Exhibit 6(ii)
SUBADVISORY AGREEMENT
This SUBADVISORY AGREEMENT is dated as of February 23, 2001, by and
between SUNAMERICA ASSET MANAGEMENT CORP., a Delaware corporation (the
"Adviser"), and XXXXX SELECTED ADVISERS, L.P., a Colorado limited partnership
(the "Subadviser").
WITNESSETH:
WHEREAS, the Adviser and SunAmerica Series Trust, a Massachusetts business
trust (the "Trust"), have entered into an Investment Advisory and Management
Agreement dated as of January 1, 1999, (the "Advisory Agreement") pursuant to
which the Adviser has agreed to provide investment management, advisory and
administrative services to the Trust; and
WHEREAS, the Trust is registered under the Investment Company Act of 1940,
as amended (the "Act"), as an open-end management investment company and may
issue shares of beneficial interest in separately designated portfolios
representing separate funds with their own investment objectives, policies and
purposes; and
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, as amended; and
WHEREAS, the Adviser desires to retain the Subadviser to furnish
investment advisory services to the investment portfolio or portfolios of the
Trust listed in Schedule A hereto (the "Portfolio(s)"), and the Subadviser is
willing to furnish such services;
NOW, THEREFORE, it is hereby agreed between the parties hereto as follows:
1. Duties of the Subadviser. (a) The Adviser hereby engages the services
of the Subadviser in furtherance of its Investment Advisory and Management
Agreement. Pursuant to this Subadvisory Agreement and subject to the oversight
and review of the Adviser, the Subadviser will manage the investment and
reinvestment of the assets of each Portfolio listed. The Subadviser will
determine in its discretion and subject to the oversight and review of the
Adviser, the securities to be purchased or sold, will provide the Adviser with
records concerning its activities which the Adviser or the Trust is required to
maintain, and will render regular reports to the Adviser and to officers and
Trustees of the Trust concerning its discharge of the foregoing
responsibilities. The Subadviser shall discharge the foregoing responsibilities
subject to the control of the officers and the Trustees of the Trust and in
compliance with such policies as the Trustees of the Trust may from time to time
establish, and in compliance with the objectives, policies, and limitations for
the Portfolio(s) set forth in the Trust's current prospectus and statement of
additional information, and applicable laws and regulations. The Adviser shall
inform the Subadviser of any requirements of the California Insurance Code (or
other applicable insurance Code, if any) and any regulations thereunder that
operate to limit
or restrict the investments the Portfolio(s) may otherwise make, and to inform
the Subadviser promptly of any changes in such requirements.
The Subadviser represents and warrants to the Adviser that each of
the Portfolios set forth in Schedule A will at all times be operated and managed
(1) in compliance with all applicable federal and state laws governing its
operations and investments; (2) so as not to jeopardize either the treatment of
the Polaris variable annuity contracts issued by Variable Separate Account (File
No. 33-47473; hereinafter "Contracts") as annuity contracts for purposes of the
Internal Revenue Code of 1986, as amended (the "Code"), or the eligibility of
the Contracts to qualify for sale to the public in any state where they may
otherwise be sold; and (3) to minimize any taxes and/or penalties payable by the
Trust or such Portfolio. Without limiting the foregoing, the Subadviser
represents and warrants (1) qualification, election and maintenance of such
election by each Portfolio to be treated as a "regulated investment company"
under subchapter M, chapter 1 of the Code, and (2) compliance with (a) the
provisions of the Act and rules adopted thereunder; (b) the diversification
requirements specified in the Internal Revenue Service's regulations under
Section 817(h) of the Code; (c) applicable state insurance laws; (d) applicable
federal and state securities, commodities and banking laws; and (e) the
distribution requirements necessary to avoid payment of any excise tax pursuant
to Section 4982 of the Code. The Subadviser further represents and warrants that
to the extent that any statements or omissions made in any Registration
Statement for the Contracts or shares of the Trust, or any amendment or
supplement thereto, are made in reliance upon and in conformity with information
furnished by the Subadviser expressly for use therein, such Registration
Statement and any amendments or supplements thereto will, when they become
effective, conform in all material respects to the requirements of the
Securities Act of 1933 and the rules and regulations of the Commission
thereunder (the "1933 Act") and the Act and will not contain any untrue
statement of a material fact or omit to state any material fact required to be
stated therein or necessary to make the statements therein not misleading.
