INVESTMENT SUB-ADVISORY AGREEMENT
THIS AGREEMENT is made as of the 1st day of May, 1997, by and between
Advantus Capital Management, Inc., a Minnesota corporation registered as an
Investment Adviser under the Investment Advisers Act of 1940 (the "Adviser"),
and Xxxxxxx Capital Management, Inc., a Minnesota Corporation registered as an
Investment Adviser under the Investment Advisers Act of 1940 (the
"Sub-Adviser").
WHEREAS, the Adviser is the Investment Adviser to Advantus Series Fund,
Inc. (the "Fund"), an open-end diversified management investment company
organized as a series fund, registered under the Investment Company Act of 1940,
as amended (the "1940 Act"); and
WHEREAS, the Adviser desires to retain the Sub-Adviser to furnish ongoing
portfolio selection and related research and statistical services in connection
with the Adviser's investment advisory activities on behalf of the Fund's
Capital Appreciation Portfolio, and the Sub-Adviser desires to furnish such
services to the Capital Appreciation Portfolio; and
WHEREAS, the Adviser also desires to retain the Sub-Adviser to furnish the
Capital Appreciation Portfolio with investment advisory services on an interim
basis in compliance with the provisions of Rule 15a-4 under the 1940 Act;
NOW, THEREFORE, in consideration of the premises and the terms and
conditions hereinafter set forth, it is agreed as follows:
1. APPOINTMENT OF SUB-ADVISER
In accordance with and subject to the Supplemental Investment Advisory
Agreement between the Fund and the Adviser dated April 28, 1987, and the
Investment Advisory Agreement between the Fund and the Adviser dated
January 30, 1986, as incorporated therein (collectively, the "Investment
Advisory Agreement"), the Adviser hereby appoints the Sub-Adviser to
perform portfolio selection services described herein for investment and
reinvestment of the Fund's Capital Appreciation Portfolio, subject to the
control and direction of the Fund's Board of Directors, for the period and
on the terms hereinafter set forth. The Sub-Adviser accepts such
appointment and agrees to furnish the services hereinafter set forth for
the compensation herein provided. The Sub-Adviser shall for all purposes
herein be deemed to be an independent contractor and shall, except as
expressly provided or authorized, have no authority to act for or represent
the Fund or the Adviser in any way or otherwise be deemed an agent of the
Fund or the Adviser.
2. OBLIGATIONS OF AND SERVICES TO BE PROVIDED BY THE SUB-ADVISER
(a) The Sub-Adviser shall provide the following services and assume the
following obligations with respect to the Fund's Capital Appreciation
Portfolio:
(1) The investment of the assets of the Capital Appreciation
Portfolio shall at all times be subject to the applicable
provisions of the Articles of Incorporation, the Bylaws, and the
Registration Statement of the Fund, as amended from time to time
under the Securities Act of 1933 and the 1940 Act (the
"Registration Statement"), and shall conform to the investment
objectives, policies and restrictions of the Capital Appreciation
Portfolio as set forth in such documents and as interpreted from
time to time by the Board of Directors of the Fund and by the
Adviser. Within the framework of the investment objectives,
policies and restrictions of the Capital Appreciation Portfolio,
and subject to the supervision of the Adviser, the Sub-Adviser
shall have the sole and exclusive responsibility for the making
and execution of all investment decisions for the Capital
Appreciation Portfolio.
(2) In carrying out its obligations to manage the investments and
reinvestments of the assets of the Capital Appreciation
Portfolio, the Sub-Adviser shall: (1) obtain and evaluate
pertinent economic, statistical, financial and other information
affecting the economy generally and individual companies or
industries the securities of which are included in the Capital
Appreciation Portfolio or are under consideration for inclusion
therein; (2) formulate and implement a continuous investment
program for the Capital Appreciation Portfolio consistent with
the investment objective and related investment policies for such
Portfolio as set forth in the Fund's Registration Statement; and
(3) take such steps as are necessary to implement the
aforementioned investment program by purchase and sale of
securities including the placing of orders for such purchases and
sales.
(3) In connection with the purchase and sale of securities of the
Fund's Capital Appreciation Portfolio, the Sub-Adviser shall
arrange for the transmission to the Adviser on a daily basis such
confirmation, trade tickets and other documents as may be
necessary to enable it to perform its administrative
responsibilities with respect to the Fund's Capital Appreciation
Portfolio. With respect to portfolio securities to be purchased
or sold through the Depository Trust Company, the Sub-Adviser
shall arrange for the automatic transmission of the I.D.
confirmation of the trade to the Adviser. The Sub-Adviser shall
render such reports to the Adviser and/or to the Fund's Board of
Directors concerning the investment activity and portfolio
composition of the
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Fund's Capital Appreciation Portfolio in such form and at such
intervals as the Adviser or the Board may from time to time
require.
(4) The Sub-Adviser shall, in the name of the Fund, place orders for
the execution of portfolio transactions in accordance with the
policies with respect thereto, as set forth in the Fund's
Registration Statement. In connection with the placement of
orders for the execution of the Fund's portfolio transactions,
the Sub-Adviser shall create and maintain all necessary brokerage
records of the Fund in accordance with all applicable law, rules
and regulations, including but not limited to, records required
by Section 31(a) of the 1940 Act. All records shall be the
property of the Fund and shall be available for inspection and
use by the Securities and Exchange Commission, the Fund or any
person retained by the Fund. Where applicable, such records
shall be maintained by the Sub-Adviser for the period and in the
place required by Rule 31a-2 under the 0000 Xxx.
(b) The Sub-Adviser shall use the same skill and care in providing
services to the Fund as it uses in providing services to fiduciary
accounts for which it has investment responsibility. The Sub-Adviser
will conform with all applicable rules and regulations of the
Securities and Exchange Commission.
