BlackRock Series, Inc. (the "Registrant"): BlackRock
International Fund (the "Fund")
77Q1(e):
Copies of any new or amended Registrant investment advisory
Contracts
Attached please find as an exhibit to Sub-Item 77Q1(e) of Form
N-SAR, a copy of the Sub-Advisory Agreement between BlackRock
Advisors, LLC and BlackRock International Limited with respect
to the Fund
SUB-INVESTMENT ADVISORY AGREEMENT
AGREEMENT dated February 27, 2017, between BlackRock Advisors,
LLC, a Delaware limited liability company (the "Advisor"), and
BlackRock International Limited, a corporation organized under
the laws of Scotland (the "Sub-Advisor").
WHEREAS, the Advisor has agreed to furnish investment advisory
services to BlackRock International Fund (the "Fund"), a series
of BlackRock Series, Inc., a Maryland corporation (the
"Corporation"), an open-end management investment company
registered under the Investment Company Act of 1940, as amended
(the "1940 Act");
WHEREAS, the Advisor wishes to retain the Sub-Advisor to
provide it with certain sub-advisory services as described below
in connection with Advisor's advisory activities on behalf of
the Fund;
WHEREAS, the advisory agreement between the Advisor and the
Corporation, dated
, 2017 (such agreement or the
most recent successor agreement between such parties relating to
advisory services to the Corporation is referred to herein as
the "Advisory Agreement") contemplates that the Advisor may sub-
contract investment advisory services with respect to the Fund
to a sub-advisor; and
WHEREAS, this Agreement has been approved in accordance with
the provisions of the 1940 Act, and the Sub-Advisor is willing
to furnish such services upon the terms and conditions herein
set forth;
NOW, THEREFORE, in consideration of the mutual premises and
covenants herein contained and other good and valuable
consideration, the receipt of which is hereby acknowledged, it
is agreed by and between the parties hereto as follows:
1. Appointment. The Advisor hereby appoints the Sub-Advisor to
act as sub-advisor with respect to the Fund and the Sub-Advisor
accepts such appointment and agrees to render the services
herein set forth for the compensation herein provided. For the
purposes of the rules of the Financial Conduct Authority of the
United Kingdom and based on information obtained in respect of
the Advisor, the Advisor will be treated by the Sub-Advisor as a
professional client. The Advisor acknowledges and accepts this
categorization. The Advisor has the right to request a different
categorization at any time from the Sub-Advisor, however the
Sub-Advisor only provides the services to professional clients
and will no longer be able to provide services to the Advisor in
the event of a request for a change in categorization.
2. Services of the Sub-Advisor. Subject to the succeeding
provisions of this section, the oversight and supervision of the
Advisor and the Corporation's Board of Directors, the
Sub-Advisor will perform certain of the day-to-day operations of
the Fund, which may include one or more of the following
services, at the request of the Advisor: (a) acting as
investment advisor for and managing the investment and
reinvestment of those assets of the Fund as the Advisor may from
time to time request and in connection therewith have complete
discretion in purchasing and selling such securities and other
assets for the Fund and in voting, exercising consents and
exercising all other rights appertaining to such securities and
other assets on behalf of the Fund; (b) arranging, subject to
the provisions of Section 3 hereof, for the purchase and sale of
securities and other assets of the Fund; (c) providing
investment research and credit analysis concerning the Fund's
investments, (d) assisting the Advisor in determining what
portion of the Fund's assets will be invested in cash, cash
equivalents and money market instruments, (e) placing orders for
all purchases and sales of such investments made for the Fund,
and (f) maintaining the books and records as are required to
support Fund investment operations. At the request of the
Advisor, the Sub-Advisor will also, subject to the oversight and
supervision of the Advisor and the Corporation's Board of
Directors, provide to the Advisor or the Corporation any of the
facilities and equipment and perform any of the services
described in Sections 2 or 3 of the Advisory Agreement. In
addition, the Sub-Advisor will keep the Corporation and the
Advisor informed of developments materially affecting the Fund
and shall, on its own initiative, furnish to the Fund from time
to time whatever information the Sub-Advisor believes
appropriate for this purpose. The Sub-Advisor will periodically
communicate to the Advisor, at such times as the Advisor may
direct, information concerning the purchase and sale of
securities for the Fund, including: (a) the name of the issuer,
(b) the amount of the purchase or sale, (c) the name of the
broker or dealer, if any, through which the purchase or sale
will be effected, (d) the CUSIP number of the instrument, if
any, and (e) such other information as the Advisor may
reasonably require for purposes of fulfilling its obligations to
the Corporation under the Advisory Agreement. The Sub-Advisor
will provide the services rendered by it under this Agreement in
accordance with the Fund's investment objectives, policies and
restrictions as stated in the Fund's Prospectus and Statement of
Additional Information (as currently in effect and as they may
be amended or supplemented from time to time) and the
resolutions of the Corporation's Board of Directors.
