<PAGE>
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES EXCHANGE ACT OF 1934
(AMENDMENT NO. )
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 (S)240.14a-11(c) or (S)240.14a-12
Chubb America Fund, Inc.
------------------------------------------------
(Name of Registrant as Specified In Its Charter)
Shari J. Lease, Esq.
------------------------------------------------
(Name of Person(s) Filing Proxy Statement)
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:
________________________________________________________________________
<PAGE>
CHUBB LIFE INSURANCE COMPANY OF AMERICA
INDIVIDUAL FLEXIBLE PREMIUM VARIABLE LIFE INSURANCE POLICIES
[April 20], 1997
Dear Policy owner:
On Friday, [May 30], 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"), is currently wholly owned by The
Chubb Corporation, but is soon to be purchased by Jefferson-Pilot Corporation.
As a result of this change of ownership, the Fund must enter into a new
Investment Management Agreement with the Adviser.
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, 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 ("Policyowners"). Each Policyowner is entitled to give voting
instructions to Chubb Life with respect to the number of shares of the
respective Portfolios attributable to the Policyowner as of the record date of
April 4, 1997.
Attached are the formal Notice of Special Meeting of Shareholders and the
Proxy 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,
Theresa M. Stone
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 [MAY 30], 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 [May 30], 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 Instruction
Statement dated [April 20], 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 a new form of Investment Subadvisory Agreement
between the Adviser and the investment subadviser ("Subadviser") currently
providing services to the relevant Portfolio.
4. To consider and act on a proposal to permit the Adviser to replace
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 vote in the election of directors and act
on each of the other proposals.
VOTING INSTRUCTIONS WHICH ARE PROPERLY EXECUTED BUT NOT OTHERWISE MARKED
WILL BE VOTED 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 April 4, 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
[MAY 30], 1997
INTRODUCTION
This Proxy and Voting Instruction 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 [May 30],
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
April 4, 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: 4,358,935.548; Money Market Portfolio:
1,279,016.339; Gold Stock Portfolio: 496,155.627; Bond Portfolio:
1,224,389.227; Domestic Growth Stock Portfolio: 3,985,901.733; Growth and
Income Portfolio: 1,561,821.573; Capital Growth Portfolio: 5,107,343.126;
Balanced Portfolio: 1,701,215.718; and Emerging Growth Portfolio 1,944,185.660.
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")
1
<PAGE>
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 ("Policyowners") will be made on or about [April 20], 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 Policyowners
participating in Separate Account A. The number of votes on which each
Policyowner 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 Portfolio for which a
Policyowner 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 Policyowners 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: 8,864.155 -
0.57%; Capital Growth Portfolio: 7,128.346 -0.14%; and Balanced Portfolio:
12,716.164 - 0.75%.
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: 4,358,935.548 - 100%; Money
Market Portfolio: 1,279,016.339 - 100%; Gold Stock Portfolio: 496,155.627 -
100%; Bond Portfolio: 1,224,389.227 - 100%; Domestic Growth Stock Portfolio:
3,985,901.733 - 100%; Growth and Income Portfolio: 1,552,957.418 - 99.4%;
Capital Growth Portfolio: 5,100,214.780 - 99.9%; Balanced Portfolio:
1,688,499.554 - 99.3%; and Emerging Growth Portfolio: 1,944,185.660 - 100%.
If the enclosed Form is executed and returned, it may nevertheless be
revoked at any time before the Special Meeting by a written revocation or later
Form, as appropriate, received at Chubb Life, One Granite Place, Concord, New
Hampshire 03301. The expense of printing and distributing to Policyowners the
Statement, the Form, and other solicitation materials, as well as
2
<PAGE>
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 (a) The Chubb Corporation, a New Jersey corporation ("Chubb"), which
currently owns 100% of the issued and outstanding shares of capital stock
("Shares") of Chubb Life and which has agreed to sell such Shares of Chubb Life
to Jefferson-Pilot Corporation, a North Carolina corporation ("Jefferson-Pilot")
pursuant to a Stock Purchase Agreement dated February 23, 1997, and/or (b)
Jefferson-Pilot.
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 Chubb. 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 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,
and by shareholders.
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
Chubb of approximately $875 million, subject to adjustment in certain
circumstances. Upon consummation of the transaction (the "Acquisition"), which
is currently scheduled for April 30, 1997, but will not, in any event, take
place after June 1, 1997, the Adviser will become an indirect wholly-owned
subsidiary of Jefferson-Pilot. Chubb Life does not presently intend to
redomesticate, and will remain a New Hampshire corporation. 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 its terms as required by
the Investment Company Act of 1940, as amended (the "1940 Act"). If the
Acquisition is not completed, the Existing Agreements will remain in effect.
