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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. 1)
Filed by the Registrant [X]
Filed by a Party other than the Registrant [_]
Check the appropriate box:
[X] Preliminary Proxy Statement [_] Confidential, for Use of the
Commission Only (as permitted by
Rule 14a-6(e)(2))
[_] Definitive Proxy Statement
[_] Definitive Additional Materials
[_] Soliciting Material Pursuant to Section 240.14a-11(c) or Section 240.14a-12
Chubb America Fund, Inc.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
Chubb America Fund, Inc.
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[_] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
-------------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
-------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which
the filing fee is calculated and state how it was determined):
-------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
-------------------------------------------------------------------------
(5) Total fee paid:
-------------------------------------------------------------------------
[_] Fee paid previously with preliminary materials.
[_] Check box if any part of the fee is offset as provided by Exchange
Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee
was paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
-------------------------------------------------------------------------
(2) Form, Schedule or Registration Statement No.:
-------------------------------------------------------------------------
(3) Filing Party:
-------------------------------------------------------------------------
(4) Date Filed:
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Notes:
<PAGE>
CHUBB LIFE INSURANCE COMPANY OF AMERICA
INDIVIDUAL FLEXIBLE PREMIUM VARIABLE LIFE INSURANCE POLICIES
[July 10], 1997
Dear Policy owner:
On Friday, August 15, 1997 a Special Meeting of Shareholders ("Special
Meeting") of Chubb America Fund, Inc. (the "Fund"), on behalf of its World
Growth Stock, Money Market, Gold Stock, Bond, Domestic Growth Stock, Growth and
Income, Capital Growth, Balanced, and Emerging Growth Portfolios (the
"Portfolios"), will be held at One Granite Place, Concord, New Hampshire for the
purposes set forth in the attached Notice.
As you may know, the investment manager to the Fund is Chubb Investment
Advisory Corporation (the "Adviser"). The Adviser's parent company, Chubb Life
Insurance Company of America ("Chubb Life"), was purchased by Jefferson-Pilot
Corporation, effective April 30, 1997. As a result of this change of ownership,
the Fund must enter into a new Investment Management Agreement with the Adviser
and new Investment Subadvisory Agreements with the subadvisers to the
Portfolios. In addition, the Fund's Board of Directors has decided to replace
the investment subadvisers for three of the Portfolios.
The Special Meeting has been called primarily so that shareholders may
consider and vote on the new Investment Management Agreement between the Fund
and the Adviser, which is substantially the same as the original agreement
between the parties. Shareholders will also be asked to consider and vote on new
subadvisory agreements between the Adviser and each of the subadvisers to the
Portfolios (including the new subadvisers), to vote on a proposal to permit the
Fund in the future to change or add subadvisers without a shareholder vote, and
to elect directors.
Shares of the Fund's Portfolios are purchased by corresponding divisions of
Chubb Separate Account A ("Separate Account A") to fund the flexible premium
variable life insurance policies (the "Policies") issued by Chubb Life. At the
Special Meeting, Chubb Life will vote the shares of the Portfolios held in
Separate Account A based on voting instructions received from owners of the
Policies ("Policy owners"). Each Policy owner is entitled to give voting
instructions to Chubb Life with respect to the number of shares of the
respective Portfolios attributable to the Policy owner as of the record date of
June 20, 1997. As the owner of a Policy, you are being asked for your voting
instructions on the proposals described in the attached Proxy and Voting
Instructions Statement.
Attached are the formal Notice of Special Meeting of Shareholders and the
Proxy and Voting Instructions Statement setting forth the matters to come before
the Special Meeting. A form of Voting Instruction for each Portfolio with
respect to which you are entitled to provide voting instructions is also
enclosed for your use.
Your interest in the Fund is gratefully acknowledged. PLEASE SIGN, DATE AND
RETURN THE ENCLOSED VOTING INSTRUCTIONS SO THAT YOUR INSTRUCTIONS CAN BE
REPRESENTED. Thank you for your prompt response.
Sincerely,
Charles C. Cornelio
Executive Vice President
IMPORTANT: You will receive one Proxy and Voting Instructions Statement for
each Portfolio you have designated for the investment of your Policy. Please
complete and return a separate Voting Instruction card for each Portfolio.
<PAGE>
CHUBB AMERICA FUND, INC.
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
TO BE HELD ON AUGUST 15, 1997
NOTICE IS HEREBY GIVEN that a Special Meeting of the Shareholders of Chubb
America Fund, Inc. (the "Fund"), on behalf of its World Growth Stock, Money
Market, Gold Stock, Bond, Domestic Growth Stock, Growth and Income, Capital
Growth, Balanced, and Emerging Growth Portfolios (each a "Portfolio"), will be
held at Chubb Life Insurance Company of America, One Granite Place, Concord, New
Hampshire 03301 on August 15, 1997 at 8:00 a.m., Eastern Time. The purpose of
the Special Meeting is to consider and act on the following proposals, all of
which are more fully discussed in the accompanying Proxy and Voting Instructions
Statement dated [July 10], 1997, and to transact such other business as may
properly come before the meeting or any adjournments.
1. To elect a Board of Directors.
2. To consider and act on a new Investment Management Agreement between the
Fund, on behalf of each of its Portfolios, and Chubb Investment Advisory
Corporation (the "Adviser").
3. To consider and act on new forms of Investment Subadvisory Agreements to
be entered into between the Adviser and (a) the current investment subadvisers
to the Domestic Growth Stock Portfolio, World Growth Stock Portfolio, Emerging
Growth Portfolio, Capital Growth Portfolio, Gold Stock Portfolio, and Bond
Portfolio, and (b) the proposed new investment subadvisers to the Growth and
Income Portfolio, Money Market Portfolio, and Balanced Portfolio.
4. To consider and act on a proposal to permit the Adviser to replace
investment subadvisers ("Subadvisers") or add Subadvisers to each existing
Portfolio or new Portfolio added as a series of the Fund in the future, and to
enter into subadvisory agreements with those Subadvisers without further
shareholder approval.
Please note that the form of Voting Instructions provides a space on which
you may grant or withhold authority to mark your instructions for voting in the
election of directors and on each of the other proposals. Voting on Proposal 1
will be tabulated on a Fund-wide basis. Voting on Proposals 2, 3, and 4 will be
tabulated separately for each Portfolio.
VOTING INSTRUCTIONS WHICH ARE PROPERLY EXECUTED BUT NOT OTHERWISE MARKED
WILL BE TREATED AS INSTRUCTIONS TO VOTE IN FAVOR OF THE ELECTION OF THE PROPOSED
DIRECTORS AND IN FAVOR OF EACH OF THE OTHER PROPOSALS.
The Board of Directors has fixed the close of business on June 20, 1997 as
the record date for determining shareholders entitled to notice of and to vote
at the Special Meeting or any adjournment of the Special Meeting.
By order of the Board of Directors
Shari J. Lease
Secretary
<PAGE>
CHUBB AMERICA FUND, INC.
WORLD GROWTH STOCK PORTFOLIO
MONEY MARKET PORTFOLIO
GOLD STOCK PORTFOLIO
BOND PORTFOLIO
DOMESTIC GROWTH STOCK PORTFOLIO
GROWTH AND INCOME PORTFOLIO
CAPITAL GROWTH PORTFOLIO
BALANCED PORTFOLIO
EMERGING GROWTH PORTFOLIO
One Granite Place
Concord, New Hampshire 03301
PROXY AND VOTING INSTRUCTIONS STATEMENT:
SPECIAL MEETING OF SHAREHOLDERS TO BE HELD
AUGUST 15, 1997
INTRODUCTION
This Proxy and Voting Instructions Statement (the "Statement") and Notice
of Special Meeting with accompanying Voting Instruction Form (the "Form") are
furnished in connection with the solicitation of proxy and voting instructions
for use at the Special Meeting of Shareholders ("Special Meeting") of the World
Growth Stock, Money Market, Gold Stock, Bond, Domestic Growth Stock, Growth and
Income, Capital Growth, Balanced, and Emerging Growth Portfolios (the
"Portfolios") of Chubb America Fund, Inc. (the "Fund") to be held on
August 15, 1997 and at any adjournment of the Special Meeting. Proxy and voting
instructions are deemed solicited on behalf of the Board of Directors of the
Fund and Chubb Life Insurance Company of America ("Chubb Life").
Holders of common stock of each Portfolio as of the close of business on
June 20, 1997 (the "Record Date") will be entitled to cast one vote for each
share held. As of the Record Date, the Fund had outstanding the following number
of shares: World Growth Stock Portfolio: 4,355,893; Money Market Portfolio:
896,143; Gold Stock Portfolio: 486,491; Bond Portfolio: 1,198,945; Domestic
Growth Stock Portfolio: 3,948,303; Growth and Income Portfolio: 1,667,712;
Capital Growth Portfolio: 5,349,551; Balanced Portfolio: 1,716,588; and Emerging
Growth Portfolio: 2,221,398.
The shares of each Portfolio are currently sold to corresponding divisions
of Chubb Separate Account A ("Separate Account A") to fund flexible premium life
insurance policies (the "Policies") issued by Chubb Life. The assets in Separate
Account A are invested in shares of the corresponding Portfolios of the Fund.
Separate Account A was established by The Volunteer State Life Insurance Company
("Volunteer") in 1984 pursuant to Tennessee insurance laws and is registered as
a unit investment trust with the U.S. Securities and Exchange Commission ("SEC")
under the Investment Company Act of 1940, as amended (the "1940 Act"). On July
1, 1991, Volunteer changed its name to Chubb Life Insurance Company of America
and redomesticated from the State of Tennessee to the State of New Hampshire
with the result that Separate Account A is now governed by the New Hampshire
insurance laws.
The initial mailing of this Statement and the enclosed Form to owners of
Policies ("Policy owners") will be made on or about [July 10], 1997. Chubb Life
will vote the shares of the Portfolios held in Separate Account A that are
attributable to the Policies based on instructions received from Policy owners
participating in Separate Account A. The number of votes on which each Policy
owner has the right to provide instructions is determined by dividing the
Policy's cash value in each Portfolio by the net asset value per share of the
relevant Portfolio. The number of shares in each
<PAGE>
Portfolio for which a Policy owner has the right to give voting instructions is
determined as of the Record Date for the Special Meeting.
Shares for which no timely voting instructions are received, shares
representing charges imposed by Chubb Life or its affiliates against Separate
Account A, and shares held by Chubb Life that are not otherwise attributable to
Policies will be voted by Chubb Life in the same proportion as the voting
instructions received from Policy owners participating in each Portfolios'
division of Separate Account A.
In order to facilitate the commencement of operations of each Portfolio,
Chubb Life purchased $1 million of shares of each Portfolio, other than the
Balanced Portfolio and the Emerging Growth Portfolio. Chubb Life purchased $5
million of shares of the Balanced Portfolio and $3 million of shares of the
Emerging Growth Portfolio in order to facilitate the commencement of operations
of each of those Portfolios. As of the Record Date, Chubb Life owned the
following number of shares in its general account, representing the percentage
indicated of the outstanding shares: Growth and Income Portfolio: 8,864 (0.5%);
Capital Growth Portfolio: 7,128 (0.1%); and Balanced Portfolio: 12,716 (0.6%).
As of the Record Date, Separate Account A owned of record the following
number of shares of each Portfolio, representing the percentage indicated of the
outstanding shares: World Growth Stock Portfolio: 4,355,893 (100%); Money Market
Portfolio: 896,143 (100%); Gold Stock Portfolio: 486,491 (100%); Bond Portfolio:
1,198,945 (100%); Domestic Growth Stock Portfolio: 3,948,303 (100%); Growth
and Income Portfolio: 1,658,848 (99.5%); Capital Growth Portfolio: 5,342,423
(99.9%); Balanced Portfolio: 1,703,872 (99.4%); and Emerging Growth Portfolio:
2,221,398 (100%).
If the enclosed Form is executed and returned, it may nevertheless be
revoked at any time before the Special Meeting by (1) submitting a written
revocation or later Form, as appropriate, effective upon receipt at Chubb Life,
One Granite Place, Concord, New Hampshire 03301; or (2) attending the Meeting
and instructing Chubb Life in person. The expense of printing and distributing
to Policy owners the Statement, the Form, and other solicitation materials, as
well as any other solicitations by telephone, electronic transmission or
personal interviews conducted by personnel of Chubb Life and/or Chubb Investment
Advisory Corporation (the "Adviser"), and other costs of the Special Meeting
will be paid by Chubb Life.
A copy of the Fund's most recent annual report is available, without
charge, upon request by writing to the Chubb Life Insurance Corporation, One
Granite Place, Concord, New Hampshire 03301 or by calling 1-800-452-4822.
BACKGROUND
Chubb Investment Advisory Corporation, the Adviser, whose principal
business office is at One Granite Place, Concord, New Hampshire 03301, has
managed the investment and reinvestment of assets of the Portfolios since the
Fund commenced operations on April 18, 1986. The Adviser is wholly-owned by
Chubb Life, which is, in turn, wholly-owned by Jefferson-Pilot Corporation, a
North Carolina corporation ("Jefferson-Pilot"). The Adviser provides investment
management services to the Fund pursuant to Investment Management Agreements
dated April 27, 1989 (a single Agreement for the World Growth Stock, Money
Market, Domestic Growth Stock, Gold Stock and Bond Portfolios), February 25,
1992 (separate Agreements for the Growth and Income, Capital Growth and Balanced
Portfolios), and April 14, 1995 (with respect to the Emerging Growth
Portfolio).(1) In addition, the Fund and the Adviser have entered into
Sub-Investment Management Agreements with investment subadvisers ("Subadvisers")
that manage each Portfolio's assets. (The current Investment Management
Agreements and Sub-Investment Management Agreements will be referred to together
as the "Existing Agreements".) The Existing Agreements were last approved by the
Board of Directors on January 30, 1997 at a regularly-scheduled meeting of the
Board. The Existing Sub-Investment Management Agreements were last approved by
the shareholders on the following dates:
- --------
(1) The Adviser does not provide investment management services to any other
registered investment company.
<PAGE>
<TABLE>
<S> <C>
Gold Stock Portfolio April 22, 1986
Domestic Growth Stock Portfolio April 8, 1987
Money Market Portfolio April 27, 1989
Bond Portfolio April 25, 1991
Growth and Income Portfolio April 23, 1992
Capital Growth Portfolio April 23, 1992
Balanced Portfolio April 23, 1992
World Growth Stock Portfolio October 28, 1992
Emerging Growth Portfolio April 23, 1995
</TABLE>
On February 23, 1997, Jefferson-Pilot entered into a Stock Purchase
Agreement with Chubb providing for the transfer of 100% of the Shares of Chubb
Life to Jefferson-Pilot in exchange for a cash payment from Jefferson-Pilot to
The Chubb Corporation, a New Jersey Corporation ("Chubb"). As of the effective
date of the transaction (the "Acquisition"), which occurred on April 30, 1997,
the Adviser became an indirect wholly-owned subsidiary of Jefferson-Pilot.
Although the Acquisition is not anticipated to affect the day-to-day operations
under the Existing Agreements, such a change in ownership of the Adviser
automatically terminates the Existing Agreements in accordance with their terms
as required by the Investment Company Act of 1940, as amended (the "1940 Act").
By this Proxy and Voting Instructions Statement the Fund seeks shareholder
approval of a new Investment Management Agreement to replace the Existing
Investment Management Agreements. In addition, the Adviser will be required to
enter into new Investment Subadvisory Agreements with each of the Subadvisers
that provide advisory services to the Portfolios. (The new Investment Management
and Investment Subadvisory Agreements will together be referred to as the "New
Agreements.") As described below, if the New Agreements are approved, six of the
Portfolios will continue to have the same Subadvisers and three of the
Portfolios will have new Subadvisers. Policy owners are asked to provide voting
instructions on each of the New Agreements as described in Items 2 and 3. In
addition, Policy owners are asked to provide voting instructions on the election
of Directors to the Board of Directors (Item 1), and on whether to permit the
Adviser to replace Subadvisers or add new Subadvisers to the Portfolios, and to
enter into Subadvisory Agreements with those Subadvisers, without further
shareholder approval (Item 4).
Vote Required
A plurality of all votes cast at the meeting will be sufficient to approve
Item 1. Approval of Items 2 through 4 for each Portfolio requires the
affirmative vote of "majority of the outstanding voting securities" of that
Portfolio. Under the 1940 Act, a "majority vote of the outstanding voting
securities" means the affirmative vote of the lesser of (a) 67% or more of the
shares of the Portfolio present at the Special Meeting or represented by proxy
if the holders of more than 50% of the outstanding shares are present or
represented by proxy or (b) more than 50% of the outstanding shares.
Item 1. Election of Directors
Nominees for Director
Four individuals have been nominated for election as Directors of the Fund,
all of whom are currently directors and have served in that capacity
continuously since originally elected or appointed. None of the nominees is
related to one another. Each nominee has consented to continue to serve if
elected at the Special Meeting.
If elected, the Directors will hold office until a successor has been
elected and has qualified, or until such Director's earlier death, resignation
or removal. However, any Director may resign, and any Director may be removed
with or without cause at any time by a vote of a majority of the votes entitled
to be cast for the election of Directors at any meeting of shareholders, duly
called and at which a quorum is present. In case of a vacancy on the Board, the
remaining Directors may, in their discretion, appoint any person to fill the
vacancy. If at any time less than two-thirds of the
<PAGE>
Directors have been elected by shareholders, the Directors then in office will
promptly call a meeting of shareholders for the purpose of electing Directors.
Other than when that situation occurs, no shareholder meetings will be held for
the purpose of electing Directors, unless otherwise required.
Each of the nominees for Director is listed in the chart below. An asterisk
(*) next to a name indicates that the nominee is an "interested person" of the
Fund and/or the Adviser, as defined in the 1940 Act.
<TABLE>
<CAPTION>
Nominee Year of
(Age) Election or
Address Principal Occupations During the Past Five Years Appointment
- -------------------------------------------------------------------------------------------------
<S> <C> <C>
Ronald Angarella*....... President, the Fund; Senior Vice President, Chubb 1995
(39) Life; President and Director, the Adviser,
One Granite Place Chubb Securities Corporation ("CSC") and Hampshire
Concord, NH 03301 Funding, Inc.; Senior Vice President and Director,
Chubb Investment Funds Inc. ("CIF").
James J. Weisbart....... Retired, previously President of Bird Bath Laundromats 1989
(62) and President of Solomon's Inc. (retail clothing
301 Smithfield Road company); Director of CIF.
Contoocook, NH 03329
Michael D. Coughlin..... President of Concord Litho Company, Inc. (printing 1989
(54) company); Director of CIF.
106 School Street
Concord, NH 03301
Elizabeth S. Hager...... Executive Director, United Way of Merrimack County, 1989
(52) NH (since 1996); State Representative, New Hampshire;
5 Auburn Street Consultant, Fund Development; Director of CIF;
Concord, NH 03301 previously, City Councilor, City of Concord, NH and
Mayor, City of Concord, NH.
</TABLE>
Mr. Angarella is an "interested person" of the Fund by virtue of his position as
an officer of the Fund and his positions with the Adviser and Chubb Securities.
The Adviser is the investment adviser to the Fund, and CSC is the principal
underwriter and distributor of the Fund. The Adviser, CSC, and Hampshire
Funding, Inc. are wholly-owned subsidiaries of Chubb Life and Jefferson-Pilot.
Committees of the Board of Directors
The Board has an Audit Committee that normally meets two times per year,
prior to the first two quarterly meetings of the Board of Directors, or as
required. The Audit Committee overseas and monitors the financial reporting
process, including recommending to the Board the independent accountants to be
selected for the Fund, reviewing internal controls and the auditing function
(both internal and external), reviewing the qualifications of key personnel
performing audit work, and overseeing compliance procedures. The Audit Committee
is composed entirely of Directors who are not interested persons of the Fund,
its principal underwriter, the Adviser or its affiliates or any of the
Subadvisers. Messrs. Weisbart and Coughlin and Ms. Hager are members of the
Audit Committee.
<PAGE>
The Board also has a Valuation Committee, the purpose of which is to review
and ratify certain portfolio securities pricing decisions made on behalf of the
Fund. The members of the Valuation Committee are Mr. Angarella and Ms.
Hager.
Information on Board Meetings During Fiscal Year 1996
The Directors met four times during the fiscal year ended December 31,
1996, and each Director attended at least 75% of the meetings.
For the year ended December 31, 1996, the following Directors received
compensation for services as a director on the Fund's Board from the Fund.
<TABLE>
<CAPTION>
Aggregate Compensation
----------------------
Name
--------------------------
from Fund
---------
<S> <C>
Michael Coughlin............ $5,000
Elizabeth Hager............. 5,000
James Weisbart.............. 5,000
</TABLE>
Officers of the Fund
The following information relates to the executive officers of the Fund who
are not directors of the Fund. Each officer also serves as an officer of the
Adviser.
<TABLE>
<CAPTION>
Name (Age) Positions with Principal Occupations Year of
Address the Fund for the Past Five Years Appointment
------- -------- ----------------------- -----------
<S> <C> <C> <C>
Charles C. Cornelio (37) Vice President Executive Vice President and Assistant 1992
One Granite Place Secretary, Chubb Life and CIF; Vice
Concord, N.H. 03301 President and Secretary, CSC and
Hampshire Funding, Inc.; Secretary, the
Adviser.
Shari J. Lease (42) Secretary Assistant Vice President and Associate 1992
One Granite Place Counsel, Chubb Life; Secretary, CIF;
Concord, N.H. 03301 Assistant Secretary, the Adviser; previously
Assistant Counsel and Assistant Vice
President, State Bond and Mortgage
Company and affiliated companies.
John A. Weston (37) Treasurer Assistant Vice President of Chubb Life; 1992
One Granite Place Treasurer of CSC, the Adviser and
Concord, N.H. 03301 Hampshire Funding, Inc.; formerly,
Treasurer of Chubb Series
Trust; Mutual Fund Accounting
Officer for the Fund, CIF and
the Adviser and Assistant
Treasurer for CSC and Hampshire
Funding, Inc.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Name (Age) Positions with Principal Occupations Year of
Address the Fund for the Past Five Years Appointment
------- -------- ----------------------- -----------
<S> <C> <C> <C>
Thomas H. Elwood (49) Assistant Assistant Counsel, Chubb Life; Assistant 1994
One Granite Place Secretary Secretary, CIF; formerly, Assistant
Concord, N.H. 03301 Secretary, Chubb Series Trust; Associate
Counsel, New York Life Insurance
Company; Secretary, New York Life
Institutional Funds, Inc.; Assistant
Secretary, Mainstay Funds and MFA Funds.
Mark D. Landry (32) Assistant Mutual Fund Accounting and Operations 1993
One Granite Place Treasurer Officer for Chubb Life and the Adviser;
Concord, N.H. 03301 Assistant Treasurer of CIF; formerly,
Mutual Fund Accounting and Operations
Manager for the Fund, CIF and
the Adviser.
</TABLE>
Voting Instructions
Properly-executed Forms will be deemed to authorize the approval of all of
the four nominees, unless authority has been withheld on any or all of the
nominees according to the directions on the Forms.
Recommendation
The Board of Directors recommends that shareholders vote FOR this proposal.
Item 2. To Consider and Act on a New Investment Management Agreement Between
the Fund and the Adviser
The Board of Directors of the Fund held an in-person Board of Directors
meeting on April 3, 1997 and has unanimously approved the New Investment
Management Agreement between the Fund, on behalf of each Portfolio, and Adviser
in accordance with Section 15(c) of the 1940 Act. The New Investment Management
Agreement became effective on April 30, 1997, the date of the consummation of
the Acquisition (the "Closing"), subject to the outcome of this Special Meeting
of Shareholders.
The Fund's Exemption from Section 15(a) of the 1940 Act
The Closing was effective as of April 30, 1997. Since the Closing date did
not permit a reasonable amount of time for the Fund to call and hold a Special
Meeting of Shareholders prior to the Closing, the Fund sought and obtained from
the SEC an order of exemption from the provisions of Section 15(a) of the 1940
Act, which requires that advisory agreements terminate upon their assignment.
The order of exemption permits the Adviser to continue to provide investment
management services to the Fund, on behalf of each Portfolio, from the Closing
until the date the New Investment Management Agreement is approved or
disapproved by shareholders, but in no event later than August 28, 1997 (the
"Interim Period").
The Board of Directors of the Fund, by unanimous written consent, voted to
authorize the Fund and the Adviser to request such exemptive relief from the
SEC. The sale of Chubb Life to Jefferson-Pilot arose primarily out of business
considerations unrelated to the Fund and the Adviser, and the parties to the
Acquisition deemed it important to hold the Closing as soon as practicable.
Specifically, it is generally recognized that the period following the
announcement of a significant corporate change, such as the Acquisition, and the
completion of such an event is a period of great
<PAGE>
uncertainty and considerable anxiety. This uncertainty and anxiety can be
damaging to relationships and may cause key employees, service providers, and
perhaps even Policy owners to seek more stable arrangements elsewhere. The
parties to the Acquisition believe that prompt completion of the Acquisition
will minimize this period of uncertainty and anxiety.
