INVESTMENT SUB-ADVISORY
AGREEMENT
This AGREEMENT made this 30th day of May 2017, by and between THE
VARIABLE ANNUITY LIFE INSURANCE COMPANY, hereinafter referred
to as "VALIC," and JANUS CAPITAL MANAGEMENT LLC, hereinafter
referred to as the "SUB-ADVISER."
VALIC and the SUB-ADVISER recognize the following:
(a) VALIC is a life insurance company organized under Chapter 3
of the Texas Insurance Code and an investment adviser
registered under the Investment Advisers Act of 1940, as
amended ("Advisers Act").
(b) VALIC is engaged as the investment adviser of VALIC
Company I ("VC I"), pursuant to an Investment Advisory
Agreement between VALIC and VC I, an investment
company organized under the general corporate laws of
Maryland as a series type of investment company issuing
separate classes (or series) of shares of common stock. VC I is
registered as an open-end, management investment company
under the Investment Company Act of 1940, as amended
("1940 Act"). The 1940 Act prohibits any person from acting
as an investment adviser of a registered investment company
except pursuant to a written contract.
(c) VC I currently consists of thirty-four portfolios ("Funds"):
Asset
Allocation
Fund
Blue Chip
Growth Fund
Broad Cap
Value Income
Fund Capital
Conservation
Fund
Core Equity
Fund
Dividend
Value
Fund
Dynamic
Allocation
Fund
Emerging
Economie
s Fund
Foreign
Value
Fund
Global Real
Estate Fund
Global Social
Awareness
Fund Global
Strategy Fund
Government
Money Market I
Fund
Government
Securities
Fund Growth
& Income
Fund
Growth Fund
Health
Sciences
Fund
Inflation
Protected
Fund
International Equities Index
Fund International
Government Bond Fund
International Growth Fund
Large Cap Core Fund
Large Capital Growth Fund
Mid Cap Index Fund
Mid Cap Strategic Growth
Fund
Nasdaq-100(r) Index
Fund Science &
Technology Fund
Small Cap Aggressive Growth
Fund
Small Cap Fund
Small Cap Index Fund
Small Cap Special Values Fund
Small-Mid Growth Fund
Stock Index Fund
Value Fund
In accordance with VC I's Articles of Incorporation (the
"Articles"), new Funds may be added to VC I upon approval
of VC I's Board of Directors without the approval of Fund
shareholders. This Agreement will apply only to the Fund(s)
set forth on the attached Schedule A, and any other Fund(s) as
may be added or deleted by amendment to the attached
Schedule A (each a "Covered Fund," and collectively, the
"Covered Funds").
(d) The SUB-ADVISER is engaged principally in the business of
rendering investment advisory services and is registered as an
investment adviser under the Advisers Act.
(e) VALIC desires to enter into an Investment Sub-Advisory
Agreement with the SUB-ADVISER for all or a portion of the
assets of the Covered Fund(s) which VALIC determines from
time to time to assign to the SUB-ADVISER.
VALIC and the SUB-ADVISER agree as follows:
1. Services Rendered and Expenses Paid by the SUB-ADVISER
The SUB-ADVISER, subject to the control and supervision of VALIC
and VC I's Board of Directors and in conformity with the 1940 Act, all
applicable laws and regulations thereunder, all other applicable federal
and state laws and regulations, including section 817(h) and Subchapter
M of the Internal Revenue Code of 1986, as amended (the "Code"), VC
I's Articles, Bylaws, registration statements, prospectus and stated
investment objectives, policies and restrictions of any Covered Fund(s)
and any applicable procedures adopted by VC I's Board of Directors
and provided to the SUB-ADVISER, shall:
(a) Manage the investment and reinvestment of all of, or to the
extent applicable, a portion of, the assets of the Covered
Fund(s) including, for example, the evaluation of pertinent
economic, statistical, financial, and other data, the
determination, in its discretion without prior consultation with
VALIC or the VC I Board of Directors, of the industries,
securities and other investments to be represented in each
Covered Fund's portfolio, and the formulation and
implementation of investment programs.
(b) Maintain a trading desk and place orders for the purchase and
sale of portfolio investments (including futures contracts or
other derivatives) for each Covered Fund's account with
brokers or dealers (including futures commission merchants)
selected by the SUB-ADVISER, or arrange for any other
entity to provide a trading desk and to place orders with
brokers and dealers (including futures commission merchants)
selected by the SUB-ADVISER, subject to the SUB-
ADVISER's control, direction, and supervision, which brokers
or dealers may include brokers or dealers (including futures
commission merchants) affiliated with the SUB-ADVISER,
subject to applicable law.