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 Subadvisory Agreements with each of the Subadvisers that provide
advisory services to the Portfolios. (The new Investment
- ---------------------------
/1/ The Adviser does not provide investment management services to any other
registered investment company.
3
<PAGE>
Management and Subadvisory Agreements will together be referred to as the "New
Agreements.") Policyowners are asked to vote on each of the New Agreements as
described in Items 2 and 3. In addition, Policyowners are asked to vote 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 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.
4
<PAGE>
<TABLE>
<CAPTION>
Nominee Year of
(Age) Principal Occupations During the Past Five Years Election or
Address Appointment
- ----------------------------------------------------------------------------------------------------------
<S> <C> <C>
Ronald Angarella* President, Chubb America Fund, Inc. Senior Vice
(39) President, Chubb Life, President and Director,
One Granite Place Chubb Investment Advisory, Chubb Securities and 1995
Concord, NH 03301 Hampshire Funding, Inc.; Senior Vice President and
Director, Chubb Investment Funds, Inc.
- ----------------------------------------------------------------------------------------------------------
James J. Weisbart Retired, previously President of Bird Bath
(65) Laundromats and President of Solomon's Inc. 1989
301 Smithfield Road (retail clothing company)
Contoocook, NH 03329
- ----------------------------------------------------------------------------------------------------------
Michael D. Coughlin President of Concord Litho Company, Inc.
(54) (printing company) 1989
106 School Street
Concord, NH 03301
- ----------------------------------------------------------------------------------------------------------
Elizabeth S. Hager Executive Director, United Way of Merrimack
(52) County, NH (since 1996), State Representative,
5 Auburn Street New Hampshire; Consultant, Fund Development; 1989
Concord, NH 03301 previously, City Councilor, City of Concord, NH
and Mayor, City of Concord, NH
- ----------------------------------------------------------------------------------------------------------
</TABLE>
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.
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.
5
<PAGE>
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 Funds' Board from the Fund and
Chubb Investment Funds, Inc. ("CIF"), the other fund in the Chubb group of
registered investment companies ("Chubb Funds"):
<TABLE>
<CAPTION>
Aggregate Compensation Total Compensation:
Name from Fund Chubb Funds
- ------------------ ----------------------- -------------------
<S> <C> <C>
Michael Coughlin $5,000 $10,000
Elizabeth Hager 5,000 10,000
James Weisbart 5,000 10,000
</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 services as an officer of the
Adviser.
<TABLE>
<CAPTION>
================================================================================
Name and Address Position with the Fund Position with the Adviser
================================================================================
<S> <C> <C>
Charles C. Cornelio Vice President & Secretary
General Counsel
- --------------------------------------------------------------------------------
Shari J. Lease Secretary Assistant Secretary
- --------------------------------------------------------------------------------
John A. Weston Treasurer Treasurer
- --------------------------------------------------------------------------------
Mark D. Landry Assistant Treasurer Mutual Fund Accounting
and Operations Officer
================================================================================
</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.
6
<PAGE>
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 Agreement between
the Fund, on behalf of each Portfolio, and Adviser in accordance with Section
15(c) of the 1940 Act. The New Agreement will become effective on 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 is presently anticipated to take place on April 30, 1997, but is
subject to Chubb Life obtaining state insurance department approvals of certain
matters required as a prerequisite to the Closing. Since the proposed 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 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 proposed 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 uncertainty and
considerable anxiety. This uncertainty and anxiety can be damaging to
relationships and may cause key employees, service providers, and perhaps even
Policyowners 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
Investment Management and Subadvisory Agreements (see Item 3 below for a
discussion of the form of Subadvisory Agreement), which are anticipated to be
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 will be held in escrow. If shareholders of each of the Portfolios
approve this Item, the escrow agent will release the fees to the Adviser. If
shareholders 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
7
<PAGE>
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 Applicants are not aware of any material changes in the personnel that
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 the 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 Agreement is the same as the Existing Agreement 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. A copy of the proposed New Agreement appears in Exhibit A.
Under the New 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.
8
<PAGE>
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 Principal Occupation
Adviser
================================================================================
<S> <C> <C>
Ronald Angarella President and Director Senior Vice President,
Chubb Life; President and
Director, Chubb
Securities, Hampshire
Funding, Inc. and Chubb
America Fund, Inc.; Senior
Vice President and
Director, Chubb Investment
Funds, Inc.
