Exhibit 99.(d)(xxxia)
SUBADVISORY AGREEMENT
This SUBADVISORY AGREEMENT is dated as of September 19, 2005,
by and between AIG SUNAMERICA ASSET MANAGEMENT CORP., a Delaware corporation
(the "Adviser"), and NORTHERN TRUST INVESTMENTS, N.A., an Illinois corporation
(the "Subadviser").
WITNESSETH:
WHEREAS, the Adviser and SunAmerica Focused Series, Inc., a Maryland
corporation (the "Corporation"), 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 Corporation; and
WHEREAS, the Corporation 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 common stock, par value $.0001 per share, in separately
designated series 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 each investment series of the Corporation listed
on Schedule A attached hereto (each, a "Portfolio"), 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 with the Corporation. Pursuant to this Subadvisory
Agreement and subject to the oversight and review of the Adviser, the Subadviser
will manage the investment and reinvestment of a portion of the assets of each
Portfolio listed on Schedule A attached hereto. 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 Subadviser is required to maintain on behalf
of the Corporation, and will render regular reports to the Adviser and to
officers and Directors of the Corporation concerning its discharge of the
foregoing responsibilities. The Subadviser shall discharge the foregoing
responsibilities subject to the control of the Adviser and the officers and the
Directors of the Corporation and in compliance with such policies as the
Directors of the Corporation may from time to time establish and communicate to
Subadviser, and in compliance with (a) the objectives, policies, and limitations
for the Portfolio set forth in the Corporation's current prospectus and
statement of additional information as provided to Subadviser, and (b)
applicable laws and regulations.
The Subadviser shall have no power, authority, responsibility,
or obligation hereunder to take any action with regard to 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 a
Portfolio, 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 Portfolio assets, and
the Adviser acknowledges and agrees that no such power, authority,
responsibility or obligation is delegated hereunder. Nevertheless, the
Subadviser agrees that it shall provide the Adviser with any and all
documentation or information relating to the Litigation in its possession as may
reasonably be requested by the Adviser.
The Subadviser represents and warrants to the Adviser that it
will manage the portion of the assets of each Portfolio set forth in Schedule A
in compliance with all applicable federal and state laws governing its
operations and investments. Without limiting the foregoing and subject to
Section 11(c) hereof, the Subadviser represents and warrants (1) that the
Subadviser's management of the portion of the assets of a Portfolio will be
designed to achieve qualification by each Portfolio as a "regulated investment
company" under subchapter M, chapter 1 of the Internal Revenue Code of 1986, as
amended (the "Code"); (2) that the execution, delivery and performance of this
Agreement are within the Subadviser's powers, have been and remain duly
authorized by all necessary action and will not violate or constitute a default
under any applicable law or regulation or of any decree, order, judgment,
agreement or instrument binding on the Subadviser; and (3) compliance with all
applicable laws and rules, including without limitation (a) the provisions of
the Act and rules adopted thereunder that relate to the investment of Portfolio
assets, including depositing those assets in custody with institutions
designated by the Corporation; and (b) federal and state securities and
commodities laws applicable to Subadviser's portfolio management
responsibilities; each of the Subadviser and the Adviser represents and warrants
that it has adopted policies and procedures reasonably designed to prevent and
prohibit transactions described in Section 17(a), (d) and (e) of the Act between
a Portfolio and an affiliated person of the Adviser identified to the Subadviser
in writing. The Subadviser further represents and warrants that to the extent
any statements or omissions proposed to be made in any Registration Statement
for shares of the Corporation, 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 information 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 Adviser represents and warrants to the Subadviser (1) that the
Adviser has been duly appointed in accordance with the Act to provide investment
services to the Portfolios as contemplated by the Advisory Agreement; (2) that
the execution, delivery and performance of this Agreement are within the
Adviser's powers, have been and remain duly authorized by all necessary action
and will not violate or constitute a default under any applicable law or
regulation or of any decree, order, judgment, agreement or instrument binding on
the Adviser; and (3) compliance with all applicable laws and rules, including
without limitation (a) the provisions of the Act and rules adopted thereunder
that relate to the investment of Portfolio assets, including depositing those
assets in custody with institutions designated by the Corporation; and (b)
federal and state securities and commodities laws applicable to Adviser's
portfolio management responsibilities.