Without limiting the foregoing, the SUB-ADVISER represents and
warrants to VALIC that all of, or to the extent applicable the portion of,
the assets which it manages of the Covered Fund(s) set forth in
Schedule A will at all times be operated and managed in compliance
with (a) all applicable federal and state laws, including securities,
commodities and banking laws, governing its operations and
investments; (b) applicable provisions of Subchapter M, chapter 1 of
the Code ("Subchapter M") for each Covered Fund to be treated as a
"regulated investment company" under Subchapter M; (c) the
diversification requirements specified in the Internal Revenue Service's
regulations under Section 817(h) of the Code so as not to jeopardize the
treatment of the variable annuity contracts that offer the Covered Funds
as annuity contracts for purposes of the Code; (d) the distribution
requirements necessary to avoid payment of any excise tax pursuant to
Section 4982 of the Code; (e) the provisions of the 1940 Act and rules
adopted thereunder; (f) the objectives, policies, restrictions and
limitations for the Covered Funds as set forth in the Covered Funds'
current prospectus and statement of additional information as most
recently provided by VALIC to the SUB-ADVISER; and (g) the
policies and procedures as adopted by the Board, as most recently
provided by VALIC to the SUB-ADVISER. The SUBADVISER shall
furnish information to VALIC, as requested, for purposes of
compliance with the distribution requirements necessary to avoid
payment of any excise tax pursuant to Section 4982 of the Code. The
SUB-ADVISER further represents and warrants that to the extent that
any statements or omissions made in any Registration Statement for
shares of the Covered Funds, 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 Registration
Statement and any amendments or supplements thereto will, when they
become effective, conform in all material respects to the requirements
of the Securities Act of 1933 and the rules and regulations of the
Commission thereunder (the "1933 Act") and the 1940 Act and 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.
VALIC agrees that SUB-ADVISER shall manage the portion of the
assets of a Covered Fund allocated to it as if it was a separate operating
fund, unless instructed otherwise in writing from VALIC, and shall
comply with the representations and warranties stated in this Section
(including, but not limited to, the investment objectives, policies and
restrictions applicable to a Covered Fund and qualifications of a
Covered Fund as a regulated investment company under the Code) with
respect to the portion of assets of a Covered Fund allocated to
SUB-ADVISER.
The SUB-ADVISER may delegate any of its duties and obligations
hereunder to any affiliated person (as such term is defined in the 0000
Xxx) that is eligible to serve as an investment adviser to an investment
company registered under the 1940 Act on such terms and conditions as
it deems necessary or appropriate, provided that VALIC and the Board
consent to any such delegation and to the terms and conditions thereof
and such delegation is permitted by and in conformity with the 1940
Act. The SUB-ADVISER shall be liable to VALIC for any loss or
damage arising out of, in connection with or related to the actions or
omissions to act of any delegee utilized hereunder. In determining
liability, the limitation of liability set forth in Section 7 of this
Agreement shall apply to the actions or omissions to act of a delegee.
The SUB-ADVISER makes no representation or warranty, express or
implied, that any level of performance or investment results will be
achieved by the Covered Fund (or portion thereof) or that the Covered
Fund will perform comparably with any standard or index, including
other clients of the SUB-ADVISER.
The SUB-ADVISER will assist the Covered Fund(s) and its agents in
determining whether prices obtained by the Covered Fund(s) and its
agents for valuation purposes accurately reflect the prices on the SUB-
ADVISER's portfolio records relating to the assets of the Covered
Fund(s) for which the SUB-ADVISER has responsibility at such times
as VALIC shall reasonably request; provided, however, that the parties
acknowledge that the SUB-ADVISER is not the fund accounting agent
for the Covered Fund(s) and is not responsible for pricing
determinations or calculations and any information provided pursuant
to this position by the SUB-ADVISER will be provided for information
purposes only.
In performing the services described in paragraph (b) above, the SUB-
ADVISER shall use its best efforts to obtain for the Covered Fund(s)
the best execution of portfolio transactions, under the circumstances of
each trade and on the basis of the SUB-ADVISER'S best execution
policy and all other relevant factors and considerations. Subject to
policies and procedures that may be adopted by VC I's Board of
Directors and Section 28(e) of the Securities Exchange Act of 1934, as
amended (the"1934 Act"), the SUB-ADVISER may cause the Covered
Fund(s) to pay to a broker a commission, for effecting a portfolio
transaction, in excess of the commission another broker would have
charged for effecting the same transaction, if the first broker provided
brokerage and/or research products or services, including statistical
data, to the SUB-ADVISER. The SUB-ADVISER shall not be deemed
to have acted unlawfully, or to have breached any duty created by this
Agreement, or otherwise, solely by reason of acting in accordance with
such authorization. In accordance with Section II(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 1940 Act and Rule
17e-l thereunder, the SUB-ADVISER may engage its affiliates, the
VALIC and its affiliates or any other sub-adviser to VC I and its
respective affiliates, as broker-dealers or futures commission merchants
to effect Covered Fund transactions in securities and other investments
for a Covered Fund.