3. EXPENSES
During the terms of this Agreement, the Sub-Adviser will pay all expenses
incurred by it in connection with its activities under this Agreement.
4. COMPENSATION
In payment for the investment sub-advisory services to be rendered by the
Sub-Adviser in respect of the Capital Appreciation Portfolio hereunder, the
Adviser shall pay to the Sub-Adviser as full compensation for all services
hereunder a fee computed at an annual rate which shall be a percentage of the
average daily value of the net assets of the Capital Appreciation Portfolio.
The fee shall be accrued daily and shall be based on the net asset value of the
Capital Appreciation Portfolio as determined as of the close of each business
day pursuant to the Articles of Incorporation, Bylaws and currently effective
Registration Statement of the Fund. The fee shall be payable in arrears on the
last day of each calendar month.
The amount of such annual fee, which reflects the substantial assets
managed by the Sub-Adviser hereunder, and as applied to the average daily value
of the net assets of the Capital Appreciation Portfolio, shall be as described
in the schedule below:
Portfolio Assets Fee
On all Portfolio Assets .375%
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5. APPROVAL, RENEWAL AND TERMINATION
(a) In compliance with Rule 15a-4 under the 1940 Act, this Agreement shall
continue in effect, after its approval by the Series Fund Board of
Directors, including a majority of the Fund's Board of Directors who
are not parties to this Agreement or interested persons of parties
hereto, for the period not to exceed one hundred and twenty days, from
the termination of the most recent investment Sub-Advisory Agreement
for the Capital Appreciation Portfolio until its approval by a
majority of the outstanding voting securities of the Capital
Appreciation Portfolio.
(b) If so approved, this Agreement shall continue in effect for a period
more than two years from the date of this Agreement, only so long as
such continuance is specifically approved at least annually by a vote
of the holders of the majority of the outstanding voting securities of
the Fund's Capital Appreciation Portfolio, or by a vote of the
majority of the Fund's Board of Directors. And further provided that
such continuance is also approved annually by a vote of the majority
of the Fund's Board of Directors who are not parties to this Agreement
or interested persons of parties hereto, cast in person at a meeting
called for the purpose of voting on such approval. This Agreement may
be terminated at any time without payment of penalty: (i) by the
Fund's Board of Directors or by a vote of a majority of the
outstanding voting securities of the Fund's Capital Appreciation
Portfolio on sixty days' prior written notice, or (ii) by either party
hereto upon sixty days' prior written notice to the other. This
Agreement will terminate automatically upon any termination of the
Investment Advisory Agreement between the Fund and the Adviser or in
the event of its assignment. The terms "interested person,"
"assignment" and "vote of a majority of the outstanding voting
securities" shall have the meanings set forth in the 1940 Act.
6. GENERAL PROVISIONS
(a) The Sub-Adviser shall not be liable for any error of judgment or
mistake of law or for any loss suffered by the Adviser or the Fund's
Capital Appreciation Portfolio in connection with the subject matter
of this Agreement unless such loss arises from lack of good faith,
provided that nothing herein shall be deemed to protect, or purport to
protect, the Sub-Adviser against any liability to the Fund or to its
shareholders to which the Sub-Adviser would otherwise be subject by
reason of willful misfeasance, bad faith or gross negligence in the
performance of its duties hereunder, or by reason of the Sub-Adviser's
reckless disregard of its obligations and duties hereunder.
(b) Provided that this Agreement is first approved by a vote of the
majority of the Fund's Board of Directors who are not parties to this
Agreement or interested persons of parties hereto cast in person at a
meeting called for the
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purpose of voting on such approval, it shall become effective on the
last day of effectiveness of the most recent investment Sub-Advisory
Agreement for the Capital Appreciation Portfolio.
(c) The Adviser understands that the Sub-Adviser now acts, will continue
to act, or may act in the future, as investment adviser to fiduciary
and other managed accounts, including other investment companies, and
the Adviser has no objection to the Sub-Adviser so acting, provided
that the Sub-Adviser duly performs all obligations under this
Agreement.
(d) Except to the extent necessary to perform its obligations hereunder,
nothing herein shall be deemed to limit or restrict the right of the
Sub-Adviser, or the right of any of its officers, directors or
employees who may also be an officer, director or employee of the
Fund, or persons otherwise affiliated with the Fund (within the
meaning of the 0000 Xxx) to engage in any other business or to devote
time and attention to the management or other aspects of any other
business, whether of a similar or dissimilar nature, or to render
services of any kind to any other trust, corporation, firm, individual
or association.
(e) Each party agrees to perform such further acts and execute such
further documents as are necessary to effectuate the purposes hereof.
This Agreement shall be construed and enforced in accordance with and
governed by the laws of the State of Minnesota. The captions in this
Agreement are included for convenience only and in no way define or
delimit any of the provisions hereof or otherwise affect their
construction or effect.
(f) Any notice under this Agreement shall be in writing, addressed and
delivered or mailed postage pre-paid to the appropriate party at the
following address: The Adviser and the Fund at 000 Xxxxx Xxxxxx
Xxxxxx, Xx. Xxxx, Xxxxxxxxx 00000-0000, and the Sub-Adviser at 4720
IDS Tower, 00 Xxxxx Xxxxxx Xxxxxx, Xxxxxxxxxxx, Xxxxxxxxx 00000.
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IN WITNESS WHEREOF, the parties have duly executed this Agreement on the
date first above written..
ADVANTUS CAPITAL MANAGEMENT, INC.
By:
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Its:
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Date:
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XXXXXXX CAPITAL MANAGEMENT, INC.
By:
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Its:
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Date:
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