- --------------------------------------------------------------------------------
Michael O'Reilly Senior Vice President Senior Vice President and
and Director Chief Investment Officer,
The Chubb Corporation;
Director, President and
Chief Operating Officer,
Chubb Asset Managers,
Inc.; President and
Director, Chubb Investment
Funds, Inc.; Senior Vice
President, Chubb & Son,
Inc., Federal Insurance
Company
- --------------------------------------------------------------------------------
Ronald H. Emery Senior Vice President Senior Vice President and
and Director Controller, Chubb Life
- --------------------------------------------------------------------------------
Charles C. Cornelio Secretary Executive Vice President
and Chief Administrative
Officer, Chubb Life; Vice
President, Counsel and
Assistant Secretary, Chubb
Investment Funds, Inc. and
Chubb America Fund, Inc.;
Vice President, General
Counsel and Secretary,
Chubb Securities and
Hampshire Funding, Inc.
- --------------------------------------------------------------------------------
John A. Weston Treasurer Assistant Vice President,
Mutual Fund Accounting
Officer, Chubb Life;
Treasurer, Chubb
Securities Corporation,
Chubb Investment Funds,
Inc. and Chubb Series
Trust and Hampshire
Funding, Inc.; previously
Financial Reporting
Officer, Chubb Life
- --------------------------------------------------------------------------------
Richard V. Werner Director Senior Vice President,
Treasurer and Chief
Financial Officer, Chubb
Life Insurance Company of
America, Colonial Life
Insurance Company, and
Chubb Sovereign Life
Insurance Company; Vice
President, The Chubb
Corporation; Senior Vice
President and Director,
Chubb America Fund, Inc.;
President, ChubbHealth
Holdings, Inc.; Chairman
of the Board, ChubbHealth,
Inc.; Vice President, The
Chubb Corporation, Federal
Insurance Company and
Chubb & Son Inc.; Senior
Vice President, Chubb
Asset Managers, Inc.
- --------------------------------------------------------------------------------
Marjorie Raines Director
================================================================================
</TABLE>
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Recommendation
- --------------
The Board of Directors recommends that you vote FOR this proposal.
ITEM 3. TO CONSIDER AND ACT ON A NEW FORM OF SUBADVISORY AGREEMENT BETWEEN THE
ADVISER AND THE SUBADVISER CURRENTLY PROVIDING SERVICES TO THE
RELEVANT 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 Investment
Management Agreement will terminate as a result of the sale of Chubb Life to
Jefferson-Pilot. Consequently, the Subadvisers will be required to enter into
new Subadvisory Agreements with the Adviser. The proposed form of Subadvisory
Agreement is attached as Exhibit B.
The Subadvisory Agreement
- -------------------------
The proposed form of New Subadvisory Agreement is 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 provides research or other
10
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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 fees to be paid to
each Subadviser will not change as a result of the Acquisition.
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.
The Subadvisers Currently Providing Services to the Portfolios
- --------------------------------------------------------------
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 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.
11
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Growth and Income, Bond and Money Market Portfolios: Chubb Asset Managers,
---------------------------------------------------------------------------
Inc.
- ----
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, as described below, certain
investment personnel employed by Chubb Asset currently provide advice to other
investment portfolios of entities not affiliated with Chubb or its affiliates.
With respect to the Growth and Income Portfolio, under the proposed New
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 0.50% on the first
$200 million of 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. With respect to the Bond and
Money Market Portfolios, under the proposed New 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.
Chubb Asset currently provides investment advisory services to two funds with
investment objectives similar to those of the Portfolio. Services are currently
provided to the Chubb Money Market Fund, and to the Chubb Growth and Income
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 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
12
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to other funds with investment objectives similar to those of the Portfolio. It
provides advisory services to Thomson Precious Metals and Natural Resources
Fund, of the Thomson Fund Group, and subadvisory services to Natural Resources
Fund, of the GCG Trust.
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 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 Fund,
and the Balanced, Equity Income, and Real Estate Growth Portfolios of the
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 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 Agreement, the Adviser will continue to pay Janus at
the end of each calendar quarter 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
during the quarter preceding such payment. 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.
13
<PAGE>
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 Portfolio, and the Travelers Capital Appreciation
Portfolio.
Balanced Portfolio: Phoenix Investment Counsel, Inc.
-----------------------------------------------------
Phoenix Investment Counsel, Inc. ("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 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 Agreement, the Adviser will continue to pay Phoenix 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.
Phoenix currently provides investment advisory or subadvisory services to
other investment company portfolios that have investment objectives similar to
those of the Portfolio. Specifically, it provides services to the A and B
Portfolios of Phoenix Balanced Series, Phoenix Convertible Fund Series, Phoenix
Income & Growth, and Phoenix Strategic Allocation. In addition, Phoenix provides
services to the Phoenix Edge Balanced Series, PDP Institutional Balanced X and
Y, Jackson National Life Balanced and SunAmerica Balanced.
