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SCHEDULE 14C INFORMATION
Information Statement Pursuant to Section 14(c) of
the Securities Exchange Act of 1934 (Amendment No. )
Check the appropriate box:
<TABLE>
<S> <C>
/ / Preliminary Information Statement
/ / Confidential, for Use of the Commission Only (as permitted
by Rule 14c-5(d)(2))
/X/ Definitive Information Statement
</TABLE>
STYLE SELECT SERIES, INC.
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(Name of Registrant as Specified in its Charter)
Payment of Filing Fee (Check the appropriate box):
/X/ No fee required.
/ / Fee computed on table below per Exchange Act Rules 14c-5(g) and 0-11.
l) Title of each class of securities to which transaction applies:
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2) Aggregate number of securities to which transaction applies:
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3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):
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4) Proposed maximum aggregate value of transaction:
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5) Total Fee paid:
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/ / Fee paid previously with preliminary materials.
/ / Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
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2) Form, Schedule or Registration Statement No.:
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3) Filing Party:
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4) Date Filed:
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SUNAMERICA ASSET MANAGEMENT CORP.
The SunAmerica Center
733 Third Avenue
New York, NY 10017
212.551.5969
800.858.8850
[LOGO]
May 26, 1998
Dear Large-Cap Blend Portfolio Shareholder:
The enclosed information statement details a recent subadviser change for
the Large-Cap Blend Portfolio of Style Select Series, Inc. On March 26, 1998,
the Board of Directors approved the engagement of Morgan Stanley Asset
Management Inc. to manage the same portion of the Portfolio that SunAmerica
Asset Management Corp. had been managing, effective as of April 1, 1998.
Morgan Stanley Asset Management joins Lazard Asset Management and T. Rowe
Price Associates, Inc., the Portfolio's other subadvisers, managing
approximately one-third of the Portfolio. We are optimistic that your Portfolio
will continue to benefit under the management of these three fine firms.
As a matter of regulatory compliance, we are sending you this information
statement which describes the management structure of the Portfolio, the
ownership of Morgan Stanley Asset Management, and the terms of the Subadvisory
Agreement with Morgan Stanley Asset Management which the Directors have
approved.
Please feel free to call your financial adviser or to call us at (800)
858-8850 should you have any questions on the enclosed information statement. We
thank you for your continued interest in the Style Select Series Portfolios.
Sincerely,
/s/ Peter A. Harbeck
[LOGO]
Peter A. Harbeck
PRESIDENT
<PAGE>
STYLE SELECT SERIES, INC.
LARGE-CAP BLEND PORTFOLIO
THE SUNAMERICA CENTER
733 THIRD AVENUE
NEW YORK, NEW YORK 10017
------------------------
INFORMATION STATEMENT
---------------------
This information statement is being provided to the shareholders of the
Large-Cap Blend Portfolio (the "Portfolio") of Style Select Series, Inc. ("Style
Select" or the "Corporation") in lieu of a proxy statement, pursuant to the
terms of an exemptive order Style Select has received from the Securities and
Exchange Commission which permits the Portfolio's manager to hire new
subadvisers and to make changes to existing subadvisory contracts with the
approval of the Board of Directors, but without obtaining shareholder approval.
This information statement is being furnished by the Directors of the
Corporation.
WE ARE NOT ASKING YOU FOR A PROXY AND YOU ARE REQUESTED NOT TO SEND US A
PROXY.
This information statement will be mailed on or about May 27, 1998.
THE CORPORATION
The Large-Cap Blend Portfolio is an investment portfolio of Style Select, a
Maryland corporation. The Corporation has entered into an Investment Advisory
and Management Agreement dated September 17, 1996, as amended from time to time,
with SunAmerica Asset Management Corp., a Delaware corporation ("SunAmerica" or
the "Adviser") (the "Advisory Agreement"). By the time this Information
Statement is mailed, the Advisory Agreement will have been amended again.
SunAmerica selects the subadvisers for and/or manages the investments of each
Portfolio of Style Select, provides various administrative services and
supervises each Portfolio's daily business affairs, subject to general review by
the Board of Directors. The Advisory Agreement authorizes SunAmerica to manage
the assets of each Portfolio and/or to retain the subadvisers to do so.