The Sub-Advisor represents, warrants and covenants that it is
authorized and regulated by the Financial Conduct Authority
("FCA" and the applicable rules promulgated by the FCA, the "FCA
Rules").
References in this Agreement to the "Supplemental Disclosures"
means any document of that title provided to potential clients
of the Sub-Advisor and its delegates prior to investment that
contains the Sub-Advisor's disclosures, as amended and notified
to the Advisor from time to time.
3. Covenants. (a) In the performance of its duties under this
Agreement, the Sub-Advisor shall at all times conform to, and
act in accordance with, any requirements imposed by: (i) the
provisions of the 1940 Act and the Investment Advisers Act of
1940, as amended (the "Advisers Act") and all applicable Rules
and Regulations of the Securities and Exchange Commission (the
"SEC"); (ii) any other applicable provision of law; (iii) the
provisions of the Fourth Articles of Amendment and Restatement
and Amended and Restated By-Laws of the Corporation, as such
documents are amended from time to time; (iv) the investment
objectives and policies of the Fund as set forth in the Fund's
Registration Statement on Form N-1A and/or the resolutions of
the Board of Directors; and (v) any policies and determinations
of the Board of the Directors of the Corporation.
(b) In addition, the Sub-Advisor will:
(i) place orders either directly with the issuer or
with any broker or dealer. Subject to the other provisions of
this paragraph, in placing orders with brokers and dealers, the
Sub-Advisor will attempt to obtain the best price and the most
favorable execution of its orders. The Advisor has been
provided with the Supplemental Disclosures which contain a copy
of the Sub-Advisor's order execution policy and hereby confirms
that it has read and understood the information in the order
execution policy and agrees to it. In particular, the Advisor
agrees that the Sub-Advisor may trade outside of the regulated
market or multilateral trading facility. In placing orders, the
Sub-Advisor will consider the experience and skill of the firm's
securities traders as well as the firm's financial
responsibility and administrative efficiency. Consistent with
this obligation, the Sub-Advisor may select brokers on the basis
of the research, statistical and pricing services they provide
to the Fund and other clients of the Advisor or the Sub-Advisor.
Information and research received from such brokers will be in
addition to, and not in lieu of, the services required to be
performed by the Sub-Advisor hereunder. A commission paid to
such brokers may be higher than that which another qualified
broker would have charged for effecting the same transaction,
provided that the Sub-Advisor determines in good faith that such
commission is reasonable in terms either of the transaction or
the overall responsibility of the Advisor and the Sub-Advisor to
the Fund and their other clients and that the total commissions
paid by the Fund will be reasonable in relation to the benefits
to the Fund over the long-term. Subject to the foregoing and
the provisions of the 1940 Act, the Securities Exchange Act of
1934, as amended, and other applicable provisions of law, the
Sub-Advisor may select brokers and dealers with which it or the
Fund is affiliated;
(ii) maintain books and records with respect to the
Fund's securities transactions and will render to the Advisor
and the Corporation's Board of Directors such periodic and
special reports as they may request;
(iii) maintain a policy and practice of conducting
its investment advisory services hereunder independently of the
commercial banking operations of its affiliates. When the
Sub-Advisor makes investment recommendations for the Fund, its
investment advisory personnel will not inquire or take into
consideration whether the issuer of securities proposed for
purchase or sale for the Fund's account are customers of the
commercial department of its affiliates; and
(iv) treat confidentially and as proprietary
information of the Fund all records and other information
relative to the Fund, and the Fund's prior, current or potential
shareholders, and will not use such records and information for
any purpose other than performance of its responsibilities and
duties hereunder, except after prior notification to and
approval in writing by the Fund, which approval shall not be
unreasonably withheld and may not be withheld where the
Sub-Advisor may be exposed to civil or criminal contempt
proceedings for failure to comply, when requested to divulge
such information by duly constituted authorities, or when so
requested by the Fund.
