Exhibit (d)24
AGREEMENT made as of the thirtieth day of April, 2001 by and among Xxxx
Xxxxxxx Variable Series Trust I, a Massachusetts business trust (the "Trust"),
Xxxx Xxxxxxx Life Insurance Company, a Massachusetts corporation ("JHLICO"), and
Xxxxxx Investment Management LLC ("Advisers");
WHEREAS, the Trust is organized and is engaged in business as an open-end
management investment company and is so registered under the Investment Company
Act of 1940 (the "1940 Act"); and
WHEREAS, JHLICO and Advisers are each engaged in the business of rendering
investment advice under the Investment Advisers Act of 1940; and
WHEREAS, the Trust is authorized to issue shares of capital stock in
separate classes with each such class representing interests in a separate
portfolio of securities and other assets; and
WHEREAS, the Trust offers shares in several classes, one of which is
designated as the Health Sciences Fund, (together with all other classes
established by the Trust, collectively referred to as the "Funds"), each of
which pursues its investment objectives through separate investment policies;
and
WHEREAS, the Trust has retained JHLICO to render investment management
services to the Trust pursuant to an Investment Management Agreement dated as of
April 30, 2001 (the "Investment Management Agreement"), pursuant to which it may
contract with Advisers as a Sub-Manager as provided for herein;
NOW, THEREFORE, WITNESSETH: That it is hereby agreed between the parties
hereto as follows:
1. APPOINTMENT OF SUB-MANAGER
(a) Subject Fund. Advisers is hereby appointed and Advisers hereby
accepts the appointment to act as investment adviser and manager to
the Health Sciences Fund (the "Subject Fund") for the period and on
the terms herein set forth, for the compensation herein provided.
(b) Additional Subject Funds. In the event that the Trust and JHLICO
desire to retain Advisers to render investment advisory services
hereunder for any other Fund, they shall so notify Advisers in
writing. If it is willing to render such services, Advisers shall
notify the Trust in writing, whereupon such Fund shall become a
Subject Fund hereunder.
(c) Incumbency Certificates. Advisers shall furnish to JHLICO,
immediately upon execution of this Agreement, a certificate of a
senior officer of Advisers setting forth (by name and title, and
including specimen signatures) those employees of Advisers who are
authorized to issue instructions for trades for the Subject Fund
pursuant to the provisions of this Agreement. Advisers shall promptly
provide supplemental certificates, as needed, in connection with each
additional Subject Fund (if any) and further supplemental
certificates, as needed, to reflect all changes with respect to such
employees for any Subject Fund. On behalf of the Trust, JHLICO shall
instruct the custodian for the Subject Fund to accept instructions
with respect to the Subject Fund from the employees of Advisers so
named.
(d) Independent Contractor. Advisers shall for all purposes herein be
deemed to be an independent contractor and shall, unless otherwise
expressly provided or authorized, have no authority to act for or be
deemed an agent of the Trust.
(e) Advisers' Representations. Advisers represents, warrants and agrees
(i) that it is registered as an investment adviser under the
Investment Advisers Act of 1940, and that it will remain so
registered and will comply with the requirements of said Act, and the
rules and regulations thereunder, at all times while this Agreement
remains in effect, (ii) that it will promptly notify JHLICO if the
foregoing representation and agreement shall cease to be true (in any
material respect) at any time during the term of this Agreement,
(iii) that it will promptly notify JHLICO of any material change in
the senior management or ownership of Advisers, or of any change in
the identity of the personnel who manage the Subject Fund(s), (iv)
that it has adopted a code of ethics complying with the requirements
of Rule 17j-1 of the Securities and Exchange Commission (the "SEC")
under the 1940 Act and has provided true and complete copies of such
code to the Trust and to JHLICO, and has adopted procedures designed
to prevent violations of such code, and (v) that it has furnished the
Trust and JHLICO each with a copy of Advisers' Form ADV, as most
recently filed with the SEC, and will promptly furnish copies of each
future amendment thereto.