Furthermore, on occasions when the SUB-ADVISER deems the
purchase or sale of a security to be in the best interest of one or more of
the Covered Fund(s) as well as other clients of the SUB-ADVISER, it
may allocate such transactions in the manner it considers to be the most
equitable and consistent with its fiduciary obligation to the Covered
Fund(s) and to such other clients. The SUB-ADVISER shall not be
deemed to have acted unlawfully, or to have breached any duty created
by this Agreement, or otherwise, solely by reason of acting in
accordance with such authorization.
The SUB-ADVISER may aggregate sales and purchase orders of
securities held by the Covered Fund(s) with similar orders being made
simultaneously for other accounts managed by the SUB-ADVISER or
with accounts of the affiliates of the SUB-ADVISER, if in the SUB-
ADVISER's reasonable judgment such aggregation is fair and
reasonable and consistent with the SUB-ADVISER'S fiduciary
obligations to the Covered Fund(s) and its other clients, considering
factors such as the advantageous selling or purchase price, brokerage
commission and other expenses. In accounting for such aggregated
order price, commission and other expenses shall be averaged on a per
bond or share basis daily. VALIC acknowledges that the determination
whether such aggregation of sales and purchase orders of securities
held by the Covered Fund(s) by the SUB-ADVISER is fair and
reasonable is subjective and that such aggregation of orders represents
the SUB-ADVISER's evaluation that the Covered Fund(s) is benefited
by relatively better purchase and sale prices, lower brokerage expenses
and beneficial timing of transactions in combination of these other
factors.
VALIC authorizes and empowers the SUB-ADVISER to direct the
Covered Fund's Custodian to open and maintain brokerage accounts for
securities and other property, including financial and commodity
futures and commodities and options thereon (all such accounts
hereinafter called "brokerage accounts") for and in the name of the
Covered Fund(s) and to execute for the Covered Fund(s) as its agent
and attorney-in-fact reasonable and customary customer agreements
and other documentation in connection with such broker or brokers as
the SUB-ADVISER shall select as provided above. With respect to
brokerage accounts for financial and commodity futures and
commodities and options thereon, the SUB-ADVISER shall select such
brokers, as approved by VALIC, prior to the establishment of such
brokerage account. The SUB-ADVISER may, using such of the
securities and other property in the Covered Fund as the SUB-
ADVISER deems necessary or desirable, direct the Covered Fund's
Custodian to deposit for the Covered Fund original and maintenance
brokerage and margin deposits and otherwise direct payments of cash,
cash equivalents and securities and other property into such brokerage
accounts and to such brokers as the SUB-ADVISER deems desirable or
appropriate and as required by applicable law.
The SUB-ADVISER shall maintain records adequately demonstrating
compliance with its obligations under this Agreement and report
periodically to VALIC and VC I's Board of Directors regarding the
performance of its services under this Agreement. The SUB-ADVISER
will make available to VALIC and VC I promptly upon their
reasonable written request all of the Covered Fund(s)' investment
records and ledgers to assist VALIC and VC I in compliance with
respect to each Covered Fund's securities transactions as required by
the 1940 Act and the Advisers Act, as well as other applicable laws.
The SUB-ADVISER will furnish VC I's Board of Directors such
periodic and special reports as VALIC and VC I's Board of Directors
may reasonably request. The SUB-ADVISER will furnish to regulatory
authorities any information or reports in connection with such services
which may be requested in order to ascertain whether the operations of
the Covered Fund(s) are being conducted in a manner consistent with
applicable laws and regulations.
Should VALIC at any time make any definite determination as to any
investment policy and notify the SUB-ADVISER in writing of such
determination, within a reasonable time after receipt of such notice as
agreed to by the SUB-ADVISER and VALIC the SUB-ADVISER shall
be bound by such determination for the period, if any, specified in such
notice or until similarly notified that such determination has been
revoked, provided such determination will permit SUB-ADVISER to
comply with the first paragraph of this Section.
