23(d)(40)
Sub-Advisory Agreement on behalf of Transamerica BlackRock Tactical Allocation
VP
INVESTMENT SUBADVISORY AGREEMENT
BLACKROCK FINANCIAL MANAGEMENT, INC.
This Agreement, dated May 1, 2009 (the "Effective Date"), is by and
between Transamerica Asset Management, Inc., a Florida corporation (referred to
herein as "TAM") and BlackRock Financial Management, Inc., a Delaware limited
liability corporation (referred to herein as the "Subadviser").
TAM is the investment adviser to Transamerica Series Trust (the
"Trust"), an open-end investment company registered under the Investment Company
Act of 1940 (collectively with the rules and regulations promulgated thereunder
and any exemptive orders thereunder, the "1940 Act"). TAM wishes to engage the
Subadviser to provide certain investment advisory services to each series of the
Trust listed on Schedule A hereto (the "Fund"). The Subadviser desires to
furnish services for the Trust and to perform the functions assigned to it under
this Agreement for the considerations provided. Accordingly, the parties have
agreed as follows:
1. APPOINTMENT. In accordance with the Investment Advisory Agreement
between the Trust and TAM (the "Advisory Agreement"), TAM hereby appoints the
Subadviser to act as subadviser with respect to the Fund for the period and on
the terms set forth in this Agreement. The Subadviser accepts such appointment
and agrees to render or cause to be rendered the services set forth for the
compensation herein specified.
2. SUBADVISORY SERVICES. In its capacity as subadviser to the
Fund, the Subadviser shall have the following responsibilities:
(a) Subject to the supervision of the Trust's Board of Trustees
(the "Board") and TAM, and consistent with the Fund's
investment objectives, policies and restrictions, as stated in
the Fund's current Prospectus and Statement of Additional
Information, the Subadviser shall direct the asset allocation
strategy and the investment decisions to implement such
strategy for the Fund in accordance with the target level of
equity exposure as determined by TAM on the first Business Day
of every month ("Target Allocation") by the proprietary
dynamic asset allocation model from Transamerica Capital
Management (the "Model"). Following receipt of the Target
Allocation by the Subadviser, the Subadviser shall have 5
Business Days to reallocate the Fund's portfolio to reflect
the new allocation; however, the Subadviser may request that
TAM extend this period if the Subadviser deems such an
extension to be in the best interest of the Fund and such
request shall not be unreasonably withheld. The Subadviser
shall not be responsible for determining the portion of the
Fund's assets that are directly held in cash and cash
equivalents, but shall be responsible for allocating such
assets among the appropriate Underlying Funds.
(b) Based on the Model's Target Allocation, the Subadviser shall
decide which series of the Transamerica Funds and the Trust
designated in the Fund's prospectus (the "Underlying Funds")
the Fund will invest and how much of the Fund's assets to
allocate to an Underlying Fund. The Subadviser shall not be
required to allocate to all Underlying Funds. The Subadviser
shall rebalance the Fund's assets among the Underlying Funds
as often as needed to maintain the Model's Target Allocation.
Nothing herein shall prevent the Subadviser from allocating
assets of the Fund to Underlying Funds managed by the
Subadviser or its affiliates.
(c) Notwithstanding the Subadviser's responsibility pursuant to
paragraph (b) of this section to allocate assets among the
Underlying Funds, TAM shall have sole control and
responsibility for selecting the Underlying Funds and
monitoring the Underlying Funds' external managers.
(d) The Subadviser shall communicate to the Trust's custodian and
transfer agent (as identified in the Fund's current
Prospectus) trade file instructions that are a result of its
investment decisions, including rebalancing/reallocation
determinations.
(e) The Subadviser shall not vote proxy statements of the
Underlying Funds that the Fund may receive. Such proxy
statements will be voted by TAM, in accordance with the
current proxy voting policies and procedures of the Trust and
TAM.
(f) Nothing in this Agreement shall limit or restrict the right of
any director, officer, or employee of the Subadviser to engage
in any other business or to devote his or her time and
attention in part to the management or other aspects of any
other business, whether of a similar nature or a dissimilar
nature, nor to limit or restrict the right of the Subadviser
to engage in any other business or to render services of any
kind, including investment advisory and management services,
to any other fund, firm, individual or association.
(g) The Subadviser shall have no power, authority, responsibility,
or obligation hereunder to take any action with regard to any
claim or potential claim in any bankruptcy proceedings, class
action securities litigation, or other litigation or
proceeding affecting Underlying Funds held at any time in the
Fund, 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 Fund assets, and TAM
acknowledges and agrees that no such power, authority,
responsibility or obligation is delegated hereunder.
3. ALLOCATION OF CHARGES AND EXPENSES. During the term of this
Agreement, the Fund will bear all expenses not expressly assumed by TAM or the
Subadviser incurred in the operation of the Fund and the offering of its shares.