(c) In addition, the Advisor:
(i) agrees that the Sub-Advisor may, to the extent
permitted by the FCA Rules, aggregate transactions for the
Fund with transactions for other clients and/ or its own
account, but shall be under no obligation to aggregate
transactions for the Fund. In relation to a particular
order, aggregation may operate on some occasions to the
advantage of the Advisor and on other occasions to the
Advisor's disadvantage. However, it must be unlikely that
the aggregation of orders and transactions will work
overall to the disadvantage of the Advisor before
transactions will be aggregated; and
(ii) instructs the Sub-Advisor not to make or book
client limit orders (being a specific instruction from the
Advisor to buy or sell a financial instrument at a
specified price limit or better and for a specified size)
in respect of securities admitted to trading on a regulated
market which are not immediately executed under prevailing
market conditions.
(d) The Advisor acknowledges that the Sub-Advisor does not
hold "client money" and/or "safe custody assets" for the Advisor
under the Client Asset Rules (the "CASS Rules") of the FCA.
4. Services Not Exclusive. Nothing in this Agreement shall
prevent the Sub-Advisor or any officer, employee or other
affiliate thereof from acting as investment advisor for any
other person, firm or corporation, or from engaging in any other
lawful activity, and shall not in any way limit or restrict the
Sub-Advisor or any of its officers, employees or agents from
buying, selling or trading any securities for its or their own
accounts or for the accounts of others for whom it or they may
be acting; provided, however, that the Sub-Advisor will
undertake no activities which, in its judgment, will adversely
affect the performance of its obligations under this Agreement.
5. Books and Records. In compliance with the requirements of
Rule 31a-3 under the 1940 Act, the Sub-Advisor hereby agrees
that all records which it maintains for the Fund are the
property of the Corporation and further agrees to surrender
promptly to the Corporation any such records upon the
Corporation's request. The Sub-Advisor further agrees to
preserve for the periods prescribed by Rule 31a-2 under the 1940
Act the records required to be maintained by Rule 31a-1 under
the 1940 Act (to the extent such books and records are not
maintained by the Advisor).
6. Expenses. During the term of this Agreement, the
Sub-Advisor will bear all costs and expenses of its employees
and any overhead incurred by the Sub-Advisor in connection with
its duties hereunder; provided that the Board of Directors of
the Corporation may approve reimbursement to the Sub-Advisor of
the pro-rata portion of the salaries, bonuses, health insurance,
retirement benefits and all similar employment costs for the
time spent on Fund operations (including, without limitation,
compliance matters) (other than the provision of investment
advice and administrative services required to be provided
hereunder) of all personnel employed by the Sub-Advisor who
devote substantial time to Fund operations or the operations of
other investment companies advised or sub-advised by the
Sub-Advisor.
7. Compensation.
(a) The Advisor agrees to pay to the Sub-Advisor and the
Sub-Advisor agrees to accept as full compensation for all
services rendered by the Sub-Advisor as such, a monthly fee in
arrears at an annual rate equal to the amount set forth in
Schedule A hereto. For any period less than a month during
which this Agreement is in effect, the fee shall be prorated
according to the proportion which such period bears to a full
month of 28, 29, 30 or 31 days, as the case may be.
(b) For purposes of this Agreement, the net assets of the
Fund shall be calculated pursuant to the procedures adopted by
resolutions of the Directors of the Corporation for calculating
the value of the Fund's assets or delegating such calculations
to third parties.
(c) If Advisor waives or reimburses any or all of its
advisory fee payable under the Advisory Agreement pursuant to an
expense limitation agreement or other advisory fee waiver
agreement, with respect to the Fund, Sub-Advisor will bear its
share of the amount of such waiver or reimbursement by waiving
fees otherwise payable to it hereunder on a proportionate basis
to be determined by comparing the aggregate fees that would
otherwise be paid to it hereunder with respect to the Fund to
the aggregate fees that would otherwise be paid by the
Corporation to Advisor under the Advisory Agreement with respect
to the Fund. Advisor shall inform Sub-Advisor prior to waiving
or reimbursing any advisory fees.
