SCHEDULE 14C INFORMATION
Information Statement Pursuant to Section 14 (c) of the Securities
Exchange Act of 1934
(Amendment No. )
Check the appropriate box:
[X] Preliminary Information Statement
[ ] Confidential,for Use of the Commission Only (as permitted by Rule 14c-5
(d)(2))
[ ] Definitive Information Statement
Style Select Series, Inc.
(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.
1) 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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[LOGO]
August 4, 1999
Dear International Equity Portfolio Shareholder:
The enclosed information statement is being provided to shareholders of the
International Equity Portfolio of Style Select Series, Inc. as a result of a
change in control of one of its subadvisers, Bankers Trust Company. On June 4,
1999, Bankers Trust Corporation, the parent company of Bankers Trust Company,
merged with Deutsche Bank AG, resulting in Bankers Trust Company becoming an
indirect wholly owned subsidiary of Deutsche Bank AG.
As a matter of regulatory compliance, we are sending you this information
statement which describes the management structure of the Portfolio, the
ownership of Bankers Trust Company, and the terms of the Subadvisory Agreement
with Bankers Trust Company 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, Inc.
Portfolios.
Sincerely,
/s/ Peter A. Harbeck
Peter A. Harbeck
PRESIDENT
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STYLE SELECT SERIES, INC.
INTERNATIONAL EQUITY PORTFOLIO
THE SUNAMERICA CENTER
733 THIRD AVENUE
NEW YORK, NEW YORK 10017
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INFORMATION STATEMENT
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This information statement is being provided to the shareholders of the
International Equity Portfolio ("International Equity") 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 received from the
Securities and Exchange Commission which permits SunAmerica Asset Management
Corp. ("SunAmerica") to hire new subadvisers and to make changes to existing
subadvisory contracts with the approval of the Board of Directors, (the
"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 August 4, 1999.
Copies of the most recent annual and semi-annual reports of Style Select are
available without charge and 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.
PURPOSE OF THE INFORMATION STATEMENT
On November 30, 1998, Bankers Trust Corporation, entered into an Agreement
and Plan of Merger whereby Deutsche Bank AG ("Deutsche Bank") would acquire
Bankers Trust Corporation, the parent company of Bankers Trust Company ("BT"), a
subadviser to International Equity. Bankers Trust Corporation and Deutsche Bank
completed the merger on June 4, 1999, resulting in BT becoming an indirect
wholly owned subsidiary of Deutsche Bank. The acquisition constitutes a change
in control of BT which results in an "assignment," as that term is defined in
Section 2(a)(4) of the Investment Company Act of 1940 (the "1940 Act"), and
consequently a termination of the Subadvisory Agreement between SunAmerica Asset
Management Corp. ("SunAmerica"), the investment adviser and manager, and BT with
respect to International Equity.
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The Corporation
The International Equity Portfolio is an investment series of Style Select,
a Maryland corporation. The Corporation initially entered into an Investment
Advisory Agreement (the "Advisory Agreement") with SunAmerica on September 17,
1996 and entered into a new Advisory Agreement with SunAmerica on January 1,
1999. SunAmerica selects the subadvisers for and/or manages the investments of
the Portfolios of Style Select, provides various administrative services and
supervises the Portfolios' daily business affairs, subject to general review by
the Directors. The Advisory Agreement authorizes SunAmerica to retain the
subadvisers for the Portfolios or portions thereof for which it does not manage
the assets. SunAmerica selects the subadvisers it believes will provide the
Portfolios with the highest quality investment services, while obtaining, within
the Portfolios' overall investment objective, a distinct investment style.
The subadvisers to Style Select act pursuant to agreements with SunAmerica.
Their duties include furnishing continuing advice and recommendations to the
relevant portion of their respective Portfolios 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 1940 Act, as amended, the rules thereunder and other applicable securities
laws.
INFORMATION ABOUT THE INTERNATIONAL EQUITY PORTFOLIO
The International Equity Portfolio seeks long-term growth of capital by
investing in equity securities of issuers in countries other than the United
States. It invests in securities of companies without regard to their market
capitalization, and also from time to time in companies located in countries
considered to be emerging markets. Under normal conditions, the International
Equity Portfolio will invest at least 65% of its total assets in equity
securities of issuers in at least three countries other than the United States
and up to 35% of its total assets in debt securities with expected potential
capital appreciation.
THE SUBADVISORY AGREEMENTS
Pursuant to a Subadvisory Agreement with SunAmerica dated January 1, 1999
(the "Previous Agreement"), BT has been serving as one of the subadvisers to
International Equity. This Previous Agreement terminated upon the consummation
of the merger between Deutsche Bank and Bankers Trust Corporation on June 4,
1999. At the Board meeting held on May 26, 1999, the Directors approved a new
Subadvisory Agreement with BT, effective June 4, 1999, which is substantially
identical in all material respects to the Previous Agreement.