2. PROVISION OF INVESTMENT MANAGEMENT SERVICES.
Advisers will provide for each Subject Fund a continuing and suitable
investment program consistent with the investment policies, objectives and
restrictions of said Fund, as established by the Trust and JHLICO and as
delivered in writing to Advisers. From time to time, JHLICO or the Trust may
provide Advisers with additional or amended investment policies, guidelines and
restrictions. Advisers, as Sub-Manager, will manage the investment and
reinvestment of the assets in the Subject Fund, and perform the functions set
forth below, subject to the overall supervision, direction, control and review
of JHLICO and the Board of Trustees of the Trust, consistent with the applicable
investment policies, guidelines and restrictions, the provisions of the Trust's
Declaration of Trust, Bylaws, prospectus, statement of additional information
(each as in effect from time to time), the 1940 Act and all other applicable
laws and regulations (including any applicable investment restrictions imposed
by state insurance laws and regulations or any directions or instructions
delivered to Advisers in writing by JHLICO or the Trust from time to time). By
its signature below, Advisers acknowledges receipt of a copy of the Trust's
Declaration of Trust, Bylaws, prospectus, and statement of additional
information, each as in effect on the date of this Agreement.
Advisers will, at its own expense:
(a) advise the Trust in connection with investment policy decisions to be
made by its Board of Trustees or any committee thereof regarding the
Subject Fund and, upon request, furnish the Trust with research,
economic and statistical data in connection with said Fund's
investments and investment policies;
(b) submit such reports and information as JHLICO or the Trust's Board of
Trustees may reasonably request, to assist the custodian in its
determination of the market value of securities held in the Subject
Fund for which market prices or quotations are not available (it
being understood that Adviser is not responsible for the pricing of
the Trust's assets);
(c) place orders for purchases and sales of portfolio investments for the
Subject Fund;
(d) give instructions to the Subject Fund's custodian concerning the
delivery of securities and transfer of cash for the Subject Fund;
(e) maintain and preserve the records relating to its activities
hereunder required by the 1940 Act to be maintained and preserved by
it as investment adviser to the Trust
(f) at the close of business each day, provide JHLICO and the custodian
with copies of trade tickets for each transaction effected for the
Subject Fund, and promptly forward to the custodian copies of all
brokerage or dealer confirmations;
(g) as soon as practicable following the end of each calendar month,
provide JHLICO with written statements showing all transactions
effected for the Subject Fund during the month, a summary listing all
investments held in such Fund as of the last day of the month, and
such other information as JHLICO may reasonably request in connection
with the accounting services that JHLICO provides for the Subject
Fund (it being understood that Advisers is not responsible for such
accounting services); and
(h) absent specific instructions to the contrary provided to it by JHLICO
and subject to its receipt of all necessary voting materials, vote
all proxies with respect to investments of the Subject Fund in
accordance with Advisers' proxy voting policy as most recently
supplied to JHLICO.
On its own initiative, Advisers will apprise JHLICO and the Trust of
important political and economic developments materially affecting the
marketplace or the Subject Fund, and will furnish JHLICO and the Trust's Board
of Trustees from time to time such information as is appropriate for this
purpose. Advisers will also make its personnel available in Boston or other
reasonable locations as often as quarterly to discuss the Subject Fund and
Advisers' management thereof, to educate JHLICO sales personnel with respect
thereto, and for such other purposes as the Trust or JHLICO may reasonably
request.
The Trust and JHLICO will provide timely information to Advisers regarding
such matters as purchases and redemptions of shares in the Subject Fund and the
cash requirements of, and cash available for investment in, the Fund. JHLICO
will timely provide Advisers with copies of monthly accounting statements for
the Subject Fund, and such other information (including, without limitation,
reports concerning the classification of portfolio securities of the Subject
Fund for purposes of Subchapter M of the Internal Revenue Code and Treasury
Regulations Section 1.817) as may be reasonably necessary or appropriate in
order for Advisers to perform its responsibilities hereunder.
3. ALLOCATION OF EXPENSES.
Each party to this Agreement shall bear the costs and expenses of
performing its obligations hereunder. In this regard, the Trust specifically
agrees to assume the expense of:
(a) brokerage commissions for transactions in the portfolio investments
of the Trust and similar fees and charges for the acquisition,
disposition, lending or borrowing of such portfolio investments;
(b) custodian fees and expenses;
(c) all taxes, including issuance and transfer taxes, and reserves for
taxes payable by the Trust to federal, state or other governmental
agencies; and
(d) interest payable on the Trust's borrowings.