8. Indemnity.
(a) The Fund may, in the discretion of the Board of
Directors of the Corporation, indemnify the Sub-Advisor, and
each of the Sub-Advisor's directors, officers, employees,
agents, associates and controlling persons and the directors,
partners, members, officers, employees and agents thereof
(including any individual who serves at the Sub-Advisor's
request as director, officer, partner, member, trustee or the
like of another entity) (each such person being an "Indemnitee")
against any liabilities and expenses, including amounts paid in
satisfaction of judgments, in compromise or as fines and
penalties, and counsel fees (all as provided in accordance with
applicable state law) reasonably incurred by such Indemnitee in
connection with the defense or disposition of any action, suit
or other proceeding, whether civil or criminal, before any court
or administrative or investigative body in which such Indemnitee
may be or may have been involved as a party or otherwise or with
which such Indemnitee may be or may have been threatened, while
acting in any capacity set forth herein or thereafter by reason
of such Indemnitee having acted in any such capacity, except
with respect to any matter as to which such Indemnitee shall
have been adjudicated not to have acted in good faith in the
reasonable belief that such Indemnitee's action was in the best
interest of the Fund and furthermore, in the case of any
criminal proceeding, so long as such Indemnitee had no
reasonable cause to believe that the conduct was unlawful;
provided, however, that (1) no Indemnitee shall be indemnified
hereunder against any liability to the Fund or its shareholders
or any expense of such Indemnitee arising by reason of
(i) willful misfeasance, (ii) bad faith, (iii) gross negligence
or (iv) reckless disregard of the duties involved in the conduct
of such Indemnitee's position (the conduct referred to in such
clauses (i) through (iv) being sometimes referred to herein as
"disabling conduct"), (2) as to any matter disposed of by
settlement or a compromise payment by such Indemnitee, pursuant
to a consent decree or otherwise, no indemnification either for
said payment or for any other expenses shall be provided unless
there has been a determination that such settlement or
compromise is in the best interests of the Fund and that such
Indemnitee appears to have acted in good faith in the reasonable
belief that such Indemnitee's action was in the best interest of
the Fund and did not involve disabling conduct by such
Indemnitee and (3) with respect to any action, suit or other
proceeding voluntarily prosecuted by any Indemnitee as
plaintiff, indemnification shall be mandatory only if the
prosecution of such action, suit or other proceeding by such
Indemnitee was authorized by a majority of the full Board of
Directors of the Corporation.
(b) The Fund shall make advance payments in connection
with the expenses of defending any action with respect to which
indemnification might be sought hereunder if the Fund receives a
written affirmation of the Indemnitee's good faith belief that
the standard of conduct necessary for indemnification has been
met and a written undertaking to reimburse the Fund unless it is
subsequently determined that such Indemnitee is entitled to such
indemnification and if the Directors of the Corporation
determine that the facts then known to them would not preclude
indemnification. In addition, at least one of the following
conditions must be met: (A) the Indemnitee shall provide a
security for such Indemnitee's undertaking, (B) the Fund shall
be insured against losses arising by reason of any unlawful
advance, or (C) a majority of a quorum consisting of Directors
of the Corporation who are neither "interested persons" of the
Corporation (as defined in Section 2(a)(19) of the 0000 Xxx) nor
parties to the proceeding ("Disinterested Non-Party Directors")
or an independent legal counsel in a written opinion, shall
determine, based on a review of readily available facts (as
opposed to a full trial-type inquiry), that there is reason to
believe that the Indemnitee ultimately will be found entitled to
indemnification.
(c) All determinations with respect to the standards for
indemnification hereunder shall be made (1) by a final decision
on the merits by a court or other body before whom the
proceeding was brought that such Indemnitee is not liable by
reason of disabling conduct, or (2) in the absence of such a
decision, by (i) a majority vote of a quorum of the
Disinterested Non-Party Directors of the Corporation, or (ii) if
such a quorum is not obtainable or even, if obtainable, if a
majority vote of such quorum so directs, independent legal
counsel in a written opinion. All determinations that advance
payments in connection with the expense of defending any
proceeding shall be authorized shall be made in accordance with
the immediately preceding clause (2) above.
The rights accruing to any Indemnitee under these provisions
shall not exclude any other right to which such Indemnitee may
be lawfully entitled.
9. Limitation on Liability.
(a) The Sub-Advisor will not be liable for any error of
judgment or mistake of law or for any loss suffered by the
Advisor or by the Corporation or the Fund in connection with the
performance of this Agreement, except a loss resulting from a
breach of fiduciary duty with respect to the receipt of
compensation for services or a loss resulting from willful
misfeasance, bad faith or gross negligence on its part in the
performance of its duties or from reckless disregard by it of
its duties under this Agreement. As used in this Section 9(a),
the term "Sub-Advisor" shall include any affiliates of the Sub-
Advisor performing services for the Fund contemplated hereby and
partners, directors, officers and employees of the Sub-Advisor
and such affiliates.
(b) Notwithstanding anything to the contrary contained in
this Agreement, the parties hereto acknowledge and agree that
this Agreement is executed by the Directors and/or officers of
the Corporation, not individually but as such Directors and/or
officers of the Corporation, and the obligations hereunder are
not binding upon any of the Directors or shareholders
individually but bind only the estate of the Corporation.