The SUB-ADVISER will not hold money or investments on behalf of
VC I. The money and investments will be held by the Custodian of VC
I. The SUB-ADVISER will arrange for the transmission to the
Custodian for VC I, on a daily basis, such confirmation, trade tickets
and other documents as may be necessary to enable the Custodian
perform its administrative responsibilities with respect to the Covered
Fund(s). The SUB-ADVISER further shall have the authority to
instruct the Custodian of VC I (i) to pay cash for securities and other
property delivered, or to be delivered, to the Custodian for the Covered
Fund(s), (ii) to deliver securities and other property against payment for
the Covered Fund(s), and (iii) to transfer assets and funds to such
brokerage accounts as the SUB-ADVISER may designate, all
consistent with the powers, authorities and limitations set forth herein.
VALIC will vote proxies relating to securities held by the Covered
Fund(s). VALIC will vote all such proxies in accordance with such
proxy voting guidelines and procedures adopted by the Board of
Directors. VALIC may, on certain non-routine matters, consult with the
SUB-ADVISER before voting proxies relating to securities held by the
Covered Fund(s). VALIC will instruct the Custodian and other parties
providing services to VC I promptly to forward to the proxy voting
service copies of all proxies and shareholder communications relating
to securities held by each Covered Fund(s). The SUB-ADVISER shall
not be responsible for taking any action on behalf of the Covered Funds
in connection with 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 the Covered Fund(s)
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 the Covered Funds'
assets.
The SUB-ADVISER shall for all purposes herein be deemed to be an
independent contractor and shall, unless otherwise provided or
authorized, have no authority to act or represent VALIC or VC I other
than in furtherance of the SUB-ADVISER's duties and responsibilities
as set forth in this Agreement.
Except as otherwise agreed, or as otherwise provided herein, the SUB-
ADVISER shall bear the expense of discharging its responsibilities
hereunder and VALIC shall pay, or arrange for others to pay, all
VALIC's expenses, except that VALIC shall in all events pay the
compensation described in Section 3 of this Agreement. VALIC and
the SUB-ADVISER acknowledge that VC I will be ultimately
responsible for all brokerage commissions, taxes, custodian fees and
other transaction-related fees incurred on behalf of the Covered
Fund(s).
The SUB-ADVISER is hereby prohibited from consulting with any
other sub-adviser of the Covered Fund(s) (or a portion thereof) or any
other sub-adviser to a fund under common control with the Covered
Fund(s) (or a portion thereof) concerning securities transactions of the
Covered Fund(s) (or a portion thereof) in securities or other assets,
other than for purposes of complying with the conditions of paragraphs
(a) and (b) of rule 12d3-l under the 1940 Act.
2. Confidentiality
The SUB-ADVISER 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 Covered
Fund(s), and will keep confidential any non-public information
obtained directly as a result of this service relationship, and disclose
such non-public information only if VALIC or the VC I Board of
Directors has authorized in writing such disclosure, or if such
information is or hereafter becomes ascertainable from public or
published information or trade sources, or if such information is or
hereafter otherwise is lawfully know by the SUB-ADVISER, or if such
disclosure is expressly required or requested by applicable federal or
state authorities (including the SUB-ADVISER'S regulatory examiners)
or court of law of competent jurisdiction or to the extent such
disclosure is reasonably required by auditors or attorneys of the SUB-
ADVISER in connection with the performance of their professional
services or as may otherwise be contemplated by this Agreement.
Notwithstanding the foregoing, the SUB-ADVISER may disclose the
total return earned by the Covered Fund(s) and may include such total
return in the calculation of composite performance information.
VALIC will not disclose or use any records or information belonging to
the SUB-ADVISER obtained pursuant to this Agreement in any
manner whatsoever except as expressly authorized in this Agreement or
as reasonably required in performance of its advisory services to the
Covered Funds, and will keep confidential any information obtained
pursuant to this service relationship, and disclose such information only
if the SUB-ADVISER has authorized in writing such disclosure, or if
such information is or hereafter becomes ascertainable from public or
published information or trade sources, or if such information is
expressly required or requested by applicable federal or state authorities
(including VALIC's regulatory examiners) or court of law of competent
jurisdiction or to the extent such disclosure is reasonably required by
auditors or attorneys of VALIC in connection with the performance of
their professional services or as may otherwise be contemplated by this
Agreement.
