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EXHIBIT(d)2.(iii)
WNL SERIES TRUST
SUB-ADVISORY AGREEMENT
AGREEMENT dated as of October 31, 1996, among XXX XXXXXX AMERICAN
CAPITAL ASSET MANAGEMENT, INC., a Delaware corporation (the "Sub-Adviser"), WNL
INVESTMENT ADVISORY SERVICES, INC., a Delaware corporation (the "Adviser"), and
WNL SERIES TRUST, a Massachusetts business trust (the "Trust").
WHEREAS, Adviser has entered into an Investment Advisory Agreement
(referred to herein as the "Advisory Agreement"), dated August 23, 1995, with
the Trust, under which Adviser has agreed to act as investment adviser to the
Trust, which is registered as an open-end diversified management investment
company under the Investment Company Act of 1940, as amended ("1940 Act"); and
WHEREAS, the Advisory Agreement provides that the Adviser may engage a
sub-adviser or sub-advisers for the purpose of managing the investments of the
Portfolios of the Trust; and
WHEREAS, the Adviser desires to retain Sub-Adviser, which is engaged in
the business of rendering investment management services, to provide certain
investment management services for the Xxx Xxxxxx American Capital Emerging
Growth Portfolio (the "Portfolio") of the Trust as more fully described below;
and
WHEREAS, it is the purpose of this Agreement to express the mutual
agreements of the parties hereto with respect to the services to be provided by
Sub-Adviser to Adviser with respect to the Portfolio and the terms and
conditions under which such services will be rendered,
NOW, THEREFORE, in consideration of the mutual covenants and agreements
set forth herein, the parties hereto agree as follows:
1. SERVICES OF SUB-ADVISER. The Sub-Adviser shall act as investment
counsel to the Adviser with respect to the Portfolio. In this capacity,
Sub-Adviser shall have the following responsibilities:
(a) to furnish continuous investment information, advice and
recommendations to the Adviser as to the acquisition, holding or disposition of
any or all of the securities or other assets which the Portfolio may own or
contemplate acquiring from time to time;
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(b) to cause its officers to attend meetings of the Adviser or
the Trust and furnish oral or written reports, as the Adviser may reasonably
require, in order to keep the Adviser and its officers and the Trustees of the
Trust and appropriate officers of the Trust fully informed as to the condition
of the investment securities of the Portfolio, the investment recommendations of
the Sub-Adviser, and the investment considerations which have given rise to
those recommendations;
(c) to furnish such statistical and analytical information and
reports as may reasonably be required by the Adviser from time to time; and
(d) to supervise and place orders for the purchase, sale,
exchange and conversion of securities as directed by the appropriate officers of
the Trust or of the Adviser.
2. OBLIGATIONS OF THE ADVISER. The Adviser shall have the following
obligations under this Agreement:
(a) to keep the Sub-Adviser continuously and fully informed as
to the composition of the Portfolio's investment securities and the nature of
the Portfolio's assets and liabilities;
(b) to keep the Sub-Adviser continually and fully advised of
the Portfolio's investment objectives, and any modifications and changes
thereto, as well as any specific investment restrictions or limitations by
sending the Sub-Adviser copies of each registration statement;
(c) to furnish the Sub-Adviser with a certified copy of any
financial statement or report prepared for the Trust with respect to the
Portfolio by certified or independent public accountants, and with copies of any
financial statements or reports made by the Trust to shareholders or to any
governmental body or securities exchange and to inform the Sub-Adviser of the
results of any audits or examinations by regulatory authorities pertaining to
the Portfolio, if these results affect the services provided by the Sub-Adviser
pursuant to this Agreement;
(d) to furnish the Sub-Adviser with any further materials or
information which the Sub-Adviser may reasonably request to enable it to perform
its functions under this Agreement; and
(e) to compensate the Sub-Adviser for its services under this
Agreement by the payment of fees as set forth in Exhibit A attached hereto.