10. Duration and Termination. This Agreement shall become
effective as of the date hereof and, unless sooner terminated
with respect to the Fund as provided herein, shall continue in
effect for a period of two years. Thereafter, if not
terminated, this Agreement shall continue in effect with respect
to the Fund for successive periods of 12 months, provided such
continuance is specifically approved at least annually by both
(a) the vote of a majority of the Corporation's Board of
Directors or a vote of a majority of the outstanding voting
securities of the Fund at the time outstanding and entitled to
vote and (b) by the vote of a majority of the Directors, who are
not parties to this Agreement or interested persons (as such
term is defined in the 0000 Xxx) of any such party, cast in
person at a meeting called for the purpose of voting on such
approval. Notwithstanding the foregoing, this Agreement may be
terminated by the Corporation or the Advisor at any time,
without the payment of any penalty, upon giving the Sub-Advisor
60 days' notice (which notice may be waived by the Sub-Advisor),
provided that such termination by the Corporation or the Advisor
shall be directed or approved by the vote of a majority of the
Directors of the Corporation in office at the time or by the
vote of the holders of a majority of the outstanding voting
securities of the Fund entitled to vote, or by the Sub-Advisor
on 60 days' written notice (which notice may be waived by the
Corporation and the Advisor), and will terminate automatically
upon any termination of the Advisory Agreement between the
Corporation and the Advisor. This Agreement will also
immediately terminate in the event of its assignment. (As used
in this Agreement, the terms "majority of the outstanding voting
securities," "interested person" and "assignment" shall have the
same meanings of such terms in the 1940 Act.)
11. Notices. Any notice under this Agreement shall be in
writing to the other party at such address as the other party
may designate from time to time for the receipt of such notice
and shall be deemed to be received on the earlier of the date
actually received or on the fourth day after the postmark if
such notice is mailed first class postage prepaid.
12. Amendment of this Agreement. This Agreement may be
amended by the parties only if such amendment is specifically
approved by the vote of the Board of Directors of the
Corporation, including a majority of those Directors 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, where required by the 1940 Act, by
a vote of a majority of the outstanding voting securities of the
Fund.
13. Miscellaneous. The captions in this Agreement are
included for convenience of reference only and in no way define
or delimit any of the provisions hereof or otherwise affect
their construction or effect. 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. This Agreement shall be binding
on, and shall inure to the benefit of the parties hereto and
their respective successors.
14. Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York
for contracts to be performed entirely therein without reference
to choice of law principles thereof and in accordance with the
applicable provisions of the 1940 Act. To the extent that the
applicable laws of the State of New York, or any of the
provisions, conflict with the applicable provisions of the 1940
Act, the latter shall control.
15. Counterparts. This Agreement may be executed in
counterparts by the parties hereto, each of which shall
constitute an original counterpart, and all of which, together,
shall constitute one Agreement.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
[PAGE BREAK]
IN WITNESS WHEREOF, the parties hereto have caused this
instrument to be executed by their duly authorized officers
designated below as of the day and year first above written.
BLACKROCK ADVISORS, LLC
By: /s/ Xxxx X. Xxxxxxx
Name: Xxxx X. Xxxxxxx
Title: Managing Director
BLACKROCK INTERNATIONAL LIMITED
By: /s/ Xxxxxx Xxxxx
Name: Xxxxxx Xxxxx
Title: Managing Director
BLACKROCK INTERNATIONAL LIMITED
By: /s/ Xxxxxxx Xxxxxx
Name: Xxxxxxx Xxxxxx
Title: Director
AGREED AND ACCEPTED
as of the date first set forth above
BLACKROCK INTERNATIONAL FUND,
A SERIES OF BLACKROCK SERIES, INC.
By:_/s/ Xxxx X. Perlowski__________________________
Name: Xxxx X. Xxxxxxxxx
Title: Chief Executive Officer and President of the Fund
[PAGE BREAK]
Schedule A
Sub-Investment Advisory Fee
Pursuant to Section 7, for that portion of the Fund for which
the Sub-Advisor acts as sub-advisor, Advisor shall pay a fee to
Sub-Advisor equal to ___% of the advisory fee received by the
Advisor from the Fund with respect to such portion, net of: (i)
expense waivers and reimbursements, (ii) expenses relating to
distribution and sales support activities borne by the Advisor,
and (iii) administrative, networking, recordkeeping, sub-
transfer agency and shareholder services expenses borne by the
Advisor.
