INVESTMENT SUB-ADVISORY AGREEMENT
This AGREEMENT made this 5th day of March,
2007, by and
between THE VARIABLE ANNUITY LIFE INSURANCE
COMPANY, hereinafter referred to as "VALIC,"
and
BLACKROCK INVESTMENT MANAGEMENT, LLC,
hereinafter referred to as the "SUB-
ADVISER."
VALIC and the SUB-ADVISER
recognize the
following:
(a) VALIC is a life insurance company
organized under Chapter 3 of
the Texas Insurance Code and an investment
adviser registered
under the Investment Advisers Act of 1940,
as amended
("Advisers Act").
(b) VALIC is engaged as the investment
adviser of VALIC
Company I ("VC I"), pursuant to an
Investment Advisory
Agreement between VALIC and VC I, an
investment company
organized under the general corporate laws
of Maryland as a
series type of investment company issuing
separate classes (or
series) of shares of common stock. VC I is
registered as an open-
end, management investment company under the
Investment
Company Act of 1940, as amended ("1940
Act"). The 1940 Act
prohibits any person from acting as an
investment adviser of a
registered investment company except
pursuant to a written
contract.
(c) VC I currently consists of
thirty-two portfolios
("Funds"):
Asset Allocation Fund
Blue Chip Growth Fund
Broad Cap Value Income Fund
Capital Conservation Fund
Core Equity Fund
Core Value Fund
Foreign Value Fund
Global Equity Fund
Global Strategy Fund
Government Securities Fund
Growth & Income Fund
Health Sciences Fund
Inflation Protected Fund
International Equities Fund
International Government Bond Fund
International Growth I Fund
Large Cap Core Fund
Large Capital Growth Fund
Mid Cap Index Fund
Mid Cap Strategic Growth Fund
Money Market I Fund
Nasdaq-100 Index Fund
Science & Technology Fund
Small Cap Aggressive Growth Fund
Small Cap Fund
Small Cap Index Fund
Small Cap Special Values Fund
Small Cap Strategic Growth Fund
Social Awareness Fund
Stock Index Fund
VALIC Ultra Fund
Value Fund
In accordance with VC I's Articles of
Incorporation (the
"Articles"), new Funds may be added to VC I
upon approval of
VC I's Board of Directors without the
approval of Fund
shareholders. This Agreement will apply only
to Funds set forth
on the attached Schedule A, and any other
Funds as may be
added or deleted by amendment to the
attached Schedule A
("Covered Fund(s)").
(d) The SUB-ADVISER is engaged principally
in the business of
rendering investment advisory services and
is registered as an
investment adviser under the Advisers Act.
(e) VALIC desires to enter into an
Investment Sub-Advisory
Agreement with the SUB-ADVISER for all or a
portion of the
assets of the Covered Fund(s) which VALIC
determines from
time to time to assign to the SUB-ADVISER.
VALIC and the SUB-ADVISER agree as
follows:
1. Services Rendered and Expenses Paid by
the SUB-
ADVISER
The SUB-ADVISER, subject to the control,
direction, and
supervision of VALIC and VC I's Board of
Directors and in
material conformity with the 1940 Act, all
applicable laws and
regulations thereunder, all other applicable
federal and state laws
and regulations, including section 817(h)
and Subchapter M of
the Internal Revenue Code of 1986, as
amended (the "Code"),
VC I's Articles, Bylaws, registration
statements, prospectus and
stated investment objectives, policies and
restrictions and any
applicable procedures adopted by VC I's
Board of Directors and
provided to the SUB-ADVISER, shall:
(a) manage the investment and reinvestment
of the assets of the
Covered Fund(s) including, for example, the
evaluation of
pertinent economic, statistical, financial,
and other data, the
determination of the industries and
companies to be represented
in each Covered Fund's portfolio, and the
formulation and
implementation of investment programs.