3. Compensation of the SUB-ADVISER
VALIC shall pay to the SUB-ADVISER, as compensation for the
services rendered and expenses paid by the SUB-ADVISER, a monthly
fee or fees based on each Covered Fund's average daily net asset value
computed for each Covered Fund as provided for herein and in the fee
schedule attached hereto as Schedule A. Schedule A may be amended
from time to time by written agreement executed by VALIC and the
SUB-ADVISER, provided that amendments are made in conformity
with applicable laws and regulations and the Articles and Bylaws of
VC I. Any change in Schedule A pertaining to any new or existing
Covered Fund shall not be deemed to affect the interest of any other
Covered Fund and shall not require the approval of shareholders of any
other Covered Fund
The average daily net asset value shall be determined by taking the
average of all of the determinations of net asset value, made in the
manner provided in VC I's constitutive documents, for each business
day during a given calendar month. VALIC shall pay this fee for each
calendar month as soon as practicable after the end of that month.
If the SUB-ADVISER serves for less than a whole month, the
foregoing compensation shall be prorated.
The payment of advisory fees related to the services of the SUB-
ADVISER under this Agreement shall be the sole responsibility of
VALIC and shall not be the responsibility of VC I. Any reimbursement
of management fees required by any expense limitation provision shall
be the sole responsibility of VALIC.
4. Scope of the SUB-ADVISER's Activities
VALIC understands that the SUB-ADVISER and its affiliates now act,
will continue to act and may act in the future as investment adviser to
fiduciary and other managed accounts and as investment adviser to
other investment companies, and VALIC has no objection to the SUB-
ADVISER so acting, provided that whenever the Covered Fund(s) and
one or more other accounts or investment companies advised by the
SUB-ADVISER have available funds for investment, investments
suitable and appropriate for each will be allocated in accordance with a
methodology believed to be equitable to each entity. The SUB-
ADVISER similarly agrees to allocate opportunities to sell securities on
an equitable basis. VALIC recognizes that, in some cases, this
procedure may limit the size of the position that may be acquired or
sold for the Covered Fund(s). In addition, VALIC understands that the
persons employed by the SUB-ADVISER to assist in the performance
of the SUB-ADVISER's duties hereunder will not devote their full time
to such service and nothing contained herein shall be deemed to limit or
restrict the right of the SUB-ADVISER or any affiliate of the SUB-
ADVISER to engage in and devote time and attention to other business
or to render services of whatever kind or nature.
Except as otherwise required by the 1940 Act, any of the shareholders,
directors, officers and employees of VALIC may be a shareholder,
director, officer or employee of, or be otherwise interested in, the
SUB-ADVISER, and in any person controlling, controlled by or under
common control with the SUB-ADVISER; and the SUB-ADVISER,
and any person controlling, controlled by or under common control
with the SUB-ADVISER, may have an interest in VALIC.
The SUB-ADVISER shall not be liable to VALIC, VC I, the Covered
Funds, or to any shareholder in the Covered Fund(s), and VALIC shall
indemnify the SUB-ADVISER, for any act or omission in rendering
services under this Agreement, or for any losses sustained in
connection with the matters to which this agreement relates, so long as
there has been no willful misfeasance, bad faith, gross negligence, or
reckless disregard of obligations or duties on the part of the SUB-
ADVISER in performing its duties under this Agreement. The
provisions of this paragraph shall survive the termination of the
Agreement.
VALIC shall perform quarterly and annual tax compliance tests and
promptly furnish reports of such tests to the SUB-ADVISER after each
quarter end to ensure that the Covered Fund(s) is in compliance with
Subchapter M of the Code and Section 817(h) of the Code. VALIC
shall apprise the SUB-ADVISER promptly after each quarter end of
any potential non-compliance with the diversification requirements in
such Code provisions. If so advised, the SUB-ADVISER shall take
prompt action so that the Covered Fund complies with such Code
diversification provisions, as directed by VALlC. VALIC
acknowledges that the SUB-ADVISER shall rely completely upon
VALIC's determination of whether and to what extent each Covered
Fund(s) is in compliance with Subchapter M and Section 817(h) of the
Code and that the SUB-ADVISER has no separate and independent
responsibility to test for such compliance.
The SUB-ADVISER does not guarantee the future performance of the
Covered Fund(s) or any specific level of performance, the success of
any investment decision or strategy that SUB-ADVISER may use, or
the success of SUB-ADVISER's overall management of the Covered
Fund(s). VALIC and VC I understand that investment decisions made
for the Covered Fund(s) by the SUB-ADVISER are subject to various
market, currency, economic, political and business risks and that those
investment decisions will not always be profitable. The SUB-
ADVISER will manage only the assets of the Covered Fund(s)
allocated to its management by VALIC and in making investment
decisions for the Covered Fund(s).