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
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required by it to perform such services on the terms and for the compensation
provided in this Agreement.
(b) The Subadviser and the Adviser each agree: (i) to maintain
a level of errors and omissions or professional liability insurance coverage
that, at all times during the course of this Agreement, is appropriate given the
nature of its business, and (ii) from time to time and upon reasonable request,
to supply evidence of such coverage to the party requesting same.
2. PORTFOLIO TRANSACTIONS. The Subadviser is responsible for decisions,
and is hereby authorized, to buy or sell securities and other investments for
each Portfolio, broker-dealers and futures commission merchants' selection, and
negotiation of brokerage commission and futures commission merchants' rates. As
a general matter, in executing Portfolio transactions, the Subadviser may employ
or deal with such broker-dealers or futures commission merchants as may, in the
Subadviser's best judgement, provide prompt and reliable execution of the
transactions at favorable prices and reasonable commission rates. In selecting
such broker-dealers or futures commission merchants, the Subadviser shall
consider all relevant factors including price (including the applicable
brokerage commission, dealer spread or futures commission merchant rate), 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-dealer or futures commission merchant
involved, the quality of the service, the difficulty of execution, the execution
capabilities and operational facilities of the firm involved, and, in the case
of securities, the firm's risk in positioning a block of securities. Subject to
such policies as the Directors may determine and consistent with Section 28(e)
of the Securities Exchange Act of 1934, as amended (the "1934 Act"), 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. 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 Act and Rule 17e-1 thereunder, the Subadviser may engage its affiliates, the
Adviser and its affiliates or any other subadviser to the Corporation and its
respective affiliates, as broker-dealers or futures commission merchants to
effect Portfolio transactions in securities and other investments for a
Portfolio. The Subadviser will promptly communicate to the Adviser and to the
officers and the Directors of the Corporation such information relating to
Portfolio transactions as they may reasonably request, including but not limited
to any reports prepared by independent third parties relating to the execution
costs of such transactions. To the extent consistent with applicable law, the
Subadviser may aggregate purchase or sell orders for the Portfolio with
contemporaneous purchase or sell orders of other clients of the Subadviser or
its affiliated persons. In such event, allocation of the securities so purchased
or sold, as well as the expenses incurred in the transaction, will be made by
the Subadviser in the manner the Subadviser determines to be equitable and
consistent with its and its affiliates' fiduciary obligations to the Portfolio
and to such other clients. The Adviser hereby acknowledges that such aggregation
of orders may not result in more favorable pricing or lower brokerage
commissions in all instances.
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3. COMPENSATION OF THE SUBADVISER. The Subadviser shall not be entitled
to receive any payment from the Corporation 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 to the Subadviser
a fee at the annual rates set forth in Schedule A hereto with respect to the
portion of the assets managed by the Subadviser for 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).
If the Subadviser shall provide its services under this Agreement for less than
the whole of any month, the foregoing compensation shall be prorated.
4. OTHER SERVICES. At the request of the Corporation or the Adviser,
the Subadviser in its discretion may make available to the Corporation office
facilities, equipment, personnel and other services. Such office facilities,
equipment, personnel and services shall be provided for or rendered by the
Subadviser and billed to the Corporation or the Adviser at the Subadviser's
cost.
5. REPORTS. The Corporation, 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 Corporation as each may reasonably request.
6. STATUS OF THE SUBADVISER. The services of the Subadviser to the
Adviser and the Corporation are not to be deemed exclusive, and the Subadviser
shall be free to render similar services to others. 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
Corporation in any way or otherwise be deemed an agent of the Corporation.