(b) maintain a trading desk and place
orders for the purchase and
sale of portfolio investments (including
futures contracts and
options thereon) for each Covered Fund's
account with brokers
or dealers (including futures commission
merchants) selected by
the SUB-ADVISER, or arrange for any other
entity to provide a
trading desk and to place orders with
brokers and dealers
(including futures commission merchants)
selected by the SUB-
ADVISER, subject to the SUB-ADVISER's
control, direction,
and supervision, which brokers or dealers
may include brokers or
dealers (including futures commission
merchants) affiliated with
the SUB-ADVISER, subject to applicable law.
The SUB-ADVISER will assist the Covered
Fund(s) and its
agents in determining whether prices
obtained by the Covered
Fund(s) and its agents for valuation
purposes are consistent with
the prices on the SUB-ADVISER's portfolio
records relating to
the assets of the Covered Fund(s) for which
the SUB-ADVISER
has responsibility at such times as VALIC
shall reasonably
request; provided, however, that the parties
acknowledge that the
SUB-ADVISER is not the fund accounting agent
for the Covered
Fund(s) and is not responsible for pricing
determinations or
calculations and any information provided
pursuant to this
position by SUB-ADVISER will be provided for
information
purposes only.
In performing the services described in
paragraph (b) above, the
SUB-ADVISER shall use its best efforts to
obtain for the
Covered Fund(s) the best execution of
portfolio transactions,
under the circumstances of each trade and on
the basis of all
relevant factors and considerations. Subject
to approval by VC
I's Board of Directors of appropriate
policies and procedures, the
SUB-ADVISER may cause the Covered Fund(s) to
pay to a
broker a commission, for effecting a
portfolio transaction, in
excess of the commission another broker
would have charged for
effecting the same transaction, if the first
broker provided
brokerage and/or research services to the
SUB-ADVISER. The
SUB-ADVISER shall not be deemed to have
acted unlawfully, or
to have breached any duty created by this
Agreement, or
otherwise, solely by reason of acting in
accordance with such
authorization. In accordance with Section
11(a) of the 1934 Act
and Rule 11a2-2(T) thereunder, and subject
to any other
applicable laws and regulations including
Section 17(e) of the
1940 Act and Rule 17e-1 thereunder, the SUB-
ADVISER may
engage its affiliates, the VALIC and its
affiliates or any other
subadviser to VC I and its respective
affiliates, as broker-dealers
or futures commission merchants to effect
Covered Fund
transactions in securities and other
investments for a Covered
Fund.
The SUB-ADVISER may aggregate sales and
purchase orders of
securities held by the Covered Fund(s) with
similar orders being
made simultaneously for other accounts
managed by the SUB-
ADVISER or with accounts of the affiliates
of the SUB-
ADVISER, if in the SUB-ADVISER's reasonable
judgment such
aggregation is fair and reasonable and
consistent with the SUB-
ADVISER'S fiduciary obligations to the
Covered Fund(s) and its
other clients, considering factors such as
the advantageous selling
or purchase price, brokerage commission and
other expenses. In
accounting for such aggregated order price,
commission and
other expenses shall be averaged on a per
bond or share basis
daily. VALIC acknowledges that the
determination whether such
aggregation is fair and reasonable by the
SUB-ADVISER is
subjective and represents the SUB-ADVISER's
evaluation that
the Covered Fund(s) may benefit by
relatively better purchase or
sales prices, lower commission expenses and
beneficial timing of
transactions or a combination of these and
other factors.