The Subadviser accepts such employment and agrees, at its own
expense, to render the services set forth herein and to provide the office
space, furnishings, equipment and personnel required by it to perform such
services on the terms and for the compensation provided in this Agreement.
(b) In performing its investment advisory services, Subadviser,
while remaining ultimately responsible for management of the portion of the
assets of the Portfolio allocated to it, may delegate any of its
responsibilities to one of its affiliates, including Xxxxx Selected Advisers -
NY, Inc., its New York affiliate.
2. Portfolio Transactions. The Subadviser is authorized to select the
brokers or dealers that will execute the purchases and sales of portfolio
securities and is directed to use its best efforts to obtain the best price and
execution. In selecting such broker or dealers, the Subadviser shall consider
all relevant factors, including price (including the applicable brokerage
commission or dealer spread), the size of the order, the nature of the market
for the security or other investment, the timing of the transaction, the
reputation, experience and financial stability of the broker or dealer involved,
the quality of the service, the difficulty of execution, the execution
capabilities and operations facilities of the firm involved, and the firm's risk
in positioning a block of securities. Subject to such policies as
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the Trustees may determine and consistent with Section 28(e) of the Securities
Exchange Act of 1934, as amended, the Subadviser shall not be deemed to have
acted unlawfully or to have breached any duty created by this Agreement or
otherwise solely by reason of the Subadviser's having caused a Portfolio to pay
a member of an exchange, broker or dealer an amount of commission for effecting
a securities transaction in excess of the amount of commission another member of
an exchange, broker or dealer would have charged for effecting that transaction,
if the Subadviser determines in good faith that such amount of commission was
reasonable in relation to the value of the brokerage and research services
provided by such member of an exchange, broker or dealer viewed in terms of
either that particular transaction or the Subadviser's overall responsibilities
with respect to such Portfolio and to other clients as to which the Subadviser
exercises investment discretion. The Subadviser will promptly communicate to the
Adviser and to the officers and the Trustees of the Trust such information
relating to portfolio transactions as they may reasonably request.
3. Compensation of the Subadviser. The Subadviser shall not be entitled to
receive any payment from the Trust and shall look solely and exclusively to the
Adviser for payment of all fees for the services rendered, facilities furnished
and expenses paid by it hereunder. As full compensation for the Subadviser under
this Agreement, the Adviser agrees to pay the Subadviser a fee at the annual
rates set forth in Schedule A hereto with respect to each Portfolio listed
thereon. Such fee shall be accrued daily and paid monthly as soon as practicable
after the end of each month (i.e., the applicable annual fee rate divided by 365
applied to each prior days' net assets in order to calculate the daily accrual).
For purposes of calculating the Subadviser's fee, the average daily net asset
value of a Portfolio shall be determined by taking an average of all
determinations of such net asset value during the month. If the Subadviser shall
provide its services under this Agreement for less than the whole of any month,
the foregoing compensation shall be prorated.
The Subadviser, not the Adviser or the Trust, will pay Xxxxx
Selected Advisers - NY, Inc., or any other affiliate the services of which are
utilized hereunder, all of such affiliate's reasonable direct and indirect costs
associated with maintenance of an office and performance of such services.
To the extent required by the laws of any state in which the Trust
is subject to an expense guarantee limitation, if the aggregate expenses of any
Portfolio in any fiscal year exceed the specified expense limitation ratios for
that year (calculated on a daily basis), as a result of which the Adviser is
required to reduce or refund its advisory and management fee payable by the
Portfolio, the Subadviser agrees to waive such portion of its subadvisory fee in
the same proportion as the fees waived by the Adviser bear to the total advisory
and management fee paid by the Portfolio. Such waiver, however, shall not exceed
the full amount of the subadvisory fee for such year except as may be elected by
the Subadviser in its discretion. For this purpose, aggregate expenses of a
Portfolio shall include the compensation of the Adviser and all normal expenses,
fees and charges, but shall exclude interest, taxes, brokerage fees on portfolio
transactions, fees and expenses incurred in connection with the distribution of
Trust shares, and extraordinary expenses including litigation expenses. In the
event any amounts are so contributed by the Subadviser to the Adviser, the
Adviser agrees to reimburse the Subadviser for any expenses waived, provided
that the Adviser has been reimbursed by the Trust.