Nothing in this Agreement shall alter the allocation of expenses and costs
agreed upon between the Trust and JHLICO in the Investment Management Agreement
or any other agreement to which they are parties.
4. SUB-ADVISORY FEES.
For all of the services rendered with respect to the Subject Fund as
herein provided, JHLICO shall pay to Advisers a fee (for the payment of which
the Trust shall have no obligation or liability), based on the Current Net
Assets of the Subject Fund, as set forth in Schedule I attached hereto and made
a part hereof. Such fee shall be accrued daily and payable monthly, as soon as
practicable after the last day of each calendar month. In the case of
termination of this Agreement with respect to the Subject Fund during any
calendar month, the fee with respect to such Fund accrued to but excluding the
date of termination shall be paid promptly following such termination. For
purposes of computing the amount of advisory fee accrued for any day, "Current
Net Assets" shall mean the Subject Fund's net assets as of the most recent
preceding day for which that Subject Fund's net assets were computed.
5. FUND TRANSACTIONS.
In connection with the investment and reinvestment of the assets of the
Subject Fund, Advisers is authorized to select the brokers or dealers that will
execute purchase and sale transactions for the Fund and to use its best efforts
to obtain the best available price and most favorable execution with respect to
all such purchases and sales of portfolio securities for said Fund. Advisers
shall maintain records adequate to demonstrate compliance with this requirement.
Subject to this primary requirement, and maintaining as its first consideration
the benefits to the Subject Fund and its shareholders, Advisers shall have the
right subject to the control of the Board of Trustees, and to the extent
authorized by the Securities Exchange Act of 1934, to follow a policy of
selecting brokers who furnish brokerage and research services to the Subject
Fund or to the Advisers, and who charge a higher commission rate to the Subject
Fund than may result when allocating brokerage solely on the basis of seeking
the most favorable price and execution. Advisers shall determine in good faith
that such higher cost was reasonable in relation to the value of the brokerage
and research services provided.
Advisers will not receive any tender offer solicitation fees or similar
payments in connection with the tender of investments of any Fund.
6. OWNERSHIP OF INFORMATION, RECORDS, AND CONFIDENTIALITY.
Except for such records Advisers is required to maintain under the
Investment Advisers Act of 1940, as amended, the Trust shall own and control all
records maintained hereunder by Advisers on the Trust's behalf and, in the event
of termination of this Agreement with respect to any Subject Fund for any
reason, all records relating to that Fund and owned by the Trust shall be
promptly returned to the Trust, free from any claim or retention of rights by
Advisers, provided that (subject to the last paragraph of this Section 6)
Advisers may retain copies of such records. Advisers also agrees, upon request
of the Trust, promptly to surrender such books and records or, at its expense,
copies thereof, to the Trust or make such books and records available for audit
or inspection by representatives of regulatory authorities or other persons
reasonably designated by the Trust. Advisers further agrees to maintain, prepare
and preserve such books and records as it is required to as an investment
sub-adviser to the Trust in accordance with the 1940 Act and rules thereunder,
including but not limited to Rules 31a-1 and 31a-2, and to supply all such
information related to the Subject Fund as may be requested by any insurance
regulatory authorities in connection with such insurance authorities'
administration of insurance laws and regulations. Advisers shall supply the
Board of Trustees and officers of the Trust and JHLICO with all statistical
information regarding investments which is reasonably required by them and
reasonably available to Advisers.
Advisers shall not disclose or use any records or information obtained
pursuant hereto in any manner whatsoever except as expressly authorized herein,
and will keep confidential any information obtained pursuant hereto, and
disclose such information only if the Trust has authorized such disclosure, or
if such disclosure is expressly requested by applicable federal or state
regulatory authorities. Advisers shall provide reasonable notice to the Trust of
any such disclosure to applicable federal or state regulatory officials in
connection with any audit of the Subject Fund or the Trust, and
in any event, Advisers shall provide reasonable notice to the Trust of any
threatened, pending or final regulatory enforcement or other disciplinary action
involving Advisers.
