Subadviser:
Credit Suisse Asset Management, LLC
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Attention: General Counsel
(b) If to the Adviser:
American General Asset Management Corp.
000 Xxxxxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Attention: Xxxxxx X. Xxxxxx, Xx.
(c) If to the Trust:
North American Funds
c/o CypressTree Asset Management
Corporation, Inc.
000 Xxxxxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Attention: Xxxxxx X. Xxxxxx, Xx.
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15. Jurisdiction. This Agreement shall be governed by and construed in
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accordance with substantive laws of the Commonwealth of Massachusetts without
reference to choice of law principles thereof and in accordance with the 1940
Act. In the case of any conflict, the 1940 Act shall control.
16. Counterparts. This Agreement may be executed in one or more
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counterparts, each of which shall be deemed an original, all of which shall
together constitute one and the same instrument.
17. Certain Definitions. For the purposes of this Agreement,
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"interested person," "affiliated person", "majority of outstanding voting
securities" and "assignment" shall have their respective meanings as set forth
in the 1940 Act, subject, however, to such exemptions as may be granted by the
SEC.
18. Captions. The captions herein are included for convenience of
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reference only and shall be ignored in the construction or interpretation
hereof.
19. Severability. If any provision of this Agreement shall be held or
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made invalid by a court decision or applicable law, the remainder of the
Agreement shall not be affected adversely and shall remain in full force and
effect.
20. Massachusetts Business Trust. The terms "Trust" and "Trustees"
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refer respectively to the Trust created and the Trustees as trustees but not
individually or personally, acting from time to time under a Declaration of
Trust, which has been or may be amended from time to time, and to which
reference is hereby made and a copy of which is on file at the office of the
Secretary of State of The Commonwealth of Massachusetts and elsewhere as
required by law, and to any and all amendments thereto so filed or hereafter
filed. The Subadviser hereby acknowledges and agrees that the obligations of the
Trust entered into in the name or on behalf thereof by any of the Trust, the
Trustees or their representatives or agents are not made individually, but only
in their capacities with respect to the Trust. Such obligations are not binding
upon any of the Trustees, shareholders or representatives of the Trust
personally, but bind only the assets of the Trust. The Subadviser hereby
acknowledges and agrees that all persons dealing with any series of shares of
the Trust must look solely to the assets of the Trust belonging to such series
for the enforcement of any claims against the Trust.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement on
the day and year first written above.
AMERICAN GENERAL ASSET MANAGEMENT CORP.
By:_______________________________
Xxxxxx X. Xxxxxx, Xx.
Vice President
CREDIT SUISSE ASSET MANAGEMENT, LLC
By:_______________________________
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EXHIBIT I
.55% of the Fund's average daily net assets
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