Emerging Growth Portfolio: Massachusetts Financial Services Company
--------------------------------------------------------------------
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 December 31, 1996, MFS
managed approximately $__ billion of assets invested in equity securities and
approximately $__ billion of assets invested in fixed income securities.
Approximately $__ 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.),
which in turn is a wholly-owned subsidiary of Sun Life Assurance Company of
Canada. MFS and its wholly-owned subsidiary, MFS Asset Management, Inc., provide
investment advice to substantial private clients.
14
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Under the proposed New Agreement, the Adviser will continue to pay MFS 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.
MFS currently serves as investment adviser to each of the other funds in the
MFS Family of Funds, and to seven 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.
Recommendation
- --------------
The Board of Directors recommends that shareholders vote FOR this proposal.
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 based on the conditions set forth in the Exemptive Application
requiring that :
(1) The Fund will disclose in its registration statement the Aggregate Fee
Disclosure;
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(2) The Adviser will not enter into an Advisory Agreement with any Affiliated
Subadviser without that agreement, including the compensation to be paid
thereunder, being approved by the shareholders of the applicable Portfolio;
(3) 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;
(4) 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.
(5) The Adviser will provide the Board of Directors of the Fund, no less
frequently than quarterly, information about the Adviser's profitability on a
per-Portfolio basis. Such information will reflect the impact on profitability
of the hiring or termination of any Subadviser during the applicable quarter.
(6) Whenever a Subadviser is hired or terminated, the Adviser will provide the
Board of Directors information showing the expected impact on the Adviser's
profitability.
(7) 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 contract owners with assets allocated to any sub-
account for which a Fund Portfolio serves as a funding medium) and that such
change does not involve a conflict of interest from which the Adviser or the
Affiliated Subadviser derives an inappropriate advantage.
(8) Before a Portfolio may rely on the order requested hereby, the operation
of the Portfolio in the manner described in this Application will be approved by
a majority of its outstanding voting securities (in the case of the Fund,
pursuant to voting instructions provided by contract 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 11
below, by the sole initial shareholder before offering shares of such Portfolio
to the public.
(9) The Adviser will provide general management services to the Fund and its
Portfolios, including overall supervisory responsibility for the general
management and investment of each Portfolio's securities portfolios, and,
subject to review and approval by the Board of Directors will (i) set each
Portfolio's overall investment strategies; (ii) select Subadvisers; (iii) when
appropriate, allocate and reallocate a Portfolio's assets among multiple
Subadvisers; (iv) monitor and evaluate the investment performance of
Subadvisers; and (v) implement procedures reasonably designed to ensure that the
Subadvisers comply with the relevant Portfolio's investment objective, policies,
and restrictions.
16
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(10) Within sixty (60) days of the hiring of any new Subadviser or the
implementation of any proposed material change in an Advisory Agreement,
shareholders will be furnished all information about a new Subadviser or
Advisory Agreement that would be included in a proxy statement, except as
modified by the order to permit Aggregate Fee Disclosure. Such information will
include Aggregate Fee Disclosure and any change in such disclosure caused by the
addition of a new Subadviser or any proposed material change in an Advisory
Agreement. The Adviser will meet this condition by providing shareholders,
within sixty (60) days of the hiring of a Subadviser or the implementation of
any material change to the terms of an Advisory Agreement, with an information
statement meeting the requirements of Regulation 14C under the 1934 Act and
Schedule 14C thereunder. The information statement will also meet the
requirements of Schedule 14A, except as modified by the order to permit
Aggregate Fee Disclosure. The Fund will ensure that the information statement is
furnished to contract owners with assets allocated to any registered separate
account for which the Fund serves as a funding medium.
(11) Each Portfolio will disclose in its prospectus the existence, substance,
and effect of any order granted pursuant to this 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 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.
(12) No director or officer of the Fund or director or officer of the Adviser
will own directly or indirectly (other than through a pooled investment vehicle
that is not controlled by that director or officer) 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 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.
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
17
<PAGE>
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, a New Hampshire corporation ("CSC"). CSC is a wholly-
owned subsidiary of Chubb.
Under the terms of CSC's underwriting 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 Policyowners, 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 will enter into a
new underwriting agreement with the Fund under the same terms as the existing
agreement. CSC will continue 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, Counsel and Assistant
Secretary, Charles C. Cornelio, is Vice President, General Counsel and Secretary
to CSC. John A. Weston is Treasurer to both the Fund and CSC. Shari J. Lease is
Assistant Secretary of CSC.