VALIC authorizes and empowers the SUB-
ADVISER to direct
the Covered Fund's Custodian to open and
maintain brokerage
accounts for securities and other property,
including financial
and commodity futures and commodities and
options thereon (all
such accounts hereinafter called "brokerage
accounts") for and in
the name of the Covered Fund(s) and to
execute for the Covered
Fund(s) as its agent and attorney-in-fact
standard customer
agreements with such broker or brokers as
the SUB-ADVISER
shall select as provided above. With respect
to brokerage
accounts for financial and commodity futures
and commodities
and options thereon, the SUB-ADVISER shall
select such
brokers, as approved by VALIC, prior to the
establishment of
such brokerage account. The SUB-ADVISER may,
using such of
the securities and other property in the
Covered Fund as the
SUB-ADVISER deems necessary or desirable,
direct the
Covered Fund's Custodian to deposit for the
Covered Fund
original and maintenance brokerage and
margin deposits and
otherwise direct payments of cash, cash
equivalents and
securities and other property into such
brokerage accounts and to
such brokers as the SUB-ADVISER deems
desirable or
appropriate.
The SUB-ADVISER shall maintain records
adequately
demonstrating compliance with its
obligations under this
Agreement and report periodically to VALIC
and VC I's Board
of Directors regarding the performance of
its services under this
Agreement. The SUB-ADVISER will make
available to VALIC
and VC I promptly upon their reasonable
written request all of
the Covered Fund(s)' investment records and
ledgers to assist
VALIC and VC I in compliance with respect to
each Covered
Fund's securities transactions as required
by the 1940 Act and
the Advisers Act, as well as other
applicable laws. The SUB-
ADVISER will furnish VC I's Board of
Directors such periodic
and special reports as VALIC and VC I's
Board of Directors may
reasonably request. The SUB-ADVISER will
furnish to
regulatory authorities any information or
reports in connection
with such services which may be requested in
order to ascertain
whether the operations of the Covered
Fund(s) are being
conducted in a manner consistent with
applicable laws and
regulations.
The SUB-ADVISER will not disclose or use any
records or
information obtained pursuant to this
Agreement in any manner
whatsoever except as expressly authorized in
this Agreement,
and will keep confidential any non-public
information obtained
directly as a result of this service
relationship, and the SUB-
ADVISER shall disclose such non-public
information only if
VALIC or the Board of Directors of VC I has
authorized such
disclosure, or if such information is or
hereafter otherwise is
known by the SUB-ADVISER or has been
disclosed, directly or
indirectly, by VALIC or VC I to others
becomes ascertainable
from public or published information or
trade sources, or if such
disclosure is expressly required or
requested by applicable
federal or state regulatory authorities or
Court of Law of
competent jurisdiction, or to the extent
such disclosure is
reasonably required by auditors or attorneys
of the SUB-
ADVISER in connection with the performance
of their
professional services. Notwithstanding the
foregoing, the SUB-
ADVISER may disclose the total return earned
by the Covered
Fund(s) and may include such total return in
the calculation of
composite performance information without
prior approval by
VALIC or the Board of Directors of VC I.
Should VALIC at any time make any definite
determination as to
any investment policy and notify the SUB-
ADVISER in writing
of such determination, within a reasonable
time after receipt of
such notice as agreed to by the SUBADVISER
and VALIC the
SUB-ADVISER shall be bound by such
determination for the
period, if any, specified in such notice or
until similarly notified
that such determination has been revoked,
provided such
determination will permit SUB-ADVISER to
comply with the
first paragraph of this Section.
The SUB-ADVISER will not hold money or
investments on
behalf of VC I. The money and investments
will be held by the
Custodian of VC I. The SUB-ADVISER will
arrange for the
transmission to the Custodian for VC I, on a
daily basis, such
confirmation, trade tickets and other
documents as may be
necessary to enable the Custodian perform
its administrative
responsibilities with respect to the Covered
Fund(s). The SUB-
ADVISER further shall have the authority to
instruct the
Custodian of VC I (i) to pay cash for
securities and other
property delivered, or to be delivered, to
the Custodian for VC I
(ii) to deliver securities and other
property against payment for
VC I, and (iii) to transfer assets and funds
to such brokerage
accounts as the SUB-ADVISER may designate,
all consistent
with the powers, authorities and limitations
set forth herein. The
SUB-ADVISER shall not have the authority to
cause the
Custodian to deliver securities and other
property except as
expressly provided for in this Agreement.