5. Representations of the SUB-ADVISER and VALIC
The SUB-ADVISER represents, warrants, and agrees as follows:
(a) The SUB-ADVISER (i) is registered as an investment adviser
under the Advisers Act and will continue to be so registered
for so long as this Agreement remains in effect: (ii) is not
prohibited by the 1940 Act or the Advisers Act from
performing the services contemplated by this Agreement;
(iii) has met, and will continue to meet for so long as this
Agreement remains in effect, any applicable federal or state
requirements, or the applicable requirements of any regulatory
or industry self-regulatory agency, necessary to be met in
order to perform the services contemplated by this Agreement;
(iv) has the authority to enter into and perform the services
contemplated by this Agreement, and (v) will immediately
notify VALIC of the occurrence of any event that would
disqualify the SUB-ADVISER from serving as an investment
adviser of an investment company pursuant to Section 9(a) of
the 1940 Act or otherwise.
(b) The SUB-ADVISER has adopted a written code of ethics
complying with the requirements of Rule 17j-1 under the 1940
Act and if it has not already done so, will provide VALIC and
VC I with a copy of such code of ethics together with
evidence of its adoption.
(c) The SUB-ADVISER has provided VALIC and VC I with a
copy of its Form ADV as most recently filed with the
Securities and Exchange Commission ("SEC") and will
promptly after filing any amendment to its Form ADV with
the SEC, furnish a copy of such amendment to VALIC.
VALIC represents, warrants, and agrees as follows:
(a) VALIC: (i) is registered as an investment adviser under the
Advisers Act and will continue to be so registered for so long
as this Agreement remains in effect: (ii) is not prohibited by
the 1940 Act or the Advisers Act from performing the services
contemplated by this Agreement; (iii) has met, and will
continue to meet for so long as this Agreement remains in
effect, any applicable federal or state requirements, or the
applicable requirements of any regulatory or industry self-
regulatory agency, necessary to be met in order to perform the
services contemplated by this Agreement; (iv) has the
authority to enter into and perform the services contemplated
by this Agreement; and (v) will immediately notify the SUB-
ADVISER of the occurrence of any event that would
disqualify VALIC from serving as an investment adviser of an
investment company pursuant to Section 9(a) of the 1940 Act
or otherwise.
(b) VALIC has the authority under the Investment Advisory
Agreement between VALIC and VC I to delegate some or all
of its responsibilities to one or more sub-advisers and the
delegation to the SUB-ADVISER under this Agreement is
authorized by and consistent with the grant of authority in that
Investment Advisory Agreement.
6. Term of Agreement
This Agreement shall become effective as to the Covered Fund(s) set
forth on Schedule A on the date hereof and as to any other Fund on the
date of the Amendment to Schedule A adding such Fund in accordance
with this Agreement. Unless sooner terminated as provided herein, this
Agreement shall continue in effect for two years from its effective date.
Thereafter, this Agreement shall continue in effect, but with respect to
any Covered Fund, subject to the termination provisions and all other
terms and conditions hereof, only so long as such continuance is
approved at least annually by the vote of a majority of VC I's Directors
who are not parties to this Agreement or interested persons of any such
parties, cast in person at a meeting called for the purpose of voting on
such approval, and by a vote of a majority of VC I's Board of Directors
or a majority of that Covered Fund's outstanding voting securities (as
defined in the 1940 Act).
This Agreement shall automatically terminate in the event of its
assignment as that term is defined in the 1940
Act or in the event of the termination of the Investment Advisory
Agreement between VALIC and VC I as it relates to any Covered
Fund(s). The Agreement may be terminated as to any Covered Fund at
any time, without the payment of any penalty, by vote of VC I's Board
of Directors or by vote of a majority of that Covered Fund's outstanding
voting securities on not more than 60 days' nor less than 30 days' prior
written notice to the SUB-ADVISER, or upon such shorter notice as
may be mutually agreed upon by the parties. This Agreement may also
be terminated by VALIC: (i) on not more than 60 days' nor less than 30
days' prior written notice to the SUB-ADVISER, or upon such shorter
notice as may be mutually agreed upon by the parties, without the
payment of any penalty; or (ii) if the SUB-ADVISER becomes unable
to discharge its duties and obligations under this Agreement. The SUB-
ADVISER may terminate this Agreement at any time, or preclude its
renewal without the payment of any penalty, on not more than 60 days'
nor less than 30 days' prior written notice to VALIC, or upon such
shorter or longer notice as may be mutually agreed upon by the parties.