SunAmerica selects subadvisers it believes will provide each Portfolio with the
highest quality investment services, while obtaining, within each Portfolio's
overall investment objective, a distinct investment style. SunAmerica monitors
the activities of the subadvisers and, from time to time, will recommend the
replacement of a subadviser on the basis of investment performance, style drift
or other considerations.
The subadvisers to Style Select act pursuant to agreements with SunAmerica.
Their duties include furnishing continuing advice and recommendations to the
relevant portion of the respective Portfolio regarding securities to be
purchased and sold. Each of the subadvisers is independent of SunAmerica and
discharges its responsibilities subject to the oversight and supervision of
SunAmerica, which pays the subadvisers' fees. The Portfolios do not pay fees
directly to the subadvisers. However, in accordance with procedures adopted by
the Directors, a subadviser may effect portfolio transactions through an
affiliated broker-dealer, acting as agent not as principal, and receive
brokerage commissions in connection therewith as permitted by Section 17(e) of
the Investment Company Act of 1940, as amended, the rules thereunder and other
applicable securities laws.
THE SUBADVISORY AGREEMENT
Since October 1997, SunAmerica has managed a portion of the Portfolio's
assets pursuant to the aforementioned Advisory Agreement. At a meeting held on
March 26, 1998, the Directors, including a majority of the Directors who are not
interested persons of the Portfolio or SunAmerica, approved SunAmerica's
recommendation to engage Morgan Stanley Asset Management Inc. ("MSAM" or the
"Subadviser") to manage the same portion of the Portfolio that SunAmerica had
been managing. Accordingly, the Directors approved a Subadvisory Agreement with
MSAM (the "Subadvisory Agreement"), which became effective April 1, 1998. The
recommendation to engage MSAM was made by SunAmerica due to the resignation of
the portfolio manager responsible for SunAmerica's portion of the
<PAGE>
Portfolio. After extensive research and qualitative and quantitative analysis of
numerous candidate firms and their organizational structure, investment process
and style, and long-term performance record, SunAmerica believes that MSAM's
management style is appropriately suited to the Portfolio and expects MSAM's
management style to complement that of the Portfolio's other Subadvisers, Lazard
Asset Management ("Lazard") and T. Rowe Price Associates, Inc. ("T. Rowe Price")
(together with MSAM, the "Subadvisers").
Under the Advisory Agreement, the annual rate of the investment advisory fee
payable to SunAmerica that applies to the Large-Cap Blend Portfolio is 1.00% of
Assets. The term "Assets" means the average daily net assets of the Portfolio.
This fee is accrued daily and paid monthly, and may be higher than those charged
to other Portfolios. For the fiscal year ended October 31, 1997, SunAmerica paid
fees to the Subadvisers of the Large-Cap Blend Portfolio equal to the aggregate
annual rate of 0.32%, expressed as a percentage of the Assets of the Portfolio.
The net advisory fee retained by SunAmerica with respect to the Portfolio after
SunAmerica paid all other Subadvisers managing its assets was 0.68%, expressed
as the aggregate annual rate of the Assets of the Portfolio.
The Subadvisory Agreement is substantially similar in form and substance to
the Subadvisory Agreements for Lazard and T. Rowe Price and the Advisory
Agreement, and provides for the Subadviser to manage the portion of the
Portfolio allocated to it on a discretionary basis, provides for the Adviser to
compensate the Subadviser for its services, authorizes the Subadviser to select
the brokers or dealers to effect portfolio transactions on behalf of the
Portfolio, and requires the Subadviser to comply with the Portfolio's investment
policies and restrictions and with applicable law. A form of the Subadvisory
Agreement is attached to this information statement as Exhibit A.
