JNL/BLACKROCK GLOBAL ALLOCATION FUND LTD.
INVESTMENT SUB-ADVISORY AGREEMENT
This AGREEMENT is effective this 10th day of June, 2011, by and between
XXXXXXX NATIONAL ASSET MANAGEMENT, LLC, a Michigan limited liability company and
registered investment adviser ("Adviser"), and BLACKROCK INVESTMENT MANAGEMENT,
LLC, a Delaware limited liability company and registered investment adviser
("Sub-Adviser").
WHEREAS, Adviser is the investment manager for the JNL/BlackRock Global
Allocation Fund ("Fund") a series of the JNL Series Trust (the "Trust"), an
open-end management investment company registered under the Investment Company
Act of 1940, as amended ("1940 Act");
WHEREAS, the Adviser represents that it has entered into an Investment
Advisory and Management Agreement ("Management Agreement") dated as of January
31, 2001, with the Trust, and amended the Management Agreement on August 29,
2011 to add the Fund;
WHEREAS, the Adviser and Sub-Adviser are contemporaneously entering in to a
sub-advisory agreement with respect to sub-advisory services to the Fund ("Fund
Sub-Advisory Agreement");
WHEREAS, JNL/BlackRock Global Allocation Fund Ltd. (the "Company") is a
wholly owned subsidiary of the Fund;
WHEREAS, the Adviser represents that it has entered into an Investment
Advisory and Management Agreement ("Management Agreement") dated as of June 10,
2011 with the Company; and
WHEREAS, Adviser desires to retain Sub-Adviser as Adviser's agent to
furnish investment advisory services to the Company.
NOW, THEREFORE, in consideration of the mutual covenants herein contained,
the parties hereto agree as follows:
1. APPOINTMENT. Adviser hereby appoints Sub-Adviser to provide certain
sub-investment advisory services to the Company for the period and on the terms
set forth in this Agreement. Sub-Adviser accepts such appointment and agrees to
furnish the services herein set forth for the compensation herein provided.
2. DELIVERY OF DOCUMENTS. Adviser has or will furnish Sub-Adviser with
copies properly certified or authenticated of each of the following prior to the
commencement of the Sub-Adviser's services:
a. The Company's Memorandum of Association and Articles of Association, and
all amendments thereto or restatements thereof (such Memorandum and Articles as
presently in effect and as it shall from time to time be amended or restated, is
herein called the "Memorandum of Association");
b. Resolutions of the Board of Directors of the Company (the "Board of
Directors") authorizing the appointment of Sub-Adviser and approving this
Agreement; and
c. Adviser will furnish the Sub-Adviser with copies of all amendments of or
supplements to the foregoing within a reasonable time before they become
effective. Any amendments or supplements that impact the management of the
Company will not be deemed effective with respect to the Sub-Adviser until the
Sub-Adviser's approval thereof.
3. MANAGEMENT. Subject always to the supervision of the Adviser, who in
turn is subject to the supervision of the Board of Directors, Sub-Adviser will
furnish an investment program in respect of, make investment decisions for all
assets of the Company and place all orders for the purchase and sale of
securities including foreign or domestic securities or property (including
commodities and commodities-related instruments, financial futures and options
of any type), all on behalf of the Company. In the performance of its duties,
Sub-Adviser will monitor the Company's investments, and will comply with the
provisions of the Memorandum of Association, as amended from time to time, and
make investment decisions in conformity with the stated investment objectives,
policies and restrictions of the Company, which may be amended from time to
time. Sub-Adviser and Adviser will each make its officers and employees
available to the other from time to time at reasonable times to review
investment policies of the Company and to consult with each other regarding the
investment affairs of the Company. Sub-Adviser will report to the Board of
Directors and to Adviser with respect to the implementation of such program.