7. Indemnification
VALIC agrees to indemnify the SUB-ADVISER for losses, costs, fees,
expenses and claims which arise directly or indirectly (i) as a result of a
failure by VALIC to provide the services or furnish materials required
under the terms of this Agreement, or (ii) as the result of any untrue
statement of a material fact or any omission to state a material fact
required to be stated or necessary to make the statements, in light of the
circumstances under which they were made, not misleading in any
registration statements, proxy materials, reports, advertisements, sales
literature, or other materials pertaining to VC I or a Covered Fund,
except insofar as any such statement or omission was specifically made
in reliance on written information provided by the SUB-ADVISER to
VALIC. The provisions of this paragraph shall survive the termination
of this Agreement.
The SUB-ADVISER agrees to indemnify VALIC for losses and claims
which arise (i) as a result of the willful misfeasance, bad faith, gross
negligence or reckless disregard of obligations or duties by the SUB-
ADVISER; or (ii) as the result of any untrue statement of a material
fact or any omission to state a material fact required to be stated or
necessary to make the statements, in light of the circumstances under
which they were made, not misleading in any registration statements,
proxy materials, reports, advertisements, sales literature, or other
materials pertaining to VC I or a Covered Fund to the extent any such
statement or omission was made in reliance on written information
provided by the SUB-ADVISER. The provisions of this paragraph shall
survive the termination of this Agreement.
Promptly after receipt by either VALIC or SUB-ADVISER (an
"Indemnified Party") under this Section 7 of the commencement of an
action, such Indemnified Party will, if a claim in respect thereof is to be
made against the other party (the "Indemnifying Party") under this
section, notify Indemnifying Party of the commencement thereof; but
the omission so to notify Indemnifying Party will not relieve it from
any liability that it may have to any Indemnified Party otherwise than
under this section. In case any such action is brought against any
Indemnified Party, and it notified Indemnifying Party of the
commencement thereof, Indemnifying Party will be entitled to
participate therein and, to the extent that it may wish, assume the
defense thereof, with counsel satisfactory to such Indemnified Party.
After notice from Indemnifying Party of its intention to assume the
defense of an action, the Indemnified Party shall bear the expenses of
any additional counsel obtained by it, and Indemnifying Party shall not
be liable to such Indemnified Party under this section for any legal or
other expenses subsequently incurred by such Indemnified Party in
connection with the defense thereof other than reasonable costs of
investigation.
8. Other Matters
The SUB-ADVISER may from time to time employ or associate with
itself any person, or persons believed to be particularly fit to assist in its
performance of services under this Agreement, provided no such
person serves or acts as an investment adviser separate from the SUB-
ADVISER so as to require a new written contract pursuant to the 1940
Act. The compensation of any such persons will be paid by the SUB-
ADVISER, and no obligation will be incurred by, or on behalf of,
VALIC or VC I with respect to them.
The SUB-ADVISER agrees that all books and records which it
maintains for the Covered Fund(s) are the Covered Fund's property.
The SUB-ADVISER also agrees upon request of VALIC or VC I, to
promptly surrender the books and records in accordance with the 1940
Act and rules thereunder; provided, however, that the SUB-ADVISER
may retain copies of such books and records to the extent necessary to
comply with applicable law or regulation. The SUB-ADVISER 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. The SUB-ADVISER agrees that all books and records which
it maintains for the Covered Fund(s) are the Covered Fund(s)'s property
and will be surrendered promptly to the Covered Fund(s) or VALIC
upon request, provided the SUB-ADVISER will not be required to
surrender or delete any books and records from back-up, archival or
electronic storage maintained by the SUB-ADVISER. The SUB-
ADVISER 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 SEC, the Covered Fund(s)'s auditors, the Covered
Fund(s) or any representative of the Covered Fund(s), VALIC, or any
governmental agency or other instrumentality having regulatory
authority over the Covered Fund(s)
VALIC has herewith furnished the SUB-ADVISER copies of VC I's
Prospectus, Statement of Additional Information, investment
objectives, policies and restrictions, and any applicable procedures
adopted by VC I's Board of Directors, as currently in effect for the
Covered Fund(s) and agrees during the continuance of this Agreement
to furnish the SUB-ADVISER copies of any amendments or
supplements thereto before or at the time the amendments or
supplements become effective. Until VALIC delivers any amendments
or supplements to the SUB-ADVISER, the SUB-ADVISER shall be
fully protected in relying on the documents previously furnished to it.
The SUB-ADVISER is authorized to honor and act on any notice,
instruction or confirmation given by VALIC on behalf of VC I or the
Covered Fund(s) in writing signed or sent by any of the persons who
the SUB-ADVISER has reason to believe are acting in good authority.
The SUB-ADVISER shall not be liable for so acting in good faith upon
such instructions, confirmation or authority.
