SUBADVISORY AGREEMENT
This SUBADVISORY AGREEMENT is dated as of September 17, 1996
by and between SUNAMERICA ASSET MANAGEMENT CORP., a Delaware corporation (the
"Adviser"), and JANUS CAPITAL CORPORATION, a Colorado corporation (the
"Subadviser").
WITNESSETH:
WHEREAS, the Adviser and Style Select Series, Inc., a Maryland
corporation (the "Corporation"), have entered into an Investment Advisory and
Management Agreement dated as of September 17, 1996, (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 (the "Advisers Act"); and
WHEREAS, the Adviser desires to retain the Subadviser to furnish
investment advisory services to the investment series of the Corporation listed
on Schedule A attached hereto (the "Portfolio"), and the Subadviser is willing
to furnish such services;
NOW, THEREFORE, it is hereby agreed between the parties hereto as
follows:
1. (a) Duties of the Subadviser. 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, and shall furnish the Adviser
with such monthly, quarterly, and annual reports concerning transactions and
performance of each Portfolio in the form as reasonably requested by the
Adviser. The Subadviser shall also provide the Adviser with such other
information and reports as may reasonably be requested by the Adviser from time
to time, other than proprietary information, and provided the Subadviser shall
not be responsible for portfolio accounting, nor shall it be required to
generate information derived from portfolio accounting data. The Subadviser
shall discharge the foregoing responsibilities subject to the control of 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 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, and (b) applicable laws and regulations.
The Subadviser agrees to manage the portion of the assets
allocated to it of each of the Portfolio set forth in Schedule A (1) in
compliance with all applicable federal and state laws governing its operations
and investments. Without limiting the foregoing, the Subadviser agrees to
manage each Portfolio (1) so that it qualifies to be treated as a "regulated
investment company" under subchapter M, chapter 1 of the Code, and (2) in
compliance with (a) the provisions of the Act and rules adopted thereunder; (b)
applicable federal and state securities, commodities and banking laws; and (c)
the distribution requirements necessary to avoid payment of any excise tax
pursuant to Section 4982 of the Code. For purposes of compliance with this
paragraph, the Subadviser shall be entitled to treat the portion of the assets
of each Portfolio that it manages as though such portion constituted the entire
Portfolio, and the Subadviser shall not be responsible in any way for the
compliance of other portions of the Portfolio or for compliance of the
Portfolio as a whole with this paragraph.
(b) The Subadviser shall be responsible for the preparation
and filing of Schedule 13G and Form 13F on behalf of the Portfolio. The
Subadviser shall not be responsible for the preparation or filing of any
reports required of the Portfolio by any governmental or regulatory agency,
except as expressly agreed to in writing. The Subadviser shall vote proxies
received in connection with securities held by the Portfolio.
(c) 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 required by it to perform such
services on the terms and for the compensation provided in this Agreement.
(d) The Adviser shall timely furnish Subadviser with such
information as may be reasonably necessary for or requested by Subadviser to
perform its responsibilities under this Agreement. The Subadviser shall
establish and maintain brokerage accounts or other accounts necessary for the
purchase or sale of various forms of securities and the Adviser shall take such
actions as Subadviser deems advisable or necessary to enable Subadviser to
establish such account on behalf of the Corporation.
2. Portfolio Transactions. The Subadviser is responsible for decisions
to buy or sell securities and other investments for a portion of the assets of
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
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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.
3. (a) 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.
(b) Expenses. Adviser, the Corporation and the Portfolio
shall assume and pay their respective organizational, operational, and business
expenses not specifically assumed or agreed to be paid by Subadviser pursuant
to this Agreement. Subadviser shall pay its own organizational, operational,
and business expenses but shall not be obligated to pay any expenses of
Adviser, the Corporation, or the Portfolio, including without limitation, (a)
interest and taxes; (b) brokerage commissions and other costs in connection
with the purchase or sale of securities or other investment instruments for the
Portfolio; and (c) custodian fees and expenses.
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,
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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 so long as its services to
the Corporation are not impaired thereby. 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. The Subadviser may
provide advice to or take action with respect to other clients, which advice or
action, including the timing and nature of such action, may differ from or be
identical to advice given or action taken with respect to the Portfolio. In the
event of such activities, the transactions and associated costs will be
allocated among such clients (including the Portfolio) in a manner that the
Subadviser believes to be equitable to the accounts involved and consistent
with such accounts' objectives, policies and limitations.