It is anticipated that the scope and quality of services provided by the
Adviser for the Portfolios during and following the Interim Period will not be
diminished from the current level of service. During and following the Interim
Period, each Portfolio will operate under the New Agreements, including the New
Investment Management and Investment Subadvisory Agreements (see Item 3 below
for a discussion of the form of Investment Subadvisory Agreement), which are
identical to the Existing Agreements in all material respects, except for the
effective and termination dates and other modifications necessary both to create
one Investment Management Agreement to cover all existing and future Portfolios
and to reflect the proposal described in Item 4 below. During the Interim
Period, fees paid by the Fund, on behalf of each Portfolio, for advisory
services are being held in escrow. If the Policy owners of each of the
Portfolios approve this Item, the escrow agent will release the fees to the
Adviser. If Policy owners of each of the Portfolios do not vote in favor of this
Item, the escrow agent will return the advisory fees attributable to those
Portfolios to such Portfolios and will release all other advisory fees to the
Adviser. In addition, the Board of Directors will reconvene to determine what
action to take with respect to advisory services for those Portfolios not
approving the New Investment Management Agreement.
The Fund is not aware of any material changes in the personnel that are
providing or will provide investment management services during and following
the Interim Period. Accordingly, each Portfolio should receive, during and
following the Interim Period, the same investment advisory services, provided in
the same manner, at the same fee levels (assuming release of the fees held in
escrow during the Interim Period), and by the same personnel as before the
Closing. If the investment personnel providing investment management services
pursuant to the New Agreements changes materially, the Adviser will apprise and
consult with the Board of Directors to assure that the Board (including a
majority of the Independent Directors of the Board) is satisfied that the
services provided by the Adviser will not be diminished in scope or quality.
The Investment Management Agreement
The New Investment Management Agreement is the same as the Existing
Investment Management Agreements in all material respects. The five Existing
Agreements will be replaced by one New Agreement that will continue to set forth
the Adviser's duties in the body of the agreement, but will indicate that the
New Agreement applies to each of the Portfolios listed on Schedule A to the New
Agreement. Fees applicable to each Portfolio will also be set forth in Schedule
A. This format will allow the Fund to continue to use a single agreement--even
when Portfolios are added or deleted or fees are changed--simply by
memorializing changes approved by the Board and/or shareholders in Schedule A,
which will bear the date of the most recent change. (Notwithstanding that there
will be only one Investment Management Agreement, any future change that affects
only one Portfolio will be required to be approved only by the affected
Portfolio.) A copy of the proposed New Agreement appears as Exhibit A.
Under the New Investment Management Agreement, as under the Existing
Agreement, the Adviser will recommend and oversee, monitor and evaluate the
activities of the Subadvisers and review the practices of broker-dealers
selected by the Subadvisers. The Adviser will also be responsible for providing
office space and related utilities necessary for the Fund's operations,
recommending auditors, counsel and custodians, maintaining records not otherwise
maintained by other parties, and providing personnel, data processing services
and supplies to the Fund. The cost of such facilities, supplies and services
will continue to be included in the investment management fee.
The Adviser will be responsible for certain administrative services such as
valuing portfolio securities, net asset value ("NAV") calculation, coordinating
and conducting meetings of the Board and shareholders, recommending auditors,
counsel, custodial and other services, preparing with the assistance of the
Fund's auditor tax filings, preparing SEC related filings, and providing
professional, administrative and clerical staff for shareholder relations and
other functions. The Adviser may also subcontract the management or
administrative responsibilities it has toward the Portfolios.
<PAGE>
Investment management fees are paid monthly to the Adviser at an annual
rate based on the daily net asset value of each Portfolio, as shown below:
World Growth Stock Gold
<TABLE>
<CAPTION>
World Growth Stock, Gold
Stock, Domestic Growth
Money Market Stock, Growth and Income Capital Emerging
Average Daily Net Assets and Bond and Balanced Growth Growth
------------------------ ---------- -------------- ------- -------
<S> <C> <C> <C> <C>
First $200 Million.......... .50% .75% 1.00% .80%
Next $1.1 Billion........... .45% .70% .95% .75%
Over $1.3 Billion........... .40% .65% .90% .70%
</TABLE>
For the fiscal year ended December 31, 1996, the Fund paid the Adviser
$656,061, $42,558, $62,705, $153,464, $480,015, $135,739, $703,701, $134,709,
and $173,563 for the World Growth Stock Portfolio, the Money Market Portfolio,
the Gold Stock Portfolio, the Bond Portfolio, the Domestic Growth Stock
Portfolio, the Growth and Income Portfolio, the Capital Growth Portfolio, the
Balanced Portfolio, and the Emerging Growth Portfolio, respectively, pursuant to
the Existing Agreements.
Management of the Adviser
The names, addresses and principal occupations of the Adviser's principal
executive officer and each of its directors are as follows:
<TABLE>
<CAPTION>
Name Positions with Adviser Principal Occupation
- --------------------------------------------------------------------------------------------------
<S> <C> <C>
Ronald Angarella President and Director Senior Vice President, Chubb Life; President
and Director, CSC, Hampshire
Funding, Inc. and the Fund; Senior Vice
President and Director, CIF.
Ronald H. Emery Senior Vice President and Senior Vice President and Controller, Chubb
Director Life
Shari J. Lease Secretary Assistant Vice President and Counsel, Chubb
Life; Secretary, CIF
John A. Weston Treasurer Assistant Vice President, Mutual Fund
Accounting Officer, Chubb Life; Treasurer,
CSC, CIF, and Hampshire Funding, Inc.;
previously Treasurer, Chubb Series Trust;
Financial Reporting Officer, Chubb Life
Carol R. Hardiman Assistant Vice President Vice President of CSC and Hampshire
Funding, Inc.
Thomas H. Elwood Assistant Secretary Assistant Counsel, Chubb Life; Assistant
Secretary, CIF
</TABLE>
Recommendation
The Board of Directors recommends that shareholders vote FOR this
proposal.
<PAGE>
Item 3. To Consider and Act on New Forms of Investment Subadvisory Agreements to
be Entered into Between the Adviser and (a) the Current Subadviser to
the Domestic Growth Stock Portfolio, World Growth Stock Portfolio,
Emerging Growth Portfolio, Capital Growth Portfolio, Gold Stock
Portfolio, and Bond Portfolio, and (b) the proposed new Subadvisers to
the Growth and Income Portfolio, Money Market Portfolio, and Balanced
Portfolio.
Each of the nine Portfolios of the Fund is currently managed by a
Subadviser pursuant to a Sub-Investment Management Agreement. Each Sub-
Investment Management Agreement provides for its automatic termination in the
event the Investment Management Agreement terminates. As described above, the
Existing Investment Management Agreements terminated as a result of the sale of
Chubb Life to Jefferson-Pilot. Consequently, the Subadvisers will be required to
enter into new Investment Subadvisory Agreements with the Adviser.
The Adviser also has recommended the replacement of the Subadvisers for
three of the Portfolios. If this proposal is approved, Massachusetts Financial
Services Company ("MFS") (which currently is Subadviser to the Emerging Growth
Portfolio) will replace Chubb Asset Managers, Inc. ("Chubb Asset") as Subadviser
to the Money Market Portfolio. Warburg, Pincus Counsellors, Inc. ("Warburg")
will replace Chubb Asset as the Subadviser to the Growth and Income Portfolio,
and J.P. Morgan Investment Management, Inc. ("JPMIM") will replace Phoenix
Investment Counsel, Inc. ("Phoenix") as the Subadviser to the Balanced
Portfolio.
The Adviser believes that the proposed Subadviser replacements will be in
the best interests of the affected Portfolios and the Policy owners. The Adviser
recommends that Chubb Asset be replaced as Subadviser to the Money Market
Portfolio and the Growth and Income Portfolio because, in light of the sale of
Chubb Life to Jefferson-Pilot, Chubb Asset no longer will be available to act as
Subadviser. The Adviser is not recommending that Chubb Asset be replaced at this
time as Subadviser to the Bond Fund, because Chubb Life is preparing an
application to the Securities and Exchange Commission to substitute an
unaffiliated bond fund for the Bond Portfolio as an investment option under the
Policies (the "Substitution Application"). Accordingly, approval of a new
contract with Chubb Asset is necessary to enable it to continue to provide
subadvisory services to the Bond Portfolio until the Substitution Application is
approved and the proposed substitution takes place. The Adviser recommends that
Phoenix be replaced as Subadviser to the Balanced Fund to seek to improve that
Portfolio's performance. In addition, the Adviser believes that the greater
name-recognition of the New Subadvisers may make those Portfolios more
attractive investment alternatives for Policy owners. Based on discussion with
the current Subadvisers, the Adviser believes that they do not dispute the
Adviser's recommendations.
The Investment Subadvisory Agreements
The proposed form of New Investment Subadvisory Agreement to be entered
into with the six Subadvisers who will continue to provide subadvisory services
to one or more Portfolios is attached as Exhibit B. The proposed forms of New
Investment Subadvisory Agreement, as particularized with respect to Janus
Capital Corporation, Massachusetts Financial Services Company, and Templeton
Global Advisors, are attached as Exhibits B-1, B-2, and B-3, respectively. The
proposed forms of New Investment Subadvisory Agreements with Warburg and JPMIM
are attached as Exhibits C and D respectively. All of the New Investment
Subadvisory Agreements are substantially the same and are described below.
The proposed form of New Investment Subadvisory Agreement and the
particularized versions mentioned above are the same as the Existing
Sub-Investment Management Agreement in all material respects, except as
described below. The terms provide that the Subadviser, subject to the
supervision of the Adviser and the Board of Directors of the Fund, will manage
the investment and reinvestment of the relevant Portfolio's assets. The
Subadviser will provide the Adviser and the Fund with, among other things,
investment research and advice, and will select the securities or other
investments to be held by the Portfolio.
The Subadvisers are obligated to use their best efforts to obtain for the
Portfolios they manage the most favorable price and best execution available
under the circumstances. However, a Subadviser may, to the extent permitted by
applicable law and to the extent the Subadviser determines the arrangement is
reasonable, pay a broker or dealer that
<PAGE>
provides research or other brokerage services a commission in excess of the
amount another broker or dealer may have charged for effecting the transaction.
The Adviser pays each Subadviser compensation out of the fees the Fund pays
the Adviser for its services to the Fund. The subadvisory fee rates to be paid
to each Subadviser will not change as a result of the Acquisition, except as
indicated below in the description of the Subadviser for each Portfolio. For
providing subadvisory services to the Portfolios for the year 1996, the Adviser
paid each current Subadviser as follows: $437,374 to Templeton Global Advisors
for the World Growth Stock Portfolio; $29,791 to Chubb Asset for the Money
Market Portfolio; $41,803 to Van Eck Associates Corporation for the Gold Stock
Portfolio; $320,010 to Pioneering Management Corporation for the Domestic Growth
Stock Portfolio; $37,425 to Chubb Asset for the Bond Portfolio; $90,493 to Chubb
Asset for the Growth and Income Portfolio; $527,776 to Janus Capital Corporation
for the Capital Growth Portfolio; $89,806 to Phoenix for the Balanced Portfolio;
and $108,477 to MFS for the Emerging Growth Portfolio.
The Existing Sub-Investment Management Agreements are styled as three-party
agreements among the Adviser, the Subadviser and the Fund. In those agreements,
the fee structure is included in the body of the agreement. The proposed New
Investment Subadvisory Agreements will be between the Adviser and the Subadviser
only, which is the more common structure for such arrangements. In addition, for
ease of maintenance, the fee to be paid to each Subadviser will be set forth in
an addendum to the agreement.
Portfolios that Will Continue to use their Current Subadvisers
World Growth Stock Portfolio: Templeton Global Advisors
Templeton Global Advisors (formerly known as Templeton, Galbraith &
Hansberger Ltd.) ("Templeton") serves as Subadviser to the World Growth Stock
Portfolio. Templeton is organized under the laws of the Bahamas, and is a
wholly-owned subsidiary of Franklin Resources, Inc., a Delaware corporation
("Franklin"). Franklin is a publicly-traded company, and its ordinary shares of
common stock are listed on the New York Stock Exchange. Templeton serves as an
investment adviser or subadviser to various investment companies registered
under the 1940 Act, subject to the supervision and direction of each company's
Board of Directors and, where appropriate, the company's investment adviser, as
well as to investment companies registered in foreign jurisdictions. In this
capacity, Templeton is responsible, on a daily basis, for managing the
companies' investments, making investment decisions on behalf of the companies
and supplying research services. Templeton may also provide investment research
and advice to certain common trust vehicles. Templeton is also an adviser or
subadviser to various private accounts. Templeton and its affiliates currently
serve as investment manager to 25 U.S.-investment companies.
Under the proposed New Investment Subadvisory Agreement, the Adviser will
continue to pay Templeton at the end of each calendar quarter a fee at the
annual rate, accruing daily, of 0.50% on the first $200 million of the average
daily net assets of the Portfolio during the quarter preceding such payment. The
fee will be reduced to 0.45% of average net assets in excess of $200 million up
to $1.3 billion, and will be further reduced to 0.40% of net assets in excess of
$1.3 billion. The average daily closing value of the aggregate net assets of the
Portfolio will continue to be determined and computed in accordance with the
description of the method of determination of net asset value contained in the
prospectus for the Fund.
Bond Portfolio: Chubb Asset Managers, Inc.
Chubb Asset is a Delaware corporation and a wholly-owned subsidiary of
Chubb. Persons employed by Chubb Asset, who are also investment personnel of
Chubb & Son, Inc., a wholly-owned subsidiary of Chubb, currently provide
investment advice to and supervise and monitor certain investment portfolios for
Chubb and its affiliates, including general accounts of insurance affiliates of
Chubb. In addition, certain investment personnel employed by Chubb Asset
currently provide advice to other investment portfolios of entities not
affiliated with Chubb or its affiliates.
<PAGE>
Under the proposed New Investment Subadvisory Agreement, the Adviser will
continue to pay Chubb Asset at the end of each calendar quarter a fee at the
annual rate, accruing daily, of 0.35% on the first $200 million of the average
daily net assets of the Portfolio during the quarter preceding such payment. The
fee will be reduced to 0.30% of average net assets in excess of $200 million up
to $1.3 billion, and will be further reduced to 0.25% of net assets in excess of
$1.3 billion. The average daily closing value of the aggregate net assets of the
Portfolio will continue to be determined and computed in accordance with the
description of the method of determination of net asset value contained in the
prospectus for the Fund.
Gold Stock Portfolio: Van Eck Associates Corporation
Van Eck Associates Corporation ("Van Eck") is a Delaware corporation.
Mr. John C. van Eck owns 25.6% of the outstanding voting securities of Van Eck,
and his wife and two sons, Jan and Derek van Eck, 270 River Road, Briarcliff
Manor, New York, are each the beneficial owners of 24.8% of such securities. Mr.
John C. van Eck has retained the right to direct the voting and disposition of
the shares of Van Eck held by his wife.
Under the proposed New Investment Subadvisory Agreement, the Adviser will
continue to pay Van Eck at the end of each calendar quarter a fee at the annual
rate, accruing daily, of 0.50% on the first $200 million of the average daily
net assets of the Portfolio during the quarter preceding such payment. The fee
will be reduced to 0.45% of average net assets in excess of $200 million up to
$1.3 billion, and will be further reduced to 0.40% of net assets in excess of
$1.3 billion. The average daily closing value of the aggregate net assets of the
Portfolio will continue to be determined and computed in accordance with the
description of the method of determination of net asset value contained in the
prospectus for the Fund. Van Eck currently provides investment advisory or
subadvisory services to other funds with investment objectives similar to those
of the Portfolio. It provides advisory services to Van Eck Funds International
Investors Gold Fund and Gold/Resources Fund, and to PIMCO Funds Multi-Manager
Series Precious Metals Fund.
Domestic Growth Stock Portfolio: Pioneering Management Corporation
Pioneering Management Corporation ("Pioneer") is a Delaware corporation. It
is a wholly-owned subsidiary of The Pioneer Group, Inc., also a Delaware
corporation. Robert Benson, Senior Vice President of Pioneer, has been primarily
responsible for the day-to-day management of the Portfolio since 1986. Mr.
Benson has been employed by Pioneer since 1974.
Under the proposed New Investment Subadvisory Agreement, the Adviser will
continue to pay Pioneer at the end of each calendar quarter a fee at the annual
rate, accruing daily, of 0.50% on the first $200 million of the average daily
net assets of the Portfolio during the quarter preceding such payment. The fee
will be reduced to 0.45% of average net assets in excess of $200 million up to
$1.3 billion, and will be further reduced to 0.40% of net assets in excess of
$1.3 billion. The average daily closing value of the aggregate net assets of the
Portfolio will continue to be determined and computed in accordance with the
description of the method of determination of net asset value contained in the
prospectus for the Fund.
Pioneer currently provides investment advisory services to other growth and
income funds. Specifically, it provides services to the Pioneer Fund, Pioneer
II, Pioneer Balanced Fund, Pioneer Equity-Income Fund, Pioneer Real Estate
Shares, and the Balanced, Equity-Income, and Real Estate Growth Portfolios of
the Pioneer Variable Contracts Trust.
Capital Growth Portfolio: Janus Capital Corporation
Janus Capital Corporation ("Janus") is a Colorado corporation. In
addition to serving as investment adviser to other registered investment
companies, as indicated below, Janus provides investment advice to individual,
corporate and pension and profit-sharing accounts. Kansas City Southern
Industries, Inc. ("KCSI") owns approximately 83% of the
<PAGE>
outstanding voting stock of Janus, most of which it acquired in 1984. KCSI is a
publicly-traded holding company whose primary subsidiaries are engaged in
transportation, financial services and real estate.
Under the proposed New Investment Subadvisory Agreement, the Adviser will
continue to pay Janus at the end of each calendar month a fee at the annual
rate, accruing daily, of 0.75% on the first $200 million of the average daily
net assets of the Portfolio. The fee will be reduced to 0.70% of average net
assets in excess of $200 million up to $1.3 billion, and will be further reduced
to 0.65% of net assets in excess of $1.3 billion. The average daily closing
value of the aggregate net assets of the Portfolio will continue to be
determined and computed in accordance with the description of the method of
determination of net asset value contained in the prospectus for the Fund.
Janus currently provides investment advisory or subadvisory services to
other investment company portfolios that have investment objectives similar to
that of the Portfolio. Specifically, it provides services to the Janus Twenty
Fund, the American Skandia JanCap Growth Portfolio, and the Travelers Capital
Appreciation Fund.
Emerging Growth Portfolio: Massachusetts Financial Services Company
MFS is America's oldest mutual fund organization. MFS and its predecessor
organizations have a history of money management dating from 1924 and the
founding of the first mutual fund in the United States, Massachusetts Investors
Trust. As of May 31, 1997, MFS managed approximately $34.19 billion of assets
invested in equity securities and approximately $19.93 billion of assets
invested in fixed income securities. Approximately $4 billion of the assets
managed by MFS are invested in securities of foreign issuers and non-U.S. dollar
denominated securities of U.S. issuers. MFS is a subsidiary of Sun Life
Assurance Company of Canada (U.S.), a subsidiary of Sun Life of Canada (U.S.)
Holdings Inc., which in turn is a wholly-owned subsidiary of Sun Life Assurance
Company of Canada. MFS and its wholly-owned subsidiary, MFS Institutional
Advisors, Inc., provide investment advice to substantial private clients.
Under the proposed New Investment Subadvisory Agreement, the Adviser will
pay MFS at the end of each calendar quarter a fee at the annual rate, accruing
daily, of 0.40% of the average daily net assets of the Portfolio during the
quarter preceding such payment. This represents a fee reduction of 0.10% on net
assets up to $200 million and 0.05% on net assets in excess of $200 million up
to $1.3 billion. The average daily closing value of the aggregate net assets of
the Portfolio will continue to be determined and computed in accordance with the
description of the method of determination of net asset value contained in the
prospectus for the Fund.
MFS currently serves as investment adviser to each of the other funds in
the MFS Family of Funds, and to twelve variable accounts established by Sun Life
Assurance Company of Canada. MFS also provides advisory or subadvisory services
to other investment company portfolios with investment objectives similar to
those of the Portfolio. Specifically, it provides services to MFS Emerging
Growth Fund, MFS Emerging Growth Series, MFS/Sun Life Emerging Growth Series,
and Travelers Emerging Growth Portfolio.
Portfolios that Will Receive New Subadvisers
Money Market Portfolio: Massachusetts Financial Services Company
MFS, which currently manages the Emerging Growth Portfolio, is described
above. If this proposal is approved, MFS will replace Chubb Asset, which also is
described above, as the Subadviser to the Money Market Portfolio.
Under the proposed New Investment Subadvisory Agreement, the Adviser will
pay MFS at the end of each calendar quarter a fee at the annual rate, accruing
daily, of 0.30% on the first $200 million of the average daily net assets of the
Portfolio during the quarter preceding such payment. The fee will be reduced to
0.25% of average net assets in excess of $200 million. The Adviser currently
pays Chubb Asset a fee at an annual rate of 0.35% on the first $200 million of
the average daily net assets of the Portfolio during the quarter preceding such
payment, 0.30% of average net assets
<PAGE>
in excess of $200 million up to $1.3 billion, and 0.25% of average net assets in
excess of $1.3 billion. The average daily closing value of the aggregate net
assets of Portfolio will continue to be determined and computed in accordance
with the description of the method of determination of net asset value contained
in the prospectus for the Fund.
MFS currently provides advisory or subadvisory services to other investment
company portfolios with objectives similar to the Portfolio. Specifically, it
provides services to the MFS Cash Reserve Fund, the MFS Money Market Fund, the
MFS Money Market Series, and the MFS Government Money Market Fund.
Growth and Income Portfolio: Warburg, Pincus Counsellors, Inc.
Warburg is a professional investment counselling firm which provides
investment services to investment companies, employee benefit plans, endowment
funds, foundations and other institutions and individuals. As of May 31, 1997,
Warburg managed approximately $18.8 billion of assets, including approximately
$11.0 billion of investment company assets. Incorporated in 1970, Warburg is a
wholly owned subsidiary of Warburg, Pincus Counsellors G.P. ("Warburg G.P."), a
New York general partnership, which itself is controlled by Warburg, Pincus &
Co. ("WP&Co."), also a New York general partnership. Lionel I. Pincus may be
deemed to control both WP&Co. and Warburg. Warburg G.P. has no business other
than being a holding company of Warburg and its subsidiaries.
Under the proposed New Investment Subadvisory Agreement, the Adviser will
pay Warburg at the end of each calendar quarter a fee at the annual rate,
accruing daily, of 0.50% of the average daily net assets of the Portfolio during
the quarter preceding such payment. The average daily closing value of the
aggregate net assets of the Portfolio will continue to be determined and
computed in accordance with the description of the method of determination of
net asset value contained in the prospectus for the Fund.
Under the Existing Investment Subadvisory Agreement, the Subadviser to the
Portfolio is Chubb Asset, which is described above. The Adviser pays Chubb Asset
a fee quarterly at the annual rate of 0.50% on the first $200 million of the
average daily net assets of the Portfolio during the quarter preceding such
payment, 0.45% of average net assets in excess of $200 million up to $1.3
billion, and 0.40% of average net assets in excess of $1.3 billion. Although the
fee rate charged by Warburg on assets in excess of $200 million is higher than
the corresponding rates charged by Chubb Asset, it is not proposed to change
the fee rate paid by the Portfolio to the Adviser. Accordingly, approval of the
Subadvisory Agreement with Warburg will not affect the total amount of advisory
fees paid by the Portfolio. Moreover, since the Portfolio's assets are less than
$200 million, approval of the New Investment Subadvisory Agreement will not
affect the amount of subadvisory fees paid by the Adviser with respect to the
Portfolio, unless the Portfolio's assets increase significantly.
Warburg currently provides advisory or subadvisory services to other
investment company portfolios with objectives similar to those of the Portfolio.
Specifically, it provides services to Warburg Pincus Growth & Income Fund, the
Growth and Income Fund of the Alexander Hamilton Variable Insurance Trust, and
the Growth & Income Portfolio of the Variable Investors Series Trust.
Balanced Portfolio: J.P. Morgan Investment Management Inc.
JPMIM is a wholly-owned subsidiary of J.P. Morgan & Co. Incorporated, a
bank holding company organized under the laws of Delaware. JPMIM offers a wide
range of investment management services and acts as investment adviser to
corporate and institutional clients. JPMIM uses a sophisticated, disciplined,
collaborative process for managing all asset classes. As of March 31, 1997,
JPMIM had assets under management of approximately $180 billion.
If this proposal is approved, JPMIM will replace Phoenix Investment Counsel
("Phoenix") as the Subadviser to the Portfolio. Phoenix is a Massachusetts
corporation. It was originally organized in 1932 as John P. Chase, Inc. and has
been engaged in the management of the Phoenix Series Fund since 1958. All of the
outstanding stock of Phoenix is owned by Phoenix Equity Planning Corporation, an
indirect subsidiary of Phoenix Home Life Mutual Insurance
<PAGE>
Company. Phoenix Home Life Mutual Insurance Company is in the business of
writing ordinary and group life and health insurance and annuities, including
variable life insurance and variable annuities.