VALIC will vote proxies relating to
securities held by the
Covered Fund(s). VALIC will vote all such
proxies in
accordance with such proxy voting guidelines
and procedures
adopted by the Board of Directors. VALIC
may, on certain non-
routine matters, consult with the SUB-
ADVISER before voting
proxies relating to securities held by the
Covered Fund(s).
VALIC will instruct the Custodian and other
parties providing
services to VC I promptly to forward to the
proxy voting service
copies of all proxies and shareholder
communications relating to
securities held by each Covered Fund(s).
The SUB-ADVISER
shall not be responsible for taking any
action on behalf of the
Covered Funds in connection with any claim
or potential claim in
any bankruptcy proceedings, class action
securities litigation, or
other litigation or proceeding affecting
securities held at any time
in the Covered Fund(s) including, without
limitation, to file
proofs of claim or other documents related
to such proceedings
(the "Litigation") or to investigate,
initiate, supervise, or monitor
the Litigation involving the Covered Funds'
assets.
The SUB-ADVISER shall for all purposes
herein be deemed to
be an independent contractor and shall,
unless otherwise
provided or authorized, have no authority to
act or represent
VALIC or VC I other than in furtherance of
the SUB-
ADVISER's duties and responsibilities as set
forth in this
Agreement.
Except as otherwise agreed, or as otherwise
provided herein, the
SUB-ADVISER shall bear the expense of
discharging its
responsibilities hereunder and VALIC shall
pay, or arrange for
others to pay, all VALIC's expenses, except
that VALIC shall in
all events pay the compensation described in
Section 2 of this
Agreement.
The SUB-ADVISER is hereby prohibited from
consulting with
any other sub-adviser of the Covered Fund(s)
(or a portion
thereof) or any other sub-adviser to a fund
under common control
with the Covered Fund(s) (or a portion
thereof) concerning
securities transactions of the Covered
Fund(s) (or a portion
thereof) in securities or other assets,
except as otherwise
permitted by the 1940 Act or any rules
thereunder.
2. Compensation of the SUB-ADVISER
VALIC shall pay to the SUB-ADVISER, as
compensation for the
services rendered and expenses paid by the
SUB-ADVISER, a
monthly fee or fees based on each Covered
Fund's average daily
net asset value computed for each Covered
Fund as provided for
herein and in the fee schedule attached
hereto as Schedule A.
Schedule A may be amended from time to time
by written
agreement executed by VALIC and the SUB-
ADVISER,
provided that amendments are made in
conformity with
applicable laws and regulations and the
Articles and Bylaws of
VC I. Any change in Schedule A pertaining to
any new or
existing Fund shall not be deemed to affect
the interest of any
other Fund and shall not require the
approval of shareholders of
any other Fund.
The average daily net asset value shall be
determined by taking
the average of all of the determinations of
net asset value, made
in the manner provided in VC I's
constitutive documents, for
each business day during a given calendar
month. VALIC shall
pay this fee for each calendar month as soon
as practicable after
the end of that month, but in any event no
later than fifteen (15)
days following the end of the month.
If the SUB-ADVISER serves for less
than a whole
month, the foregoing compensation shall be
prorated.
The payment of advisory fees related to the
services of the SUB-
ADVISER under this Agreement shall be the
sole responsibility
of VALIC and shall not be the responsibility
of VC I.
