EXHIBIT 5(C)
PanAgora Sub-Advisory Agreement
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(S&P 100 Plus Portfolio)
PANAGORA ASSET MANAGEMENT SUB-ADVISORY AGREEMENT
ASSIGNMENT AND CONSENT
THIS ASSIGNMENT AND CONSENT ("Assignment") is made as of this 31st day of
January, 1996, by and among PRINCIPAL PRESERVATION PORTFOLIOS, INC. ("Principal
Preservation"), a Maryland corporation which is a series, open-end, management
investment company registered under the Investment Company Act of 1940, ▇.▇.
▇▇▇▇▇▇▇ AND COMPANY ("▇.▇. ▇▇▇▇▇▇▇"), a registered investment adviser which
presently serves as the investment adviser to Principal Preservation's S&P 100
Plus Portfolio, ▇▇▇▇▇▇▇ ASSET MANAGEMENT, INC. ("ZAMI"), a registered investment
adviser which is an affiliate of ▇.▇. ▇▇▇▇▇▇▇, and PANAGORA ASSET MANAGEMENT,
INC. ("PanAgora"), a registered investment adviser which presently serves as
sub-adviser to Principal Preservation's S&P 100 Plus Portfolio.
RECITALS
WHEREAS, ▇.▇. ▇▇▇▇▇▇▇ and ZAMI are each wholly-owned subsidiaries of The
▇▇▇▇▇▇▇ Companies, Inc.;
WHEREAS, ▇.▇. ▇▇▇▇▇▇▇ presently serves as investment adviser to Principal
Preservation's S&P 100 Plus Portfolio pursuant to the terms of a May 1, 1989
Investment Advisory Agreement by and between Principal Preservation and ▇.▇.
▇▇▇▇▇▇▇ (the "Investment Advisory Agreement"), and PanAgora presently serves as
sub-adviser to Principal Preservation's S&P 100 Plus Portfolio pursuant to the
terms of a May 1, 1991 Sub-Advisory Agreement by and among Principal
Preservation (on behalf of the S&P 100 Plus Portfolio), ▇.▇. ▇▇▇▇▇▇▇ (as
investment adviser to the S&P 100 Plus Portfolio), and PanAgora (the "Sub-
Advisory Agreement");
WHEREAS, in connection with a restructuring and realignment, The ▇▇▇▇▇▇▇
Companies, Inc. is consolidating all of its investment advisory operations
within ZAMI, and therefore, by the mutual consent of ▇.▇. ▇▇▇▇▇▇▇, ZAMI and
Principal Preservation, the Investment Advisory Agreement this day is being
assigned from ▇.▇. ▇▇▇▇▇▇▇ to, and is being assumed by, ZAMI;
WHEREAS, in a consistent fashion, the parties to this Assignment wish to
express their intention and consent to the Assignment by ▇.▇. ▇▇▇▇▇▇▇ of all of
its duties and obligations under the Sub-Advisory Agreement to ZAMI, and for
ZAMI to assume and agree to perform all of ▇.▇. ▇▇▇▇▇▇▇'▇ duties and obligations
under the Sub-Advisory Agreement;
AGREEMENT
NOW, THEREFORE, for and in consideration of the mutual promises set forth
herein, and for other good and valuable consideration, the receipt and
sufficiency of which is acknowledged by all parties hereto, the parties hereto
agree as follows:
1. ASSIGNMENT AND ASSUMPTION OF SUB-ADVISORY AGREEMENT. Effective at the
close of business on January 31, 1996, ▇.▇. ▇▇▇▇▇▇▇ hereby assigns, conveys, and
transfers all of its rights, duties and obligations under the Sub-Advisory
Agreement to ZAMI, and ZAMI agrees to become bound by the terms and conditions
of the Sub-Advisory Agreement and to assume, discharge, perform and become
liable for the performance of all of ▇.▇. ▇▇▇▇▇▇▇'▇ duties and obligations under
the Sub-Advisory Agreement. Principal Preservation and PanAgora each hereby
consent to such assignment and assumption. Accordingly, from and after the
close of business on January 31, 1996, the Sub-Advisory Agreement shall continue
in full force and effect with all duties and obligations of ▇.▇. ▇▇▇▇▇▇▇
thereunder being deemed duties and obligations of ZAMI as though Principal
Preservation and PanAgora had executed such Sub-Advisory Agreement with ZAMI,
and all rights of ▇.▇. ▇▇▇▇▇▇▇ under such Sub-Advisory Agreement shall be deemed
rights of ZAMI enforceable by ZAMI. In short, each and every reference to ▇.▇.