18
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CHUBB AMERICA FUND, INC.
[_______] PORTFOLIO
VOTING INSTRUCTIONS
To be voted at the [May 30], 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 [May 30], 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. Hage
____ 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. To consider and act on a new form of Investment Subadvisory Agreement
between the Adviser and the investment subadviser ("Subadviser") currently
providing services to the relevant Portfolio.
____ Yes ____ No ____ Abstain
4. To consider and act on a proposal to permit the Adviser to replace
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 Signature, Title (if
applicable) applicable)
<PAGE>
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", and collectively, the "Portfolios");
WHEREAS, Chubb Investment is engaged in the business of rendering
investment advisory services and its 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 and 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 ("Manager") for each of the Portfolios of the 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 and 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 advisers ("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
<PAGE>
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 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;
(3) Recommend auditors, counsel, Custodian and others;
(4) Coordinate, supervise and direct any Sub-Investment Advisor,
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
PAGE 2
<PAGE>
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 provision 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.
(c) 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 of Chubb Investment hereunder; provided, however, that the
compensation of such other parties will be the sole responsibility of Chubb and
the duties and responsibilities of such other Subadvisers 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 Subadvisers 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 Subadvisers and that of potential
Subadvisers, 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 Subadvisers and potential Subadvisers as they and Chubb
Investment to supervise and monitor the practices of Subadvisers 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.
PAGE 3
<PAGE>
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 mane of the Portfolio of 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 adequate to demonstrate compliance
with their 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(3) 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'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
reasons 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
PAGE 4
<PAGE>
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 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 Sub-investment Manager. 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 right 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 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 5
<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.
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 Funds 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 1988 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 1988 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 Investments 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 6
<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 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;
PAGE 7
<PAGE>
(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 expense 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
subject to approval 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 that 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, 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.
PAGE 8
<PAGE>
16. 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 thereunder or
other federal laws and regulations which maybe applicable the latter shall
control.
17. Provision 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 an 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 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.
18. Entire Agreement. This Agreement contains the entire understanding
and agreement of the parties.
19. Headings. The headings in the sections of this Agreement are
inserted for convenience of reference only and shall not constitute a part
hereof.
20. 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.
21. 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, or
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.
22. 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.
CHUBB AMERICA FUND, INC.
PAGE 9
<PAGE>
Attest: By:
Title: Title:
CHUBB INVESTMENT ADVISORY CORPORATION
Attest: By:
Title: Title:
PAGE 10
<PAGE>
SCHEDULE A
CHUBB AMERICA FUND INC.
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------
NAME OF PORTFOLIO ANNUAL FEE AS A PERCENTAGE
OF
AVERAGE DAILY NET ASSETS
- --------------------------------------------------------------------------------
<S> <C>
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 $1.8 Billion
- --------------------------------------------------------------------------------
Gold Stock Portfolio .75% of first $200 Million
.70% of next $1.1 Billion
.65% over $1.8 Billion
- --------------------------------------------------------------------------------
Bond Portfolio .50% of first $200 Million
.45% of next $1.1 Billion
.40% over $1.8 Billion
- --------------------------------------------------------------------------------
Domestic Growth Stock Portfolio .75% of first $200 Million
.70% of next $1.1 Billion
.65% over $1.8 Billion
- --------------------------------------------------------------------------------
Growth and Income Portfolio .75% of first $200 Million
.70% of next $1.1 Billion
.65% over $1.8 Billion
- --------------------------------------------------------------------------------
Capital Growth Portfolio 1.00% of first $200 Million
.95% of next $1.1 Billion
.90% over $1.8 Billion
- --------------------------------------------------------------------------------
Balanced Portfolio .75% of first $200 Million
.70% of next $1.1 Billion
.65% over $1.8 Billion
- --------------------------------------------------------------------------------
Emerging Growth Portfolio .80% of first $200 Million
.75% of next $1.1 Billion
.70% over $1.8 Billion
================================================================================
</TABLE>
PAGE 11
<PAGE>
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") and
__________________, a __________ corporation with offices at __________________,
(the "Subadviser");
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, and 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 covenants
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 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
-1-
<PAGE>
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 as 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 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
-2-
<PAGE>
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 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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<PAGE>
(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 form 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 Exchange Act of 1934, cause the Portfolio to pay a broker or dealer
that provides brokerage or research services to the Manager, the Subadviser, or
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 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
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<PAGE>
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. 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.
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<PAGE>
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.
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
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<PAGE>
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 the 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 State of New Hampshire as at
the time in effect and the applicable provisions of the Investment Company Act
or other federal laws and
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<PAGE>
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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