The Sub-Adviser further agrees that it:
a) Will use the same skill and care in providing such services as it uses
in providing services to its other client mandates for which it has investment
responsibilities;
b) Act in strict conformity to Cayman Islands law, the 1940 Act, the
Investment Advisers Act of 1940, as amended ("Advisers Act"), and the Securities
Exchange Act of 1934, as amended ("1934 Act") and will comply with all
applicable Rules and Regulations of the SEC in all material respects and in
addition will conduct its activities under this Agreement in accordance with any
applicable regulations of any governmental authority pertaining to its
investment advisory activities, including but not limited to compliance with
Rule 38a-1 under the 1940 Act and Rule 206(4)-7 under the Advisers Act;
c) Will report regularly to Adviser and to the Board of Directors, and
periodically to the Trust's Board of Trustees (the "Board of Trustees"), as
reasonably agreed between the Adviser and Sub-Adviser and will make appropriate
persons available for the purpose of reviewing with representatives of Adviser,
the Board of Directors, and the Board of Trustees at reasonable times agreed to
by the Adviser and Sub-Adviser, the management of the Company, including,
without limitation, review of the general investment strategies of the Company,
the performance of the Company in relation to the specified benchmarks and will
provide various other reports from time to time as reasonably requested by
Adviser;
d) Will prepare and maintain such books and records with respect to the
Company's securities transactions in accordance with applicable law, and will
furnish Adviser and Board of Directors such periodic and special reports as the
Adviser may reasonably request;
e) Will act upon reasonable instructions from Adviser not inconsistent with
the fiduciary duties and investment objectives hereunder;
f) Will treat confidentially and as proprietary information of Company all
such records and other information relative to the Company maintained by the
Sub-Adviser, and will not use such records and information for any purpose other
than performance of its responsibilities and duties hereunder, except after
prior notification to and approval in writing by the Company, which approval
shall not be unreasonably withheld and may not be withheld where the Sub-Adviser
may be exposed to civil or criminal contempt proceedings for failure to comply,
when requested to divulge such information by duly constituted authorities, or
when so requested by Company, provided, however, that notwithstanding the
foregoing, Sub-Adviser may disclose such information as required by applicable
law, regulation or upon request by a regulator or auditor of Sub-Adviser;
g) Will vote proxies received in connection with securities held by the
Company consistent with its fiduciary duties hereunder; and
h) Will provide investment research and evaluation of the Company's
investments and provide statistical information the Adviser may reasonably
request with regard to existing or potential securities holdings.
4. CUSTODY OF ASSETS. Sub-Adviser shall at no time have the right to
physically possess the assets of the Company or have the assets registered in
its own name or the name of its nominee, nor shall Sub-Adviser in any manner
acquire or become possessed of any income, whether in kind or cash, or proceeds,
whether in kind or cash, distributable by reason of selling, holding or
controlling such assets of the Company. In accordance with the preceding
sentence, Sub-Adviser shall have no responsibility with respect to the
collection of income, physical acquisition or the safekeeping of the assets of
the Company. All such duties of collection, physical acquisition and safekeeping
shall be the sole obligation of the custodian.
5. BROKERAGE AND TRANSACTIONS.
The Sub-Adviser is responsible for decisions to buy and sell securities for
the Company, broker-dealer selection, and negotiation of brokerage commission
rates. Sub-Adviser shall have the express authority to negotiate, open, continue
and terminate brokerage accounts and other brokerage arrangements with respect
to all portfolio transactions entered into by Sub-Adviser on behalf of the
Company. Sub-Adviser will provide copies of brokerage agreements and other
documents to establish, operate and conduct all brokerage and other trading
accounts entered into by the Company to the Adviser. It is the Sub-Adviser's
general policy in selecting a broker to effect a particular transaction to seek
to obtain "best execution", which means prompt and efficient execution of the
transaction at the best obtainable price with payment of commissions which are
reasonable in relation to the value of the brokerage services provided by the
broker.