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Under the Advisory Agreement, the annual rates of the investment advisory
fees payable to SunAmerica for International Equity are 1.10% for the first $750
million of Assets, 1.05% for the next $750 million and 1.00% thereafter. 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
mutual funds. For the fiscal year ended October 31, 1998, SunAmerica paid fees
to the subadvisers of International Equity, equal to the aggregate annual rate
of 0.66% of Assets. The fees retained by SunAmerica for International Equity is
0.44%.
The new agreement between BT and SunAmerica, on behalf of International
Equity, is substantially similar in form and in substance to the Previous
Agreement, in that they (i) provide for the Subadviser to manage the portion of
the relevant portfolio allocated to it on a discretionary basis, (ii) provide
for the Adviser to compensate the Subadviser for its services, (iii) authorize
the Subadviser to select the brokers or dealers to effect portfolio transactions
for the Portfolio, and (iv) require the Subadviser to comply with the
Portfolio's investment policies and restrictions and with applicable law. The
new agreement will not result in any increase in fees to shareholders. A form of
the Subadvisory Agreement is attached to this information statement as Exhibit
A.
INFORMATION ABOUT BANKERS TRUST COMPANY
BT is the principal banking subsidiary of BT Corporation. BT is a bank and,
therefore, not required to register as an investment adviser under the Advisers
Act. BT provides a broad range of commercial banking and financial services and
is a major wholesale supplier of financial services to the international and
domestic institutional markets. BT also engages in trading currencies,
securities, derivatives and commodities. As of March 31, 1999, BT managed
approximately $378 billion in assets.
BT utilizes an investment objective of achieving long-term capital
appreciation primarily through investing in high-quality, undervalued non-U.S.
mid- and large-cap stocks that exhibit strong earnings and cash flow potential.
An active desire to maximize after-tax returns by emphasizing equities that can
outperform both in bull and bear markets results in low turnover. BT also
employs a currency overlay strategy to mitigate adverse exchange rate
fluctuations.
Fundamental analysis of individual securities forms the basis for BT=s
stock selection. Although individual markets are screened for relative
attractiveness, regional allocations preferences are ultimately driven by the
availability of undervalued stocks with outstanding growth characteristics. As a
result, smaller markets may receive a higher relative weighting than their
representation in the world's market capitalization, while Japan may remain
underweighted.
BT uses a methodology for stock selection which screens numerous criteria,
such as various measures of free cash flow, relative valuation parameters and
earnings revisions of over 4,000 companies. These proprietary models attempt to
place all equities on an equal footing, eliminating country-specific accounting
practices which could under- or overstate earnings growth and disguise relative
attractiveness across markets. Rather than emphasize traditional price to
earnings ratios, BT focuses on cash flows because it believes that they are a
better measure of a firm's ability to generate
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profits. BT's investment process uses an earnings estimate revision model which
compiles the expectations of analysts worldwide and produces a current
indication of changes of opinion that could signal the movement of a stock.
The names, business addresses and principal occupations of the current
directors and chief executive officer of BT are set forth below:
<TABLE>
<CAPTION>
NAME POSITION ADDRESS
<S> <C> <C>
Josef Ackermann Member, Board of Managing Deutsche Bank AG
Director Taunusanlage 12
D-60262 Frankfurt am Main
Federal Republic of Germany
Robert B. Allardice III Executive Vice President Deutsche Bank
Deutsche Bank Americas 31 West 52nd Street
Holding Corp. New York, New York 10019
George B. Beitzel Director of Various 29 King Street
Corporations Chappaqua, New York 10514
William R. Howell Chairman Emeritus, J.C. Penney Company, Inc.
J.C. Penney Company, Inc. P.O. Box 10001
Dallas, Texas 75301
Hermann-Josef Lamberti Member, Board of Managing Deutsche Bank AG
Directors Taunusanlage 12
Deutsche Bank AG D-60262 Frankfurt am Main
Federal Republic of Germany
John A. Ross Regional Chief Executive Deutsche Bank
Officer 31 West 52nd Street
Deutsche Bank Americas New York, New York 10019
Holding Corp.