7. LIABILITY; STANDARD OF CARE.
Advisers shall be liable to JHLICO, the Trust or the Trust's shareholders
for losses resulting from any willful misfeasance, bad faith or negligence in
the performance of Advisers' duties or the reckless disregard of its obligations
and duties under this Agreement or the Investment Management Agreement. No
provision hereof shall be deemed to protect any trustee or officer of the Trust
against any such liability to which he might otherwise be subject by reason of
any willful misfeasance, bad faith or negligence in the performance his duties
or the reckless disregard of his obligations and duties. Adviser shall employ
only qualified personnel to manage the Subject Fund; shall comply with all
applicable laws and regulations in the discharge of its duties under this
Agreement; shall (as provided in Section 2 above) comply with the investment
policies, guidelines and restrictions of the Subject Fund and with the
provisions of the Trust's Declaration of Trust, Bylaws, prospectus and statement
of additional information; shall manage the Subject Fund (subject to the receipt
of, and based upon the information contained in, periodic reports from JHLICO or
the custodian concerning the classification of Fund securities for such
purposes) as a regulated investment company in accordance with subchapter M of
the Internal Revenue Code of 1986, as amended (the "Code"), and Treasury
Regulations Section 1.817-5(b); shall act at all times in the best interests of
the Trust; and shall discharge its duties with the care, skill, prudence and
diligence under the circumstances then prevailing that a prudent person acting
in a like capacity and familiar with such matters would use in the conduct of a
similar enterprise. However, Advisers shall not be obligated to perform any
service not described in this Agreement, and shall not be deemed by virtue of
this Agreement to have made any representation or warranty that any level of
investment performance or level of investment results will be achieved.
8. DURATION AND TERMINATION OF THIS AGREEMENT.
(a) Duration. This Agreement shall become effective with respect to the
Subject Fund on the date hereof and, with respect to any additional
Subject Fund, on the date of receipt by the Trust of notice from
Advisers in accordance with Paragraph 1(b) hereof that it is willing
to serve with respect to such Fund. Unless terminated as herein
provided, this Agreement shall remain in full force and effect for
two years from the date hereof with respect to the initial Subject
Fund and, with respect to each additional Subject Fund, until two
years following the date on which such Fund becomes a Subject Fund
hereunder, and shall continue in full force and effect thereafter
with respect to each Subject Fund so long as such continuance with
respect to any such Fund is approved at least annually (a) by either
the Board of Trustees of the Trust or by vote of a majority of the
outstanding voting shares of such Fund, and (b) in either event by
the vote of a majority of the 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.
(b) Any approval of this Agreement by the holders of a majority of the
outstanding shares of any Subject Fund shall be effective to continue
this Agreement with respect to any such Fund notwithstanding (A) that
this Agreement has not been approved by the holders of a majority of
the outstanding shares of any other Fund affected hereby, and (B)
that this Agreement has not been approved by the vote of a majority
of the outstanding shares of the Trust, unless such approval shall be
required by any other applicable law or otherwise. The terms
"assignment," "vote of a majority of the outstanding shares" and
"interested person," when used in this Agreement, shall have the
respective meanings specified in the 1940 Act and rules thereunder.
(c) Termination. This Agreement may be terminated with respect to any
Subject Fund at any time, without payment of any penalty, by the
Trust pursuant to a vote of the trustees of the Trust or a vote of a
majority of the outstanding shares of the Subject Portfolio, which
termination shall be effective immediately upon delivery of notice
thereof to Advisers and JHLICO. This Agreement may be terminated by
Advisers on at least ninety days' prior written notice to the Series
and
JHLICO, and may be terminated by JHLICO on at least ninety days'
prior written notice to the Trust and Advisers.
(d) Automatic Termination. This Agreement shall automatically and
immediately terminate in the event of its assignment or if the
Investment Management Agreement is terminated.
9. SERVICES NOT EXCLUSIVE; USE OF ADVISERS' NAME AND LOGO.
(a) The services of Advisers to the Trust are not to be deemed exclusive
and it shall be free to render similar services to others so long as
its services hereunder are not impaired thereby. It is specifically
understood that directors, officers and employees of Advisers and of
its subsidiaries and affiliates may continue to engage in providing
Fund management services and advice to other investment companies,
whether or not registered, and other investment advisory clients.