Under the proposed New Investment Subadvisory Agreement, the Adviser will
pay JPMIM at the end of each calendar quarter a fee at the annual rate, accruing
daily, of 0.45% on the first $100 million of the average daily net assets of the
Portfolio during the quarter preceding such payment, 0.40% on the next $100
million of average daily net assets, 0.35% on the next $100 million of average
daily net assets, and 0.30% of net assets in excess of $400 million. The Adviser
currently pays Phoenix a fee at the annual rate of 0.50% on the first $200
million of average daily net assets, 0.45% on average daily net assets from $200
million up to $1.3 billion, and 0.40% on average daily net assets in excess of
$1.3 billion. The average daily closing value of the aggregate net assets of the
Portfolio will continue to be determined and computed in accordance with the
description of the method of determination of net asset value contained in the
prospectus for the Fund.
JPMIM currently provides advisory or subadvisory services to other
investment company portfolios with objectives similar to those of the Portfolio.
Specifically, it provides services to Alexander Hamilton Balanced Fund and
Pacific Select Fund - Multi Strategy Portfolio.
Recommendation
The Board of Directors recommends that shareholders vote FOR each of the
New Investment Subadvisory Agreements.
Item 4. To Consider and Act on a Proposal to Permit the Adviser to Replace
Subadvisers or add Subadvisers to the Portfolios, and to Enter into
Subadvisory Agreements with those Subadvisers Without Further
Shareholder Approval
The Fund requests that it be permitted to replace Subadvisers or add
Subadvisers to each Portfolio and enter into Subadvisory Agreements in
substantially the form as appears in Exhibit B without obtaining additional
approval from the relevant Portfolio's shareholders. This proposal is being
submitted to the shareholders of each Portfolio for approval as required by the
terms of a second request for exemptive relief (the "Exemptive Application")
filed with the SEC. This proposal will not become effective with respect to any
Portfolio unless and until (i) the SEC has granted the relief requested in the
Exemptive Application and (ii) this proposal has been approved by shareholders
of that Portfolio.
In the Exemptive Application, the Fund seeks an exemptive order (the
"Exemption") from the SEC from the provisions of Section 15(a) of the 1940 Act
that, if granted, would permit the Adviser to enter into Investment Subadvisory
Agreements with Subadvisers for the Portfolios upon approval of the Board but
without the formal shareholder approval currently required under that Section.
There can be no assurance that the Exemption will be granted. The requested
relief is subject to the following conditions set forth in the Exemptive
Application requiring that:
(1) Before a Portfolio may rely on the order requested in the
Application, the operation of the Portfolio in the manner described in the
Application will be approved by a majority of its outstanding voting
securities (in the case of the Fund, pursuant to voting instructions
provided by Policy owners with assets allocated to any sub-account of a
registered separate account for which a Portfolio of the Fund serves as a
funding medium) as defined in the 1940 Act, or, in the case of a new
Portfolio whose public shareholders purchased shares on the basis of a
prospectus containing the disclosure contemplated by condition 2 below, by
the sole initial shareholder before offering shares of such Portfolio to
the public.
(2) The Prospectus for each Portfolio will disclose the existence,
substance, and effect of any order granted pursuant to the Application. In
addition, each Portfolio will hold itself out to the public as employing
the management structure described in the Application. The prospectus and
any sales materials or other
<PAGE>
shareholder communications relating to the structure of the Fund or the
management of a Portfolio will prominently disclose that the Adviser has
ultimate responsibility for the investment management of the Portfolio due
to its responsibility to oversee Subadvisers and recommend their hiring,
termination, and replacement.
(3) Within sixty (60) days of the hiring of any new Subadviser or the
implementation of any proposed material change in an Investment Subadvisory
Agreement, shareholders will be furnished all information about the new
Subadviser or Investment Subadvisory Agreement that would be included in a
proxy statement, except as modified by the order with respect to Aggregate
Fee Disclosure. Such information will include Aggregate Fee Disclosure and
any proposed material change in the Portfolio's Investment Subadvisory
Agreement. To meet this condition, the Adviser will provide shareholders
with an information statement meeting the requirements of Regulation 14C
under the 1934 Act, Schedule 14C thereunder and Item 22 of Schedule 14A,
except as modified by the order with respect to Aggregate Fee Disclosure.
The Fund will ensure that the information statement is furnished to Policy
owners with assets allocated to any registered separate account for which
the Fund serves as a funding medium.
(4) The Adviser will not enter into an Investment Subadvisory
Agreement with any Affiliated Subadviser without that agreement, including
the compensation to be paid thereunder, being approved by the shareholders
of the applicable Portfolio.
(5) At all times, a majority of the Directors of the Fund will be
Independent Directors, and the nomination of new or additional Independent
Directors will be placed within the discretion of the then-existing
Independent Directors.
(6) When a Subadviser change is proposed for a Portfolio with an
Affiliated Subadviser, the Board of Directors, including a majority of the
Independent Directors, will make a separate finding, reflected in the
Board's minutes, that such change is in the best interests of the Portfolio
and its shareholders (in the case of the Fund, the Policy owners with
assets allocated to any sub-account for which a Portfolio serves as a
funding medium) and does not involve a conflict of interest from which the
Adviser or the Affiliated Subadviser derives an inappropriate advantage.
(7) Independent counsel knowledgeable about the 1940 Act and the
duties of Independent Directors will be engaged to represent the
Independent Directors of the Fund. The selection of such counsel will
remain within the discretion of the Independent Directors.
(8) The Adviser will provide the Board of Directors of the Fund, no
less frequently than quarterly, with information about the Adviser's
profitability for each Portfolio relying on the relief requested in the
Application. Such information will reflect the impact on profitability of
the hiring or termination of any Subadviser during the applicable quarter.
(9) Whenever a Subadviser for a particular Portfolio is hired or
terminated, the Adviser will provide the Board of Directors with
information showing the expected impact on the Adviser's profitability.
(10) The Adviser will provide general management services to the Fund
and its Portfolios, and, subject to review and approval by the Board of
Directors will (i) set each Portfolio's overall investment strategies; (ii)
select and recommend Subadvisers; (iii) allocate and, when appropriate,
reallocate a Portfolio's assets among Subadvisers; (iv) monitor and
evaluate the investment performance of Subadvisers; and (v) oversee
Subadviser compliance with each Portfolio's investment objective, policies,
and restrictions.
(11) No director or officer of the Fund or the Adviser will own
directly or indirectly (other than through a pooled investment vehicle over
which such person does not have control) any interest in any Subadviser
except for: (i) ownership of interests in the Adviser or any entity that
controls, is controlled by, or is under common control with the Adviser; or
(ii) ownership of less than 1% of the outstanding securities of any class
<PAGE>
of any equity or debt of a publicly-traded company that is either a
Subadviser or an entity that controls, is controlled by, or is under common
control with a Subadviser.
(12) Each Portfolio will disclose in its registration statement
the Aggregate Fee Disclosure.
While the foregoing conditions are consistent with relief previously
granted by the Commission to other similar investment companies, the Commission
may require modifications of the foregoing conditions as a condition to granting
relief to the Fund.
The Directors, including a majority of the Independent Directors (in
consultation with counsel), believe that the authority to replace Subadvisers or
add Subadvisers and enter into Investment Subadvisory Agreements with the
Adviser, subject to the conditions described above, would allow the Adviser to
better perform the functions the Portfolios are currently paying it to perform
- --i.e., selecting Subadvisers, monitoring their performance and making whatever
changes to the roster of Subadvisers as the Adviser deems appropriate, subject
to approval by the Fund's Board of Directors. The Directors further believe that
requiring shareholder approval of each new Investment Subadvisory Agreement
results in unnecessary administrative expenses to the Portfolios and may result
in delays in executing changes in Subadvisers or their Investment Subadvisory
Agreements, which may be detrimental to the Portfolios.
Shareholders should recognize that in engaging new Subadvisers and entering
into Investment Subadvisory Agreements, the Adviser will negotiate fees with
those Subadvisers and, because these fees are paid by the Adviser and not
directly by each Portfolio, any fee reduction negotiated by the Adviser will
inure to the Adviser's benefit and any increase will inure to its detriment. The
fees paid to the Adviser by the Portfolios and the fees paid to the Subadvisers
by the Adviser are considered by the Board in approving the advisory and
subadvisory arrangements, and any change in fees paid by a Portfolio to the
Adviser would require shareholder approval.
Recommendation
The Board of Directors recommends that shareholders vote FOR this proposal.
OTHER BUSINESS
The Board of Directors knows of no other business that will come before the
Special Meeting. Should any matters other than the matter referred to above
properly come before the Special Meeting, it is the intention of Chubb Life to
vote on such matters in its discretion.
ADDITIONAL INFORMATION
Shareholder Proposals
The Fund does not hold annual shareholder meetings. According to the Fund's
Bylaws, annual meetings, when held, will be held in the month of April of any
year. Shareholders who would like to submit proposals for consideration at
future shareholder meetings should send written proposals to Chubb America Fund,
Inc., One Granite Place, Concord, New Hampshire 03301.
Principal Underwriter
The principal underwriter and distributor for the Fund's Portfolios is
Chubb Securities Corporation, One Granite Place, Concord, New Hampshire 03301, a
New Hampshire corporation ("CSC"). CSC is a wholly-owned subsidiary of Chubb
Life and Jefferson-Pilot.
<PAGE>
Under the terms of CSC's distribution agreement with the Fund, CSC makes a
continuous offering of the Fund's shares. CSC is responsible for paying the
costs of printing copies of prospectuses and periodic reports for distribution
to new or prospective Policy owners, preparation, printing and distribution of
sales literature, and all other expenses arising primarily in connection with
promoting the sale of the Fund's shares. CSC must, as the Fund's agent, cause
any sales literature, advertising or other similar material to be filed with the
appropriate authorities. As a result of the Acquisition, CSC has entered into a
new underwriting agreement with the Fund under the same terms as the previously
existing agreement. CSC continues to be an affiliate of Chubb Life.
The President and a Director of the Fund, Ronald Angarella, is also
President and a Director of CSC. The Fund's Vice President and Assistant
Secretary, Charles C. Cornelio, is Vice President and Secretary to CSC. John A.
Weston is Treasurer to both the Fund and CSC. Shari J. Lease is Assistant
Secretary of CSC.
<PAGE>
EXHIBIT A
FORM OF INVESTMENT MANAGEMENT AGREEMENT
---------------------------------------
THIS AGREEMENT made this _____ day of April 1997, between CHUBB AMERICA
FUND, INC., a Maryland corporation with offices at One Granite Place, Concord,
New Hampshire (the "Fund"), and CHUBB INVESTMENT ADVISORY CORPORATION, a
Tennessee corporation with offices at One Granite Place, Concord, New Hampshire
("Chubb Investment");
WITNESSETH
WHEREAS, the Fund is engaged in business as a diversified open-end
management investment company and is registered as such under the Investment
Company of 1940 (the "Investment Company Act");
WHEREAS, the Fund is authorized to issue shares of common stock, $.01
par value, ("Stock") in separate classes or series with each such class or
series representing an interest in a separate portfolio of securities and other
assets, and each with its own investment objectives, investment policies and
restrictions (individually, a "Portfolio", collectively, the "Portfolios");
WHEREAS, Chubb Investment is engaged in the business of rendering
investment advisory services and is registered as an investment adviser under
the Investment Advisers Act of 1940;
WHEREAS, the Board of Directors of the Fund desires to retain Chubb
Investment to render investment management and corporate administrative services
to the Fund's Portfolios set forth in Schedule A hereto, as such may be revised
from time to time, in the manner and on the terms set forth herein; and
WHEREAS, the Board of Directors of the Fund believes that Chubb
Investment's expertise and business contacts are and will be of material benefit
to the Fund in employing and supervising any investment subadviser
("Subadviser"), as further described below;
NOW, THEREFORE, in consideration of the premises and the covenants
hereinafter contained, the Fund and Chubb Investment hereby agree as follows:
1. Appointment of Manager. The Fund hereby appoints Chubb Investment
as the investment manager ("Investment Manager" or "Manager") or for each of the
Portfolios of the
PAGE 1
<PAGE>
Fund specified in Appendix A to this Agreement, as such Appendix A may be
amended by the Manager and the Fund from time to time, subject to the
supervision of the Directors of the Fund and in the manner under the terms and
conditions set forth in this Agreement.
2(a) Duties of Chubb Investment. Chubb Investment hereby agrees,
subject to the supervision of the Board of Directors of the Fund (i) to act as
the investment manager of the Portfolios, and, in that connection, (ii) to
select and contract, at its own expense, with investment subadvisers
("Subadvisers") to manage the investment operations and composition of each and
every Portfolio of the Fund, including the purchase, retention, and disposition
of the investments, securities and cash contained in each Portfolio.
In taking any action hereunder, Chubb Investment shall always be subject to, and
shall follow at all times (i) any restrictions of the Fund's Articles of
Incorporation and By-Laws, as amended from time to time, (ii) the applicable
provisions of the Investment Company Act, and any rules and regulations adopted
thereunder, (iii) the statements relating to the Portfolios' investment
objectives, policies and restrictions as the same are set forth in the
prospectus of the Fund and Statement of Additional Information then currently
effective under the Securities Act of 1933 (the "Prospectus"), and (iv) any
other provisions of state and federal law applicable to it in connection with
its duties hereunder, including any applicable provisions imposed by state
insurance regulations and under the Internal Revenue Code of 1986, as amended,
and regulations thereunder (the "Code").
(b) Interim Arrangements. Notwithstanding the provisions of subsection
(a) of this paragraph, the Manager may, in the event of a Subadviser becomes
unable to provide portfolio management services to a Portfolio, itself provide
to the Portfolio those services normally provided by the Subadviser under the
Subadviser's agreement with the Manager, until such time as the Manager selects
and contracts with a replacement Subadviser.
(c) Administrative Services. Subject to the direction and control of
the Board of Directors of the Fund, Chubb Investment shall perform
administrative services in connection with the management of the Portfolios and
will supervise all aspects of the Portfolios' operations. In this connection,
Chubb Investment agrees to perform the following administrative functions:
(1) Determine the value of each Portfolio's assets and
liabilities, compute the daily income and net asset value of each Portfolio and
compute the yield and/or total return of each Portfolio as may be required, in
accordance with applicable law;
(2) Schedule, plan agendas for and conduct directors and
shareholders meetings;
PAGE 2
<PAGE>
(3) Recommend auditors, counsel, Custodian and others;
(4) Coordinate, supervise and direct any Subadviser, the
Fund's Custodian and the Fund's Distributor, auditors and counsel on a day-to-
day basis;
(5) Prepare and distribute all required proxy statements,
reports, and other communications with shareholders;
(6) Prepare and file tax returns, reports due and other
required filings with the Securities and Exchange Commission ("SEC"), the
National Association of Securities Dealers, Inc., state blue sky authorities,
and generally monitor compliance with all federal and state securities laws and
the Code;
(7) Supply clerical, secretarial, accounting and bookkeeping
services, data processing services, office supplies and stationery;
(8) Provide persons to perform such professional,
administrative and clerical functions as are necessary in connection with
shareholder relations, reports, redemption requests and account adjustments,
including the receipt, handling and coordination of shareholder complaints;
(9) Provide adequate office space and related services
(including telephone and other utility service) necessary for the Fund's
operations;
(10) Maintain corporate records not otherwise maintained by
the Fund's Custodian, Distributor, or any Subadviser; and
(11) Assist, generally, in all aspects of the Fund's
operations with respect to the Portfolios.
The Manager may enter into arrangements with its parent or other persons
affiliated or unaffiliated with the Manager for the provisions of certain
personnel and facilities to the Manager to enable the Manager to fulfill its
duties and obligations under this Agreement. Nothing herein will be construed to
restrict the Fund's right, at its own expense, to contract for services to be
performed by third parties.
(d) Arrangements with Subadvisers. Notwithstanding any other provision
hereof, Chubb Investment, with the approval of the Board of Directors of the
Fund, may contract with one or more Subadvisers to perform any of the investment
management services required by the Fund, and may contract with one or more
Subadvisers or other parties to perform any of the administrative services
required
PAGE 3
<PAGE>
of Chubb Investment hereunder; provided, however, that the compensation of such
other parties will be the sole responsibility of Chubb Investment and the duties
and responsibilities of such other Subadviser or other parties shall be as set
forth in an agreement or agreements between Chubb Investment and such other
parties.
Chubb Investment shall exercise reasonable care in recommending,
monitoring, and supervising the performance of Subadviser and others serving
pursuant to the foregoing paragraph, but Chubb Investment shall not otherwise be
liable or legally responsible for the conduct of any Subadviser. In this
connection, it shall be a particular responsibility of Chubb Investment to
evaluate the investment performance of Subadviser and that of potential
Subadviser, and Chubb Investment shall supply the Board of Directors of the Fund
with such statistical and research data bearing on each Portfolio's performance
and that of Subadviser and potential Subadviser as they and Chubb Investment
deem necessary. It shall also be a particular responsibility of Chubb Investment
to supervise and monitor the practices of Subadviser in placing orders and
selecting brokers and dealers to effect Portfolio transactions and in
negotiating commission rates with them, and the services provided by such
brokers and dealers.
It also is understood that Chubb Investment, at its expense, will enter
into an agreement with Chubb America Service Corporation, a New Hampshire
corporation, pursuant to which Chubb Investment will obtain from said
corporation most staff, facilities and services necessary to meet its
obligations hereunder. Entering into said agreement shall in no way diminish any
obligation or liability of Chubb Investment hereunder.
3.(a) Purchase and Sale of Assets. Nothing in this Investment
Management Agreement shall preclude the combining of orders for the sale or
purchase of securities or other investments with other accounts managed by Chubb
Investment, provided that Chubb Investment does not favor any account over any
other account and provided further that any purchase or sale orders executed
contemporaneously shall be allocated in a manner that Chubb Investment deems to
be equitable to all accounts involved and, under normal circumstances, such
transactions will be (1) done on a pro rata basis substantially in proportion to
the amounts ordered by each account, (2) entered into only if, in Chubb
Investment's opinion, the trade is likely to produce a benefit for the
Portfolio, and (3) is at a price which is approximately the same for all parties
involved. Neither Chubb Investment, nor any of its directors, officers, or
employees, nor any person, firm, or corporation controlling, controlled by or
under common control with it shall act as a principal or receive any commission
as agent in connection with the purchase or sale of assets for the Portfolios.
(b) Brokerage Fees. In placing orders for the purchase or sale of
investments for the Portfolios, in the name of the Portfolio or their nominees,
Chubb Investment shall use its best efforts to obtain for the Portfolios the
most favorable price and best execution available, considering all of the
circumstances, and shall maintain records
PAGE 4
<PAGE>
adequate to demonstrate compliance with this requirement. Notwithstanding the
foregoing, however, and subject to appropriate policies and procedures as then
approved by the Board of Directors of the Fund, Chubb Investment may, to the
extent authorized by Section 28(e) of the Securities Exchange Act of 1934, cause
the Fund to pay a broker or dealer that provides research or other brokerage
services to Chubb Investment and the Fund with respect to the Portfolio an
amount of commission for effecting a portfolio transaction in excess of the
amount of commission another broker or dealer would have charged for effecting
that transaction if Chubb Investment determines in good faith that such amount
of commission is reasonable in relationship to the value of such services,
viewed in terms of that particular transaction or Chubb Investment's overall
responsibilities to the Portfolios or its other advisory clients. To the extent
authorized by said Section 28(e) and the Fund's Board of Directors, Chubb
Investment shall not be deemed to have acted unlawfully or to have breached any
duty created by this Investment Management Agreement or otherwise solely by
reason of such action.
4. Compensation of Chubb Investment. Except as hereinafter provided,
for the services rendered and expenses assumed by Chubb Investment, while this
Investment Management Agreement is in effect, the Fund shall pay to Chubb
Investment fees at an annual rate set forth in Schedule A attached hereto. Fees
will accrue daily and will be payable as agreed by the Fund and Chubb
Investment, but not more frequently than monthly. The average asset value of
the Portfolios shall be determined and computed in accordance with the
description of the method of determining net asset value contained in the
Prospectus.
The fees payable to Chubb Investment by the Fund hereunder shall be
reduced by any tender solicitation fees or similar payments received by Chubb
Investment, or any affiliated person of Chubb Investment, in connection with the
tender of investments of any Portfolio (less any direct expenses incurred by
Chubb Investment, or any affiliated person of Chubb Investment, in connection
with obtaining such fees or payments). Chubb Investment shall use its best
efforts to recapture all available tender offer solicitation fees and similar
payments in connection with tenders of the securities of any Portfolio,
provided, however, that Chubb Investment shall not be required to register as a
broker-dealer for this purpose. Chubb Investment shall advise the Board of
Directors of any fees or payments of whatever type which it may be possible for
Chubb Investment to receive in connection with the purchase or sale of
investment securities for any Portfolio.
5. Non-Exclusivity. The Fund agrees that the services of Chubb
Investment are not to be deemed exclusive and Chubb Investment is free to act as
investment manager to various investment companies and as fiduciary for other
managed
PAGE 5
<PAGE>
accounts. Chubb Investment shall, for all purposes herein, be deemed to be an
independent contractor and shall, unless otherwise provided or authorized, have
no authority to act for or represent the Fund with respect to the Portfolios in
any way or otherwise be deemed an agent of the Fund with respect to the
Portfolios other than in furtherance of its duties and responsibilities as set
forth in this Investment Management Agreement. It is understood and agreed that
the directors, officers and employees of Chubb Investment are not prohibited
from engaging in any other business activity or from rendering services to any
other person, or from serving as partners, officers, directors, trustees, or
employees of any other firm or corporation, including other investment
companies.
6. Books and Records. Chubb Investment will maintain all books and
records required for the Fund with respect to the Portfolios, to the extent not
maintained by the Custodian or any Subadviser. Chubb Investment agrees that all
books and records which it maintains for the Fund are the Fund's property, and,
in the event of termination of this Investment Management Agreement for any
reason, Chubb Investment agrees promptly to return to the Fund, free from any
claim or retention of rights by Chubb Investment, all records relating to the
Fund. Chubb Investment also agrees, upon request of the Fund, promptly to
surrender such books and records to the Fund or, at the Fund's expense, to make
copies thereof available to the Fund or to make such books and records available
for inspection by representatives of regulatory authorities or other persons
reasonably designated by the Fund. Chubb Investment further agrees to maintain,
prepare and preserve such books and records in accordance with the Investment
Company Act and rules thereunder, including but not limited to, Rules 31a-1 and
31a-2.
Chubb Investment will use records or information obtained under this
Investment Management Agreement only for the purposes contemplated hereby, and
will not disclose such records or information in any manner other than as
expressly authorized by the Board of Directors or officers of the Fund, or
unless disclosure is expressly required by applicable federal or state
regulatory authorities or by this Investment Management Agreement. Chubb
Investment shall supply all information requested by any insurance regulatory
authorities to determine whether all insurance laws and regulations are being
complied with.
The records maintained for the Fund hereunder by Chubb Investment shall
include records showing, for each shareholder's account, the following: (a)
name, address and tax identifying number; (b) number and class of shares held;
(c) historical information regarding the account of each shareholder, including
dividends paid and the date, class of Stock and price for all transactions; (d)
any stop or restraining order placed against the account; (e) any dividend
reinvestment order, dividend address and correspondence relating to the current
maintenance of the account; (f) certificate numbers and denominations for any
Stock certificates; (g) any other information required in order for Chubb
Investment to perform the calculations contemplated or required by this
Investment Management Agreement; and (h) such other records as the Fund may from
time to time reasonably request.
PAGE 6
<PAGE>
7. Liability. Chubb Investment will not be liable for any loss suffered
by the Portfolios in connection with any investment policy established by the
Fund for the purchase, sale or redemption of any securities at the direction of
the Board of Directors of the Fund. Nothing herein contained shall be construed
to protect Chubb Investment against any liability resulting from the willful
misfeasance, bad faith or negligence of Chubb Investment in the performance of
its duties or from reckless disregard of its obligations and duties under this
Investment Management Agreement or by virtue of violation of any applicable law.
PAGE 7
<PAGE>
8. (a) Initial Documents. The Fund's management shall file with Chubb
Investment the following documents: (i) certified copies of the Articles of
Incorporation of the Fund and all amendments thereto, made from time to time;
(ii) a certified copy of the By-Laws of the Fund as amended, from time to time;
(iii) a copy of the resolution of the Board of Directors of the Fund authorizing
this Investment Management Agreement; (iv) specimens of all forms of outstanding
and new stock certificates, if any, with respect to Portfolio Stock in the form
approved by the Board of Directors of the Fund accompanied by Board of
Directors' resolutions approving such forms, and with a certificate of the
Secretary of the Fund as to such approval; (v) an opinion of counsel for the
Fund with respect to the validity of the Portfolio Stock, the number of shares
authorized, the number of Shares allocated to the Portfolio's class of Shares,
the status of redeemed or repurchased Shares and the number of Shares with
respect to which a registration statement under the Securities Act of 1933 has
been filed and is in effect; and (vi) a listing of the insurance companies with
which Chubb Life through its general account or Separate Account A or any
additional separate accounts established by Chubb Life, its successors or
assigns, is affiliated.