3. Scope of the SUB-ADVISER's Activities
VALIC understands that the SUB-ADVISER and
its affiliates
now act, will continue to act and may act in
the future as
investment adviser to fiduciary and other
managed accounts and
as investment adviser to other investment
companies, and VALIC
has no objection to the SUB-ADVISER so
acting, provided that
whenever a Covered Fund(s) and one or more
other accounts or
investment companies advised by the SUB-
ADVISER have
available funds for investment, investments
suitable and
appropriate for each will be allocated in
accordance with a
methodology believed by the SUB-ADVISER to
be equitable to
each entity. The SUB-ADVISER similarly
agrees to allocate
opportunities to sell securities on an
equitable basis. VALIC
recognizes that, in some cases, this
procedure may limit the size
of the position that may be acquired or sold
for a Covered
Fund(s). In addition, VALIC understands that
the persons
employed by the SUB-ADVISER to assist in the
performance of
the SUB-ADVISER's duties hereunder will not
devote their full
time to such service and nothing contained
herein shall be
deemed to limit or restrict the right of the
SUB-ADVISER or any
affiliate of the SUB-ADVISER to engage in
and devote time and
attention to other business or to render
services of whatever kind
or nature.
Except as otherwise required by the 1940
Act, any of the
shareholders, directors, officers and
employees of VALIC may
be a shareholder, director, officer or
employee of, or be
otherwise interested in, the SUB-ADVISER,
and in any person
controlling, controlled by or under common
control with the
SUB-ADVISER; and the SUB-ADVISER, and any
person
controlling, controlled by or under common
control with the
SUB-ADVISER, may have an interest in VALIC.
The SUB-ADVISER shall not be liable to
VALIC, VC I, or to
any shareholder in the Covered Fund(s), and
VALIC shall
indemnify the SUB-ADVISER, for any act or
omission in
rendering services under this Agreement, or
for any losses
sustained in connection with the matters to
which this agreement
relates, so long as there has been no
willful misfeasance, bad
faith, gross negligence, or reckless
disregard of obligations or
duties on the part of the SUB-ADVISER in
performing its duties
under this Agreement. The provisions of
this paragraph shall
survive the termination of the Agreement.
VALIC shall perform quarterly and annual tax
compliance tests
and promptly furnish reports of such tests
to the SUB-ADVISER
after each quarter end to ensure that the
Covered Fund(s) is in
compliance with Subchapter M of the Code and
Section 817(h)
of the Code. VALIC shall apprise the SUB-
ADVISER promptly
after each quarter end of any potential non-
compliance with the
diversification requirements in such Code
provisions. If so
advised, the SUB-ADVISER shall take prompt
action so that the
Covered Fund complies with such Code
diversification
provisions, as directed by VALIC. VALIC
acknowledges that
the SUB-ADVISER shall rely completely upon
VALIC's
determination of whether and to what extent
each Covered
Fund(s) is in compliance with Subchapter M
and Section 817(h)
of the Code and that the SUB-ADVISER has no
separate and
independent responsibility to test for such
compliance.
4. Representations of the SUB-ADVISER and
VALIC
The SUB-ADVISER represents,
warrants, and agrees as
follows:
(a) The SUB-ADVISER (i) is registered as
an investment adviser
under the Advisers Act and will continue to
be so registered for
so long as this Agreement remains in effect:
(ii) is not prohibited
by the 1940 Act or the Advisers Act from
performing the
services contemplated by this Agreement;
(iii) has met, and will
continue to meet for so long as this
Agreement remains in effect,
any applicable federal or state
requirements, or the applicable
requirements of any regulatory or industry
self-regulatory
agency, necessary to be met in order to
perform the services
contemplated by this Agreement, (iv) has the
authority to enter
into and perform the services contemplated
by this Agreement,
and (v) will immediately notify VALIC of the
occurrence of any
event that would disqualify the SUB-ADVISER
from serving as
an investment adviser of an investment
company pursuant to
Section 9(a) of the 1940 Act or otherwise.
(b) The SUB-ADVISER has adopted a written
code of ethics
complying with the requirements of Rule 17j-
1 under the 1940
Act and if it has not already done so, will
provide VALIC and
VC I with a copy of such code of ethics
together with evidence of
its adoption.
(c) The SUB-ADVISER has provided VALIC and
VC I with a copy
of its Form ADV as most recently filed with
the SEC and will
promptly after filing its annual update to
its Form ADV with the
SEC, furnish a copy of such amendment to
VALIC.