(b) During the term of this Agreement, JHLICO and the Trust shall have
the non-exclusive and non-transferable right to use Advisers' name
and logo in all materials relating to the Subject Fund, including all
prospectuses, proxy statements, reports to shareholders, sales
literature and other written materials prepared for distribution to
shareholders of the Trust or the public. However, prior to
distribution of any materials which refer to Advisers or use its
logo, JHLICO shall consult with Advisers and shall furnish to
Advisers a copy of such materials. Advisers agrees to cooperate with
JHLICO and to review such materials promptly. JHLICO shall not
distribute such materials if Advisers reasonably objects in writing,
within ten (10) days of its receipt of such copy (or such other time
as may be mutually agreed), to the manner in which its name and logo
are used.
10. AVOIDANCE OF INCONSISTENT POSITION.
In connection with the purchase and sale of portfolio securities of the
Subject Fund, Advisers and its directors, officers and employees will not act as
principal or agent or receive any commission. Nothing in this Agreement,
however, shall preclude the combination of orders for the sale or purchase of
portfolio securities of the Subject Fund with those for other registered
investment companies managed by Advisers or its affiliates, if orders are
allocated in a manner deemed equitable by Advisers among the accounts and at a
price approximately averaged.
11. AMENDMENT.
No provision of this Agreement may be changed, waived, discharged or
terminated orally, but only by an instrument in writing. No amendment of this
Agreement shall be effective with respect to any Fund until approved
specifically by (a) the Board of Trustees of the Trust, or by vote of a majority
of the outstanding shares of that Fund, and (b) by vote of a majority of those
trustees of the Trust who are not interested persons of any party to this
Agreement cast in person at a meeting called for the purpose of voting on such
approval.
12. LIMITATION OF LIABILITY.
It is expressly agreed that the obligations of the Trust hereunder shall
not be binding upon any of the trustees, shareholders, officers, agents or
employees of Trust personally, but only bind the trust property of the Trust, as
provided in the Trust's Declaration of Trust.
13. NOTICES
Notices and other communications required or permitted under this
Agreement shall be in writing, shall be deemed to be effectively delivered when
actually received, and may be delivered by US mail (first class, postage
prepaid), by facsimile transmission, by hand or by commercial overnight delivery
service, addressed as follows:
ADVISERS Xxxxxx Investment Management LLC
Xxx Xxxx Xxxxxx Xxxxxx
Xxxxxx, Xxxx 00000
Fax #: 000-000-0000
JHLICO: Xxxx Xxxxxxx Life Insurance Company
000 Xxxxxxxxx Xxxxxx
X.X. Xxx 000
Xxxxxx, XX 00000
Attention: Xxxxxxx X. Xxxxx
Fax #: 000-000-0000
TRUST: Xxxx Xxxxxxx Variable Series Trust I
000 Xxxxxxxxx Xxxxxx
X.X. Xxx 000
Xxxxxx, XX 00000
Attention: Xxxxxxx X. Xxxxx
Fax #: 000-000-0000
14. GOVERNING LAW.
This agreement shall be construed in accordance with the laws of the
Commonwealth of Massachusetts and the applicable provisions of the 1940 Act and
rules thereunder.
15. ASSIGNMENT.
This Agreement may not be assigned by any party, either in whole or in
part, without the prior written consent of each other party.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
as of the day first set forth above.
ATTEST: XXXX XXXXXXX VARIABLE SERIES
TRUST I
/s/ Xxxxxx X. Xxxxxxx By: /s/ Xxxxxxx X. Xxx Xxxx
Counsel Title: Chairman and CEO
ATTEST: XXXX XXXXXXX LIFE INSURANCE COMPANY
/s/ Xxxxxx X. Xxxxxxx
Counsel By: /s/ Xxxxxx X. Xxxxxxx
Title: Senior Vice President and Chief
Investment Strategist
ATTEST: XXXXXX INVESTMENT MANAGEMENT LLC
/s/ Xxxxxx Xxxxxxxx By: /s/ Xxxx X. Xxxxxx
Assistant Vice President Title: Senior Vice President
SCHEDULE I
FEES
Health Sciences Fund
Current Net Assets Under Management Sub-Advisory Fee
On the first $250,000,000 55 basis points (0.55%) per annum
On amounts over $250,000,000 50 basis points (0.50%) per annum