3. PORTFOLIO TRANSACTIONS. The Sub-Adviser shall place all orders for
the purchase and sale of portfolio securities for the account of the Portfolio
with broker-dealers selected
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by the Sub-Adviser. In executing portfolio transactions and selecting
broker-dealers, the Sub-Adviser will use its best efforts to seek best execution
on behalf of the Portfolio. In assessing the best execution available for any
transaction, the Sub-Adviser shall consider all factors it deems relevant,
including the breadth of the market in the security, the price of the security,
the financial condition and execution capability of the broker-dealer, and the
reasonableness of the commission, if any (all for the specific transaction and
on a continuing basis). In evaluating the best execution available, and in
selecting the broker-dealer to execute a particular transaction, the Sub-Adviser
may also consider the brokerage and research services (as those terms are used
in Section 28(e) of the Securities Exchange Act of 1934) provided to the
Portfolio and/or other accounts over which the Sub-Adviser, an affiliate of the
Sub-Adviser (to the extent permitted by law) or another investment adviser of
the Portfolio exercises investment discretion. The Sub-Adviser is authorized to
cause the Portfolio to pay a broker-dealer who provides such brokerage and
research services a commission for executing a portfolio transaction for the
Portfolio which is in excess of the amount of commission another broker-dealer
would have charged for effecting that transaction if, but only if, the
Sub-Adviser determines in good faith that such commission was reasonable in
relation to the value of the brokerage and research services provided by such
broker-dealer viewed in terms of that particular transaction or in terms of all
of the accounts over which investment discretion is so exercised.
4. MARKETING SUPPORT. The Sub-Adviser shall provide marketing support
to the Adviser in connection with the sale of Trust shares and/or the sale of
variable annuity and variable life insurance contracts issued by Western
National Life Insurance Company and its affiliates which may invest in the Trust
(collectively, the "Life Company"), as reasonably requested by the Adviser. Such
support shall include, but not necessarily be limited to, presentations by
representatives of the Sub-Adviser at investment seminars, conferences and other
industry meetings. Any materials utilized by the Adviser which contain any
information relating to the Sub-Adviser shall be submitted to the Sub-Adviser
for approval prior to use, not less than five (5) business days before such
approval is needed by the Adviser. Any materials utilized by the Sub-Adviser
which contain any information relating to the Adviser, the Life Company
(including any information relating to its separate accounts or variable annuity
or variable life insurance contracts) or the Trust shall be submitted to the
Adviser for approval prior to use, not less than five (5) business days before
such approval is needed by the Sub-Adviser.
5. GOVERNING LAW. This Agreement shall be construed in accordance with
and governed by the laws of the Commonwealth of Massachusetts.
6. EXECUTION OF AGREEMENT. This Agreement will become binding on the
parties hereto upon their execution of the attached Exhibit A to this Agreement.
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7. COMPLIANCE WITH LAWS. The Sub-Adviser represents that it is, and
will continue to be throughout the term of this Agreement, an investment adviser
registered under all applicable federal and state laws. In all matters relating
to the performance of this Agreement, the Sub-Adviser will act in conformity
with the Trust's Declaration of Trust, Bylaws, and current registration
statement applicable to the Portfolio and with the instructions and direction of
the Adviser and the Trust's Trustees, and will conform to and comply with the
1940 Act and all other applicable federal or state laws and regulations.
8. TERMINATION. This Agreement shall terminate automatically upon the
termination of the Advisory Agreement. This Agreement may be terminated at any
time, without penalty, by the Adviser or by the Trust by giving sixty (60) days'
written notice of such termination to the Sub-Adviser at its principal place of
business, provided that such termination is approved by the Board of Trustees of
the Trust or by vote of a majority of the Outstanding voting securities (as that
phrase is defined in Section 2(a)(42) of the 0000 Xxx) of the Portfolio. This
Agreement may be terminated at any time by the Sub-Adviser by giving 60 days'
written notice of such termination to the Trust and the Adviser at their
respective principal places of business.
9. ASSIGNMENT. This Agreement shall terminate automatically in the
event of any assignment (as that term is defined in Section 2(a)(4) of the 0000
Xxx) of this Agreement.
