SUBADVISORY AGREEMENT



     Agreement made as of the February 28, 2002, by and between American Express

Financial  Corporation,  a Delaware corporation  ("AEFC"),  and GAMCO Investors,

Inc., a  wholly-owned  subsidiary of Gabelli Asset  Management  Inc., a New York

corporation ("Subadviser").



     WHEREAS  the Fund or Funds  listed  in  Schedule  A are each a series of an

investment  company  registered  under the  Investment  Company Act of 1940,  as

amended (the "1940 Act");  provided that  references  in this  Agreement to "the

Fund" in the  singular  shall be  understood  to refer to all Funds so listed in

Schedule A.



     WHEREAS AEFC has entered into an Investment  Management  Services Agreement

(the  "Advisory  Agreement")  with the Fund  pursuant  to  which  AEFC  provides

investment advisory services to the Fund.



     WHEREAS  AEFC and the Fund  each  desire to retain  Subadviser  to  provide

investment  advisory  services to the Fund,  and Subadviser is willing to render

such investment advisory services.



NOW, THEREFORE, the parties, intending to be legally bound, agree as follows:



1.   Subadviser's Duties.



     (a)  Portfolio  Management.  Subject to  supervision by AEFC and the Fund's

          Board  of  Directors  (the  "Board"),   Subadviser  shall  manage  the

          investment operations and the composition of that portion of assets of

          the Fund which is  allocated to  Subadviser  from time to time by AEFC

          (which portion may include any or all of the Fund's assets), including

          the purchase,  retention,  and disposition thereof, in accordance with

          the Fund's investment  objectives,  policies,  and  restrictions,  and

          subject to the following understandings:



          (i)  Investment  Decisions.  Subadviser  shall  determine from time to

               time what investments and securities will be purchased, retained,

               or sold by the Fund,  and what  portion  of such  assets  will be

               invested or held uninvested as cash.



          (ii) Investment   Limits.   In  the  performance  of  its  duties  and

               obligations  under  this  Agreement,   Subadviser  shall  act  in

               conformity with applicable  limits and  requirements,  as amended

               from time to time, as set forth in the (A) Fund's, Prospectus and

               Statement of Additional Information ("SAI"); (B) instructions and

               directions of AEFC and of the Board; (C) requirements of the 1940

               Act, the Internal Revenue Code of 1986, as amended, as applicable

               to the Fund, and all other applicable  federal and state laws and

               regulations;  and (D) the  procedures and standards set forth in,

               or established in accordance with, the Advisory Agreement.

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(iii) Portfolio Transactions.



          (A)  Trading.  With respect to the securities and other investments to

               be purchased or sold for the Fund,  Subadviser shall place orders

               with or  through  such  persons,  brokers,  dealers,  or  futures

               commission   merchants   (including,    but   not   limited   to,

               broker-dealers  that  are  affiliated  with  AEFC or  Subadviser)

               selected by Subadviser; provided, however, that such orders shall

               be consistent  with the brokerage  policy set forth in the Fund's

               SAI,  as  approved  by  the  Board;   and  conform  with  federal

               securities laws and the interpretations thereof by the Securities

               and  Exchange  Commision  ("SEC").  Within the  framework of this

               policy,   Subadviser   may  consider  the  research,   investment

               information,  and other  services  provided by, and the financial

               responsibility  of,  brokers,   dealers,  or  futures  commission

               merchants who may effect,  or be a party to, any such transaction

               or other  transactions to which Subadviser's other clients may be

               a party.



          (B)  Aggregation  of Trades.  On occasions when  Subadviser  deems the

               purchase or sale of a security  or futures  contract to be in the

               best interest of the Fund as well as other clients of Subadviser,

               Subadviser,  to the  extent  permitted  by  applicable  laws  and

               regulations,  may, but shall be under no obligation to, aggregate

               the  securities  or futures  contracts to be sold or purchased in

               order to  obtain  the  most  favorable  price or lower  brokerage

               commissions and efficient execution. In such event, allocation of

               the securities or futures contracts so purchased or sold, as well

               as the  expenses  incurred  in the  transaction,  will be made by

               Subadviser  in the  manner  Subadviser  considers  to be the most

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