Consistent with this policy, the Sub-Adviser, in selecting broker-dealers
and negotiating commission rates, will take all relevant factors into
consideration, including, but not limited to: the best price available; the
reliability, integrity and financial condition of the broker-dealer; the size of
and difficulty in executing the order; the broker's execution capabilities and
any research provided by the broker that aids the Sub-Adviser's investment
decision-making process; and the value of the expected contribution of the
broker-dealer to the investment performance of the Company on a continuing
basis. Subject to such policies and procedures and other written instructions as
the Adviser or the Board of Directors may adopt, the Sub-Adviser shall have
discretion to effect investment transactions through broker-dealers (including,
to the extent permissible under applicable law, broker-dealer affiliates) who
provide brokerage and/or research services, as such services are defined in
section 28(e) of the 1934 Act, and to cause the Company to pay any such
broker-dealers an amount of commission for effecting a portfolio investment
transaction in excess of the amount of commission another broker-dealer would
have charged for effecting that transaction, if the Sub-Adviser determines in
good faith that such amount of commission is reasonable in relation to the value
of the brokerage or research services provided by such broker-dealer, viewed in
terms of either that particular investment transaction or the Sub-Adviser's
overall responsibilities with respect to the Company and other accounts to which
the Sub-Adviser exercises investment discretion (as such term is defined in
section 3(a)(35) of the 1934 Act. Allocation of orders placed by the Sub-Adviser
on behalf of the Company to such broker-dealers shall be in such amounts and
proportions as the Sub-Adviser shall determine in good faith in conformity with
its responsibilities under applicable laws, rules and regulations. The
Sub-Adviser will submit reports on brokerage placements to the Adviser as
reasonably requested by the Adviser, in such form as may be mutually agreed to
by the parties hereto, indicating the broker-dealers to whom such allocations
have been made and the basis therefore.
With respect to any investments, including but not limited to repurchase
and reverse repurchase agreements, derivatives contracts, futures contracts,
International Swaps and Derivatives Association, Inc. ("ISDA") Master
Agreements, and options on futures contracts ("futures"), which Sub-Adviser is
hereby authorized to make so long as such investments are consistent with the
investment objective and strategies of the Company and the Fund, as outlined in
the Registration Statement for the Trust, the Adviser hereby authorizes and
directs the Sub-Adviser to do and perform every act and thing whatsoever
necessary or incidental in performing its duties and obligations under this
Agreement including, but not limited to, executing as agent of the Adviser, on
behalf of the Company, brokerage agreements and other documents to establish,
operate and conduct all brokerage and other trading accounts, and executing as
agent of the Adviser, on behalf of the Company, such agreements and other
documentation as may be required for the purchase or sale, assignment, transfer
and ownership of any permitted investment, including limited partnership
agreements, repurchase and derivative master agreements, including any schedules
and annexes to such agreements, releases, consents, elections and confirmations.
6. EXPENSES. The Sub-Adviser shall bear all expenses incurred by it in
connection with the performance of its services under this Agreement. The
Company will bear the costs of other expenses to be incurred in its operations,
as agreed to by the Company, the Fund and the Adviser.
7. COMPENSATION. For the services provided and the expenses assumed
pursuant to this Agreement, for sub-advisory services to the Company and as
sub-adviser to the Fund the Adviser to the Fund will pay and the Sub-Adviser
agrees to accept as full compensation therefore, a single sub-advisory fee
accrued daily and payable monthly on the average daily net assets in the Fund in
accordance with Schedule B of the Fund Sub-Advisory Agreement. Thus, no separate
compensation shall be payable under this Agreement.
8. SERVICES TO OTHERS. Adviser understands, and has advised the Board of
Directors, that Sub-Adviser now acts, or may in the future act, as an investment
adviser or sub- adviser to other investment companies or accounts. Adviser has
no objection to Sub-Adviser acting in such capacities, provided that whenever
the Company and one or more other investment advisory clients of Sub-Adviser
have available funds for investment, investments suitable and appropriate for
each will be allocated in a manner believed by Sub-Adviser to be equitable to
each. Sub-Adviser may group orders for the Company with orders for other funds
and accounts to obtain the efficiencies that may be available on larger
transactions when it determines that investment decisions are appropriate for
each participating account. Sub-Adviser cannot assure that such policy will not
adversely affect the price paid or received by the Company. Adviser recognizes,
and has advised the Board of Directors, that in some cases this procedure may
adversely affect the size and the opportunities of the position that the Company
may obtain in a particular security. In addition, Adviser understands, and has
advised the Board of Directors, that the persons employed by Sub-Adviser to
assist in Sub-Adviser's duties under this Agreement will not devote their full
time to such service and nothing contained in this Agreement will be deemed to
limit or restrict the right of Sub-Adviser or any of its affiliates to engage in
and devote time and attention to other businesses or to render services of
whatever kind or nature.