(b) Further Documentation. The Fund's management will also furnish to
Chubb Investment from time to time the following documents: (i) each resolution
of the Board of Directors of the Fund authorizing the original issue of the
Portfolio's Shares; (ii) each registration statement filed with the SEC under
the Securities Act of 1933 or under the Investment Company Act and amendments
thereof, orders relating thereto and the Prospectus in effect with respect to
the sale of shares of the Fund; (iii) certified copies of each resolution of the
Board of Directors authorizing officers to give instructions to Chubb
Investment.
(c) Information. The Fund, its officers or agent will provide timely
information to Chubb Investment regarding such matters as purchases and
redemptions of shares in the Portfolios, cash requirements, and cash available
for investment in the Portfolios, and all other information as may be reasonably
necessary, or appropriate, in order for Chubb Investment to perform its
responsibilities hereunder.
(d) Reliance on Documents and Information. Chubb Investment will be
entitled to rely on all documentation and information furnished to it by the
Fund's management.
9. Authorized Shares. The Fund certifies to Chubb Investment, that as
of the close of business on the date of this Investment Management Agreement, it
has authorized one billion shares of its Stock, and further certifies that, by
virtue of its Articles of Incorporation and the provisions of the law of the
state of its incorporation, shares of its Stock which are redeemed or
repurchased by the Fund from its shareholder are restored to the status of
authorized and unissued shares.
PAGE 8
<PAGE>
10. (a) Expenses of the Fund. As between the Fund and Chubb
Investment, the following expenses shall be borne exclusively by the Fund;
(i) Brokerage commissions and transfer taxes in connection
with portfolio transactions and similar fees and charges for the acquisition,
disposition, lending or borrowing of portfolio investments;
(ii) All other state, federal, local or foreign governmental
fees and taxes (including any insurance, transfer, franchise or income taxes)
payable by the Fund and all corporate or filing fees payable by the Fund to any
governmental entity or agency;
(iii) All expenses, incidental and otherwise, associated with
preparing and filing with appropriate state, federal, local or foreign
governments or agencies all tax returns, including the expenses associated with
any mailings to the policy owners with respect to such returns.
(iv) Fees and expenses incurred in the registration or
qualification (and maintaining said registration or qualification) of the Fund
and its shares under federal or state securities laws, if deemed applicable,
subsequent to the effective date of the registration statement including all
fees and expenses incurred in connection with the preparation, setting in type,
printing and mailing of the registration statement and any amendments or
supplements that may be made from time to time;
(v) Compensation paid to directors who are not "interested
persons" of the Fund within the meaning of the Investment Company Act and travel
expenses paid to all directors;
(vi) Interest and any other cost related to borrowings by
the Fund;
(vii) Any extraordinary or non-recurring expenses (such as
legal claims and liabilities, and litigation costs and any indemnification
related thereto);
(viii) Costs of printing and distributing to current policy
owners, shareholder reports, proxy statements, Prospectuses and any stickers and
supplements thereto, and otherwise communicating with the shareholders;
(ix) Costs and all incidental expenses associated with
conducting shareholder meetings;
(x) The cost of the fidelity bond required by Investment
Company Act Rule 17g-1 and any errors and omissions insurance or other liability
insurance
PAGE 9
<PAGE>
covering the Fund and/or its officers, directors and employees;
(xi) The cost of obtaining quotes necessary for valuing the
assets and related liabilities for the Portfolios;
(xii) The charges and expenses of the Custodian, independent
accountants and independent legal counsel retained by the Fund, the charges and
expenses of any independent proxy solicitation firm retained by the Fund to
solicit voting instructions from policy owners with respect to Portfolio Shares,
and the charges and expenses of any trade association fees; and
(xiv) All other expenses not specifically assumed hereunder
by Chubb Investment.
(b) Expenses of Chubb Investment. As between the Fund and Chubb
Investment, the costs and expenses of providing the necessary facilities,
personnel, office equipment and supplies, office space, telephone service, and
other utility service necessary to carry out its obligations hereunder shall be
borne exclusively by Chubb Investment, except as otherwise herein expressly
provided. In addition, Chubb Investment shall pay and assume all expenses
specifically assumed by Chubb Investment as set forth in Paragraphs 1(b)(1),
(3), (4), (7), (8), (9), (10) and (11); and 1(c), (d), (e), (f) and (g) of this
Investment Management Agreement.
11. Duration and Termination of the Agreement. This Investment
Management Agreement shall become effective as of the date first written above
provided that it has been approved by the majority of the outstanding shares of
each of the Portfolios. Thereafter, it shall continue in effect with respect to
each of the Portfolios from year to year, but only so long as such continuance
is specifically approved at least annually by the Board of Directors in
conformity with the requirements of the Investment Company Act. This Investment
Management Agreement may be terminated, with respect to each Portfolio, without
the payment of any penalty, by the Board of Directors of the Fund or by vote of
a majority of the outstanding shares of Portfolio on sixty days' written notice
to Chubb Investment, or by Chubb Investment on sixty days' written notice to the
Fund. This Investment Management Agreement shall automatically terminate in the
event of its assignment.
12. Amendment of the Agreement. This Investment Management Agreement
may be amended with respect to any Portfolio only if, to the extent required by
law, such amendment is specifically approved by (a) the vote of a majority of
the outstanding shares of the Portfolio, and (b) by the vote of the Board of
Directors of the Fund, including a majority of those directors of the Fund who
are not parties to nor interested persons of any party to this Investment
Management Agreement cast in person at a meeting called for the purpose of
voting on such approval.
13. Definitions. The terms "assignment," "interested person," and
"majority of the outstanding shares," when used in this Investment Management
Agreement,
PAGE 10
<PAGE>
shall have the respective meanings specified under the Investment Company Act
and rules thereunder.
14. Further Actions. Each party agrees to perform such further acts and
execute such further documents as are necessary to effectuate the purposes
hereof.
15. Name. This Investment Management Agreement is entered into in
recognition of an agreement, dated February 15, 1985, between the Fund and The
Chubb Corporation granting the Fund a license to use the word "Chubb" in its
corporate name and to use such words in connection with its business.
16. Provisions of Certain Information by Manager. The Manager will
promptly notify the Fund in writing of the occurrence of any of the following
events:
a. The Manager fails to be registered as a investment adviser under
the Advisers Act or under the laws of any jurisdiction in which the Manager is
required to be registered as an investment adviser in order to perform its
obligations under this Agreement,
b. the Manager is served or otherwise receives notice of any action,
suit, proceeding, inquiry or investigation, at law or in the equity, before or
by any court, public board or body, involving the affairs of the Fund, and/or
c. the chief executive officer or controlling stockholder of the
Manager or the portfolio manager of any Portfolio changes or there is otherwise
an actual change in control or management of the Manager.
PAGE 11
<PAGE>
17. Entire Agreement. This Agreement contains the entire understanding
and agreement of the Parties.
18. Headings. The headings in the sections of this Agreement are
inserted for convenience of reference only and shall not constitute a part
hereof.
19. Notices. All notices required to be given pursuant to this
Agreement shall be delivered or mailed to the last known business address of the
Fund or Manager in person or by registered mail or a private mail or delivery
service providing the sender with notice of receipt. Notice shall be deemed
given on the date delivered or mailed in accordance with this section.
20. Force Majeure. The Manager shall not be liable for delays or
errors occurring by reason of circumstances beyond its control, including, but
not limited to, acts of civil or military authority, national emergencies, work
stoppages, fire, flood catastrophe, acts of nature, insurrection, war, riot,
failure of communication or power supply. In the event of equipment breakdowns
beyond its control, the Manager shall take reasonable steps to minimize service
interruptions but shall have no liability with respect to such undertakings.
21. Severability. Should any portion of this Agreement for any reason
be held to be void in law or in equity, the Agreement shall be construed,
insofar as is possible, as if such portion had never been contained in the
Agreement.
22. Governing Law. The provisions of this Investment Management
Agreement shall be construed and interpreted in accordance with the laws of the
State of New Hampshire, as at the time in effect, and the applicable provisions
of the Investment Company Act and rules thereunder or other federal laws and
regulations which may be applicable. To the extent that the applicable law of
the State of New Hampshire, or any of the provisions herein, conflict with the
applicable provisions of the Investment Company Act and rules pthereunder or
other federal laws and regulations which may be applicable the latter shall
control.
CHUBB AMERICA FUND, INC.
Attest: By:
Title: Title:
CHUBB INVESTMENT ADVISORY
CORPORATION
<PAGE>
Attest: By:
Title: Title:
PAGE 13
<PAGE>
SCHEDULE A
CHUBB AMERICA FUND, INC.
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------
<S> <C>
NAME OF PORTFOLIO ANNUAL FEE AS A PERCENTAGE OF
AVERAGE DAILY NET ASSETS
- ------------------------------------------------------------------------------------------------
World Growth Stock Portfolio .75% of first $200 Million
.70% of next $1.1 Billion
.65% over $1.3 Billion
- ------------------------------------------------------------------------------------------------
Money Market Portfolio .50% of first $200 Million
.45% of next $1.1 Billion
.40% over $1.3 Billion
- ------------------------------------------------------------------------------------------------
Gold Stock Portfolio .75% of first $200 Million
.70% of next $1.1 Billion
.65% over $1.3 Billion
- ------------------------------------------------------------------------------------------------
Bond Portfolio .50% of first $200 Million
.45% of next $1.1 Billion
.40% over $1.3 Billion
- ------------------------------------------------------------------------------------------------
Domestic Growth Stock Portfolio .75% of first $200 Million
.70% of next $1.1 Billion
.65% over $1.3 Billion
- ------------------------------------------------------------------------------------------------
Growth and Income Portfolio .75% of first $200 Million
.70% of next $1.1 Billion
.65% over $1.3 Billion
- ------------------------------------------------------------------------------------------------
Capital Growth Portfolio 1.00% of first $200 Million
.95% of next $1.1 Billion
.90% over $1.3 Billion
- ------------------------------------------------------------------------------------------------
Balanced Portfolio .75 of first $200 Million
.70% of next $1.1 Billion
.65% over $1.3 Billion
- ------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
<TABLE>
- ------------------------------------------------------------------------------------------------
<S> <C> <C>
Emerging Growth Portfolio .80 of first $200 Million
.75% of next $1.1 Billion
.70% over $1.3 Billion
- ------------------------------------------------------------------------------------------------
</TABLE>
EFFECTIVE:
----------------------------------
PAGE 15
<PAGE>
EXHIBIT B
FORM OF INVESTMENT SUBADVISORY AGREEMENT
----------------------------------------
THIS AGREEMENT, made this _____ day of __________, 199___, is between CHUBB
INVESTMENT ADVISORY CORPORATION, a Tennessee corporation with offices at One
Granite Place, Concord, New Hampshire, 03301 (the "Investment Manager" or
"Manager") and _______________, (the "Subadviser") a _______________ corporation
with offices at __________________.
WITNESSETH:
WHEREAS, Chubb America Fund, Inc. (the "Fund") is engaged in business
as a diversified open-end management investment company and is registered as
such under the Investment Company Act of 1940 (the "Investment Company Act");
WHEREAS, the Fund issues separate classes or series of stock, each of
which represents a separate portfolio of investments;
WHEREAS, the Fund's shareholders are and will be separate accounts
maintained by insurance companies for variable life insurance policies under
which income, gains, losses, whether or not realized, from assets allocated to
such accounts are, in accordance with the Policies, credited to or charged
against such accounts without regard to other income, gains, or losses of such
insurance companies;
WHEREAS, the Fund has employed the Investment Manager to act as
investment manager of the Portfolio, as set forth in an Investment Management
Agreement between the Fund and the Investment Manager dated _______, 199__, (the
"Investment Management Agreement") pursuant to which it was agreed that the
Investment Manager may contract with the Investment Adviser, or other parties
for certain investment management services;
WHEREAS, the Subadviser is engaged in the business of rendering
investment advisory services and is registered as an investment adviser under
the Investment Advisers Act of 1940;
WHEREAS, the Investment Manager desires to retain the Subadviser to
render investment management services to the Fund's __________ Portfolio (the
"Portfolio") in the manner and on the terms hereinafter set forth;
NOW, THEREFORE, in consideration of the premises and the convenants
hereinafter contained the Investment Manager and the Subadviser hereby agree as
follows:
1. Appointment of the Subadviser. The Manager hereby appoints the
Subadviser to act as an investment subadviser for the Portfolio and to manage
1
<PAGE>
the investment and reinvestment of the assets of the Portfolio, subject to the
supervision of the Directors of the Fund and the terms and conditions of this
Agreement. The Subadviser will be an independent contractor and will have no
authority to act for or represent the Fund or Manager in any way or otherwise be
deemed an agent of the Fund or Manager except as expressly authorized in this
Agreement or another writing by the Fund, Manager and the Subadviser.
Notwithstanding the foregoing, the Subadviser may execute account documentation,
agreements, contracts and other documents as the Subadviser may be requested by
brokers, dealers, counterparts and other persons in connection with the
Subadviser's management of the assets of the Portfolio, provided that the
Subadviser receives the express agreement and consent of the Manager and/or the
Fund's Board of Directors to execute such documentation, agreements, contracts
and other documents. In such respect, and only for this limited purpose, the
Subadviser shall act at the Manager and/or the Fund's agent and
attorney-in-fact.
2. Duties of the Subadviser. The Subadviser hereby agrees, subject to
the supervision of the Investment Manager and the Board of Directors of the
Fund, (1) to act as the Subadviser of the Portfolio, (2) to manage the
investment and reinvestment of the assets of the Portfolio for the period and on
the terms and conditions set forth in this Agreement, and (3) during the term
hereof, to render the services and to assume the obligations herein set forth in
return for the compensation provided for herein and to bear all expenses of its
performance of such services and obligations.
3. Services to be Rendered by the Subadviser to the Fund
A. The Subadviser will manage the investment and reinvestment
of the assets of the Portfolio and determine the composition of the assets of
the Portfolio, subject always to the direction and control of the Directors of
the Fund and the Manager and in accordance with the provisions of the Fund's
registration statement, as amended from time to time. In fulfilling its
obligations to manage the investment and reinvestment of the assets of the
Portfolio, the Subadviser will:
(i) obtain and evaluate pertinent economic, statistical,
financial, and other information affecting the economy generally and individual
companies or industries, the securities of which are included in the Portfolio
or are under consideration for inclusion in the Portfolio;
(ii) formulate and implement a continuous investment program
for the Portfolio (a) consistent with the investment objectives, policies, and
restrictions of the Portfolio as stated in the Fund's Agreement and Articles of
Incorporation, Bylaws, and such Portfolio's currently effective Prospectus and
Statement of Additional Information ("SAI") as amended from time to time, and
(b) in compliance with the requirements applicable to both regulated investment
companies and segregated asset accounts under Subchapters M and L of the
Internal Revenue Code of 1986, as amended, and requirements applicable to
2
<PAGE>
registered investment companies under applicable laws;
(iii) take whatever steps are necessary to implement the
investment program for the Portfolio by the purchase and sale of securities and
other investments authorized under the Fund's Agreement and Articles of
Incorporation, Bylaws, and such Portfolio's currently effective Prospectus and
SAI, including the placing of orders for such purchases and sales;
(iv) regularly report to the Directors of the Fund and the
Manager with respect to the implementation of the investment program and, in
addition, provide such statistical information and special reports concerning
the Portfolio and/or important developments materially affecting the investments
held, or contemplated to be purchased, by the Portfolio, as may reasonably be
requested by the Manager or the Directors of the Fund, including attendance at
Board of Directors Meetings, as reasonably requested, to present such
information and reports to the Board;
(v) provide determinations of the fair value of certain
portfolio securities when market quotations are not readily available for the
purpose of calculating the Portfolio's net asset value in accordance with
procedures and methods established by the Directors of the Fund;
(vi) provide any and all information, records and supporting
documentation about accounts the Subadviser manages that have investment
objectives, policies, and strategies substantially similar to those employed by
the Subadviser in managing the Portfolio which may be reasonably necessary,
under applicable laws, to allow the Portfolio or its agent to present
information concerning the Subadviser's prior performance in the Prospectus and
the SAI of the Portfolio and any permissible reports and materials prepared by
the Portfolio or its agent; and
(vii) establish appropriate interfaces with the Fund's Manager
in order to provide such Manager with all necessary information requested by the
Manager.
B. To facilitate the Subadviser's fulfillment of its obligations
under this Agreement, the Manager and the Fund will undertake the following:
(i) the Manager agrees promptly to provide the Subadviser
with all amendments or supplements to the Registration Statement, the Fund's
Agreement and Articles of Incorporation, and Bylaws;
(ii) the Fund and the Manager each agrees, on an ongoing
basis, to notify the Subadviser expressly in writing of each change in the
fundamental and nonfundamental investment policies of the Portfolio;
(iii) The Manager agrees to provide or cause to be
3
<PAGE>
provided to the Subadviser with such assistance as may be reasonably requested
by the Subadviser in connection with its activities pertaining to the Portfolio
under this Agreement, including, without limitation, information concerning the
Portfolio, its available funds, or funds that may reasonably become available
for investment, and information as to the general condition of the Portfolio's
affairs;
(iv) the Manager agrees to provide or cause to be provided to
the Subadviser on an ongoing basis, such information as is reasonably requested
by the Subadviser for performance by the Subadviser 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 Manager fails to provide
or cause to be provided such requested information and the Subadviser relies on
the information most recently furnished to the Subadviser; and
(v) the Manager will promptly provide the Subadviser with any
guidelines and procedures applicable to the Subadviser or the Portfolio adopted
from time to time by the Board of Directors of the Fund and agrees to promptly
provide the Subadviser copies of all amendments thereto.
C. The Subadviser, at its expense, will furnish: (i) all necessary
investment and management facilities and investment personnel, including
salaries, expenses and fees of any personnel required for it to faithfully
perform its duties under this Agreement; and (ii) administrative facilities,
including bookkeeping, clerical personnel and equipment necessary for the
efficient conduct of the investment affairs of the Portfolio (excluding that
necessary for the determination of net asset value and shareholder accounting
services). The Subadviser shall not be obligated to pay any expenses of or for
the Portfolio not expressly assumed by the Subadviser pursuant to this
Section 3.
D. The Subadviser will select brokers and dealers to effect all
portfolio transactions subject to the conditions set forth herein. The
Subadviser will place all necessary orders with brokers, dealers, or issuers,
and will negotiate brokerage commissions if applicable. The Subadviser is
directed at all times to seek to execute brokerage transactions for the
Portfolio in accordance with such policies or practices as may be established by
the Board of Directors and described in the Fund's currently effective
Prospectus and SAI, as amended from time to time. In placing orders for the
purchase or sale of investments for the Portfolio, in the name of the Portfolio
or its nominees, the Subadviser shall use its best efforts to obtain for the
Portfolio the most favorable price and best execution available, considering all
of the circumstances, and shall maintain records adequate to demonstrate
compliance with this requirement.
Subject to the appropriate policies and procedures approved by the
Board of Directors, the Subadviser may, to the extent authorized by Section
28(e) of the Securities and Exchange Act of 1934, cause the Portfolio to pay a
broker or dealer that provides brokerage or research services to the Manger, the
Subadviser, or the Portfolio an amount of commissions for effecting a portfolio
4
<PAGE>
transaction in excess of the amount of commission another broker or dealer would
have charged for effecting that transaction if the Subadviser determines, in
good faith, that such amount of commission is reasonable in relationship to the
value of such brokerage or research services provided viewed in terms of that
particular transaction or the Subadviser's overall responsibilities to the
Portfolio or its other advisory clients. To the extent authorized by said
Section 28(e) and the Fund's Board of Directors, 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 such action. In addition, subject to
seeking the most favorable price and best execution available, the Subadviser
may also consider sales of shares of the Fund as a factor in the selection of
brokers and dealers.
E. On occasions when the Subadviser deems the purchase or sale of
a security to be in the best interest of the Portfolio 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 purchased or sold to attempt to obtain a more favorable price or lower
brokerage commissions and efficient execution. In such event, allocation of the
securities so purchased or sold, 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 Portfolio and to its other clients.
F. The Subadviser will maintain all accounts, books and records
with respect to the Portfolio as are required of an investment adviser of a
registered investment company pursuant to the Investment Company Act and
Advisers Act and the rules thereunder.
4. Compensation of the Subadviser. The Investment Manager will pay the
Subadviser, with respect to the Portfolio, the compensation specified in
Appendix A to this Agreement. Payments shall be made to the Subadviser on the
first day of each month; however, this advisory fee will be calculated on the
daily average value of the Portfolio's assets and accrued on a daily basis.
5. Non-Exclusivity. The Investment Manager agrees that the services of
the Subadviser are not to be deemed exclusive and the Subadviser is free to act
as investment manager to various investment companies and as fiduciary for other
managed accounts. The Subadviser shall, for all purposes herein, be deemed to be
an independent contractor and shall, unless otherwise provided or authorized,
have no authority to act for or represent the Fund or the Investment Manager in
any way or otherwise be deemed an agent of the Fund or Investment Manager other
than in furtherance of its duties and responsibilities as set forth in this
Subadvisory Agreement.
6. Books and Records. The Subadviser agrees that all books and
records which it maintains for the fund are the Fund's property, and, in the
event of termination of this Agreement for any reason, the Subadviser agrees
promptly
5
<PAGE>
to return to the Fund, free from any claim or retention of rights by the
Subadviser, all records relating to the Portfolio. The Subadviser also agrees
upon request of the Investment Manager or the Fund, promptly to surrender the
books and records to either party or make the book and records available for
inspection by representatives of regulatory authorities. In connection with its
duties hereunder, the Subadviser further agrees to maintain, prepare and
preserve books and records in accordance with the Investment Company Act and
rules thereunder, including but not limited to, Rule 31a-1 and 31a-2.
The Subadviser will use records or information obtained under this
Agreement only for the purposes contemplated hereby, and will not disclose such
records or information in any manner other than expressly authorized by the
Fund, or if disclosure is expressly required by applicable federal or state
regulatory authorities or by this Agreement. The Subadviser will furnish any
informational reports requested by any state insurance commissioner.
7. Liability. The Subadviser will not be liable for any loss suffered
by the Fund in connection with any investment policy established by the Fund for
the purchase, sale or redemption of any securities at the direction of the Board
of Directors of the Fund or the Investment Manager. Nothing herein contained
shall be construed to protect the Subadviser against any liability resulting
from the willful misfeasance, bad faith or [gross] negligence of the Subadviser
in the performance of its duties or from reckless disregard of its obligations
and duties under this Subadviser Agreement.
8. Reliance on Documents. The Board of Directors of the Fund or its
officers or agent will provide timely information to the Subadviser regarding
such matters as purchases and redemptions of shares in the Portfolio, the cash
requirements, and cash available for investment in the Portfolio, and all other
information as may be reasonably necessary or appropriate in order for the
Subadviser to perform its responsibilities hereunder.
Neither the Fund or the Investment Manager, nor their respective
designees or agents, shall use any material describing or identifying the
Subadviser or its affiliates without the prior consent of the Subadviser. Any
material utilized by the Fund, the Investment Manager or their respective
designees or agents which contain information as to the Subadviser and/or its
affiliates shall be submitted to the Subadviser for approval prior to use, not
less than five (5) business days before such approval is requested.
The Investment Manager has herewith furnished the Subadviser copies of
the Fund's Prospectus, Articles of Incorporation and By-Laws as currently in
effect and agrees during the continuance of the Agreement to furnish the
Subadviser copies of any amendments or supplements thereto before or at the time
the amendments or supplements become effective. The Subadviser will be entitled
to rely on all such documents furnished to it by the Investment Manager of the
Fund.
6
<PAGE>
9. Duration and Termination of the Agreement. This Subadvisory
Agreement shall become effective as of the date first written above and remain
in force until _______________ [date]. Thereafter, it shall continue in effect
from year to year, but only so long as such continuance is specifically approved
at least annually by (a) the Board of Directors of the Fund, or by the vote of a
majority of the outstanding voting securities of the Portfolio, and (b) a
majority of those directors who are not parties to this Subadviser Agreement,
not interested persons of any party to this Subadviser Agreement, cast in person
at a meeting called for the purpose of voting on such approval. This Agreement
may be terminated, without the payment of any penalty, by the Board of Directors
of the Fund, by a vote of a majority of the outstanding shares of the Portfolio,
or by the Investment Manager on sixty days' written notice to the Subadviser, or
by the Subadviser on sixty days' written notice to the Fund or the Investment
Manager. Termination by the Board of Directors or by the Investment Manager
shall be subject to shareholder approval to the extent legally required. This
Agreement shall automatically terminate in the event of its assignment or in the
event of termination of the Investment Management Agreement.
10. Amendments of the Agreement. Except to the extent permitted by the
Investment Company Act or the rules or regulations thereunder or pursuant to any
exemptive relief granted by the Securities and Exchange Commission ("SEC"), this
Agreement may be amended by the parties only if such amendment, if material, is
specifically approved by the vote of a majority of the outstanding voting
securities of the Portfolio (unless such approval is not required by Section 15
of the Investment Company Act as interpreted by the SEC or its staff) and by the
vote of a majority of the Independent Directors cast in person at a meeting
called for the purpose of voting on such approval. The required shareholder
approval shall be effective with respect to the Portfolio if a majority of the
outstanding voting securities of the Portfolio vote to approve the amendment,
notwithstanding that amendment may not have been approved by a majority of the
outstanding voting securities of any other portfolio affected by the amendment
or all the portfolios of the Fund.