VALIC represents, warrants, and
agrees as follows:
(a) VALIC: (i) is registered as an
investment adviser under the
Advisers Act and will continue to be so
registered for so long as
this Agreement remains in effect: (ii) is
not prohibited by the
1940 Act or the Advisers Act from performing
the services
contemplated by this Agreement; (iii) has
met, and will continue
to meet for so long as this Agreement
remains in effect, any
applicable federal or state requirements, or
the applicable
requirements of any regulatory or industry
self-regulatory
agency, necessary to be met in order to
perform the services
contemplated by this Agreement, (iv) has the
authority to enter
into and perform the services contemplated
by this Agreement,
and (v) will immediately notify the SUB-
ADVISER of the
occurrence of any event that would
disqualify VALIC from
serving as an investment adviser of an
investment company
pursuant to Section 9(a) of the 1940 Act or
otherwise.
(b) VALIC has the authority under the
Investment Advisory
Agreement between VALIC and VC I to delegate
some or all of
its responsibilities to one or more sub-
advisers.
5. Term of Agreement
This Agreement shall become effective as to
the Covered Fund(s)
set forth on Schedule A on the date hereof
and as to any other
Fund on the date of the Amendment to
Schedule A adding such
Fund in accordance with this Agreement.
Unless sooner
terminated as provided herein, this
Agreement shall continue in
effect for two years from its effective
date. Thereafter, this
Agreement shall continue in effect, but with
respect to any
Covered Fund, subject to the termination
provisions and all other
terms and conditions hereof, only so long as
such continuance is
approved at least annually by the vote of a
majority of VC I's
Directors who are not parties to this
Agreement or interested
persons of any such parties, cast in person
at a meeting called for
the purpose of voting on such approval, and
by a vote of a
majority of VC I's Board of Directors or a
majority of that
Covered Fund's outstanding voting securities
(as defined in the
1940 Act).
This Agreement shall automatically terminate
in the event of its
assignment as that term is defined in the
1940 Act, or in the event
of the termination of the Investment
Advisory Agreement
between VALIC and VC I as it relates to any
Covered Fund(s).
The Agreement may be terminated as to any
Covered Fund at any
time, without the payment of any penalty, by
vote of VC I's
Board of Directors or by vote of a majority
of that Covered
Fund's outstanding voting securities on not
more than 60 days'
nor less than 30 days' prior written notice
to the SUB-
ADVISER, or upon such shorter notice as may
be mutually
agreed upon by the parties. This Agreement
may also be
terminated by VALIC: (i) on not more than 60
days' nor less than
30 days' prior written notice to the SUB-
ADVISER, or upon
such shorter notice as may be mutually
agreed upon by the
parties, without the payment of any penalty;
or (ii) if the SUB-
ADVISER becomes unable to discharge its
duties and
obligations under this Agreement. The SUB-
ADVISER may
terminate this Agreement at any time, or
preclude its renewal
without the payment of any penalty, on not
more than 60 days'
nor less than 30 days' prior written notice
to VALIC, or upon
such shorter notice as may be mutually
agreed upon by the
parties.
6. Other Matters
The SUB-ADVISER may from time to time employ
or associate
with itself any person or persons believed
to be particularly fit to
assist in its performance of services under
this Agreement,
provided no such person serves or acts as an
investment adviser
separate from the SUB-ADVISER so as to
require a new written
contract pursuant to the 1940 Act. The
compensation of any such
persons will be paid by the SUB-ADVISER, and
no obligation
will be incurred by, or on behalf of, VALIC
or VC I with respect
to them.