▇▇▇▇▇▇▇ in the Sub-Advisory Agreement shall be deemed instead a reference to
ZAMI.
2. EFFECT OF ASSIGNMENT. The parties acknowledge and intend that,
because (among other factors) ▇.▇. ▇▇▇▇▇▇▇ and ZAMI are under the common control
of The ▇▇▇▇▇▇▇ Companies, Inc., this Assignment and Consent does not result in
an "assignment" (as that term is defined in the Investment Company Act of 1940)
of the Sub-Advisory Agreement which would bring about its automatic termination.
IN WITNESS WHEREOF, each of the parties hereto has caused this Assignment
to be executed on its behalf by its duly authorized officer as of the date and
year written above.
PRINCIPAL PRESERVATION PORTFOLIOS, INC.
By: /s/ ▇.▇. ▇▇▇▇▇▇▇
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▇. ▇. ▇▇▇▇▇▇▇, President
▇.▇. ▇▇▇▇▇▇▇ AND COMPANY
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, President
▇▇▇▇▇▇▇ ASSET MANAGEMENT, INC.
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇
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▇▇▇▇▇ ▇▇▇▇▇▇, President and CEO
PANAGORA ASSET MANAGEMENT, INC.
By: /s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
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▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, Senior Manager
SUB-ADVISORY AGREEMENT
AGREEMENT made as of the 1st day of May, 1991, by and among PRINCIPAL
PRESERVATION PORTFOLIOS, INC. (the "Fund"), a Maryland corporation, ▇.▇. ▇▇▇▇▇▇▇
AND COMPANY (the "Advisor"), and PANAGORA ASSET MANAGEMENT, INC. (the "Sub-
Advisor").
W I T N E S S E T H :
In consideration of the mutual promises and agreements herein contained and
other good and valuable consideration, the receipt of which is hereby
acknowledged, it is hereby agreed by and among the parties hereto as follows:
1. IN GENERAL
The Sub-Advisor agrees, as more fully set forth herein, to act as
Sub-Advisor to the Fund with respect to the investment and
reinvestment of the assets of each series of its common stock
specified on Exhibit A hereto. Each series is referred to herein as a
"Portfolio," and collectively as the "Portfolios." The Sub-Advisor
agrees to supervise and arrange the purchase of securities for and the
sale of securities held in the portfolios of each Portfolio specified
on Exhibit A. It is understood that the Fund may create one or more
additional series of shares and that, if it does so, this Agreement
may be amended by the mutual written consent of the parties to include
additional series under the terms of this Agreement.
2. DUTIES AND OBLIGATIONS OF THE SUB-ADVISOR WITH RESPECT TO INVESTMENTS
OF ASSETS OF THE PORTFOLIOS
(a) Subject to the succeeding provisions of this section and
subject to the oversight and review of the Advisor and the direction
and control of the Board of Directors of the Fund, the Sub-Advisor
shall:
(i) Determine what securities shall be purchased or sold by
each Portfolio specified on Exhibit A;
(ii) Arrange for the purchase and the sale of securities
held in each Portfolio specified on Exhibit A; and
(iii) Provide the Advisor and the Directors with such
reports as may reasonably be requested in connection with the
discharge of the foregoing responsibilities and the discharge of
the Advisor's responsibilities under the Investment Advisory
Agreement with the Fund and those of ▇.▇. ▇▇▇▇▇▇▇ and Company
(the "Distributor") under the Distribution Agreement with the
Fund.