11. Definitions. The terms "assignment", "interested person", and
"majority of the outstanding voting securities", when used in this Agreement,
shall have the respective meaning specified under the Investment Company Act and
the rules thereunder.
12. Notices. Any notice that is required to be given by the parties to
each other under the terms of this Agreement shall be given in writing,
delivered, or mailed postpaid to the other party, or transmitted by facsimile
with acknowledgment of receipt, to the parties at the following addresses or
facsimile numbers, which may from time to time be changed by the parties by
notice to the other party:
(a) If to the Subadviser:
7
<PAGE>
(b) If to the Investment Manager:
Chubb Investment Advisory Corporation
One Granite Place
Concord, NH 03301
Attn: Ronald Angarella
Facsimile (603) 224-1691
13. Governing Law. The provisions of this Agreement shall be
construed and interpreted in accordance with the laws of the State of New
Hampshire as at the time in effect and the applicable provisions of the
Investment Company Act or other federal laws and regulations which may be
applicable. To the extent that the applicable law of the State of New Hampshire
or any of the provisions herein, conflict with the applicable provisions of the
Investment Company Act or other federal laws and regulations which may be
applicable, the latter shall control.
14. Use of Subadviser's Name. Neither the Fund nor the Manager or any
affiliate or agent thereof shall make reference to or use the name, and any
derivative thereof or logo associated with that name, of the Subadviser or any
of its affiliates 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, the Manager and the Fund shall
forthwith cease to use such name (or derivative or logo) as soon as reasonably
practicable.
15. Entire Agreement. This Agreement contains the entire
understanding and agreement of the parties with respect to the Portfolio.
16. Headings. The headings in the sections of this Agreement are
inserted for convenience of reference only and shall not constitute a part
hereof.
17. Severability. Should any portion of this Agreement for any reason
be held to be void in law or in equity, the Agreement shall be construed,
insofar as is possible, as if such portion had never been contained herein.
CHUBB INVESTMENT ADVISORY CORPORATION
ATTEST: BY:
-------------------- -----------------------
TITLE: TITLE:
--------------------- ---------------------
SUBADVISER
ATTEST: BY:
-------------------- -----------------------
8
<PAGE>
TITLE: TITLE:
---------------------- ---------------------
9
<PAGE>
EXHIBIT B-1
JANUS CAPITAL CORPORATION
-------------------------
FORM OF INVESTMENT SUBADVISORY AGREEMENT
-----------------------------------------
THIS AGREEMENT, made this _____ day of __________, 199___, is between CHUBB
INVESTMENT ADVISORY CORPORATION, a Tennessee corporation with offices at One
Granite Place, Concord, New Hampshire, 03301 (the "Investment Manager" or
"Manager") and Janus Capital Corporation, (the "Subadviser") a Colorado
corporation with offices at 100 Fillmore Street, Suite 300, Denver, Colorado
80206.
WITNESSETH:
WHEREAS, Chubb America Fund, Inc. (the "Fund") is engaged in business
as a diversified open-end management investment company and is registered as
such under the Investment Company Act of 1940 (the "Investment Company Act");
WHEREAS, the Fund issues separate classes or series of stock, each of
which represents a separate portfolio of investments;
WHEREAS, the Fund's shareholders are and will be separate accounts
maintained by insurance companies for variable life insurance policies under
which income, gains, losses, whether or not realized, from assets allocated to
such accounts are, in accordance with the Policies, credited to or charged
against such accounts without regard to other income, gains, or losses of such
insurance companies;
WHEREAS, the Fund has employed the Investment Manager to act as
investment manager of the Portfolio, as set forth in an Investment Management
Agreement between the Fund and the Investment Manager dated _______, 199__, (the
"Investment Management Agreement") pursuant to which it was agreed that the
Investment Manager may contract with the Investment Adviser, or other parties
for certain investment management services;
WHEREAS, the Subadviser is engaged in the business of rendering
investment advisory services and is registered as an investment adviser under
the Investment Advisers Act of 1940;
WHEREAS, the Investment Manager desires to retain the Subadviser to
render investment management services to the Fund's Capital Growth Portfolio
(the "Portfolio") in the manner and on the terms hereinafter set forth;
NOW, THEREFORE, in consideration of the premises and the covenants
hereinafter contained the Investment Manager and the Subadviser hereby agree as
follows:
1
<PAGE>
1. Appointment of the Subadviser. The Manager hereby appoints the
Subadviser to act as an investment subadviser for the Portfolio and to manage
the investment and reinvestment of the assets of the Portfolio, subject to the
supervision of the Directors of the Fund and the terms and conditions of this
Agreement. The Subadviser will be an independent contractor and will have no
authority to act for or represent the Fund or Manager in any way or otherwise be
deemed an agent of the Fund or Manager except as expressly authorized in this
Agreement or another writing by the Fund, Manager and the Subadviser.
Notwithstanding the foregoing, the Subadviser may execute account documentation,
agreements, contracts and other documents as the Subadviser may be requested by
brokers, dealers, counterparts and other persons in connection with the
Subadviser's management of the assets of the Portfolio, provided that the
Subadviser receives the express agreement and consent of the Manager and/or the
Fund's Board of Directors to execute such documentation, agreements, contracts
and other documents. In such respect, and only for this limited purpose, the
Subadviser shall act at the Manager and/or the Fund's agent and
attorney-in-fact.
2. Duties of the Subadviser. The Subadviser hereby agrees, subject to
the supervision of the Investment Manager and the Board of Directors of the
Fund, (1) to act as the Subadviser of the Portfolio, (2) to manage the
investment and reinvestment of the assets of the Portfolio for the period and on
the terms and conditions set forth in this Agreement, and (3) during the term
hereof, to render the services and to assume the obligations herein set forth in
return for the compensation provided for herein and to bear all expenses of its
performance of such services and obligations.
3. Services to be Rendered by the Subadviser to the Fund
A. The Subadviser will manage the investment and
reinvestment of the assets of the Portfolio and determine the composition of the
assets of the Portfolio, subject always to the direction and control of the
Directors of the Fund and the Manager and in accordance with the provisions of
the Fund's registration statement, as amended from time to time. In fulfilling
its obligations to manage the investment and reinvestment of the assets of the
Portfolio, the Subadviser will:
(i) obtain and evaluate pertinent statistical,
financial, and other information relating to individual companies or industries,
the securities of which are included in the Portfolio or are under consideration
for inclusion in the Portfolio;
(ii) formulate and implement a continuous
investment program for the Portfolio (a) consistent with the investment
objectives, policies, and restrictions of the Portfolio as stated in the Fund's
Agreement and Articles of Incorporation, Bylaws, and such Portfolio's currently
effective Prospectus and Statement of Additional Information ("SAI") as amended
from time to time, and (b) in compliance with the requirements applicable to
both regulated Investment
2
<PAGE>
companies and segregated asset accounts under Subchapters M and L of the
Internal Revenue Code of 1986, as amended ("IRC"), and requirements applicable
to registered investment companies under applicable laws;
(iii) take whatever steps are necessary to
implement the investment program for the Portfolio by the purchase and sale of
securities and other investments authorized under the Fund's Agreement and
Articles of Incorporation, Bylaws, and such Portfolio's currently effective
Prospectus and SAI, including the placing of orders for such purchases and
sales;
(iv) regularly report to the Directors of the
Fund and the Manager with respect to the implementation of the investment
program and, in addition, provide such statistical information and special
reports concerning the Portfolio and/or important developments materially
affecting the investments held, or contemplated to be purchased, by the
Portfolio, as may reasonably be requested by the Manager or the Directors of the
Fund, including attendance at Board of Directors Meetings, as reasonably
requested, to present such information and reports to the Board, provided that
Subadviser shall not be responsible for fund accounting;
(v) will assist in suggesting methods for
determining fair value of certain portfolio securities when market quotations
are not readily available for the purpose of calculating the Portfolio's net
asset value in accordance with procedures and methods established by the
Directors of the Fund;
(vi) establish appropriate interfaces with the
Fund's Manager in order to provide such Manager with all necessary information
requested by the Manager and required to be provided by Subadviser hereunder.
B. To facilitate the Subadviser's fulfillment of its
obligations under this Agreement, the Manager and the Fund will undertake the
following:
(i) the Manager agrees to provide the
Subadviser with all amendments or supplements to the Registration Statement, the
Fund's Agreement and Articles of Incorporation, and Bylaws prior to filing with
SEC;
(ii) the Fund and the Manager each agrees, on an
ongoing basis, to notify the Subadviser expressly in writing of each change in
the fundamental and nonfundamental investment policies of the Portfolio prior to
the effective date of such changes;
(iii) The Manager agrees to provide or cause to be
provided to the Subadviser such assistance as may be reasonably requested by the
Subadviser in connection with its activities pertaining to the Portfolio under
this Agreement, including, without limitation, information concerning the
Portfolio, its available funds, or funds that may reasonably become available
for investment,
3
<PAGE>
and information as to the general condition of the Portfolio's affairs and
information to enable Subadviser to monitor the "short-short" test and 90%
source tax of Subchapter M of the IRC;
(iv) the Manager agrees to provide or cause to
be provided to the Subadviser on an ongoing basis, such information as is
reasonably requested by the Subadviser for performance by the Subadviser 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 Manager
fails to provide or cause to be provided such requested information and the
Subadviser relies on the information most recently furnished to the Subadviser;
and
(v) the Manager will promptly provide the
Subadviser with any guidelines and procedures applicable to the Subadviser or
the Portfolio adopted from time to time by the Board of Directors of the Fund
and agrees to promptly provide the Subadviser copies of all amendments thereto.
C. Fund and Investment Manager shall not, without the prior
written consent of Sub-Investment Manager, make representations in any
disclosure document, advertisement, sales literature or other promotional
material regarding Sub-Investment Manager or its affiliates. Investment Manager
shall hold harmless and indemnify Sub-Investment Manager against any loss,
liability, cost, damage or expense (including reasonable attorneys fees and
costs) arising out of any use of any disclosure documents, advertisement, sales
literature or other promotional material without prior written consent by Sub-
Investment Manager.
D. The Subadviser, at its expense, will furnish all necessary
investment and management facilities and investment personnel, including
salaries, expenses and fees of any personnel required for it to faithfully
perform its duties under this Agreement. The Fund or Investment Manager assumes
and shall pay all expenses incidental to their respective organization,
operation and business not specifically assumed or agreed to be paid by Sub-
Investment Manager pursuant hereto, including, but not limited to, investment
adviser fees; any compensation, fees, or reimbursements which the Fund pays to
its Directors; compensation of the Fund's custodian, transfer agent, registrar
and dividend disbursing agent; legal, accounting, audit and printing expenses;
administrative, clerical, record-keeping and bookkeeping expenses; brokerage
commissions and all other expenses in connection with execution of portfolio
transactions (including any appropriate commissions paid to Sub-Investment
Manager or its affiliates for effecting exchange listed, over-the-counter or
other securities transactions); interest, all federal, state and local taxes
(including stamp, excise, income and franchise taxes) costs of stock
certificates and expenses of delivering such certificates to the purchaser
thereof; expenses of shareholders' meetings and of preparing, printing and
distributing proxy statements, notices, and reports to shareholders; regulatory
authorities; all expenses incurred in complying with all federal and state laws
and the laws of any foreign country applicable to the issue, offer, or sale of
shares for the Fund, including, but not limited to all costs involved
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<PAGE>
in the registration or qualification of shares of the Fund for sale in any
jurisdiction, the costs of portfolio pricing services and systems for compliance
with blue sky laws, and all costs involved in preparing, printing and mailing
prospectuses and statements of additional information of the Fund; and all fees,
dues and other expenses incurred by the Fund in connection with the membership
in any trade association or other investment company organization.
E. The Subadviser will select brokers and dealers to effect all
portfolio transactions subject to the conditions set forth herein. The
Subadviser will place all necessary orders with brokers, dealers, or issuers,
and will negotiate brokerage commissions if applicable. The Subadviser is
directed at all times to seek to execute brokerage transactions for the
Portfolio in accordance with such policies or practices as may be established by
the Board of Directors and described in the Fund's currently effective
Prospectus and SAI, as amended from time to time. In placing orders for the
purchase or sale of investments for the Portfolio, in the name of the Portfolio
or its nominees, the Subadviser shall use its best efforts to obtain for the
Portfolio the most favorable price and best execution available, considering all
of the circumstances, and shall maintain records adequate to demonstrate
compliance with this requirement.
Subject to the appropriate policies and procedures approved by the
Board of Directors, the Subadviser may, to the extent authorized by Section
28(e) of the Securities and Exchange Act of 1934, cause the Portfolio to pay a
broker or dealer that provides brokerage or research services to the Manger, the
Subadviser, or the Portfolio an amount of commissions for effecting a portfolio
transaction in excess of the amount of commission another broker or dealer would
have charged for effecting that transaction if the Subadviser determines, in
good faith, that such amount of commission is reasonable in relationship to the
value of such brokerage or research services provided viewed in terms of that
particular transaction or the Subadviser's overall responsibilities to the
Portfolio or its other advisory clients. To the extent authorized by said
Section 28(e) and the Fund's Board of Directors, 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 such action. In addition, subject to
seeking the most favorable price and best execution available, the Subadviser
may also consider sales of shares of the Fund as a factor in the selection of
brokers and dealers.
F. On occasions when the Subadviser deems the purchase or sale of
a security to be in the best interest of the Portfolio 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 purchased or sold to attempt to obtain a more favorable price or lower
brokerage commissions and efficient execution. In such event, allocation of the
securities so purchased or sold, 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 Portfolio and to its other clients.
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Sub-Investment Manager may perform its Services through any
employee, officer or agent of Sub-Investment Manager and Investment Manager and
the Fund shall not be entitled to the advice, recommendation or judgment of any
specific person. Sub-Investment Manager makes no representation or warranty,
express or implied, that any level of performance or investment results will be
achieved by the Capital Growth Portfolio or that such Portfolio will perform
comparably with any standard or index, including other clients of Sub-Investment
Manager, whether public or private.
G. The Subadviser will maintain all accounts, books and records
with respect to the Portfolio as are required of an investment adviser of a
registered investment company pursuant to the Investment Company Act and
Advisers Act and the rules thereunder.
4. Compensation of the Subadviser. The Investment Manager will
pay the Subadviser, with respect to the Portfolio, the compensation specified in
Appendix A to this Agreement. Payments shall be made to the Subadviser on the
first day of each month; however, this advisory fee will be calculated on the
daily average value of the Portfolio's assets and accrued on a daily basis.
5. Non-Exclusivity. The Investment Manager agrees that the
services of the Subadviser are not to be deemed exclusive and the Subadviser is
free to act as investment manager to various investment companies and as
fiduciary for other managed accounts. The Subadviser shall, for all purposes
herein, be deemed to be an independent contractor and shall, unless otherwise
provided or authorized, have no authority to act for or represent the Fund or
the Investment Manager in any way or otherwise be deemed an agent of the Fund or
Investment Manager other than in furtherance of its duties and responsibilities
as set forth in this Subadvisory Agreement.
6. Books and Records. The Subadviser agrees that all books and
records which it maintains for the fund are the Fund's property, and, in the
event of termination of this Agreement for any reason, the Subadviser agrees
promptly to return to the Fund, free from any claim or retention of rights by
the Subadviser, all records relating to the Portfolio. The Subadviser also
agrees upon request of the Investment Manager or the Fund, promptly to surrender
the books and records to either party or make the book and records available for
inspection by representatives of regulatory authorities. In connection with its
duties hereunder, the Subadviser further agrees to maintain, prepare and
preserve books and records in accordance with the Investment Company Act and
rules thereunder, including but not limited to, Rule 31a-1 and 31a-2.
The Subadviser will use records or information obtained under this
Agreement only for the purposes contemplated hereby, and will not disclose such
records or information in any manner other than expressly authorized by the
Fund, or if disclosure is expressly required by applicable federal or state
regulatory authorities or by this Agreement. The Subadviser will furnish any
6
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informational reports requested by any state insurance commissioner.
7. Liability. Except as may otherwise be provided by the
Investment Company Act, neither Sub-Investment Manager nor its officers,
directors, employees or agents shall be subject to any liability to Investment
Manager, the Fund or any shareholder of the Fund for any error of judgment,
mistake of law or any loss arising out of any investment or other act or
omission in the course of, connected with or arising out of any service to be
rendered hereunder, except by reason of willful misfeasance, bad faith or gross
negligence in the performance of its duties or by reason of reckless disregard
of its obligations and duties under this Agreement. Investment Manager shall
hold harmless and indemnify Sub-Investment Manager for any loss, liability,
cost, damage or expense (including reasonable attorneys fees and costs) arising
from any claim or demand by the Fund or any past or present shareholder of the
fund that is not arising from Subadvisers willful misfeasance, bad faith or
gross negligence.
8. Reliance on Documents. The Board of Directors of the Fund or
its officers or agent will provide timely information to the Subadviser
regarding such matters as purchases and redemptions of shares in the Portfolio,
the cash requirements, and cash available for investment in the Portfolio, and
all other information as may be reasonably necessary or appropriate in order for
the Subadviser to perform its responsibilities hereunder. A Subadviser has
provided the Investment Manager with a copy of its current form ADV.
Neither the Fund or the Investment Manager, nor their respective
designees or agents, shall use any material describing or identifying the
Subadviser or its affiliates without the prior consent of the Subadviser. Any
material utilized by the Fund, the Investment Manager or their respective
designees or agents which contain information as to the Subadviser and/or its
affiliates shall be submitted to the Subadviser for approval prior to use, not
less than five (5) business days before such approval is requested.
The Investment Manager has herewith furnished the Subadviser copies of
the Fund's Prospectus, Statement of Additional Information, Articles of
Incorporation and By-Laws as currently in effect and agrees during the
continuance of the Agreement to furnish the Subadviser copies of any amendments
or supplements thereto before or at the time the amendments or supplements
become effective. The Subadviser will be entitled to rely on all such documents
furnished to it by the Investment Manager of the Fund.
9. Duration and Termination of the Agreement. This Subadvisory
Agreement shall become effective as of the date first written above and remain
in force until _______________ [date]. Thereafter, it shall continue in effect
from year to year, but only so long as such continuance is specifically approved
at least annually by (a) the Board of Directors of the Fund, or by the vote of a
majority of the outstanding voting securities of the Portfolio, and (b) a
majority of those directors who are not parties to this Subadviser Agreement,
not interested
7
<PAGE>
persons of any party to this Subadviser Agreement, cast in person at a meeting
called for the purpose of voting on such approval. This Agreement may be
terminated, without the payment of any penalty, by the Board of Directors of the
Fund, by a vote of a majority of the outstanding shares of the Portfolio, or by
the Investment Manager on sixty days' written notice to the Subadviser, or by
the Subadviser on sixty days' written notice to the Fund or the Investment
Manager. Termination by the Board of Directors or by the Investment Manager
shall be subject to shareholder approval to the extent legally required. This
Agreement shall automatically terminate in the event of its assignment or in the
event of termination of the Investment Management Agreement.
10. Amendments of the Agreement. Except to the extent permitted by
the Investment Company Act or the rules or regulations thereunder or pursuant to
any exemptive relief granted by the Securities and Exchange Commission ("SEC"),
this Agreement may be amended by the parties only if such amendment, if
material, is specifically approved by the vote of a majority of the outstanding
voting securities of the Portfolio (unless such approval is not required by
Section 15 of the Investment Company Act as interpreted by the SEC or its staff)
and by the vote of a majority of the Independent Directors cast in person at a
meeting called for the purpose of voting on such approval. The required
shareholder approval shall be effective with respect to the Portfolio if a
majority of the outstanding voting securities of the Portfolio vote to approve
the amendment, notwithstanding that amendment may not have been approved by a
majority of the outstanding voting securities of any other portfolio affected by
the amendment or all the portfolios of the Fund.
11. Definitions. The terms "assignment", "interested person", and
"majority of the outstanding voting securities", when used in this Agreement,
shall have the respective meaning specified under the Investment Company Act and
the rules thereunder.
12. Notices. Any notice that is required to be given by the
parties to each other under the terms of this Agreement shall be given in
writing, delivered, or mailed postpaid to the other party, or transmitted by
facsimile with acknowledgment of receipt, to the parties at the following
addresses or facsimile numbers, which may from time to time be changed by the
parties by notice to the other party:
(a) If to the Subadviser:
(b) If to the Investment Manager:
Chubb Investment Advisory Corporation
One Granite Place
Concord, NH 03301
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<PAGE>
Attn: Ronald Angarella
Facsimile (603) 224-1691
13. Governing Law. The provisions of this Agreement shall be
construed and interpreted in accordance with the laws of the State of New
Hampshire as at the time in effect and the applicable provisions of the
Investment Company Act or other federal laws and regulations which may be
applicable. To the extent that the applicable law of the State of New Hampshire
or any of the provisions herein, conflict with the applicable provisions of the
Investment Company Act or other federal laws and regulations which may be
applicable, the latter shall control.
14. Use of Subadviser's Name. Neither the Fund nor the Manager or
any affiliate or agent thereof shall make reference to or use the name, and any
derivative thereof or logo associated with that name, of the Subadviser or any
of its affiliates 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, the Manager and the Fund shall
forthwith cease to use such name (or derivative or logo) as soon as reasonably
practicable.
15. Entire Agreement. This Agreement contains the entire
understanding and agreement of the parties with respect to the Portfolio.
16. Headings. The headings in the sections of this Agreement are
inserted for convenience of reference only and shall not constitute a part
hereof.
17. Severability. Should any portion of this Agreement for any
reason be held to be void in law or in equity, the Agreement shall be construed,
insofar as is possible, as if such portion had never been contained herein.
CHUBB INVESTMENT ADVISORY CORPORATION
ATTEST:____________________ BY: _______________________
TITLE:______________________ TITLE:_____________________
SUBADVISER
ATTEST:____________________ BY: _______________________
TITLE:______________________ TITLE:_____________________
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<PAGE>
EXHIBIT B-2
FORM OF INVESTMENT SUBADVISORY AGREEMENT
----------------------------------------
THIS AGREEMENT, made this _____ day of __________, 199___, is between CHUBB
INVESTMENT ADVISORY CORPORATION, a Tennessee corporation with offices at One
Granite Place, Concord, New Hampshire, 03301 (the "Investment Manager" or
"Manager") and Massachusetts Financial Services Company, (the "Subadviser") a
_______________ corporation with offices at 500 Boyleston Street, Boston,
Massachusetts 02116.
WITNESSETH:
WHEREAS, Chubb America Fund, Inc. (the "Fund") is engaged in business
as a diversified open-end management investment company and is registered as
such under the Investment Company Act of 1940 (the "Investment Company Act");
WHEREAS, the Fund issues separate classes or series of stock, each of
which represents a separate portfolio of investments;
WHEREAS, the Fund's shareholders are and will be separate accounts
maintained by insurance companies for variable life insurance policies under
which income, gains, losses, whether or not realized, from assets allocated to
such accounts are, in accordance with the Policies, credited to or charged
against such accounts without regard to other income, gains, or losses of such
insurance companies;
WHEREAS, the Fund has employed the Investment Manager to act as
investment manager of the Portfolio, as set forth in an Investment Management
Agreement between the Fund and the Investment Manager dated _______, 199__, (the
"Investment Management Agreement") pursuant to which it was agreed that the
Investment Manager may contract with the Subadviser, or other parties for
certain investment management services;
WHEREAS, the Subadviser is engaged in the business of rendering
investment advisory services and is registered as an investment adviser under
the Investment Advisers Act of 1940;
WHEREAS, the Investment Manager desires to retain the Subadviser to
render investment management services to the Fund's Emerging Growth Portfolio
and Money Market Portfolio (the "Portfolios") in the manner and on the terms
hereinafter set forth;
NOW, THEREFORE, in consideration of the premises and the convenants
hereinafter contained the Investment Manager and the Subadviser hereby agree as
follows:
<PAGE>
1. Appointment of the Subadviser. The Manager hereby appoints the
Subadviser to act as an investment subadviser for the Portfolio and to manage
the investment and reinvestment of the assets of the Portfolio, subject to the
supervision of the Directors of the Fund and the terms and conditions of this
Agreement. The Subadviser will be an independent contractor and will have no
authority to act for or represent the Fund or Manager in any way or otherwise be
deemed an agent of the Fund or Manager except as expressly authorized in this
Agreement or another writing by the Fund, Manager and the Subadviser.
Notwithstanding the foregoing, the Subadviser may execute account documentation,
agreements, contracts and other documents as the Subadviser may be requested by
brokers, dealers, counterparts and other persons in connection with the
Subadviser's management of the assets of the Portfolio, provided that the
Subadviser receives the express agreement and consent of the Manager and/or the
Fund's Board of Directors to execute such documentation, agreements, contracts
and other documents. In such respect, and only for this limited purpose, the
Subadviser shall act at the Manager and/or the Fund's agent and
attorney-in-fact.