7. ADVERTISING. Subadviser shall not provide or in any way distribute
any sales or advertising materials related to the Corporation to any employee or
representative of AIG SunAmerica Capital Services, Inc. ("SACS") or its
affiliates, including wholesaling personnel, unless such material has been
received and approved, in writing, by the Adviser. Notwithstanding the
foregoing, Subadviser may include the Adviser's and Corporation's names in its
"client list" used in promotional materials with prior consent of the Adviser
and/or Corporation.
8. PROXY VOTING. Each Portfolio has appointed Investor Responsibility
Research Center as the proxy-voting agent and will vote all such proxies in
accordance with the proxy voting policies and procedures adopted by the Board of
Directors. With respect to certain vote items, a Portfolio may request guidance
or a recommendation from the adviser, administrator or subadviser of the
Portfolio. The Subadviser shall not have responsibilities in connection with
proxy voting for a Portfolio unless it is affirmatively requested to make a
proxy voting recommendation and agrees to provide same.
9. 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 that are required to be
maintained by the Subadviser on behalf of the Corporation pursuant to the
requirements of Rule 31a-1 of that Act. Copies of 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 Corporation will be provided promptly to the Corporation or the
Adviser on request.
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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 Corporation's
auditors, the Corporation or any representative of the Corporation, the Adviser,
or any governmental agency or other instrumentality having regulatory authority
over the Corporation.
10. REFERENCE TO THE SUBADVISER. Neither the Corporation nor the
Adviser or any affiliate or agent thereof shall make reference to or use the
name or logo 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.
11. LIABILITY OF THE SUBADVISER. (a) In the absence of willful
misfeasance, bad faith, gross negligence or reckless disregard of obligations or
duties ("disabling conduct") hereunder on the part of the Subadviser (and its
officers, directors, agents, employees, controlling persons, shareholders and
any other person or entity affiliated with the Subadviser), the Subadviser shall
not be subject to liability to the Adviser, its officers, directors, agents,
employees, controlling persons or shareholders or to the Corporation or to any
shareholder of the Corporation for any act or omission in the course of, or
connected with, rendering services hereunder, including without limitation, any
error of judgment or mistake of law or for any loss suffered by any of them in
connection with the matters to which this Agreement relates, except to the
extent specified in Section 36(b) of the Act concerning loss resulting from a
breach of fiduciary duty with respect to the receipt of compensation for
services. Except for such disabling conduct, the Adviser shall indemnify the
Subadviser (and its officers, directors, partners, agents, employees,
controlling persons, shareholders and any other person or entity affiliated with
the Subadviser) (collectively, the "Indemnified Parties") from any and all
losses, claims, damages, liabilities or litigation (including reasonable legal
and other expenses) arising from the Subadviser's providing services under this
Agreement or the sale of securities of the Corporation.
(b) 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 reasonable 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 are
caused by Subadviser's disabling conduct; 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.
(c) The Subadviser shall not be liable to the Adviser its
officers, directors, agents, employees, controlling persons or shareholders or
to the Corporation or its shareholders for (i) any acts of the Adviser or any
other subadviser to the Portfolio with respect to the portion of the assets of a
Portfolio not managed by Subadviser and (ii) acts of the Subadviser which result
from or are based upon acts of the Adviser, including, but not limited to, a
failure of the Adviser to provide accurate and current information with respect
to any records maintained by Adviser or any other subadviser to a Portfolio,
which records are not also maintained by the Subadviser or, to the
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extent such records relate to the portion of the assets managed by the
Subadviser, otherwise available to the Subadviser upon reasonable request. The
Adviser and Subadviser each agree that the Subadviser shall manage the portion
of the assets of a Portfolio allocated to it as if it was a separate operating
portfolio and shall comply with subsections (a) and (b) of Section 1 of this
Subadvisory Agreement (including, but not limited to, the investment objectives,
policies and restrictions applicable to a Portfolio and qualifications of a
Portfolio as a regulated investment company under the Code) only with respect to
the portion of assets of a Portfolio allocated to Subadviser. The Adviser shall
indemnify the Indemnified Parties from any and all losses, claims, damages,
liabilities or litigation (including reasonable legal and other expenses)
arising from the conduct of the Adviser, the Corporation and any other
subadviser with respect to the portion of a Portfolio's assets not allocated to
the Subadviser and with respect to any other portfolio of the Corporation.