(b) Any investment purchases or sales made by the Sub-Advisor
under this section shall at all times conform to, and be in accordance
with, any requirements imposed by: (1) the provisions of the
Investment Company Act of 1940 (the "Act") and of any rules or
regulations in force thereunder; and (2) the provisions of the
Articles of Incorporation and By-Laws of the Fund as amended from time
to time; (3) any policies and determinations of the Board of Directors
of the Fund; and (4) the fundamental policies of the Fund, as
reflected in its registration statement under the Act, or as amended
by the shareholders of the Fund; provided that copies of the items
referred to in clauses (2), (3) and (4) shall have been furnished to
the Sub-Advisor.
(c) The Sub-Advisor shall give the Fund the benefit of its best
judgment and effort in rendering services hereunder. In the absence
of willful misfeasance, bad faith, gross negligence or reckless
disregard of its obligations or duties ("disabling conduct") hereunder
on the part of the Sub-Advisor (and its officers, directors, agents,
employees, controlling persons, shareholders and any other person or
entity affiliated with the Sub-Advisor) the Sub-Advisor shall not be
subject to liability to the Fund or to any shareholder of the Fund for
any act or omission in the course of, or connected with rendering
services hereunder, including without limitation, any error of
judgment or mistake of law or for any loss suffered by any of them in
connection with the matters to which this Agreement relates, except to
the extent specified in Section 36(b) of the Act concerning loss
resulting from a breach of fiduciary duty with respect to the receipt
of compensation for services. Except for such disabling conduct, the
Fund shall indemnify the Sub-Advisor (and its officers, directors,
agents, employees, controlling persons, shareholders and any other
person or entity affiliated with the Sub-Advisor) against any
liability arising from the Sub-Advisor's conduct under this Agreement
to the extent permitted by the Fund's Articles of Incorporation, By-
Laws and applicable law.
(d) Nothing in this Agreement shall prevent the Sub-Advisor or
any affiliated person (as defined in the Act) of the Sub-Advisor from
acting as investment advisor or manager for any other person, firm or
corporation and shall not in any way limit or restrict the Sub-Advisor
or any such affiliated person from buying, selling or trading any
securities for its or their own accounts or for the accounts of others
for whom it or they may be acting, provided, however, that the Sub-
Advisor expressly represents that it will undertake no activities
which, in its judgment, will adversely affect the performance of its
obligations to the Fund under this Agreement or under the Act. It is
agreed that the Sub-Advisor 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-Advisor for inclusion therein. The Sub-Advisor
shall be deemed to be an independent contractor and, unless otherwise
expressly provided or authorized, have no authority to act for or
represent the Fund in any way or otherwise be deemed an agent of the
Fund.
(e) In connection with its duties to arrange for the purchase
and sales of the Fund's portfolio securities, the Sub-Advisor shall
follow the principles set forth in any Investment advisory agreement
in effect from time to time between the Fund and the Advisor, provided
that a copy of any such agreement shall have been provided to the Sub-
Advisor. The Sub-Advisor will promptly communicate to the Advisor and
to the officers and the Directors of the Fund such information
relating to portfolio transactions as they may reasonably request.
3. ALLOCATION OF EXPENSES
The Sub-Advisor agrees that it will furnish the Fund, at the Sub-
Advisor's expense, with all office space and facilities, equipment and
clerical personnel necessary for carrying out its duties under this
Agreement. The Sub-Advisor will also pay all compensation of those of
the Fund's officers and employees, if any, and of those Directors, if
any, who in each case are affiliated persons of the Sub-Advisor.
4. CERTAIN RECORDS
Any records required to be maintained and preserved pursuant to
the provisions of Rule 31a-1 and Rule 31a-2 under the Act which are
prepared or maintained by the Sub-Advisor on behalf of the Fund are
the property of the Fund and will be surrendered promptly to the Fund
or the Advisor on request.