INFORMATION ABOUT MSAM
MSAM is a wholly owned subsidiary of Morgan Stanley, Dean Witter & Co., with
principal offices at 1221 Avenue of the Americas, New York, New York 10020. MSAM
offers investment management and fiduciary services to taxable and tax-exempt
funds and institutions, international organizations and individuals investing in
U.S. and international equity and fixed income securities. As of March 31, 1998,
MSAM had approximately $99 billion of combined assets under management as
investment managers or fiduciary advisers. MSAM's Investment Strategy Group is
responsible for its overall asset allocation and portfolio policy, working
within the Group's investment philosophy and policy guidelines to meet the
objectives, needs and risk tolerances of each individual client. MSAM emphasizes
a global investment strategy and benefits from research coverage of a broad
spectrum of investment opportunities worldwide by drawing upon the capabilities
of its asset management specialists located in various offices worldwide. MSAM
is not affiliated with SunAmerica.
The names and principal occupations of the Directors and Principal Executive
Officers of MSAM are set forth below:
<TABLE>
<CAPTION>
NAME POSITION ADDRESS
- --------------------------- ------------------------------------- ----------
<S> <C> <C>
Barton M. Biggs Chairman of the Board, Chief MSAM
Investment Officer
Marna C. Whittington Chief Operating Officer MSAM
James M. Allwin President MSAM
Peter A. Nadosy Vice Chairman of the Board MSAM
P. Dominic Caldecott Managing Director MSAM
Madhav Dhar Managing Director MSAM
Thomas Bennett Managing Director MSAM
Alan Goldberg Managing Director MSAM
Frank P. L. Minard Managing Director MSAM
Richard B. Worley Managing Director MSAM
Francine J. Bovich Managing Director MSAM
</TABLE>
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<PAGE>
BOARD OF DIRECTORS' CONSIDERATIONS
In approving the Subadvisory Agreement, the Directors, at an in-person
meeting held on March 26, 1998, considered certain factors, including (i) the
nature and quality of the services expected to be rendered by MSAM to the
Portfolio, including the credentials and investment experience of its officers
and employees; (ii) MSAM's investment approach, which is expected to complement
that of Lazard and T. Rowe Price and to provide additional diversification to
the Portfolio, (iii) the structure of MSAM and its ability to provide services
to the Portfolio, based on its financial condition, its performance record, and
the fact that MSAM serves as subadviser of two other SunAmerica funds; (iv) a
comparison of MSAM's subadvisory fee with those of other advisers; and (v)
indirect costs and benefits of providing such subadvisory services to the
Portfolio. The Directors determined that the engagement of MSAM as Subadviser to
the Portfolio and the subadvisory fee were reasonable, fair and in the best
interests of the Portfolio and its shareholders.
ADDITIONAL INFORMATION
SunAmerica serves as investment adviser, selects the subadvisers for and/or
manages the investments of each Portfolio, provides various administrative
services and supervises each Portfolio's daily business affairs, subject to
general review by the Directors. SunAmerica Capital Services, Inc. (the
"Distributor") serves as distributor of the shares of each Portfolio of the
Corporation. Both SunAmerica and the Distributor are located at The SunAmerica
Center, 733 Third Avenue, New York, New York 10017.
The Corporation is not required to hold annual meetings of shareholders and,
therefore, it cannot be determined when the next meeting of shareholders will be
held. Shareholder proposals to be considered for inclusion in the proxy
statement for the next meeting of shareholders must be submitted a reasonable
time before the proxy statement is mailed. Whether a proposal submitted will be
included in the proxy statement will be determined in accordance with applicable
state and federal law.
Copies of the most recent annual and semi-annual reports are available
without charge. Copies of such reports may be obtained by writing to SunAmerica,
at The SunAmerica Center, 733 Third Avenue, New York, New York 10017, or by
calling (800) 858-8850.
By Order of the Directors,
/s/ Robert M. Zakem
[LOGO]
Robert M. Zakem
SECRETARY
Dated: May 26, 1998
3
<PAGE>
EXHIBIT A
SUBADVISORY AGREEMENT
This SUBADVISORY AGREEMENT is dated as of April 1, 1998 by and between
SUNAMERICA ASSET MANAGEMENT CORP., a Delaware corporation (the "Adviser"), and
MORGAN STANLEY ASSET MANAGEMENT INC., a Delaware corporation (the "Subadviser').