2. Duties of the Subadviser. The Subadviser hereby agrees, subject to
the supervision of the Investment Manager and the Board of Directors of the
Fund, (1) to act as the Subadviser of the Portfolio, (2) to manage the
investment and reinvestment of the assets of the Portfolio for the period and on
the terms and conditions set forth in this Agreement, and (3) during the term
hereof, to render the services and to assume the obligations herein set forth in
return for the compensation provided for herein and to bear all expenses of its
performance of such services and obligations.
3. Services to be Rendered by the Subadviser to the Fund
A. The Subadviser will manage the investment and reinvestment of
the assets of the Portfolio and determine the composition of the assets of the
Portfolio, subject always to the direction and control of the Directors of the
Fund and the Manager and in accordance with the provisions of the Fund's
registration statement, as amended from time to time. In fulfilling its
obligations to manage the investment and reinvestment of the assets of the
Portfolio, the Subadviser will:
(i) obtain and evaluate pertinent economic,
statistical, financial, and other information affecting the economy generally
and individual companies or industries, the securities of which are included in
the Portfolio or are under consideration for inclusion in the Portfolio;
(ii) formulate and implement a continuous
investment program for the Portfolio (a) consistent with the investment
objectives, policies, and restrictions of the Portfolio as stated in the Fund's
Agreement and Articles of Incorporation, Bylaws, and such Portfolio's currently
effective Prospectus and Statement of Additional Information ("SAI") as amended
from time to time, and (b) in compliance with the requirements applicable to
both regulated investment
2
<PAGE>
companies and segregated asset accounts under Subchapters M and L of the
Internal Revenue Code of 1986, as amended, and requirements applicable to
registered investment companies under applicable laws;
(iii) take whatever steps are necessary to implement the
investment program for the Portfolio by the purchase and sale of securities and
other investments authorized under the Fund's Agreement and Articles of
Incorporation, Bylaws, and such Portfolio's currently effective Prospectus and
SAI, including the placing of orders for such purchases and sales;
(iv) subject to the consent of the Subadvisor, regularly
report to the Directors of the Fund and the Manager with respect to the
implementation of the investment program and, in addition and subject to the
consent of the Subadviser, provide such statistical information and special
reports concerning the Portfolio and/or important developments materially
affecting the investments held, or contemplated to be purchased, by the
Portfolio, as may reasonably be requested by the Manager or the Directors of the
Fund, including attendance at Board of Directors Meetings, as reasonably
requested, to present such information and reports to the Board.
B. To facilitate the Subadviser's fulfillment of its obligations
under this Agreement, the Manager and the Fund will undertake the following:
(i) the Manager agrees promptly to provide the Subadviser
with all amendments or supplements to the Registration Statement, the Fund's
Agreement and Articles of Incorporation, and Bylaws;
(ii) the Fund and the Manager each agrees, on an ongoing
basis, to notify the Subadviser expressly in writing of each change in the
fundamental and nonfundamental investment policies of the Portfolio;
(iii) The Manager agrees to provide or cause to be provided to
the Subadviser with such assistance as may be reasonably requested by the
Subadviser in connection with its activities pertaining to the Portfolio under
this Agreement, including, without limitation, information concerning the
Portfolio, its available funds, or funds that may reasonably become available
for investment, and information as to the general condition of the Portfolio's
affairs;
(iv) the Manager agrees to provide or cause to be provided to
the Subadviser on an ongoing basis, such information as is reasonably requested
by the Subadviser for performance by the Subadviser 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 Manager fails to provide
or cause to be provided such requested information and the Subadviser relies on
the information most recently furnished to the Subadviser; and
3
<PAGE>
(v) the Manager will promptly provide the Subadviser with any
guidelines and procedures applicable to the Subadviser or the Portfolio adopted
from time to time by the Board of Directors of the Fund and agrees to promptly
provide the Subadviser copies of all amendments thereto.
(vi) the Board of Directors of the Fund or its officers or
agent will provide timely information to the Subadviser regarding such matters
as purchases and redemptions of shares in the Portfolio, the cash requirements,
and cash available for investment in the Portfolio and all other information as
may be reasonably necessary or appropriate in order for the Subadviser to
perform its responsibilities hereunder.
C. The Subadviser, at its expense, will furnish: (i) all necessary
investment and management facilities and investment personnel, including
salaries, expenses and fees of any personnel required for it to faithfully
perform its duties under this Agreement; and (ii) administrative facilities,
including bookkeeping, clerical personnel and equipment required for it to
faithfully perform its duties under this agreement. The Subadviser shall not be
obligated to pay any expenses of or for the Portfolio not expressly assumed by
the Subadviser pursuant to this Section 3.
D. The Subadviser will select brokers and dealers to effect all
portfolio transactions subject to the conditions set forth herein. The
Subadviser will place all necessary orders with brokers, dealers, or issuers,
and will negotiate brokerage commissions if applicable. The Subadviser is
directed at all times to seek to execute brokerage transactions for the
Portfolio in accordance with such policies or practices as may be established by
the Board of Directors and described in the Fund's currently effective
Prospectus and SAI, as amended from time to time. In placing orders for the
purchase or sale of investments for the Portfolio, in the name of the Portfolio
or its nominees, the Subadviser shall use its best efforts to obtain for the
Portfolio the most favorable price and best execution available, considering all
of the circumstances, and shall maintain records adequate to demonstrate
compliance with this requirement.
Subject to the appropriate policies and procedures approved by the
Board of Directors, the Subadviser may, to the extent authorized by Section
28(e) of the Securities and Exchange Act of 1934, cause the Portfolio to pay a
broker or dealer that provides brokerage or research services to the Manger, the
Subadviser, or the Portfolio an amount of commissions for effecting a portfolio
transaction in excess of the amount of commission another broker or dealer would
have charged for effecting that transaction if the Subadviser determines, in
good faith, that such amount of commission is reasonable in relationship to the
value of such brokerage or research services provided viewed in terms of that
particular transaction or the Subadviser's overall responsibilities to the
Portfolio or its other advisory clients. To the extent authorized by said
Section 28(e) and the Fund's Board of Directors, the Subadviser shall not be
deemed to have acted unlawfully or to have breached any duty created by this
Agreement or otherwise
4
<PAGE>
solely by reason of such action. In addition, subject to seeking the most
favorable price and best execution available, the Subadviser may also consider
sales of shares of the Fund as a factor in the selection of brokers and dealers.
E. On occasions when the Subadviser deems the purchase or sale of
a security to be in the best interest of the Portfolio 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 purchased or sold to attempt to obtain a more favorable price or lower
brokerage commissions and efficient execution. In such event, allocation of the
securities so purchased or sold, 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 Portfolio and to its other clients.
F. The Subadviser will maintain all accounts, books and records
with respect to the Portfolio as are required of an investment adviser of a
registered investment company pursuant to the Investment Company Act and
Advisers Act and the rules thereunder.
4. Compensation of the Subadviser. The Investment Manager will pay the
Subadviser, with respect to the Portfolio, the compensation specified in
Appendix A to this Agreement. Payments shall be made to the Subadviser on the
first day of each month; however, this advisory fee will be calculated on the
daily average value of the Portfolio's assets and accrued on a daily basis.
5. Non-Exclusivity. The Investment Manager agrees that the services of
the Subadviser are not to be deemed exclusive and the Subadviser is free to act
as investment manager to various investment companies and as fiduciary for other
managed accounts.
6. Books and Records. The Subadviser agrees that all books and records
which it maintains for the Fund are the Fund's property, and, in the event of
termination of this Agreement for any reason, the Subadviser agrees promptly to
return to the Fund, free from any claim or retention of rights by the
Subadviser, all records relating to the Portfolio. The Subadviser also agrees
upon request of the Investment Manager or the Fund, promptly to surrender the
books and records to either party or make the book and records available for
inspection by representatives of regulatory authorities. In connection with its
duties hereunder, the Subadviser further agrees to maintain, prepare and
preserve books and records in accordance with the Investment Company Act and
rules thereunder, including but not limited to, Rule 31a-1 and 31a-2.
The Subadviser will use records or information obtained under this
Agreement only for the purposes contemplated hereby, and will not disclose such
records or information in any manner other than expressly authorized by the
Fund, or if disclosure is expressly required by applicable federal or state
5
<PAGE>
regulatory authorities or by this Agreement. The Subadviser will furnish any
informational reports requested by any state insurance commissioner.
7. Liability. The Subadviser will not be liable for any loss suffered
by the Fund in connection with any investment policy established by the Fund for
the purchase, sale or redemption of any securities at the direction of the Board
of Directors of the Fund or the Investment Manager. Nothing herein contained
shall be construed to protect the Subadviser against any liability resulting
from the willful misfeasance, bad faith or gross negligence of the Subadviser in
the performance of its duties or from reckless disregard of its obligations and
duties under this Subadviser Agreement.
8. Documents. Neither the Fund or the Investment Manager, nor their
respective designees or agents, shall use any material describing or identifying
the Subadviser or its affiliates without the prior consent of the Subadviser.
Any material utilized by the Fund, the Investment Manager or their respective
designees or agents which contain information as to the Subadviser and/or its
affiliates shall be submitted to the Subadviser for approval prior to use, not
less than five (5) business days before such approval is requested.
9. Duration and Termination of the Agreement. This Subadvisory
Agreement shall become effective as of the date first written above and remain
in force until _______________ [date]. Thereafter, it shall continue in effect
from year to year, but only so long as such continuance is specifically approved
at least annually by (a) the Board of Directors of the Fund, or by the vote of a
majority of the outstanding voting securities of the Portfolio, and (b) a
majority of those directors who are not parties to this Subadviser Agreement,
not interested persons of any party to this Subadviser Agreement, cast in person
at a meeting called for the purpose of voting on such approval. This Agreement
may be terminated, without the payment of any penalty, by the Board of Directors
of the Fund, by a vote of a majority of the outstanding shares of the Portfolio,
or by the Investment Manager on sixty days' written notice to the Subadviser, or
by the Subadviser on sixty days' written notice to the Fund or the Investment
Manager. Termination by the Board of Directors or by the Investment Manager
shall be subject to shareholder approval to the extent legally required. This
Agreement shall automatically terminate in the event of its assignment or in the
event of termination of the Investment Management Agreement.
10. Amendments of the Agreement. Except to the extent permitted by the
Investment Company Act or the rules or regulations thereunder or pursuant to any
exemptive relief granted by the Securities and Exchange Commission ("SEC"), this
Agreement may be amended by the parties only if such amendment, if material, is
specifically approved by the vote of a majority of the outstanding voting
securities of the Portfolio (unless such approval is not required by Section 15
of the Investment Company Act as interpreted by the SEC or its staff) and by the
vote of a majority of the Independent Directors cast in person at a meeting
called for the purpose of voting on such approval. The required shareholder
6
<PAGE>
approval shall be effective with respect to the Portfolio if a majority of the
outstanding voting securities of the Portfolio vote to approve the amendment,
notwithstanding that amendment may not have been approved by a majority of the
outstanding voting securities of any other portfolio affected by the amendment
or all the portfolios of the Fund.
11. Definitions. The terms "assignment", "interested person", and
"majority of the outstanding voting securities", when used in this Agreement,
shall have the respective meaning specified under the Investment Company Act and
the rules thereunder.
12. Notices. Any notice that is required to be given by the parties
to each other under the terms of this Agreement shall be given in writing,
delivered, or mailed postpaid to the other party, or transmitted by facsimile
with acknowledgment of receipt, to the parties at the following addresses or
facsimile numbers, which may from time to time be changed by the parties by
notice to the other party:
(a) If to the Subadviser:
(b) If to the Investment Manager:
Chubb Investment Advisory Corporation
One Granite Place
Concord, NH 03301
Attn: Ronald Angarella
Facsimile (603) 224-1691
13. Governing Law. The provisions of this Agreement shall be
construed and interpreted in accordance with the laws of the Commonwealth of
Massachusetts as at the time in effect and the applicable provisions of the
Investment Company Act or other federal laws and regulations which may be
applicable. To the extent that the applicable law of the Commonwealth of
Massachusetts or any of the provisions herein, conflict with the applicable
provisions of the Investment Company Act or other federal laws and regulations
which may be applicable, the latter shall control.
14. Use of Subadviser's Name. Neither the Fund nor the Manager or any
affiliate or agent thereof shall make reference to or use the name, and any
derivative thereof or logo associated with that name, of the Subadviser or any
of its affiliates in any advertising or promotional materials, without the prior
approval of the Subadviser. Upon termination of this Agreement, the Manager and
the Fund shall forthwith cease to use such name (or derivative or logo) as soon
as reasonably practicable.
7
<PAGE>
15. Entire Agreement. This Agreement contains the entire
understanding and agreement of the parties with respect to the Portfolio.
16. Headings. The headings in the sections of this Agreement are
inserted for convenience of reference only and shall not constitute a part
hereof.
17. Severability. Should any portion of this Agreement for any reason
be held to be void in law or in equity, the Agreement shall be construed,
insofar as is possible, as if such portion had never been contained herein.
CHUBB INVESTMENT ADVISORY CORPORATION
ATTEST:____________________ BY: _______________________
TITLE:______________________ TITLE:_____________________
SUBADVISER
ATTEST:____________________ BY: _______________________
TITLE:______________________ TITLE:_____________________
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EXHIBIT B-3
FORM OF INVESTMENT SUBADVISORY AGREEMENT
----------------------------------------
THIS AGREEMENT, made this _____ day of __________, 199___, is between CHUBB
INVESTMENT ADVISORY CORPORATION, a Tennessee corporation with offices at One
Granite Place, Concord, New Hampshire, 03301 (the "Investment Manager" or
"Manager") and Templeton Global Advisers Limited, (the "Subadviser") a Bahamian
corporation with offices at Nassau, Bahamas.
WITNESSETH:
WHEREAS, Chubb America Fund, Inc. (the "Fund") is engaged in business
as a diversified open-end management investment company and is registered as
such under the Investment Company Act of 1940 (the "Investment Company Act");
WHEREAS, the Fund issues separate classes or series of stock, each of
which represents a separate portfolio of investments;
WHEREAS, the Fund's shareholders are and will be separate accounts
maintained by insurance companies for variable life insurance policies under
which income, gains, losses, whether or not realized, from assets allocated to
such accounts are, in accordance with the Policies, credited to or charged
against such accounts without regard to other income, gains, or losses of such
insurance companies;
WHEREAS, the Fund has employed the Investment Manager to act as
investment manager of the Portfolio, as set forth in an Investment Management
Agreement between the Fund and the Investment Manager dated _______, 199__, (the
"Investment Management Agreement") pursuant to which it was agreed that the
Investment Manager may contract with the Subadviser, or other parties for
certain investment management services;
WHEREAS, the Subadviser is engaged in the business of rendering
investment advisory services and is registered as an investment adviser under
the Investment Advisers Act of 1940;
WHEREAS, the Investment Manager desires to retain the Subadviser to
render investment management services to the Fund's World Growth Stock Portfolio
(the "Portfolio") in the manner and on the terms hereinafter set forth;
NOW, THEREFORE, in consideration of the premises and the covenants
hereinafter contained the Investment Manager and the Subadviser hereby agree as
follows:
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1. Duties of the Subadviser. The Subadviser hereby agrees, subject
to the instructions and supervision of the Investment Manager: (1) to act as the
Subadviser of the Portfolio, (2) to manage the investment and reinvestment of
the assets of the Portfolio for the period and on the terms and conditions set
forth in this Agreement, and (3) during the term hereof, to render the services
and to assume the obligations herein set forth in return for the compensation
provided for herein and to bear all expenses of its performance of such services
and obligations. It is understood that all acts of the Subadviser in performing
this Agreement are to be performed by it outside the United States.
2. Services to be Rendered by the Subadviser to the Fund
A. The Subadviser will manage the investment and reinvestment
of the assets of the Portfolio and determine the composition of the assets of
the Portfolio, subject to the instructions and supervision of the Manager and
consistent with the provisions of the Fund's registration statement, as amended
from time to time. In fulfilling its obligations to manage the investment and
reinvestment of the assets of the Portfolio, the Subadviser will:
(i) formulate and implement a continuous investment
program for the Portfolio (a) consistent with the investment objectives,
policies, and restrictions of the Portfolio as stated in the Fund's Agreement
and Articles of Incorporation, Bylaws, and such Portfolio's currently effective
Prospectus and Statement of Additional Information ("SAI") as amended from time
to time, and (b) in compliance with the requirements communicated in writing by
the Investment Manager to the Subadviser and applicable to regulated investment
companies and segregated asset accounts under Subchapters M and L of the
Internal Revenue Code of 1986, as amended, and applicable to registered
investment companies under applicable laws;
(ii) implement the investment program for the Portfolio by
the purchase and sale of securities and other investments authorized under the
Fund's Agreement and Articles of Incorporation, Bylaws, and such Portfolio's
currently effective Prospectus and SAI, including the placing of orders for such
purchases and sales;
(iii) regularly report to the Directors of the Fund and the
Manager with respect to the implementation of the investment program and, in
addition, provide such statistical information and special reports concerning
the Portfolio and/or important developments materially affecting the investments
held, or contemplated to be purchased, by the Portfolio, as may reasonably be
requested by the Manager or the Directors of the Fund;
(iv) provide determinations of the fair value of certain
portfolio securities when market quotations are not readily available for the
purpose of calculating the Portfolio's net asset value in accordance with
procedures and methods established by the Directors of the Fund; and
2
<PAGE>
(v) the Subadviser is not required to furnish any personnel,
overhead items or facilities for the Investment Manager or the Fund, including
trading desk facilities or daily pricing of the Fund's portfolio.
B. To enable the Subadviser's fulfillment of its obligations under
this Agreement, the Manager will undertake the following:
(i) the Manager agrees promptly to provide the Subadviser
with all amendments or supplements to the Registration Statement, the Fund's
Agreement and Articles of Incorporation, and Bylaws;
(ii) the Manager agrees, on an ongoing basis, to notify
the Subadviser expressly in writing of each change in the fundamental and
nonfundamental investment policies of the Portfolio;
(iii) The Manager agrees to provide or cause to be provided
to the Subadviser with such assistance as may be reasonably requested by the
Subadviser in connection with its activities pertaining to the Portfolio under
this Agreement, including, without limitation, information concerning the
Portfolio, its available funds, or funds that may reasonably become available
for investment, and information as to the general condition of the Portfolio's
affairs;
(iv) the Manager agrees to provide or cause to be provided
to the Subadviser on an ongoing basis, such information as is reasonably
requested by the Subadviser for performance by the Subadviser 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 Manager fails to
provide or cause to be provided such requested information and the Subadviser
relies on the information most recently furnished to the Subadviser; and
(v) the Manager will promptly provide the Subadviser with
any guidelines and procedures applicable to the Subadviser or the Portfolio
adopted from time to time by the Board of Directors of the Fund and agrees to
promptly provide the Subadviser copies of all amendments thereto.
C. The Subadviser, at its expense, will furnish all necessary
investment and management facilities and investment personnel, including
salaries, expenses and fees of any personnel required for it to faithfully
perform its duties under this Agreement.
D. The Subadviser shall be responsible for selecting members of
securities exchanges, brokers and dealers (such members, brokers and dealers
being hereinafter referred to as "brokers") for the execution of the Fund's
portfolio transactions consistent with the Fund's brokerage policies and, when
applicable, the negotiation of commissions in connection therewith.
3
<PAGE>
All decisions and placements shall be made in accordance with the
following principles:
(i) Purchase and sale orders will usually be placed with
brokers which are selected by the Subadviser as able to achieve "best execution"
of such orders. "Best execution" shall mean prompt and reliable execution at the
most favorable security price, taking into account the other provisions
hereinafter set forth. The determination of what may constitute best execution
and price in the execution of a securities transaction by a broker involves a
number of considerations, including, without limitation, the overall direct net
economic result to the Fund (involving both price paid or received and any
commissions and other costs paid), the efficiency with which the transaction is
effected, the ability to effect the transaction at all where a large block is
involved, availability of the broker to stand ready to execute possibly
difficult transactions in the future, and the financial strength and stability
of the broker. Such considerations are judgmental and are weighed by the
Subadviser in determining the overall reasonableness of brokerage commissions.
(ii) In selecting brokers for portfolio transactions, the
Subadviser shall take into account its past experience as to brokers qualified
to achieve "best execution," including brokers who specialize in any foreign
securities held by the Fund.
(iii) The Subadviser is authorized to allocate brokerage
business to brokers who have provided brokerage and research services, as such
services are defined in Section 28(e) of the Securities Exchange Act of 1934
(the "1934 Act"), for the Fund and/or other accounts, if any, for which the
Subadviser exercises investment discretion (as defined in Section 3(a)(35) of
the 1934 Act) and, as to transactions for which fixed minimum commission rates
are not applicable, to cause the Fund to pay a commission for effecting a
securities transaction in excess of the amount another broker would have charged
for effecting that transaction, if the Subadviser determines in good faith that
such amount of commission is 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 Fund and the other accounts, if any, as to which it
exercises investment discretion. In reaching such determination, the Subadviser
will not be required to place or attempt to place a specific dollar value on the
research or execution services of a broker or on the portion of any commission
reflecting either of said services. In demonstrating that such determinations
were made in good faith, the Subadviser shall be prepared to show that all
commissions were allocated and paid for purposes contemplated by the Fund's
brokerage policy; that the research services provide lawful and appropriate
assistance to the Subadviser in the performance of its investment decision-
making responsibilities; and that the commissions paid were within a reasonable
range. Whether commissions were within a reasonable range shall be based on any
available information as to the level of commission known to be charged by other
brokers on comparable
4
<PAGE>
transactions, but there shall be taken into account the Fund's policies that (i)
obtaining a low commission is deemed secondary to obtaining a favorable
securities price, since it is recognized that usually it is more beneficial to
the Fund to obtain a favorable price than to pay the lowest commission; and (ii)
the quality, comprehensiveness and frequency of research studies that are
provided for the Subadviser are useful to the Subadviser in performing its
advisory services under this Agreement. Research services provided by brokers to
the Subadviser are considered to be in addition to, and not in lieu of, services
required to be performed by the Subadviser under this Agreement. Research
furnished by brokers through which the Fund effects securities transactions may
be used by the Subadviser for any of its accounts, and not all research may be
used by the Subadviser for the Fund. When execution of portfolio transactions is
allocated to brokers trading on exchanges with fixed brokerage commission rates,
account may be taken of various services provided by the broker.
(iv) Purchases and sales of portfolio securities within
the United States other than on a securities exchange shall be executed with
primary market makers acting as principal, except where, in the judgment of the
Subadviser, better prices and execution may be obtained on a commission basis or
from other sources.
(v) Sales of the Fund's shares by a broker are one factor
among others to be taken into account in deciding to allocate portfolio
transactions (including agency transactions, principal transactions, purchases
in underwritings or tenders in response to tender offers) for the account of the
Fund to that broker, provided that the broker shall furnish "best execution," as
defined in subparagraph (i) above, and that such allocation shall be within the
scope of the Fund's policies as stated above; provided further, that in every
allocation made to a broker in which the sale of Fund shares is taken into
account, there shall be no increase in the amount of the commissions or other
compensation paid to such broker beyond a reasonable commission or other
compensation determined, as set forth in subparagraph (iii) above, on the basis
of best execution alone or best execution plus research services, without taking
account of or placing any value upon such sale of the Fund's shares.
E. On occasions when the Subadviser deems the purchase or sale of a
security to be in the best interest of the Portfolio 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 purchased or sold to attempt to obtain a more favorable price or lower
brokerage commissions and efficient execution. In such event, allocation of the
securities so purchased or sold, 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 Portfolio and to its other clients.
5
<PAGE>
F. The Subadviser will maintain all accounts, books and records
with respect to the Portfolio as are required of an investment adviser of a
registered investment company pursuant to the Investment Company Act and
Advisers Act and the rules thereunder.
3. Compensation of the Subadviser. The Investment Manager will pay
the Subadviser, with respect to the Portfolio, the compensation specified in
Appendix A to this Agreement. Payments shall be made to the Subadviser on the
first day of each month; however, this advisory fee will be calculated on the
daily average value of the Portfolio's assets and accrued on a daily basis.
4. Non-Exclusivity. It is understood that the services of the
Subadviser are not deemed to be exclusive, and nothing in this Agreement shall
prevent the Subadviser, or any affiliate thereof, from providing similar
services to other investment companies and other clients, including clients
which may invest in the same types of securities as the Fund, or, in providing
such services, from using information furnished by others. The Subadviser shall,
for all purposes herein, be deemed to be an independent contractor and shall,
unless otherwise provided or authorized, have no authority to act for or
represent the Fund or the Investment Manager in any way or otherwise be deemed
an agent of the Fund or Investment Manager other than in furtherance of its
duties and responsibilities as set forth in this Subadvisory Agreement.
5. Books and Records. The Subadviser agrees that all books and
records which it maintains concerning the Fund are the Fund's property, and, in
the event of termination of this Agreement for any reason, the Subadviser agrees
promptly to return to the Fund, free from any claim or retention of rights by
the Subadviser, except the right to make and retain copies, all records relating
to the Portfolio. The Subadviser also agrees upon request of the Investment
Manager or the Fund, promptly to surrender the books and records to either party
or make the book and records available for inspection by representatives of
regulatory authorities. The Subadviser will furnish any information or reports
requested by any state insurance commissioner. The Investment Manager shall
reimburse the Subadviser for its costs and expenses in complying with any such
request.