7. Certain Records. While the Subadviser is not being engaged to serve
as the Corporation's official record keeper, the Subadviser nevertheless hereby
undertakes and agrees to maintain, in the form and for the period required by
Section 204 of the Advisers Act and Rule 204-2 thereunder, all records relating
to the investments of the Portfolio that are required to be maintained by the
Subadviser pursuant to the requirements of Rule 204-2 under the Advisers Act.
The Subadviser will also, in connection with the purchase and sale of
securities for each Portfolio, arrange for the transmission to the custodian
for the Corporation on a daily basis, such confirmation, trade tickets, and
other documents and information, that identify securities to be purchased or
sold on behalf of the Portfolio, as may be reasonably necessary to enable the
custodian to perform its administrative and recordkeeping responsibilities with
respect to the Portfolio.
The Subadviser agrees that all accounts, books and other
records maintained and preserved by it with respect to the Portfolio 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.
8. Confidentiality and Proprietary Rights. The Adviser will not,
directly or indirectly, and will not permit its affiliates, employees,
officers, directors, agents, contractors, or the Corporation to, in any form or
by any means, use, disclose, or furnish, to any person or entity, records or
information concerning the business of the Subadviser, except as necessary for
the performance of its duties under this Agreement or the Advisory Agreement,
or as required by law upon prior written notice to the Subadviser. The
Subadviser is the sole owner of the name and xxxx "Xxxxx." The Adviser shall
not, and shall not permit the Corporation to, without prior written consent of
the Subadviser, use the name or xxxx "Janus" or make representations regarding
the Subadviser or its affiliates. Upon termination of this Agreement for any
reasons, the Adviser shall immediately cease, and the Adviser shall cause the
Corporation to immediately cease, all use of the Janus name or any Xxxxx xxxx.
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9. 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) neither the
Subadviser nor its officers, directors, agents, employees, controlling persons,
shareholders, and any other person or entity affiliated with the Subadviser
shall be subject to liability 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
liability arising from (1) the Subadviser's conduct under this Agreement, or
(2) any untrue statement of a material fact in the Corporation's registration
statement or omission to state a material fact required to be stated therein or
necessary to make the statements therein not misleading, if such statement or
omission was made in reliance on information furnished by the Adviser.
(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 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 may
be based upon (i) any wrongful act or material breach of this Agreement by the
Subadviser resulting from Subadviser's disabling conduct , or (ii) any untrue
statement of a material fact in the Corporation's registration statement or
omission to state a material fact required to be stated therein or necessary to
make the statements therein not misleading, if such statement or omission was
made in reliance on information furnished by the Subadviser; 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 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 the Subadviser and (ii)
acts of the Subadviser which result from 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 the Adviser or any other
subadviser to a Portfolio, which records are not also maintained by the
Subadviser. The Adviser agrees 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 I 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)
with respect to the portion of assets of a Portfolio allocated to the
Subadviser. The Adviser shall indemnify the
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Indemnified Parties from any liability arising from the conduct of the
Adviser and any other subadviser with respect to the portion of a Portfolio's
assets not allocated to the Subadviser.
10. 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.
11. 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 Portfolio 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, 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. Notwithstanding the foregoing, the
Subadviser may terminate the Agreement upon 60 days' written notice in the
event of a breach of the Agreement by the Adviser. 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. The obligations contained in Section 9 shall survive termination of
this Agreement.
12. Severability. 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.
13. 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.
14. 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.
15. Separate Series. Pursuant to the provisions of the Articles of
Incorporation, each Portfolio is a separate Portfolio of the Corporation, and
all debts, liabilities, obligations and
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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.
16. 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: Janus Capital Corporation
000 Xxxxxxxx Xxxxxx
Xxxxxx, XX 00000-0000
Attention: Xxxxx X. Xxxxxx
General Counsel
Adviser: SunAmerica Asset Management Corp.
The SunAmerica Center
000 Xxxxx Xxxxxx, Xxxxx Xxxxx
Xxx Xxxx, XX 00000-0000
Attention: Xxxxxx X. Xxxxx
Senior Vice President and
General Counsel
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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.
SUNAMERICA ASSET MANAGEMENT CORP.
By: ____________________________________
Name: Xxxxx X. Xxxxxxx
Title: President
JANUS CAPITAL CORPORATION
By: ____________________________________
Name:
Title:
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