</TABLE>
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Deutsche Bank is a banking company with limited liability organized under
the laws of the Federal Republic of Germany. Deutsche Bank is the parent company
of a group consisting of banks, capital markets companies, funds management
companies, mortgage banks and a property finance company, installment financing
and leasing companies, insurance companies, research and consultancy companies
and other domestic and foreign companies. At December 31, 1998, based on
international accounting standards and converted at the exchange rate on
December 30, 1998 of US $1 = DM 1.6730, the Deutsche Bank Group had total assets
of DM 1,225.5 billion, or U.S. $732.5 billion. The Deutsche Bank Group's capital
and reserves at December 31, 1998, in accordance with Bank for International
Settlements standards, were DM 57.4 billion, or U.S. $34.3 billion.
BOARD OF DIRECTORS' CONSIDERATION
In approving the Subadvisory Agreement described hereto, the Directors, at
an in-person meeting held on May 26, 1999, considered certain factors, including
(i) the nature and quality of the services expected to be rendered by BT,
including the credentials and investment experience of its officers and
employees; (ii) the assurance from BT that its management and personnel would
remain continuous following the merger; (iii) the structure of BT and its
ability to provide services, based on both its financial conditions as well as
its performance record; (iv) a comparison of BT's subadvisory fee with those of
other advisers, as well as any indirect costs and benefits of providing such
subadvisory services to International Equity; and (v) the fact that the terms of
the agreement
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is similar in form and substance to that of the Previous Agreement. The
Directors determined that the engagement of BT 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 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 at 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.
By Order of the Directors,
/s/ Robert M. Zakem
Robert M. Zakem
Secretary
Dated: August 4, 1999
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EXHIBIT A
[FORM OF]
SUBADVISORY AGREEMENT
This SUBADVISORY AGREEMENT is dated as of June 4, 1999, by and between
SUNAMERICA ASSET MANAGEMENT CORP., a Delaware corporation (the "Adviser"), and
BANKERS TRUST COMPANY (the "Subadviser"), a wholly-owned indirect subsidiary of
Deutsche Bank AG.
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 January 1, 1999, (the "Advisory Agreement"), pursuant to
which the Adviser has agreed to provide investment management, advisory and
administrative services to the Corporation; and
WHEREAS, the Corporation is registered under the Investment Company Act of
1940, as amended (the "Act"), as an open-end management investment company and
may issue shares of common stock, par value $.0001 per share, in separately
designated series representing separate funds with their own investment
objectives, policies and purposes; and
WHEREAS, the Subadviser is engaged in the business of rendering investment
advisory services and is a "bank" as defined 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. (a) The Adviser hereby engages the services of
the Subadviser in furtherance of its Investment Advisory and Management
Agreement with the Corporation. Pursuant to this Subadvisory Agreement and
subject to the oversight and review of the Adviser, the Subadviser will manage
the investment and reinvestment of a portion of the assets of each Portfolio
listed on Schedule A attached hereto. The Subadviser will determine, in its
discretion and subject to the oversight and review of the Adviser, the
securities to be purchased or sold, will provide the Adviser with records
concerning its activities which the Adviser of 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
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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 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") and the 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.
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.
(b) The Subadviser agrees: (i) to maintain a level of errors and
omissions or professional liability insurance coverage that, at all times during
the course of this Agreement, is appropriate given the nature of its business,
and (ii) from time to time and upon reasonable request, to supply evidence of
such coverage to the Adviser.
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 judgment, 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
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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 rate set forth in Schedule A hereto with respect to the
portion of the assets managed by the Subadviser for the 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.
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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 in order to facilitate
meetings or other similar functions. Such office facilities, equipment,
personnel and services shall be provided for or rendered by the Subadviser and
billed to the Corporation or the Adviser at the Subadviser's cost.
5. REPORTS. The Corporation, the Adviser and the Subadviser agree to
furnish to each other, if applicable, current prospectuses, statements of
additional information, proxy statements, reports of shareholders, certified
copies of their financial statement, 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 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
("disabling conduct") hereunder on the part of the Subadviser (and its officers,
directors, agents, employees, controlling persons, shareholders and any other
person or entity affiliated with the Subadviser) the Subadviser shall not be
subject to liability to the Corporation or to any shareholder of the Corporation
for any act or
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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 the Subadviser's conduct under this Agreement.
(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 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.
(c) 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 and (ii) acts of
the Subadviser which result from acts of the Adviser, including, but not limited
to: (A) 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; and (B) acts of the Subadviser that were
made in reasonable reliance upon information provided to it by the Adviser. 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 1 of this Subadvisory Agreement
(including, but not limited to, the investment objectives, policies and
restrictions applicable to a Portfolio and qualifications of a Portfolio as a
regulated investment company under the Code) 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.
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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 the 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 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 continue 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.
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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: Bankers Trust Company
130 Liberty Street, 26th Floor, Mail Stop 2265
New York, New York 10006
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
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: Peter A. Harbeck
Title: President
BANKERS TRUST COMPANY
By: _____________________
Name:
Title:
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