The SUB-ADVISER agrees that all books and
records which it
maintains for the Covered Fund(s) are the
Covered Fund's
property. The SUB-ADVISER also agrees upon
request of
VALIC or VC I, to promptly surrender the
books and records in
accordance with the 1940 Act and rules
thereunder, provided that
VALIC reimburses the SUB-ADVISER for its
reasonable
expenses in making duplicate copies of such
books and records
for SUB-ADVISER's files. The SUB-ADVISER
further agrees
to preserve for the periods prescribed by
Rule 31a-2 under the
1940 Act the records required to be
maintained by subparagraphs
(b)(5), (6), (7), (9), (10), (11) and
paragraph (f) of Rule 31a-1
under the 1940 Act.
VALIC has herewith furnished the SUB-ADVISER
copies of VC
I's Prospectus, Statement of Additional
Information, investment
objectives, policies and restrictions, and
any applicable
procedures adopted by VC I's Board of
Directors, as currently in
effect and agrees during the continuance of
this Agreement to
furnish the SUB-ADVISER copies of any
amendments or
supplements thereto before or at the time
the amendments or
supplements become effective. Until VALIC
delivers any
amendments or supplements to the SUB-
ADVISER, the SUB-
ADVISER shall be fully protected in relying
on the documents
previously furnished to it.
The SUB-ADVISER is authorized to honor and
act on any
notice, instruction or confirmation given by
VALIC on behalf of
VC I or the Covered Fund(s) in writing
signed or sent by any of
the persons who the SUB-ADVISER has reason
to believe are
acting in good authority. The SUB-ADVISER
shall not be liable
for so acting in good faith upon such
instructions, confirmation
or authority.
VALIC agrees to furnish the SUB-ADVISER at
its principal
office prior to use thereof, copies of all
prospectuses, proxy
statements, reports to shareholders, sales
literature, or other
material prepared for distribution to
shareholders of the Covered
Fund(s) or the public that refer in any way
to the SUB-
ADVISER, and not to use such material if the
SUB-ADVISER
reasonably objects in writing within ten
(10) business days (or
such other time as may be mutually agreed)
after receipt thereof.
In the event of termination of this
agreement, VALIC will
continue to furnish to the SUB-ADVISER
copies of any of the
above-mentioned materials that refer in any
way to the SUB-
ADVISER and shall cease to use the SUB-
ADVISER name
and/or logo as soon as is reasonable. VALIC
shall furnish or
otherwise make available to the SUB-ADVISER
such other
information relating to the business affairs
of VALIC and the
Covered Fund as the SUB-ADVISER at any time,
or from time
to time, may reasonably request in order to
discharge obligations
hereunder. The provisions of this paragraph
shall survive the
termination of this Agreement.
VALIC agrees to indemnify the SUB-ADVISER
for losses,
costs, fees, expenses and claims which arise
directly or indirectly
(i) as a result of a failure by VALIC to
provide the services or
furnish materials required under the terms
of this Agreement, or
(ii) as the result of any untrue statement
of a material fact or any
omission to state a material fact required
to be stated or
necessary to make the statements, in light
of the circumstances
under which they were made, not misleading
in any registration
statements, proxy materials, reports,
advertisements, sales
literature, or other materials pertaining to
VC I or a Covered
Fund, except insofar as any such statement
or omission was
specifically made in reliance on written
information provided by
the SUB-ADVISER to VALIC. The provisions of
this paragraph
shall survive the termination of this
Agreement. The provisions
of this paragraph shall survive the
termination of this Agreement.
The SUB-ADVISER agrees to indemnify VALIC
for losses and
claims which arise (i) as a result of the
willful misfeasance, bad
faith, gross negligence or reckless
disregard of obligations or
duties by the SUB-ADVISER; or (ii) as the
result of any untrue
statement of a material fact or any omission
to state a material
fact required to be stated or necessary to
make the statements, in
light of the circumstances under which they
were made, not
misleading in any registration statements,
proxy materials,
reports, advertisements, sales literature,
or other materials
pertaining to VC I or a Covered Fund to the
extent any such
statement or omission was made in reliance
on written
information provided by the SUB-ADVISER.