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4. Reports. The Adviser and the Subadviser agree to furnish to each other,
if applicable, current prospectuses, statements of additional information, proxy
statements, reports of shareholders, certified copies of their financial
statements, and such other information with regard to their affairs and that of
the Trust as each may reasonably request.
5. Status of the Subadviser. The services of the Subadviser to the Adviser
and the Trust are not to be deemed exclusive, and the Subadviser shall be free
to render similar services to others so long as its services to the Trust are
not impaired thereby. The Subadviser shall be deemed to be an independent
contractor and shall, unless otherwise expressly provided or authorized, have no
authority to act for or represent the Trust in any way or otherwise be deemed an
agent of the Trust.
6. Certain Records. The Subadviser hereby undertakes and agrees to
maintain, in the form and for the period required by Rule 31a-2 under the Act,
all records relating to the investments of the Portfolio(s) that are required to
be maintained by the Trust pursuant to the requirements of Rule 31a-1 of that
Act. Any records required to be maintained and preserved pursuant to the
provisions of Rule 31a-1 and Rule 31a-2 promulgated under the Act which are
prepared or maintained by the Subadviser on behalf of the Trust are the property
of the Trust and will be surrendered promptly to the Trust or the Adviser on
request.
The Subadviser agrees that all accounts, books and other records
maintained and preserved by it as required hereby shall be subject at any time,
and from time to time, to such reasonable periodic, special and other
examinations by the Securities and Exchange Commission, the Trust's auditors,
the Trust or any representative of the Trust, the Adviser, or any governmental
agency or other instrumentality having regulatory authority over the Trust.
7. Reference to the Subadviser. Neither the Trust nor the Adviser or any
affiliate or agent thereof shall make reference to or use the 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.
8. Indemnification. The Adviser agrees to indemnify and hold harmless the
Subadviser and its affiliates and each of its directors and officers and each
person, if any, who controls the Subadviser within the meaning of Section 15 of
the 1933 Act against any and all losses, claims, damages, liabilities or
litigation (including legal and other expenses), to which the Subadviser or its
affiliates or such directors, officers or controlling person may become subject
under the 1933 Act, under any other statute, at common law or otherwise, which
may be based upon any wrongful act or breach of this Agreement by the Adviser;
provided, however, that in no case is the Adviser's indemnity in favor of any
person deemed to protect such person against any liability to which such person
would otherwise be subject by reason of willful misfeasance, bad faith, or gross
negligence in the performance of his, her or its duties or by reasons of his,
her or its reckless disregard of obligations and duties under this Agreement.
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The Subadviser agrees to indemnify and hold harmless the Adviser and
its affiliates 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 and all losses, claims, damages, liabilities or litigation
(including legal and other expenses), to which the Adviser or its affiliates or
such directors, officers or controlling person may become subject under the 1933
Act, under other statutes, at common law or otherwise, which may be based upon
(i) any wrongful act or breach of this Agreement by the Subadviser, or (ii) any
failure by the Subadviser to comply with the representations and warranties set
forth in Section 1 of this Agreement; provided, however, that in no case is the
Subadviser's indemnity in favor of any person deemed to protect such other
persons against any liability to which such person would otherwise be subject by
reasons of willful misfeasance, bad faith, or gross negligence in the
performance of his, her or its duties or by reason of his, her or its reckless
disregard of obligation and duties under this Agreement.
9. Term of the Agreement. This Agreement shall continue in full force and
effect with respect to each Portfolio until the earlier of (a) two years from
the date this Agreement is approved by the Trustees, or (b) the first meeting of
the shareholders of the Portfolio of the Trust after the date hereof. If
approved at such meeting by the affirmative vote of a majority of the
outstanding voting securities (as defined in the Act), of the Portfolio with
respect to such Portfolio, voting separately from any other series of the Trust,
this Agreement shall continue in full force and effect with respect to such
Portfolio from year to year thereafter so long as such continuance is
specifically approved at least annually (i) by the vote of a majority of those
Trustees of the Trust who are not parties to this Agreement or interested
persons of any such party, cast in person at a meeting called for the purpose of
voting on such approval, and (ii) by the Trustees of the Trust or by vote of a
majority of the outstanding voting securities of the Portfolio voting separately
from any other series of the Trust, provided, however, that if the shareholders
fail to approve the Agreement as provided herein, the Subadviser may continue to
serve hereunder in the manner and to the extent permitted by the Act and rules
thereunder. The foregoing requirement that continuance of this Agreement be
"specifically approved at least annually" shall be construed in a manner
consistent with the Act and the rules and regulations thereunder.