Each party will use records or information obtained under this
Agreement only for the purposes contemplated hereby, and will not disclose such
records or information (except information which is a matter of public record)
in any manner other than expressly authorized by the other party, or if
disclosure is expressly required by applicable federal or state regulatory
authorities or by this Agreement.
7. Except as may otherwise be provided by the 1940 Act, neither the
Subadviser nor its officers, directors, employees or agents shall be subject to
any liability for any error of judgment, mistake of law, or any loss arising out
of any investment or other act or omission in the performance by the Subadviser
of its duties under this Agreement or for any loss or damage resulting from the
6
<PAGE>
imposition by any government of exchange control restrictions which might affect
the liquidity of the Fund's assets, or from acts or omissions of custodians, or
securities depositories, or from any war or political act of any foreign
government to which such assets might be exposed, or for failure, on the part of
the custodian or otherwise, timely to collect payments, except for any
liability, loss or damage resulting from willful misfeasance, bad faith or gross
negligence on the Subadviser's part or by reason of reckless disregard of the
Subadviser's duties under this Agreement. It is hereby understood and
acknowledged by the Investment Manager that the value of the investments made
for the Fund may increase as well as decrease and are not guaranteed by the
Subadviser. It is further understood and acknowledged by the Investment Manager
that investment decisions made on behalf of the Fund by the Subadviser are
subject to a variety of factors which may affect the values and income generated
by the Fund's portfolio securities, including general economic conditions,
market factors and currency exchange rates, and that investment decisions made
by the Subadviser will not always be profitable or prove to have been correct.
8. Reliance on Documents. The Investment Manager shall assure that
the Fund or its officers or agent will provide timely information to the
Subadviser regarding such matters as purchases and redemptions of shares in the
Portfolio, the cash requirements, and cash available for investment in the
Portfolio, and all other information as may be reasonably necessary or
appropriate in order for the Subadviser to perform its responsibilities
hereunder.
Neither the Fund or the Investment Manager, nor their respective
designees or agents, shall use any material describing or identifying the
Subadviser or its affiliates without the prior consent of the Subadviser. Any
material utilized by the Fund, the Investment Manager or their respective
designees or agents which contains information as to the Subadviser and/or its
affiliates shall be submitted to the Subadviser for approval prior to use, not
less than ten (10) business days before such approval is requested.
The Investment Manager has herewith furnished the Subadviser copies of
the Investment Management Agreement and the Fund's Prospectus, Articles of
Incorporation and By-Laws as currently in effect and agrees during the
continuance of the Agreement to furnish the Subadviser copies of any amendments
or supplements thereto before or at the time the amendments or supplements
become effective. The Investment Manager also agrees to notify the Subadviser of
any federal or state law or regulation, including tax laws or regulations, which
restrict the activities of the Subadviser hereunder. The Subadviser will be
entitled to rely on all such documents or other information furnished to it by
the Investment Manager or the Fund.
9. Duration and Termination of the Agreement. This Subadvisory
Agreement shall become effective as of the date first written above and remain
in force until _______________ [date]. Thereafter, it shall continue in effect
from year to year, but only so long as such continuance is specifically approved
at
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<PAGE>
least annually by (a) the Board of Directors of the Fund, or by the vote of a
majority of the outstanding voting securities of the Portfolio, and (b) a
majority of those directors who are not parties to this Subadviser Agreement,
not interested persons of any party to this Subadvisory Agreement, cast in
person at a meeting called for the purpose of voting on such approval. This
Agreement may be terminated, without the payment of any penalty, by the Board of
Directors of the Fund, by a vote of a majority of the outstanding shares of the
Portfolio, or by the Investment Manager on sixty days' written notice to the
Subadviser, or by the Subadviser on sixty days' written notice to the Fund or
the Investment Manager. Termination by the Board of Directors or by the
Investment Manager shall be subject to shareholder approval to the extent
legally required. This Agreement shall automatically terminate in the event of
its assignment or in the event of termination of the Investment Management
Agreement.
10. Amendments of the Agreement. Except to the extent permitted by
the Investment Company Act or the rules or regulations thereunder or pursuant to
any exemptive relief granted by the Securities and Exchange Commission ("SEC"),
this Agreement may be amended by the parties only if such amendment, if
material, is specifically approved by the vote of a majority of the outstanding
voting securities of the Portfolio (unless such approval is not required by
Section 15 of the Investment Company Act as interpreted by the SEC or its staff)
and by the vote of a majority of the Independent Directors cast in person at a
meeting called for the purpose of voting on such approval. The required
shareholder approval shall be effective with respect to the Portfolio if a
majority of the outstanding voting securities of the Portfolio vote to approve
the amendment, notwithstanding that amendment may not have been approved by a
majority of the outstanding voting securities of any other portfolio affected by
the amendment or all the portfolios of the Fund.
11. Definitions. The terms "assignment", "interested person", and
"majority of the outstanding voting securities", when used in this Agreement,
shall have the respective meaning specified under the Investment Company Act and
the rules thereunder.
12. Notices. Any notice that is required to be given by the parties
to each other under the terms of this Agreement shall be given in writing,
delivered, or mailed postpaid to the other party, or transmitted by facsimile
with acknowledgment of receipt, to the parties at the following addresses or
facsimile numbers, which may from time to time be changed by the parties by
notice to the other party:
(a) If to the Subadviser:
Karen L. Skidmore
Senior Corporate Counsel
Franklin Resources, Inc.
777 Mariners Island Boulevard
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<PAGE>
San Mateo, CA 94404
with a copy to:
Secretary
Templeton Global Advisors, Limited
Box N-7759
Nassau, Bahamas
(b) If to the Investment Manager:
Chubb Investment Advisory Corporation
One Granite Place
Concord, NH 03301
Attn: Ronald Angarella
Facsimile (603) 224-1691
13. Governing Law. The provisions of this Agreement shall be
construed and interpreted in accordance with the laws of the State of New
Hampshire as at the time in effect and the applicable provisions of the
Investment Company Act or other federal laws and regulations which may be
applicable. To the extent that the applicable law of the State of New Hampshire
or any of the provisions herein, conflict with the applicable provisions of the
Investment Company Act or other federal laws and regulations which may be
applicable, the latter shall control.
14. In the event this Agreement is terminated and the Subadviser no
longer acts as Subadviser to the Fund, the Subadviser reserves the right to
withdraw from the Investment Manager and the Fund the use of names "Franklin,"
"Templeton" or any name misleadingly implying a continuing relationship between
the Investment Manager or the Fund and the Subadviser or any of its affiliates.
15. Entire Agreement. This Agreement contains the entire
understanding and agreement of the parties with respect to the Portfolio.
16. Headings. The headings in the sections of this Agreement are
inserted for convenience of reference only and shall not constitute a part
hereof.
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<PAGE>
17. Severability. Should any portion of this Agreement for any
reason be held to be void in law or in equity, this Agreement shall be
construed, insofar as is possible, as if such portion had never been contained
herein.
CHUBB INVESTMENT ADVISORY CORPORATION
ATTEST: BY:
-------------------- -----------------------
TITLE: TITLE:
--------------------- --------------------
SUBADVISER
ATTEST: BY:
-------------------- -----------------------
TITLE: TITLE:
--------------------- --------------------
10
<PAGE>
EXHIBIT C
FORM OF INVESTMENT SUBADVISORY AGREEMENT
----------------------------------------
THIS AGREEMENT, made this _____ day of __________, 199___, is between
CHUBB INVESTMENT ADVISORY CORPORATION, a Tennessee corporation with offices at
One Granite Place, Concord, New Hampshire, 03301 (the "Investment Manager" or
"Manager") and Warburg, Pincus Counsellors, Inc., ("Subadviser") a Delaware
corporation with offices at 466 Lexington Avenue, New York, New York 10017.
WITNESSETH:
WHEREAS, Chubb America Fund, Inc. (the "Fund") is engaged in business
as a diversified open-end management investment company and is registered as
such under the Investment Company Act of 1940 (the "Investment Company Act");
WHEREAS, the Fund issues separate classes or series of stock, each of
which represents a separate portfolio of investments;
WHEREAS, the Fund's shareholders are and will be separate accounts
maintained by insurance companies for variable life insurance policies under
which income, gains, losses, whether or not realized, from assets allocated to
such accounts are, in accordance with the Policies, credited to or charged
against such accounts without regard to other income, gains, or losses of such
insurance companies;
WHEREAS, the Fund has employed the Investment Manager to act as
investment manager of the Portfolio, as set forth in an Investment Management
Agreement between the Fund and the Investment Manager dated _______, 199__, (the
"Investment Management Agreement") pursuant to which it was agreed that the
Investment Manager may contract with the Subadviser, or other parties for
certain investment management services;
WHEREAS, the Subadviser is engaged in the business of rendering
investment advisory services and is registered as an investment adviser under
the Investment Advisers Act of 1940;
WHEREAS, the Investment Manager desires to retain the Subadviser to
render investment management services to the Fund's Growth and Income Portfolio
(the "Portfolio") in the manner and on the terms hereinafter set forth;
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<PAGE>
NOW, THEREFORE, in consideration of the premises and the convenants
hereinafter contained the Investment Manager and the Subadviser hereby agree as
follows:
1. Appointment of the Subadviser. The Investment Manager hereby
appoints the Subadviser to act as an investment subadviser for the Portfolio and
to manage the investment and reinvestment of the assets of the Portfolio,
subject to the supervision of the Directors of the Fund and the terms and
conditions of this Agreement. The Subadviser will be an independent contractor
and will have no authority to act for or represent the Fund or Investment
Manager in any way or otherwise be deemed an agent of the Fund or Investment
Manager except as expressly authorized in this Agreement or another writing by
the Fund, Investment Manager and the Subadviser. Notwithstanding the foregoing,
the Subadviser may execute account documentation, agreements, contracts and
other documents as the Subadviser may be requested by brokers, dealers,
counterparts and other persons in connection with the Subadviser's management of
the assets of the Portfolio, provided that the Subadviser receives the express
agreement and consent of the Investment Manager and/or the Fund's Board of
Directors to execute such documentation, agreements, contracts and other
documents. In such respect, and only for this limited purpose, the Subadviser
shall act as the Investment Manager and/or the Fund's agent and
attorney-in-fact.
2. Duties of the Subadviser. The Subadviser hereby agrees, subject to
the supervision of the Investment Manager and the Board of Directors of the
Fund, (1) to act as the Subadviser of the Portfolio, (2) to manage the
investment and reinvestment of the assets of the Portfolio for the period and on
the terms and conditions set forth in this Agreement, and (3) during the term
hereof, to render the services and to assume the obligations herein set forth in
return for the compensation provided for herein and to bear all expenses of its
performance of such services and obligations.
3. Services to be Rendered by the Subadviser to the Fund
A. The Subadviser will manage the investment and reinvestment of the
assets of the Portfolio and determine the composition of the assets of the
Portfolio, subject always to the direction and control of the Directors of the
Fund and the Investment Manager and in accordance with the provisions of the
Fund's registration statement, as amended from time to time. In fulfilling its
obligations to manage the investment and reinvestment of the assets of the
Portfolio, the Subadviser will:
(i) obtain and evaluate pertinent economic, statistical,
financial, and other information affecting the economy generally and individual
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<PAGE>
companies or industries, the securities of which are included in the Portfolio
or are under consideration for inclusion in the Portfolio;
(ii) formulate and implement a continuous investment program
for the Portfolio (a) consistent with the investment objectives, policies, and
restrictions of the Portfolio as stated in the Fund's Agreement and Articles of
Incorporation, Bylaws, and such Portfolio's currently effective Prospectus and
Statement of Additional Information ("SAI") as amended from time to time, and
(b) in compliance with the requirements applicable to both regulated investment
companies and segregated asset accounts under Subchapters M and L of the
Internal Revenue Code of 1986, as amended, and requirements applicable to
registered investment companies under applicable laws;
(iii) take whatever steps are necessary to implement the
investment program for the Portfolio by the purchase and sale of securities and
other investments authorized under the Fund's Agreement and Articles of
Incorporation, Bylaws, and such Portfolio's currently effective Prospectus and
SAI, including the placing of orders for such purchases and sales;
(iv) regularly report to the Directors of the Fund and the
Investment Manager with respect to the implementation of the investment program
and, in addition, provide such statistical information and special reports
concerning the Portfolio and/or important developments materially affecting the
investments held, or contemplated to be purchased, by the Portfolio, as may
reasonably be requested by the Investment Manager or the Directors of the Fund,
including attendance at Board of Directors Meetings, as reasonably requested, to
present such information and reports to the Board;
(v) Assist in the determination of the fair value of certain
portfolio securities when market quotations are not readily available for the
purpose of calculating the Portfolio's net asset value in accordance with
procedures and methods established by the Directors of the Fund;
(vi) establish appropriate interfaces with the Fund's
Investment Manager in order to provide such Investment Manager with all
necessary information requested by the Manager.
B. To facilitate the Subadviser's fulfillment of its obligations
under this Agreement, the Investment Manager and the Fund will undertake the
following:
(i) the Manager agrees promptly to provide the Subadviser with
all amendments or supplements to the Registration Statement, the Fund's
Agreement and Articles of Incorporation, and Bylaws;
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<PAGE>
(ii) the Fund and the Manager each agrees, on an ongoing basis,
to notify the Subadviser expressly in writing of each change in the fundamental
and nonfundamental investment policies of the Portfolio;
(iii) The Manager agrees to provide or cause to be provided to
the Subadviser with such assistance as may be reasonably requested by the
Subadviser in connection with its activities pertaining to the Portfolio under
this Agreement, including, without limitation, information concerning the
Portfolio, its available funds, or funds that may reasonably become available
for investment, and information as to the general condition of the Portfolio's
affairs;
(iv) the Manager agrees to provide or cause to be provided to
the Subadviser on an ongoing basis, such information as is reasonably requested
by the Subadviser for performance by the Subadviser 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 Manager fails to provide
or cause to be provided such requested information and the Subadviser relies on
the information most recently furnished to the Subadviser; and
(v) the Manager will promptly provide the Subadviser with any
guidelines and procedures applicable to the Subadviser or the Portfolio adopted
from time to time by the Board of Directors of the Fund and agrees to promptly
provide the Subadviser copies of all amendments thereto.
C. The Subadviser, at its expense, will furnish: (i) all necessary
investment and management facilities and investment personnel, including
salaries, expenses and fees of any personnel required for it to faithfully
perform its duties under this Agreement; and (ii) administrative facilities,
including bookkeeping, clerical personnel and equipment necessary for the
efficient conduct of the investment affairs of the Portfolio (excluding that
necessary for the determination of net asset value and shareholder accounting
services). The Subadviser shall not be obligated to pay any expenses of or for
the Portfolio not expressly assumed by the Subadviser pursuant to this Section
3.
D. The Subadviser will select brokers and dealers to effect all
portfolio transactions subject to the conditions set forth herein. The
Subadviser will place all necessary orders with brokers, dealers, or issuers,
and will negotiate brokerage commissions if applicable. The Subadviser is
directed at all times to seek to execute brokerage transactions for the
Portfolio in accordance with such policies or practices as may be established by
the Board of Directors and described in the Fund's currently effective
Prospectus and SAI, as amended from time to time. In placing orders for the
purchase or sale of investments for the Portfolio, in the name of the Portfolio
or its nominees, the Subadviser shall use its best efforts to obtain for the
Portfolio the most favorable price and best execution available,
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considering all of the circumstances, and shall maintain records adequate to
demonstrate compliance with this requirement.
Subject to the appropriate policies and procedures approved by the
Board of Directors, the Subadviser may, to the extent authorized by Section
28(e) of the Securities and Exchange Act of 1934, cause the Portfolio to pay a
broker or dealer that provides brokerage or research services to the Manger, the
Subadviser, or the Portfolio an amount of commissions for effecting a portfolio
transaction in excess of the amount of commission another broker or dealer would
have charged for effecting that transaction if the Subadviser determines, in
good faith, that such amount of commission is reasonable in relationship to the
value of such brokerage or research services provided viewed in terms of that
particular transaction or the Subadviser's overall responsibilities to the
Portfolio or its other advisory clients. To the extent authorized by said
Section 28(e) and the Fund's Board of Directors, 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 such action. In addition, subject to
seeking the most favorable price and best execution available, the Subadviser
may also consider sales of shares of the Fund as a factor in the selection of
brokers and dealers.
E. On occasions when the Subadviser deems the purchase or sale of a
security to be in the best interest of the Portfolio 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 purchased or sold to attempt to obtain a more favorable price or lower
brokerage commissions and efficient execution. In such event, allocation of the
securities so purchased or sold, 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 Portfolio and to its other clients over time. It is recognized that in
some cases this practice may adversely affect the price paid or received by the
Portfolio or the size of the position obtainable for, or disposed of by, the
Portfolio.
F. The Subadviser will maintain all accounts, books and records with
respect to the Portfolio as are required of an investment adviser of a
registered investment company pursuant to the Investment Company Act and
Advisers Act and the rules thereunder.
4. Compensation of the Subadviser. The Investment Manager will pay the
Subadviser, with respect to the Portfolio, the compensation specified in
Appendix A to this Agreement. Payments shall be made to the Subadviser on the
first day of each month; however, this advisory fee will be calculated on the
daily average value of the Portfolio's assets and accrued on a daily basis.
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5. Non-Exclusivity. The Investment Manager agrees that the services of
the Subadviser are not to be deemed exclusive and the Subadviser is free to act
as investment manager to various investment companies and as fiduciary for other
managed accounts. The Subadviser shall, for all purposes herein, be deemed to be
an independent contractor and shall, unless otherwise provided or authorized,
have no authority to act for or represent the Fund or the Investment Manager in
any way or otherwise be deemed an agent of the Fund or Investment Manager other
than in furtherance of its duties and responsibilities as set forth in this
Subadvisory Agreement.
6. Books and Records. The Subadviser agrees that all books and records
which it maintains for the fund are the Fund's property, and, in the event of
termination of this Agreement for any reason, the Subadviser agrees promptly to
return to the Fund, free from any claim or retention of rights by the
Subadviser, all records relating to the Portfolio. The Subadviser also agrees
upon request of the Investment Manager or the Fund, promptly to surrender the
books and records to either party or make the book and records available for
inspection by representatives of regulatory authorities. In connection with its
duties hereunder, the Subadviser further agrees to maintain, prepare and
preserve books and records in accordance with the Investment Company Act and
rules thereunder, including but not limited to, Rule 31a-1 and 31a-2.
The Subadviser will use records or information obtained under this
Agreement only for the purposes contemplated hereby, and will not disclose such
records or information in any manner other than expressly authorized by the
Fund, or if disclosure is expressly required by applicable federal or state
regulatory authorities or by this Agreement. The Subadviser will furnish any
informational reports requested by any state insurance commissioner.
7. Representations and Warranties by the Investment Manager and the
Subadviser. The Investment Manager and the Subadviser each hereby represents and
warrants to the other that:
A. it is registered as an investment adviser under the Advisers Act;
B. it is a corporation duly organized and validly existing under the
laws of its state of incorporation 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 of this Agreement by such
party are within such party's powers and have been duly authorized by all
necessary action and no action by or in respect of, or filing with, any
governmental body, agency or official is required on the part of such party for
the execution, delivery and performance of this Agreement by such party and such
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execution, delivery and performance by such party do not contravene or
constitute a default under (i) any provision of applicable law, rule or
regulation, (ii) such party's governing instruments and (iii) any material
agreement, judgment, injunction, order, decree or other instrument binding upon
such party; and
D. the Form ADV of such party previously provided to the other party is a true
and complete copy of the form filed with the Securities and Exchange Commissions
(the "SEC") and the information contained therein is accurate and complete in
all material respects.
The Investment Manager acknowledges that it received a copy of the
Subadvisers ADV more than 48 hours prior to the execution of this Agreement.
8. Representations and Warranties on Behalf of the Fund and the Portfolio.
The Investment Manager hereby represents and warrants, on behalf of the Fund and
the Portfolio, that:
A. the Fund is registered as an investment company under the Investment Company
Act and the Portfolio's shares are registered under the Securities Act of 1933,
as amended (the "Securities Act");
B. the Fund, on behalf of the Portfolio, has filed a notice of exemption
pursuant to Rule 4.5 under the Commodity Exchange Act with the Commodity Futures
Trading Commission and the National Futures Association; and
C. The Fund is a Maryland corporation duly organized and validly existing under
the laws of the State of Maryland with the power to own and possess its assets
and carry on its business as it is now being conducted.
9. Survival of Representations and Warranties; Duty to Update Information.
All representations and warranties made pursuant to Sections 7 and 8 of this
Agreement shall survive for the duration of this Agreement and each party hereto
shall promptly notify the owner in writing upon becoming aware that any of the
foregoing representations and warranties made by such party are no longer true.
10. Liability. Neither the Subadviser nor any of its affiliates, directors,
officers, or employees shall be liable to the Investment Manager, the Fund or
any shareholder thereof or any service provider to any Portfolio for any loss
suffered by the Investment Manager, the Fund or any shareholder thereof or any
service provider to any portfolio resulting from its acts or omissions as
Subadviser to the Portfolio, except for losses resulting from willful
misconduct, bad faith or gross negligence in the performance of, or from
reckless disregard of, the duties of the Subadviser or any of its affiliates,
directors, officers or employees. The
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Subadviser, its affiliates, directors, officers or employees shall not be liable
to the Investment Manager or the Fund for any loss suffered as a consequence of
any action or inaction of other service providers to the Trust, provided such
action or inaction of such other service providers to any Portfolio of the Fund
is not a result of the willful misconduct, bad faith or gross negligence in the
performance of, or from reckless disregard of, the duties of the Subadviser
under this Agreement.
11. Indemnifications.
A. The Investment Manager shall indemnify the Subadviser and its
affiliates, officers, directors, employees, agents, legal representatives and
persons controlled by it (which shall not include the Fund or any portfolio)
(collectively, "Subadviser Related Persons") to the fullest extent permitted by
law against any and all loss, damage, judgments, fines, amounts paid in
settlement and reasonable expenses, including attorneys' fees (collectively
"Losses"), incurred by the Subadviser or Subadviser Related Persons arising from
or in connection with this Agreement or the performance by the Subadviser or
Subadviser Related Persons of its or their duties hereunder so long as such
losses arise out of the Investment Manager's gross negligence, willful
misconduct or bad faith, in performing its responsibilities hereunder or under
its agreements with the Fund or the gross negligence, willful misconduct or bad
faith of any service provided to any portfolio of the Fund, including without
limitation, such losses arising under any applicable law or that may be based
upon any untrue statement of a material fact contained in the Fund's
registration statement, or any amendment thereof or any supplement thereto, or
the omission to state therein a material fact known or which should have been
known and was required to be stated therein or necessary to make the statement
therein not misleading, unless such statement or omission was made in reliance
upon written information furnished to the Investment Manager or the Fund by the
Subadviser or any Subadviser Related Person specifically for inclusion in the
registration statement or any amendment or supplement thereto, except to the
extent any such losses referred to in this paragraph A (i.e., paragraph A.)
result from willful misfeasance, bad faith, gross negligence or reckless
disregard on the part of the Subadviser or a Subadviser Related Person in the
performance of any of its duties under, or in connection with, this Agreement.
B. The Subadviser shall indemnify the Investment Manager and its
controlling persons, officers, directors, employees, agents, legal
representatives and persons controlled by it (which shall not include the Fund
or any Portfolio) (collectively, "Investment Manager Related Persons") to the
fullest extent permitted by law against any and all losses incurred by the
Investment Manager or Investment Manager Related Persons arising from or in
connection with this Agreement or the performance by the Investment Manager or
Investment Manager Related Persons of its or their duties hereunder so long as
such losses
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arise out of the Subadviser's gross negligence, willful misconduct or bad faith
in performing it responsibilities hereunder, including, without limitation, such
losses arising under any applicable law or that may be based upon any untrue
statement of a material fact contained in the Fund's registration statement, or
any amendment thereof or any supplement thereto or the omission to state therein
a material fact known or which should have been known and was required to be
stated therein or necessary to make the statement therein not misleading,
provided that such statement or omission was made in reliance upon written
information furnished by the Subadviser or Subadviser Related Person to the
Investment Manager or the Fund, except to the extent any such losses referred to
in this paragraph B (i.e., paragraph B.) result from willful misfeasance, bad
faith, gross negligence or reckless disregard on the part of the Investment
Manager or a Investment Manager Related Person in the performance of any of its
duties under, or in connection with, this Agreement.
C. The indemnifications provided in this Section shall survive the
termination of this Agreement.
12. Reliance on Documents. The Board of Directors of the Fund or its
officers or agent will provide timely information to the SubAdviser regarding
such matters as purchases and redemptions of shares in the Portfolio, the cash
requirements, and cash available for investment in the Portfolio, and all other
information as may be reasonably necessary or appropriate in order for the
SubAdviser to perform its responsibilities hereunder.
Neither the Fund or the Investment Manager, nor their respective designees
or agents, shall use any material describing or identifying the SubAdviser or
its affiliates without the prior consent of the SubAdviser. Any material
utilized by the Fund, the Investment Manager or their respective designees or
agents which contain information as to the SubAdviser and/or its affiliates
shall be submitted to the SubAdviser for approval prior to use, not less than
five (5) business days before such approval is requested.