VALIC agrees to furnish the SUB-ADVISER at its principal office
prior to use thereof, copies of all prospectuses, statements of additional
information, proxy statements, reports to shareholders, sales literature,
or other material prepared for distribution to shareholders of the
Covered Fund(s) or the public that refer in any way to the SUB-
ADVISER, and not to use such material if the SUB-ADVISER
reasonably objects in writing within ten (10) business days (or such
other time as may be mutually agreed) after receipt thereof. In the event
of termination of this Agreement, VALIC will continue to furnish to
the SUB-ADVISER copies of any of the above-mentioned materials
that refer in any way to the SUB-ADVISER and shall cease to use the
SUB-ADVISER name and/or logo as soon as is reasonable. VALIC
shall furnish or otherwise make available to the SUB-ADVISER such
other information relating to the business affairs of VALIC and the
Covered Fund as the SUB-ADVISER at any time, or from time to time,
may reasonably request in order to discharge obligations hereunder.
The provisions of this paragraph shall survive the termination of this
Agreement.
VALIC agrees that the SUB-ADVISER may use the name of VALIC
or VC I in any material that merely refers in accurate terms to the
appointment of the SUB-ADVISER hereunder.
9. Applicability of Federal Securities Laws
This Agreement shall be interpreted in accordance with the laws of the
State of New York and applicable federal securities laws and
regulations, including definitions therein and such exemptions as may
be granted to VALIC or the SUB-ADVISER by the SEC or such
interpretive positions as may be taken by the SEC or its staff. To the
extent that the applicable law of the State of New York, or any of the
provisions herein, conflict with applicable provisions of the federal
securities laws, the latter shall control.
10. Amendment and Waiver
The Agreement may be amended by mutual written consent of the
parties, subject to the requirements of the
1940 Act and the rules and regulations promulgated and orders granted
thereunder.
11. Force Majeure
Neither party to this Agreement shall be liable for damages resulting
from delayed or defective performance when such delays arise out of
causes beyond the control and without the fault or negligence of the
offending party and could not have been reasonably prevented by the
offending party through back-up systems and other business
continuation and disaster recovery procedures commonly employed by
other SEC-registered investment advisers that meet reasonable
commercial standards in the investment company industry. Such causes
may include, but are not restricted to, Acts of God or of the public
enemy, terrorism, acts of the State in its sovereign capacity, fires,
floods, earthquakes, power failure, disabling strikes, epidemics,
quarantine restrictions, and freight embargoes.
12. Notices
All notices hereunder shall be given in writing (and shall be deemed to
have been duly given upon receipt) by delivery in person, by facsimile,
by registered or certified mail or by overnight delivery (postage
prepaid, return receipt requested) to VALIC and to SUB-ADVISER at
the address of each set forth below:
If to VALIC:
The Variable Annuity Life Insurance Company
Attn: Mutual Fund Legal
0000 Xxxxx Xxxxxxx, 0xx Xxxxx
Xxxxxxx, Xxxxx 00000
If to SUB-ADVISER:
Janus Capital Management LLC
000 Xxxxxxx Xxxxxx
Xxxxxx, XX 00000
Attention: General Counsel
13. Severability
If any part of this Agreement be held invalid or unenforceable to any
extent, the remainder of this Agreement shall be enforced to the
greatest extent permitted by law.
[Signature Page Follows]
The parties hereto have each caused this Agreement to be signed in duplicate on
its behalf by its duly authorized officer on the above date.
THE VARIABLE ANNUITY LIFE INSURANCE COMPANY
By: /s/ Xxxxxx X. Xxxx
Name: Xxxxxx X. Xxxx
Title: Vice President
ATTEST: /s/ Xxxxx X. Xxxxxx XX
Name: Xxxxx X. Xxxxxx XX
Title: Assistant Secretary
JANUS CAPITAL MANAGEMENT LLC
By: /s/ Xxxxxxx X. Xxxxxxx
Name: Xxxxxxx X. Xxxxxxx
Title: Senior Vice President
ATTEST: /s/ Xxxx Xxxxxxxxxxx
Name: Xxxx Xxxxxxxxxxx
Title: Legal Counsel
SCHEDULE A
COVERED FUNDS
E
f
f
e
c
t
i
v
e
M
a
y
3
0
,
2
0
1
7
Annual Fee computed at the following annual rate, based on average daily net
asset value for each month on that portion of the assets managed by SUB-
ADVISER, and payable monthly:
Covered Fund Fee
Mid-Cap Strategic Growth Fund 0.44% on the first
$50 million
0.40% over $50 million
1
4
17