10. TERM. This Agreement shall begin on the date of its execution and
unless sooner terminated in accordance with its terms shall continue in effect
until April 30, 1997 and from year to year thereafter provided continuance is
specifically approved at least annually by the vote of a majority of the
Trustees of the Trust who are not parties hereto or interested persons (as the
term is defined in Section 2(a)(19) of the 0000 Xxx) of any such party, cast in
person at a meeting called for the purpose of voting on the approval of the
terms of such renewal, and by either the Trustees of the Trust or the
affirmative vote of a majority of the outstanding voting securities of the
Portfolio (as that phrase is defined in Section 2(a)(42) of the 1940 Act).
11. AMENDMENTS. This Agreement may be amended only with the approval by
the affirmative vote of a majority of the outstanding voting securities of the
Portfolio (as that phrase is defined in Section 2(a)(42) of the 0000 Xxx) and
the approval by the vote of a majority of the Trustees of the Trust who are not
parties hereto or interested persons (as that term is defined in Section
2(a)(19) of the 0000 Xxx) of any such party, cast in person at a meeting called
for the purpose of voting on the approval of such amendment, unless otherwise
permitted in accordance with the 1940 Act.
12. INDEMNIFICATION. The Adviser shall indemnify and hold harmless the
Sub-Adviser, its officers and directors and each person, if any, who controls
the Sub-Adviser within the meaning of Section 15 of the Securities Act of 1933
("1933 Act") (any and ail such persons shall be referred to as "Indemnified
Party"), against any loss, liability, claim,
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damage or expense (including the reasonable cost of investigating or defending
any alleged loss, liability, claim, damages or expense and reasonable counsel
fees incurred in connection therewith), arising by reason of any matter to which
this Sub-Advisory Agreement relates. However, in no case (i) is this indemnity
to be deemed to protect any particular indemnified Party against any liability
to which such Indemnified Party would otherwise be subject by reason of willful
misfeasance, bad faith or gross negligence in the performance of its duties or
by reason of reckless disregard of its obligations and duties under this
Sub-Advisory Agreement or (ii) is the Adviser to be liable under this indemnity
with respect to any claim made against any particular Indemnified Party unless
such Indemnified Party shall have notified the Adviser in writing within a
reasonable time after the summons or other first legal process giving
information of the nature of the claim shall have been served upon the
Sub-Adviser or such controlling persons.
The Sub-Adviser shall indemnify and hold harmless the Adviser and each
of its directors and officers and each person if any who controls the adviser
within the meaning of Section 15 of the 1933 Act, against any loss, liability,
claim, damage or expense described in the foregoing indemnity, but only with
respect to the Sub-Adviser's willful misfeasance, bad faith or gross negligence
in the performance of its duties under this Sub-Advisory Agreement. In case any
action shall be brought against the Adviser or any person so indemnified, in
respect of which indemnity may be sought against the Sub-adviser, the
Sub-Adviser shall have the rights and duties given to the Adviser, and the
Adviser and each person so indemnified shall have the rights and duties given to
the Sub-Adviser by the provisions of subsections (i) and (ii) of this section.
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EXHIBIT A
WNL SERIES TRUST
SUB-ADVISORY COMPENSATION
For all services rendered by Sub-Adviser hereunder, Adviser shall pay
to Sub-Adviser and Sub-Adviser agrees to accept as full compensation for all
services rendered hereunder, monthly a fee of:
VAN KAMPAN AMERICAN CAPITAL EMERGING GROWTH PORTFOLIO
of 1 % on an annualized basis of net assets under management.
WNL SERIES TRUST
By: /s/ XXXX X. XXXXXXXX
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Title: Vice President Asst. Secretary
WNL INVESTMENT ADVISORY SERVICES, INC.
By: /s/ XXXX X. XXXXXXXX
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Title: Vice President CFO
XXX XXXXXX AMERICAN CAPITAL ASSET MANAGEMENT,INC.
By: /s/ [ILLEGIBLE]
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Title: President and Chief Operating Officer
A copy of the document establishing the Trust is filed with the Secretary of the
Commonwealth of Massachusetts. This Agreement is executed by officers not as
individuals and is not binding upon any of the Trustees, officers or
shareholders of the Trust individually but only upon the assets each Portfolio.
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