The Investment Manager has herewith furnished the Subadviser copies of the
Fund's Prospectus, Articles of Incorporation and By-Laws as currently in effect
and agrees during the continuance of the Agreement to furnish the Subadviser
copies of any amendments or supplements thereto before or at the time the
amendments or supplements become effective. The Subadviser will be entitled to
rely on all such documents furnished to it by the Investment Manager of the
Fund.
13. Duration and Termination of the Agreement. This Subadvisory Agreement
shall become effective as of the date first written above and remain in force
until _______________ [date]. Thereafter, it shall continue in effect from
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year to year, but only so long as such continuance is specifically approved at
least annually by (a) the Board of Directors of the Fund, or by the vote of a
majority of the outstanding voting securities of the Portfolio, and (b) a
majority of those directors who are not parties to this Subadviser Agreement,
not interested persons of any party to this Subadviser Agreement, cast in person
at a meeting called for the purpose of voting on such approval. This Agreement
may be terminated, without the payment of any penalty, by the Board of Directors
of the Fund, by a vote of a majority of the outstanding shares of the Portfolio,
or by the Investment Manager on sixty days' written notice to the Subadviser, or
by the Subadviser on sixty days' written notice to the Fund or the Investment
Manager. Termination by the Board of Directors or by the Investment Manager
shall be subject to shareholder approval to the extent legally required. This
Agreement shall automatically terminate in the event of its assignment or in the
event of termination of the Investment Management Agreement.
14. Amendments of the Agreement. Except to the extent permitted by the
Investment Company Act or the rules or regulations thereunder or pursuant to any
exemptive relief granted by the Securities and Exchange Commission ("SEC"), this
Agreement may be amended by the parties only if such amendment, if material, is
specifically approved by the vote of a majority of the outstanding voting
securities of the Portfolio (unless such approval is not required by Section 15
of the Investment Company Act as interpreted by the SEC or its staff) and by the
vote of a majority of the Independent Directors cast in person at a meeting
called for the purpose of voting on such approval. The required shareholder
approval shall be effective with respect to the Portfolio if a majority of the
outstanding voting securities of the Portfolio vote to approve the amendment,
notwithstanding that amendment may not have been approved by a majority of the
outstanding voting securities of any other portfolio affected by the amendment
or all the portfolios of the Fund.
15. Definitions. The terms "assignment", "interested person", and
"majority of the outstanding voting securities", when used in this Agreement,
shall have the respective meaning specified under the Investment Company Act and
the rules thereunder.
16. Notices. Any notice that is required to be given by the parties to
each other under the terms of this Agreement shall be given in writing,
delivered, or mailed postpaid to the other party, or transmitted by facsimile
with acknowledgment of receipt, to the parties at the following addresses or
facsimile numbers, which may from time to time be changed by the parties by
notice to the other party:
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(a) If to the Subadviser:
Warburg, Pincus Counsellors, Inc.
466 Lexington Avenue
New York, New York 10017
Attn: Eugene P. Grace
Facsimile: (212) 878-9351
(b) If to the Investment Manager:
Chubb Investment Advisory Corporation
One Granite Place
Concord, NH 03301
Attn: Ronald Angarella
Facsimile (603) 224-1691
17. Governing Law. The provisions of this Agreement shall be construed and
interpreted in accordance with the laws of the State of New Hampshire as at the
time in effect and the applicable provisions of the Investment Company Act or
other federal laws and regulations which may be applicable. To the extent that
the applicable law of the State of New Hampshire or any of the provisions
herein, conflict with the applicable provisions of the Investment Company Act or
other federal laws and regulations which may be applicable, the latter shall
control.
18. Neither the Fund nor the Investment Manager or any affiliate, designee
or agent thereof shall make reference to or use the name, and any derivative
thereof or logo associated with that name, of the Subadviser or any of its
clients or affiliates or use any material describing the Subadviser without the
prior approval of the Subadviser. Upon termination of this Agreement, the
Investment Manager and the Fund shall forthwith cease to use such name (or
derivative or logo) as soon as reasonably practicable.
19. Entire Agreement. This Agreement contains the entire understanding and
agreement of the parties with respect to the Portfolio and the Fund with respect
to the subject matter contained herein
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20. Headings. The headings in the sections of this Agreement are inserted
for convenience of reference only and shall not constitute a part hereof.
21. Severability. Should any portion of this Agreement for any reason be
held to be void in law or in equity, the Agreement shall be construed, insofar
as is possible, as if such portion had never been contained herein.
CHUBB INVESTMENT ADVISORY CORPORATION
ATTEST: BY:
----------------------- ---------------------------
TITLE: TITLE:
------------------------ -------------------------
SUBADVISER
ATTEST: BY:
----------------------- ---------------------------
TITLE: TITLE:
------------------------ -------------------------
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EXHIBIT D
FORM OF INVESTMENT SUBADVISORY AGREEMENT
----------------------------------------
THIS AGREEMENT, made this _____ day of __________, 199___, is between
CHUBB INVESTMENT ADVISORY CORPORATION, a Tennessee corporation with offices at
One Granite Place, Concord, New Hampshire, 03301 (the "Investment Manager" or
"Manager") and JP Morgan Investment Management, Inc. (the "Subadviser") a New
York corporation with offices at 522 Fifth Avenue, 10th Floor, New York, New
York 10036.
WITNESSETH:
WHEREAS, Chubb America Fund, Inc. (the "Fund") is engaged in business
as a diversified open-end management investment company and is registered as
such under the Investment Company Act of 1940 (the "Investment Company Act");
WHEREAS, the Fund issues separate classes or series of stock, each of
which represents a separate portfolio of investments;
WHEREAS, the Fund's shareholders are and will be separate accounts
maintained by insurance companies for variable life insurance policies under
which income, gains, losses, whether or not realized, from assets allocated to
such accounts are, in accordance with the Policies, credited to or charged
against such accounts without regard to other income, gains, or losses of such
insurance companies;
WHEREAS, the Fund has employed the Investment Manager to act as
investment manager of the Portfolio, as set forth in an Investment Management
Agreement between the Fund and the Investment Manager dated _______, 199__, (the
"Investment Management Agreement") pursuant to which it was agreed that the
Investment Manager may contract with the Investment Adviser, or other parties
for certain investment management services;
WHEREAS, the Subadviser is engaged in the business of rendering
investment advisory services and is registered as an investment adviser under
the Investment Advisers Act of 1940;
WHEREAS, the Investment Manager desires to retain the Subadviser to
render investment management services to the Fund's Balanced Portfolio (the
"Portfolio") in the manner and on the terms hereinafter set forth;
NOW, THEREFORE, in consideration of the premises and the convenants
hereinafter contained the Investment Manager and the Subadviser hereby agree as
follows:
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1. Appointment of the Subadviser. The Investment Manager hereby
appoints the Subadviser to act as an investment subadviser for the Portfolio and
to manage the investment and reinvestment of the assets of the Portfolio,
subject to the supervision of the Directors of the Fund and the terms and
conditions of this Agreement. The Subadviser will be an independent contractor
and will have no authority to act for or represent the Fund or Investment
Manager in any way or otherwise be deemed an agent of the Fund or Investment
Manager except as expressly authorized in this Agreement or another writing by
the Fund, Investment Manager and the Subadviser. Notwithstanding the foregoing,
the Subadviser may execute account documentation, agreements, contracts and
other documents as the Subadviser may be requested by brokers, dealers,
counterparts and other persons in connection with the Subadviser's management of
the assets of the Portfolio, provided that the Subadviser receives the express
agreement and consent of the Investment Manager and/or the Fund's Board of
Directors to execute such documentation, agreements, contracts and other
documents. In such respect, and only for this limited purpose, the Subadviser
shall act as the Investment Manager and/or the Fund's agent and attorney-in-
fact.
2. Duties of the Subadviser. The Subadviser hereby agrees, subject
to the supervision of the Investment Manager and the Board of Directors of the
Fund, (1) to act as the Subadviser of the Portfolio, (2) to manage the
investment and reinvestment of the assets of the Portfolio for the period and on
the terms and conditions set forth in this Agreement, and (3) during the term
hereof, to render the services and to assume the obligations herein set forth in
return for the compensation provided for herein and to bear all expenses of its
performance of such services and obligations.
3. Services to be Rendered by the Subadviser to the Fund
A. The Subadviser will manage the investment and reinvestment
of the assets of the Portfolio and determine the composition of the assets of
the Portfolio, subject always to the direction and control of the Directors of
the Fund and the Investment Manager and in accordance with the provisions of the
Fund's registration statement, as amended from time to time. In fulfilling its
obligations to manage the investment and reinvestment of the assets of the
Portfolio, the Subadviser will:
(i) obtain and evaluate pertinent economic, statistical,
financial, and other information affecting the economy generally and individual
companies or industries, the securities of which are included in the Portfolio
or are under consideration for inclusion in the Portfolio;
(ii) formulate and implement a continuous investment
program for the Portfolio (a) consistent with the investment objectives,
policies, and restrictions of the Portfolio as stated in the Fund's Agreement
and Articles of Incorporation, Bylaws, and such Portfolio's currently effective
Prospectus and Statement of Additional Information ("SAI") as amended from time
to time, and (b)
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in compliance with the requirements applicable to both regulated investment
companies and segregated asset accounts under Subchapters M and L of the
Internal Revenue Code of 1986, as amended, and requirements applicable to
registered investment companies under applicable laws;
(iii) take whatever steps are necessary to implement the
investment program for the Portfolio by the purchase and sale of securities and
other investments authorized under the Fund's Agreement and Articles of
Incorporation, Bylaws, and such Portfolio's currently effective Prospectus and
SAI, including the placing of orders for such purchases and sales;
(iv) regularly report to the Directors of the Fund and the
Investment Manager with respect to the implementation of the investment program
and, in addition, provide such statistical information and special reports
concerning the Portfolio and/or important developments materially affecting the
investments held, or contemplated to be purchased, by the Portfolio, as may
reasonably be requested by the Investment Manager or the Directors of the Fund,
including attendance at Board of Directors Meetings, as reasonably requested, to
present such information and reports to the Board;
(v) assist in determination of the fair value of certain
portfolio securities when market quotations are not readily available for the
purpose of calculating the Portfolio's net asset value in accordance with
procedures and methods established by the Directors of the Fund;
(vi) establish appropriate interfaces with the Fund's
Investment Manager in order to provide such Investment Manager with all
necessary information requested by the Investment Manager.
B. To facilitate the Subadviser's fulfillment of its
obligations under this Agreement, the Investment Manager and the Fund will
undertake the following:
(i) the Manager agrees promptly to provide the Subadviser
with all amendments or supplements to the Registration Statement, the Fund's
Agreement and Articles of Incorporation, and Bylaws;
(ii) the Fund and the Manager each agrees, on an ongoing
basis, to notify the Subadviser expressly in writing of each change in the
fundamental and nonfundamental investment policies of the Portfolio;
(iii) The Manager agrees to provide or cause to be provided
to the Subadviser with such assistance as may be reasonably requested by the
Subadviser in connection with its activities pertaining to the Portfolio under
this Agreement, including, without limitation, information concerning the
Portfolio, its available funds, or funds that may reasonably become available
for investment, and information as to the general condition of the Portfolio's
affairs;
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(iv) the Manager agrees to provide or cause to be provided
to the Subadviser on an ongoing basis, such information as is reasonably
requested by the Subadviser for performance by the Subadviser 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 Manager fails to
provide or cause to be provided such requested information and the Subadviser
relies on the information most recently furnished to the Subadviser; and
(v) the Manager will promptly provide the Subadviser with
any guidelines and procedures applicable to the Subadviser or the Portfolio
adopted from time to time by the Board of Directors of the Fund and agrees to
promptly provide the Subadviser copies of all amendments thereto.
C. The Subadviser, at its expense, will furnish: (i) all necessary
investment and management facilities and investment personnel, including
salaries, expenses and fees of any personnel required for it to faithfully
perform its duties under this Agreement; and (ii) administrative facilities,
including bookkeeping, clerical personnel and equipment necessary for the
efficient conduct of the investment affairs of the Portfolio (excluding that
necessary for the determination of net asset value and shareholder accounting
services). The Subadviser shall not be obligated to pay any expenses of or for
the Portfolio not expressly assumed by the Subadviser pursuant to this Section
3.
D. The Subadviser will select brokers and dealers to effect all
portfolio transactions subject to the conditions set forth herein. The
Subadviser will place all necessary orders with brokers, dealers, or issuers,
and will negotiate brokerage commissions if applicable. The Subadviser is
directed at all times to seek to execute brokerage transactions for the
Portfolio in accordance with such policies or practices as may be established by
the Board of Directors and described in the Fund's currently effective
Prospectus and SAI, as amended from time to time. In placing orders for the
purchase or sale of investments for the Portfolio, in the name of the Portfolio
or its nominees, the Subadviser shall use its best efforts to obtain for the
Portfolio the most favorable price and best execution available, considering all
of the circumstances, and shall maintain records adequate to demonstrate
compliance with this requirement.
Subject to the appropriate policies and procedures approved by the Board
of Directors, the Subadviser may, to the extent authorized by Section 28(e) of
the Securities and Exchange Act of 1934, cause the Portfolio to pay a broker or
dealer that provides brokerage or research services to the Manger, the
Subadviser, or the Portfolio an amount of commissions for effecting a portfolio
transaction in excess of the amount of commission another broker or dealer would
have charged for effecting that transaction if the Subadviser determines, in
good faith, that such amount of commission is reasonable in relationship to the
value of such brokerage or research services provided viewed in terms of that
particular transaction or the Subadviser's overall responsibilities to the
Portfolio or its other advisory clients. To the extent authorized by said
Section 28(e) and
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the Fund's Board of Directors, 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 such action. In addition, subject to seeking the most
favorable price and best execution available, the Subadviser may also consider
sales of shares of the Fund as a factor in the selection of brokers and dealers.
E. On occasions when the Subadviser deems the purchase or sale of a
security to be in the best interest of the Portfolio 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 purchased or sold to attempt to obtain a more favorable price or lower
brokerage commissions and efficient execution. In such event, allocation of the
securities so purchased or sold, 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 Portfolio and to its other clients.
F. The Subadviser will maintain all accounts, books and records with
respect to the Portfolio as are required of an investment adviser of a
registered investment company pursuant to the Investment Company Act and
Advisers Act and the rules thereunder.
4. Compensation of the Subadviser. The Investment Manager will pay the
Subadviser, with respect to the Portfolio, the compensation specified in
Appendix A to this Agreement. Payments shall be made to the Subadviser on the
first day of each month; however, this advisory fee will be calculated on the
daily average value of the Portfolio's assets and accrued on a daily basis.
5. Non-Exclusivity. The Investment Manager agrees that the services of
the Subadviser are not to be deemed exclusive and the Subadviser is free to act
as investment manager to various investment companies and as fiduciary for other
managed accounts. The Subadviser shall, for all purposes herein, be deemed to be
an independent contractor and shall, unless otherwise provided or authorized,
have no authority to act for or represent the Fund or the Investment Manager in
any way or otherwise be deemed an agent of the Fund or Investment Manager other
than in furtherance of its duties and responsibilities as set forth in this
Subadvisory Agreement.
6. Books and Records. The Subadviser agrees that all books and records
which it maintains for the fund are the Fund's property, and, in the event of
termination of this Agreement for any reason, the Subadviser agrees promptly to
return to the Fund, free from any claim or retention of rights by the
Subadviser, all records relating to the Portfolio. The Subadviser also agrees
upon request of the Investment Manager or the Fund, promptly to surrender the
books and records to either party or make the book and records available for
inspection by representatives of regulatory authorities. In connection with its
duties hereunder, the Subadviser further agrees to maintain, prepare and
preserve books and
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records in accordance with the Investment Company Act and rules thereunder,
including but not limited to, Rule 31a-1 and 31a-2.
The Subadviser will use records or information obtained under this
Agreement only for the purposes contemplated hereby, and will not disclose such
records or information in any manner other than expressly authorized by the
Fund, or if disclosure is expressly required by applicable federal or state
regulatory authorities or by this Agreement. The Subadviser will furnish any
informational reports requested by any state insurance commissioner.
7. Liability. The Subadviser will not be liable for any loss suffered
by the Fund in connection with any investment policy established by the Fund for
the purchase, sale or redemption of any securities at the direction of the Board
of Directors of the Fund or the Investment Manager. Nothing herein contained
shall be construed to protect the Subadviser against any liability resulting
from the willful misfeasance, bad faith or gross negligence of the Subadviser in
the performance of its duties or from reckless disregard of its obligations and
duties under this Subadviser Agreement.
8. Indemnification. The Adviser agrees to indemnify and hold harmless
---------------
the Sub-Adviser from and against any and all claims, losses, liabilities or
damages (including reasonable attorney's fees and other related expenses)
("Losses"), howsoever arising, from or in connection with this Agreement or the
performance by the Sub-Adviser of its duties hereunder; provided, however, that
nothing contained herein shall require that the Sub-Adviser be indemnified for
losses resulting from willful misfeasance, bad faith or gross negligence of, or
from reckless disregard of, the duties of the Sub-Adviser or any of its
employees.
9. Reliance on Documents. The Board of Directors of the Fund or its
officers or agent will provide timely information to the Subadviser regarding
such matters as purchases and redemptions of shares in the Portfolio, the cash
requirements, and cash available for investment in the Portfolio, and all other
information as may be reasonably necessary or appropriate in order for the
Subadviser to perform its responsibilities hereunder.
Neither the Fund or the Investment Manager, nor their respective
designees or agents, shall use any material describing or identifying the
Subadviser or its affiliates without the prior consent of the Subadviser. Any
material utilized by the Fund, the Investment Manager or their respective
designees or agents which contain information as to the Subadviser and/or its
affiliates shall be submitted to the Subadviser for approval prior to use, not
less than five (5) business days before such approval is requested.
The Investment Manager has herewith furnished the Subadviser copies of
the Fund's Prospectus, Articles of Incorporation and By-Laws as currently in
effect and agrees during the continuance of the Agreement to furnish the
Subadviser copies of any amendments or supplements thereto before or at the time
the
6
<PAGE>
amendments or supplements become effective. The Subadviser will be entitled to
rely on all such documents furnished to it by the Investment Manager of the
Fund.
10. Duration and Termination of the Agreement. This Subadvisory
Agreement shall become effective as of the date first written above and remain
in force until _______________ [date]. Thereafter, it shall continue in effect
from year to year, but only so long as such continuance is specifically approved
at least annually by (a) the Board of Directors of the Fund, or by the vote of a
majority of the outstanding voting securities of the Portfolio, and (b) a
majority of those directors who are not parties to this Subadviser Agreement,
not interested persons of any party to this Subadviser Agreement, cast in person
at a meeting called for the purpose of voting on such approval. This Agreement
may be terminated, without the payment of any penalty, by the Board of Directors
of the Fund, by a vote of a majority of the outstanding shares of the Portfolio,
or by the Investment Manager on sixty days' written notice to the Subadviser, or
by the Subadviser on sixty days' written notice to the Fund or the Investment
Manager. Termination by the Board of Directors or by the Investment Manager
shall be subject to shareholder approval to the extent legally required. This
Agreement shall automatically terminate in the event of its assignment or in the
event of termination of the Investment Management Agreement.
11. Amendments of the Agreement. Except to the extent permitted by
the Investment Company Act or the rules or regulations thereunder or pursuant to
any exemptive relief granted by the Securities and Exchange Commission ("SEC"),
this Agreement may be amended by the parties only if such amendment, if
material, is specifically approved by the vote of a majority of the outstanding
voting securities of the Portfolio (unless such approval is not required by
Section 15 of the Investment Company Act as interpreted by the SEC or its staff)
and by the vote of a majority of the Independent Directors cast in person at a
meeting called for the purpose of voting on such approval. The required
shareholder approval shall be effective with respect to the Portfolio if a
majority of the outstanding voting securities of the Portfolio vote to approve
the amendment, notwithstanding that amendment may not have been approved by a
majority of the outstanding voting securities of any other portfolio affected by
the amendment or all the portfolios of the Fund.
12. Definitions. The terms "assignment", "interested person", and
"majority of the outstanding voting securities", when used in this Agreement,
shall have the respective meaning specified under the Investment Company Act and
the rules thereunder.
13. Notices. Any notice that is required to be given by the
parties to each other under the terms of this Agreement shall be given in
writing, delivered, or mailed postpaid to the other party, or transmitted by
facsimile with acknowledgment of receipt, to the parties at the following
addresses or facsimile
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numbers, which may from time to time be changed by the parties by notice to the
other party:
(a) If to the Subadviser:
(b) If to the Investment Manager:
Chubb Investment Advisory Corporation
One Granite Place
Concord, NH 03301
Attn: Ronald Angarella
Facsimile (603) 224-1691
14. Governing Law. The provisions of this Agreement shall be
construed and interpreted in accordance with the laws of the State of New
Hampshire as at the time in effect and the applicable provisions of the
Investment Company Act or other federal laws and regulations which may be
applicable. To the extent that the applicable law of the State of New Hampshire
or any of the provisions herein, conflict with the applicable provisions of the
Investment Company Act or other federal laws and regulations which may be
applicable, the latter shall control.
14. Use of Subadviser's Name. Neither the Fund nor the Manager or
any affiliate or agent thereof shall make reference to or use the name, and any
derivative thereof or logo associated with that name, of the Subadviser or any
of its affiliates in any advertising or promotional materials without the prior
approval of the Subadviser. Upon termination of this Agreement, the Manager and
the Fund shall forthwith cease to use such name (or derivative or logo) as soon
as reasonably practicable.
15. Entire Agreement. This Agreement contains the entire
understanding and agreement of the parties with respect to the Portfolio.
16. Headings. The headings in the sections of this Agreement are
inserted for convenience of reference only and shall not constitute a part
hereof.
17. Severability. Should any portion of this Agreement for any
reason be held to be void in law or in equity, the Agreement shall be construed,
insofar as is possible, as if such portion had never been contained herein.
8
<PAGE>
CHUBB INVESTMENT ADVISORY CORPORATION
ATTEST: BY:
---------------------- -------------------------
TITLE: TITLE:
----------------------- ----------------------
SUBADVISER
ATTEST: BY:
---------------------- -------------------------
TITLE: TITLE:
----------------------- ----------------------
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CHUBB AMERICA FUND, INC.
[ ] Portfolio
VOTING INSTRUCTIONS
To be voted at the August 15, 1997 Special Meeting of Shareholders
THESE VOTING INSTRUCTIONS ARE SOLICITED ON BEHALF OF
THE BOARD OF DIRECTORS
I hereby instruct the Chubb Life Insurance Company of America ("Chubb
Life") to vote the shares of the ____________ Portfolio (the "Portfolio"), as to
which I am entitled to give voting instructions, at the Special Meeting of
Shareholders of the Portfolio to be held at the offices of Chubb Life, One
Granite Place, Concord, New Hampshire 03301, on August 15, 1997 at 8:00 a.m. and
at any adjournment of the Special Meeting. Chubb Life is instructed to vote as
indicated on the matters referred to in the Proxy and Voting Instructions
Statement for the Special Meeting, receipt of which is hereby acknowledged, with
discretionary power to vote on such other business as may properly come before
the Special Meeting or any adjournment of the Special Meeting.
The Board of Directors recommends that you vote FOR the proposals.
Please vote and sign on the reverse side.
<PAGE>
1. To elect the following persons to the Board of Directors:
Ronald Angarella
James J. Weisbart
Michael D. Coughlin
Elizabeth S. Hager
Yes to all
---
If you are not voting in favor of all of the Directors, you may strike
through the names of the persons for whom you are withholding your vote.
2. To consider and act on a new Investment Management Agreement
between the Fund, on behalf of each of its Portfolios, and Chubb Investment
Advisory Corporation (the "Adviser").
Yes No Abstain
--- --- ---
3. For the Domestic Growth Stock, World Growth Stock, Emerging
Growth, Capital Stock, Gold Stock and Bond Portfolios, to consider and act on a
new form of Investment Subadvisory Agreement between the Adviser and the current
investment subadviser to the relevant Portfolio; and, for the Growth and Income,
Money Market and Balanced Portfolios, to consider and act on a new form of
Investment Subadvisory Agreement between the Adviser and the proposed new
investment subadvisor to the relevant Portfolios.
Yes No Abstain
--- --- ---
4. To consider and act on a proposal to permit the Adviser to
replace investment subadvisers ("Subadvisers") or add Subadvisers to each
existing Portfolio or new Portfolio added as a series of the Fund in the future,
and to enter into subadvisory agreements with those Subadvisers without further
shareholder approval.
Yes No Abstain
--- --- ---
PLEASE SIGN, DATE, AND RETURN PROMPTLY IN THE
ENCLOSED ENVELOPE.
NOTE: Please sign exactly as your name appears on this Voting Instructions form.
When signing in a fiduciary capacity, such as an executor, administrator,
trustee, guardian, etc., please so indicate. Corporate and partnership proxies
should be signed by an authorized person indicating the person's title.
1997
- --------- -------------------------------- -----------------------------
Date Signature, Title (if applicable) Signature, Title
(if applicable)