With respect to each Portfolio, this Agreement may be terminated at
any time, without payment of penalty by the Portfolio or the Trust, by vote of a
majority of the Trustees, or by vote of a majority of the outstanding voting
securities (as defined in the Act) of the Portfolio, voting separately from any
other series of the Trust, or by the Adviser, on not less than 30 nor more than
60 days' written notice to the Subadviser. With respect to each Portfolio, this
Agreement may be terminated by the Subadviser at any time, without the payment
of any penalty, on 90 days' written notice to the Adviser and the Trust;
provided, however, that this Agreement may not be terminated by the Subadviser
unless another subadvisory agreement has been approved by the Trust in
accordance with the Act, or after six months' written notice, whichever is
earlier. The termination of this Agreement with respect to any Portfolio or the
addition of any Portfolio to Schedule A hereto (in the manner
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required by the Act) shall not affect the continued effectiveness of this
Agreement with respect to each other Portfolio subject hereto. This Agreement
shall automatically terminate in the event of its assignment (as defined by the
Act).
This Agreement will also terminate in the event that the Advisory
Agreement by and between the Trust and the Adviser is terminated.
10. Severability. If any provision of this Agreement shall be held or made
invalid by a court decision, statute, rule or otherwise, the remainder of this
Agreement shall not be affected thereby.
11. Amendments. This Agreement may be amended by mutual consent in
writing, but the consent of the Trust must be obtained in conformity the
requirements of the Act.
12. Governing Law. This Agreement shall be construed in accordance with
the laws of the State of New York and the applicable provisions of the Act. To
the extent the applicable laws of the State of New York, or any of the
provisions herein, conflict with the applicable provisions of the Act, the
latter shall control.
13. Personal Liability. The Declaration of the Trust establishing the
Trust (the "Declaration"), is on file in the office of the Secretary of the
Commonwealth of Massachusetts, and, in accordance with that Declaration, no
Trustee, shareholder, officer, employee or agent of the Trust shall be held to
any personal liability, nor shall resort be had to their private property for
satisfaction of any obligation or claim or otherwise in connection with the
affairs of the Trust, but the "Trust Property" only shall be liable.
14. Separate Series. Pursuant to the provisions of the Declaration, each
portfolio is a separate series of the Trust, and all debts, liabilities,
obligations and expenses of a particular portfolio shall be enforceable only
against the assets of that portfolio and not against the assets of any other
portfolio or of the Trust as a whole.
15. Notices. All notices shall be in writing and deemed properly given
when delivered or mailed by United States certified or registered mail, return
receipt requested, postage prepaid, addressed as follows:
Subadviser: Xxxxx Selected Advisers, L.P.
000 X. Xxxxx Xxxxxx
X.X. Xxx 0000 Xxxxx Xx, XX 00000-0000
Attention: Xxxxxxx X. Xxxx
Chief Operating Officer
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Adviser: SunAmerica Asset Management Corp.
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxx X. Xxxxx
Senior Vice President
and General Counsel
with a copy to: SunAmerica Inc.
0 XxxXxxxxxx Xxxxxx
Xxxxxxx Xxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000-0000
Attention: Xxxxx X. Xxxxxx
Vice President, Associate
General Counsel and
Secretary
IN WITNESS WHEREOF, the parties have caused their respective duly
authorized officers to execute this Agreement as of the date first above
written.
SUNAMERICA ASSET MANAGEMENT CORP.
By: /s/ Xxxxx X. Xxxxxxx
----------------------
Name: Xxxxx X. Xxxxxxx
Title: President
XXXXX SELECTED ADVISERS, L.P.
By: Xxxxx Investments LLC (General Partner)
By: /s/ Xxxxxx Xxxx
----------------------
Name: Xxxxxx Xxxx
Title: Vice President
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SCHEDULE A
Fee
(as percentage of
average daily net assets of
Portfolio the Portfolio)
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Xxxxx Venture Value .45% - first $100MM
.40% - next $400MM
.35% - over $500MM
Real Estate .45% - first $100MM
.40% - next $400MM
.35% - over $500MM
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