Promptly after receipt by either VALIC or
SUB-ADVISER (an
"Indemnified Party") under this Section 6 of
the commencement
of an action, such Indemnified Party will,
if a claim in respect
thereof is to be made against the other
party (the "Indemnifying
Party") under this section, notify
Indemnifying Party of the
commencement thereof; but the omission so to
notify
Indemnifying Party will not relieve it from
any liability that it
may have to any Indemnified Party otherwise
than under this
section. In case any such action is brought
against any
Indemnified Party, and it notified
Indemnifying Party of the
commencement thereof, Indemnifying Party
will be entitled to
participate therein and, to the extent that
it may wish, assume the
defense thereof, with counsel satisfactory
to such Indemnified
Party. After notice from Indemnifying Party
of its intention to
assume the defense of an action, the
Indemnified Party shall bear
the expenses of any additional counsel
obtained by it, and
Indemnifying Party shall not be liable to
such Indemnified Party
under this section for any legal or other
expenses subsequently
incurred by such Indemnified Party in
connection with the
defense thereof other than reasonable costs
of investigation.
A successor by law of the parties to this
Agreement shall be
entitled to the benefits of the
indemnification contained herein.
The indemnification provisions contained
herein shall survive
any termination of this Agreement.
7. Applicability of Federal Securities
Laws
This Agreement shall be interpreted in
accordance with the laws
of the State of New York and applicable
federal securities laws
and regulations, including definitions
therein and such
exemptions as may be granted to VALIC or the
SUB-ADVISER
by the Securities and Exchange Commission or
such interpretive
positions as may be taken by the Commission
or its staff. To the
extent that the applicable law of the State
of New York, or any of
the provisions herein, conflict with
applicable provisions of the
federal securities laws, the latter shall
control.
8. Amendment and Waiver
Provisions of this Agreement may be amended,
waived,
discharged or terminated only by an
instrument in writing signed
by the party against which enforcement of
the change, waiver,
discharge or termination is sought. The
Agreement may be
amended by mutual written consent of the
parties, subject to the
requirements of the 1940 Act and the rules
and regulations
promulgated and orders granted thereunder.
9. Notices
All notices hereunder shall be given in
writing (and shall be
deemed to have been duly given upon receipt)
by delivery in
person, by facsimile, by registered or
certified mail or by
overnight delivery (postage prepaid, return
receipt requested) to
VALIC and to SUB-ADVISER at the address of
each set forth
below:
If to VALIC:
With a
copy to:
Attn: Xxxxxx Xxxxxx
Attn: Xxx
Xxxx
2929 Xxxxx Parkway, L14
0000 Xxxxx
Xxxxxxx, X00-00
Xxxxxxx, Xxxxx 00000
Xxxxxxx,
Xxxxx 00000
Tel: (000) 000-0000
Tel: (713)
000-0000
Fax: (000) 000-0000
Fax: (713)
000-0000
If to SUB-ADVISER:
000 Xxxxxxxx Xxxx Xxxx
Xxxxxxxxxx, XX 00000
Attn: Legal Department
Tel: (000) 000-0000
Fax: (000) 000-0000
[REMAINDER OF PAGE INTENTIONALLY LEFT
BLANK]
The parties hereto have each caused
this Agreement to
be signed in duplicate on its behalf by its
duly authorized officer
on the above date.
THE VARIABLE
ANNUITY LIFE INSURANCE COMPANY
By:
Name:
Title:
ATTEST:
Attest:
Name:
Title:
BLACKROCK
INVESTMENT MANAGEMENT, LLC
By:
Name:
Title:
ATTEST:
Attest:
Name:
Title:
SCHEDULE A
COVERED FUND(S)
Annual Fee computed at the following annual
rate, based on
average daily net asset value for each month
on that portion of
the assets managed by SUB-ADVISER, and
payable monthly:
Covered Fund
Core Equity Fund
Fee
0.350% on the first $250 million
0.325% on the next $250 million
0.300% on the next $500 million
0.275% over $1 billion
2
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Agreement (FINAL).doc