9. LIMITATION OF LIABILITY. Sub-Adviser, its officers, directors,
employees, agents or affiliates will not be subject to any liability to the
Adviser or the Company or its directors, officers, employees, agents or
affiliates for any error of judgment or mistake of law or for any loss suffered
by the Company, any shareholder of the Company or the Adviser either in
connection with the performance of Sub-Adviser's duties under this Agreement or
its failure to perform due to events beyond the reasonable control of the
Sub-Adviser or its agents, except for a loss resulting from Sub-Adviser's
willful misfeasance, or gross negligence in the performance of its duties or by
reason of its reckless disregard of its obligations and duties under this
Agreement. Cayman Islands, and United States' State and Federal securities laws
may impose liabilities under certain circumstances on persons who act in good
faith, and therefore nothing herein shall in any way constitute a waiver or
limitation of any right which Adviser may have under any applicable laws.
10. INDEMNIFICATION. Adviser and the Sub-Adviser each agree to indemnify
the other party (and each such party's affiliates, employees, directors and
officers) against any claim, damages, loss or liability (including reasonable
attorneys' fees) arising out of any third party claims brought against an
indemnified party that are found to constitute willful misfeasance or gross
negligence on the part of the indemnifying party.
11. DURATION AND TERMINATION. This Agreement will become effective as to
the Company upon execution or, if later, on the date that initial capital for
the Company is first provided to it and, unless sooner terminated as provided
herein, will continue in effect for two years from the date of its execution.
Thereafter, if not terminated, this Agreement will continue in effect for
successive periods of 12 months, provided that such continuation is specifically
approved at least annually by the Board of Directors. Notwithstanding the
foregoing, this Agreement may be terminated at any time, without the payment of
any penalty, on sixty days' written notice by the Adviser, or on sixty days'
written notice by the Sub-Adviser. This Agreement will immediately terminate in
the event of its assignment. Sections 9, 10, and 12 herein shall survive the
termination of this Agreement.
12. CONFIDENTIAL TREATMENT. It is understood that any information or
recommendation supplied by, or produced by, Sub-Adviser in connection with the
performance of its obligations hereunder is to be regarded as confidential and
for use only by the Adviser and the Company. Furthermore, except as required by
law, or as agreed to by the Adviser and Sub-Adviser, the Adviser and Company
will not disclose any list of securities held by the Company except as provided
for in the policies and procedures of the Fund as described in the current
Statement of Additional Information of the Trust.
13. ENTIRE AGREEMENT; AMENDMENT OF THIS AGREEMENT. This Agreement
constitutes the entire agreement between the parties with respect to the
Company. No provision of this Agreement may be changed, waived, discharged or
terminated orally, but only by an instrument in writing signed by the party
against which enforcement of the change, waiver, discharge or termination is
sought.
14. NOTICE. Any notice under this Agreement shall be in writing, addressed
and delivered or mailed, postage prepaid, to the other party at such address as
designated herein.
a) TO ADVISER:
Xxxxxxx National Life Insurance Company
0 Xxxxxxxxx Xxx
Xxxxxxx, XX 00000
Attn: Legal Department - Contracts Administrator
b) TO SUB-ADVISER:
BlackRock Investment Management, LLC
000 Xxxxxxxx Xxxx Xxxx
Xxxxxxxxxx, XX 00000
Attention: Xxxxxx Xxxxxxxx
15. MISCELLANEOUS. The captions in this Agreement are included for
convenience of reference only and in no way define or limit any of the
provisions hereof or otherwise affect their construction or effect. If any
provision of this Agreement is held or made invalid by a court decision,
statute, rule or otherwise, the remainder of this Agreement will be binding upon
and shall inure to the benefit of the parties hereto.
16. APPLICABLE LAW. This Agreement shall be construed in accordance with
applicable federal law and the laws of the State of Illinois.
17. COUNTERPART SIGNATURES. This Agreement may be executed in several
counterparts, including via facsimile, each of which shall be deemed an original
for all purposes, including judicial proof of the terms hereof, and all of which
together shall constitute and be deemed one and the same agreement.
IN WITNESS WHEREOF, the Adviser and the Sub-Adviser have caused this
Agreement to be executed as of this 10th day of June, 2011.
XXXXXXX NATIONAL ASSET MANAGEMENT, LLC
By: /s/ Xxxx X. Xxxxx
Name: Xxxx X. Xxxxx
Title: President and Chief Executive Officer
BLACKROCK INVESTMENT MANAGEMENT, LLC
By: /s/ Xxxxxxx Xxxxxx
Name: Xxxxxxx Xxxxxx
Title: Manging Director