W I T N E S S E T H:
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, as amended August 20, 1997 (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 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. 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, will provide the Adviser with records
concerning its activities which the Adviser or the Corporation is required to
maintain, 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 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 represents and warrants to the Adviser that the portion of
the assets which it manages of the Portfolio set forth in Schedule A will at all
times be operated and managed in compliance with all applicable federal and
state laws governing its operations and investments. Without limiting the
foregoing, the Subadviser represents and warrants (1) qualification, election
and maintenance of such election by each Portfolio to be treated as a "regulated
investment company" under subchapter M, chapter 1 of the Internal Revenue Code
of 1986, as amended (the "Code"), and (2) 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. The Subadviser further represents and warrants that to the extent that any
statements or omissions 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 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")
<PAGE>
and the Act and will not contain any untrue statement of a material fact or omit
to state any material fact necessary to make the statements therein, in light of
the circumstance under which they were made not misleading.
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.
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, the selection of broker-dealers and futures commission merchants',
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. 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.
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
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<PAGE>
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 as agreed upon by the
Corporation or the Adviser and the Subadviser.
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 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.
7. 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 Corporation pursuant to the requirements of Rule 31a-1 of that
Act. 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 are the
property of the Corporation and will be surrendered promptly to the Corporation
or the Adviser on request.
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.
8. REFERENCE TO THE SUBADVISER. Neither the Corporation nor the Adviser or
any affiliate or agent thereof shall make reference to or use the name 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.
9. LIABILITY OF THE SUBADVISER. (a) In the absence of willful misfeasance,
bad faith, gross negligence or reckless disregard of obligations or duties
hereunder on the part of the Subadviser (and its officers, directors, employees,
controlling persons, shareholders and any other person or entity affiliated with
the Subadviser) the Subadviser shall not be subject to liability 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.
(b) The Adviser agrees to indemnify and hold harmless the Subadviser and
its affiliates and each of their directors and officers and each persons, if
any, who controls the Subadviser 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 Subadviser or its
affiliates or such directors, officers or controlling person may become subject
under the 1933 Act, under an other statute, at common law or otherwise, which
may be based upon any breach of this Agreement by the Adviser; provided,
however, that
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in no case is the Adviser's indemnity in favor of any persons deemed to protect
such person against any liability to which such person would otherwise be
subject by reason of willful misfeasance, bad faith, or gross negligence in the
performance of his, her or its duties or by reasons of his, her or its reckless
disregard of obligations and duties under this Agreement.
(c) 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 may
be based upon (i) breach of this Agreement by the Subadviser, or (ii) any
failure by the Subadviser to comply with the representations and warranties set
forth in Section 1 of this Agreement; 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.
(d) The Subadviser shall not be liable to the Adviser 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 or (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 Adviser or any other subadviser to a
Portfolio, which records are not also maintained by or otherwise available to
the Subadviser upon reasonable request. The Adviser agrees that 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 Subadviser.
The Adviser shall indemnify the 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 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 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, 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; provided, however, that this Agreement may not be
terminated by the Subadviser unless another subadvisory agreement has been
approved by the Corporation in accordance with the Act, or after
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six months' written notice, whichever is earlier. 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.
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 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.
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:
<TABLE>
<C> <S> <C>
Subadviser: Morgan Stanley Asset Management Inc.
1221 Avenue of the Americas
New York, New York 10020
Attention: Harold J. Schaff, Jr.
General Counsel
Adviser: SunAmerica Asset Management Corp.
The SunAmerica Center
733 Third Avenue, Third Floor
New York, NY 10017-3204
Attention: Robert M. Zakem
Senior Vice President and General Counsel
</TABLE>
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.
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<S> <C> <C>
By:
------------------------
Name: Peter A. Harbeck
Title: PRESIDENT
</TABLE>
MORGAN STANLEY ASSET MANAGEMENT INC.
<TABLE>
<S> <C> <C>
By:
------------------------
Name: Harold J. Schaff, Jr.
Title GENERAL COUNSEL
</TABLE>
5