5. REFERENCE TO THE SUB-ADVISOR
Neither the Fund, the Advisor or any affiliate or agent thereof
shall make reference to or use the name of the Sub-Advisor or any of
its affiliates in any advertising or promotional materials without the
prior approval of the Sub-Advisor, which approval shall not be
unreasonably withheld.
6. COMPENSATION OF THE SUB-ADVISOR
The Advisor agrees to pay the Sub-Advisor and the Sub-Advisor
agrees to accept as full compensation for all services rendered by the
Sub-Advisor as such, a management fee as specified on Exhibit A.
7. DURATION AND TERMINATION
(a) This Agreement shall go into effect as to each Portfolio on
the date set forth on Exhibit A and shall, unless terminated as
hereinafter provided, continue in effect until May 1, 1993 and
thereafter from year to year, but only so long as such continuance is
specifically approved at least annually by: (i) the vote of a majori-
ty of the Directors who are not parties to this Agreement or
"interested persons" (as defined in the Act) of any such party cast in
person at a meeting called for the purpose of voting on such approval;
and (ii) either by a majority of the Board of Directors or by the vote
of the holders of a "majority" (as defined in the Act) of the
outstanding voting securities of the Fund (or with respect to any
Portfolio, by the vote of a majority of the outstanding shares of such
Portfolio).
(b) This Agreement may be terminated by the Sub-Advisor at any
time without penalty upon giving the Fund and the Advisor sixty (60)
days' written notice (which may be waived by the Fund and the Advisor)
and may be terminated by the Fund or the Advisor at any time without
penalty upon giving the Sub-Advisor sixty (60) days' written notice
(which notice may be waived by the Sub-Advisor), provided that such
termination by the Fund shall be directed or approved by the vote of a
majority of all of its Directors in office at the time or by the vote
of the holders of a majority (as defined in the Act) of the voting
securities of the Fund, or with respect to any Portfolio by the vote
of a majority of the outstanding shares of such Portfolio. This
Agreement shall automatically terminate in the event of its assignment
(as defined in the Act). This Agreement win also automatically
terminate in the event that the Investment Advisory Agreement is
terminated for any reason.
IN WITNESS WHEREOF, the parties hereto have caused the foregoing instrument
to be executed by their duly authorized officers and their seals to be hereto
affixed, all as of the day and year first above written.
PRINCIPAL PRESERVATION PORTFOLIOS, INC. ▇.▇. ▇▇▇▇▇▇▇ AND COMPANY
/s/ ▇. ▇. ▇▇▇▇▇▇▇ /s/ ▇. ▇. ▇▇▇▇▇▇▇
By: By:
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▇. ▇. ▇▇▇▇▇▇▇, President ▇. ▇. ▇▇▇▇▇▇▇, President
PANAGORA ASSET MANAGEMENT, INC.
/s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
By:
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▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, Senior Manager
EXHIBIT A
Sub-Advisory Agreement
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Pursuant to Section 6 of the Sub-Advisory Agreement to which this Exhibit A
is attached, the parties hereto agree that, effective May 1, 1996, the sub-
advisory fees payable by ▇▇▇▇▇▇▇ Asset Management, Inc. to PanAgora Asset
Management, Inc. for the latter's services as subadvisor to Principal
Preservation Portfolios, Inc.'s S&P 100 Plus Portfolio (the "Portfolio") shall
be as follows: 0.20 of 1% of the Portfolio's average daily net assets up to $100
million; 0.175 of 1% of the next $400 million of the Portfolio's average daily
net assets; and 0.15 of 1% on the Portfolio's average daily net assets in excess
of $500 million.
IN WITNESS WHEREOF, each of the parties hereto has caused this Exhibit A to
be executed on its behalf by its duly authorized officer as of this day of
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, 1996.
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PRINCIPAL PRESERVATION PORTFOLIOS, INC.
By:
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▇.▇. ▇▇▇▇▇▇▇, President
▇▇▇▇▇▇▇ ASSET MANAGEMENT, INC.
By:
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▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇., President and CEO
PANAGORA ASSET MANAGEMENT, INC.
By:
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▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, Senior Manager