12. CONFIDENTIALITY. The Subadviser 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 or as reasonably
required to execute transactions on behalf of the Portfolios, and will keep
confidential any non-public information obtained directly as a result of this
service relationship, and the Subadviser shall disclose such non-public
information only if the Adviser or the Board of Directors has authorized such
disclosure by prior written consent, or if such information is or hereafter
otherwise is known by the Subadviser or has been disclosed, directly or
indirectly, by the Adviser or the Corporation 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 to the extent such disclosure is reasonably required by auditors
or attorneys of the Subadviser in connection with the performance of their
professional services or as may otherwise be contemplated by this Agreement.
Notwithstanding the foregoing, the Subadviser may disclose the total return
earned by the Portfolios and may include such total return in the calculation of
composite performance information. The Adviser will not disclose or use any
confidential information pertaining to the Subadviser obtained as a result of
this service relationship except as contemplated by this Agreement or as
required by law.
13. PERMISSIBLE INTERESTS. Directors and agents of the Corporation are
or may be interested in the Subadviser (or any successor thereof) as directors,
partners, officers, or shareholders, or otherwise; directors, partners,
officers, agents, and shareholders of the Subadviser are or may be interested in
the Corporation as Directors, or otherwise; and the Subadviser (or any
successor) is or may be interested in the Corporation in some manner.
14. TERM OF THE AGREEMENT. This Agreement shall continue in full force
and effect with respect to each Portfolio until two years from the date hereof,
and 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 Directors of
the Corporation 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 Directors of the Corporation or by vote of a
majority of the outstanding voting securities of the Portfolio voting separately
from any other series of the Corporation.
With respect to each Portfolio, this Agreement may be
terminated at any time, without payment of a penalty by the Portfolio or the
Corporation, by vote of a majority of the Directors, 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 Corporation, or by the Adviser,
on not less than 30 nor more than 60 days' written notice to the Subadviser.
With respect to each Portfolio,
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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
Corporation. The termination of this Agreement with respect to any Portfolio or
the addition of any Portfolio to Schedule A hereto (in the manner 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 Corporation and the Adviser is terminated.
15. SEVERABILITY. This Agreement constitutes the entire Agreement
between the parties hereto. 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.
16. AMENDMENTS. This Agreement may be amended by mutual consent in
writing, but the consent of the Corporation must be obtained in conformity with
the requirements of the Act.
17. 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.
18. SEPARATE SERIES. Pursuant to the provisions of the Articles of
Incorporation and the General Laws of the State of Maryland, each Portfolio is a
separate series of the Corporation, 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
Corporation as a whole.
19. 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: Northern Trust Investments, N.A.
00 Xxxxx XxXxxxx Xx., X-0
Xxxxxxx, Xxxxxxxx 00000
Attention: Legal Department
Adviser: AIG SunAmerica Asset Management Corp.
Harborside Financial Center
0000 Xxxxx 0
Xxxxxx Xxxx, Xxx Xxxxxx 00000-0000
Attention: Legal Department
20. SURVIVAL. Sections 9, 10, 11, 12, 15, 17, 18 and this Section 20
shall survive the termination of this Agreement for any cause whatsoever.
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IN WITNESS WHEREOF, the parties have caused their respective duly
authorized officers to execute this Agreement as of the date first above
written.
AIG SUNAMERICA ASSET MANAGEMENT CORP.
By:
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Name: Xxxxx X. Xxxxxxx
Title: President and CEO
NOTHERN TRUST INVESTMENTS, N.A.
By:
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Name: Xxxxx X. Xxxxxxxxx
Title: Senior Vice President