Without limiting the generality of the foregoing:
(a) The Fund shall pay (i) fees payable to TAM pursuant to the
Advisory Agreement; (ii) the cost (including brokerage
commissions, if any) incurred in connection with purchases and
sales of the Fund's portfolio securities; (iii) expenses of
organizing the Fund; (iv) filing fees and expenses relating to
registering and qualifying and maintaining the registration
and qualification of the Fund's shares for sale under federal
and state securities laws; (v) its allocable share of the
compensation, fees and reimbursements paid to the Trust's
non-interested Trustees; (vi) custodian and transfer agent
fees; (vii) legal and accounting expenses allocable to the
Fund, including costs for local representation in the Trust's
jurisdiction of organization and fees and expenses of special
counsel, if any, for the independent Trustees; (viii) all
federal, state and local tax (including stamp, excise, income
and franchise taxes) and the preparation and filing of all
returns and reports in connection therewith; (ix) cost of
certificates, if any, and delivery to purchasers; (x) expenses
of preparing and filing reports with federal and state
regulatory authorities; (xi) expenses of shareholders'
meetings and of preparing, printing and distributing proxy
statements (unless otherwise agreed to by the Trust and TAM);
(xii) costs of any liability, uncollectible items of deposit
and other insurance or fidelity bonds; (xiii) any costs,
expenses or losses arising out of any liability of, or claim
for damage or other relief asserted against, the Trust for
violation of any law; (xiv) expenses of preparing, typesetting
and printing prospectuses and supplements thereto for existing
shareholders and of reports and statements to shareholders;
(xv) fees and expenses in connection with membership in
investment company organizations and 12b-1 fees; and (xvi) any
extraordinary expenses incurred by the Trust on behalf of the
Fund.
(b) TAM shall pay all expenses incurred by it in the performance
of its duties under this Agreement. TAM shall also pay all
fees payable to the Subadviser pursuant to this Agreement.
(c) The Subadviser shall pay all expenses incurred by it in the
performance of its duties under this Agreement.
4. OBLIGATION TO PROVIDE INFORMATION. Each party's obligation to
provide information shall be as follows:
(a) TAM shall cause the Subadviser to be kept fully informed at
all times with regard to the securities owned by the Fund, its
funds available, or to become available, for investment, and
generally as to the condition of the Fund's affairs. TAM shall
provide the Subadviser with daily access to underlying
holdings within each Underlying Fund. TAM shall furnish the
Subadviser with such other documents and information with
regard to the Fund's affairs as the Subadviser may from time
to time reasonably request.
(b) TAM shall provide no less than 30 days' notice to the
Subadviser of its intention to remove a series of the
Transamerica Funds and/or the Trust as an Underlying Fund or
to replace the subadvisor of an Underlying Fund. TAM shall
provide notice to the Subadviser prior to the addition of an
Underlying Fund.
(c) TAM has furnished the Subadviser a copy of the prospectus and
statement of additional information of the Fund and agrees
during the term of this Agreement, to furnish to the
Subadviser at its principal office all prospectuses, proxy
statements, financial reports to shareholders, sales and
marketing literature, or other material prepared for
distribution to shareholders of the Fund or the public, which
refer to the Fund, the Subadviser or investment companies or
other advisory accounts advised or sponsored by the Subadviser
in any way, prior to the use thereof, and TAM shall not use
any such materials without the prior written consent of the
Subadviser, which shall not be unreasonably withheld. The
Subadviser agrees to respond to TAM within a reasonable amount
of time after receipt thereof to signify its consent or
rejection. TAM agrees to furnish the Subadviser with copies
of any further materials or information which the Subadviser
may reasonably request to enable it to perform its functions
under the Agreement.
(d) TAM has furnished the Subadviser with copies of each of the
following documents and will furnish to the Subadviser all
future amendments and supplements to such documents, if any,
as soon as practicable after such documents become available:
(1) The Trust's Declaration of Trust, as in effect on the date
hereof and as amended from time to time; (2) The By-Laws of
the Trust as in effect on the date hereof and as amended from
time to time; (3) Certified resolutions of the Board and the
Trust authorizing the appointment of the TAM and the
Subadviser and approving the Agreement; (4) Copies of any
financial statements or reports made by the Fund to its
shareholders or to any governmental body or securities
exchange; (5) An executed copy of the Agreement; and (6) A
list of each affiliated person (and any affiliated person of
such an affiliated person) of TAM. Until TAM delivers any
such amendment or supplement to the documents listed in this
section to the Fund, the Subadviser shall be fully protected
in relying on the most recent versions of such documents or
policies previously furnished to the Subadviser.
(e) The Subadviser, at its expense, shall supply the Board, the
officers of the Trust and TAM with all information and reports
reasonably required by them and reasonably available to the
Subadviser relating to the services provided by the Subadviser
hereunder, including such information the Fund's Chief
Compliance Officer reasonably believes necessary for
compliance with Rule 38a-1 under the 1940 Act.
5. COMPENSATION OF THE SUBADVISER. As compensation for the services
performed by the Subadviser, TAM shall pay the Subadviser out of the advisory
fee it receives with respect to the Fund, and only to the extent thereof, as
promptly as possible after the last day of each month, a fee, computed daily at
an annual rate set forth opposite the Fund's name on Schedule A annexed hereto.
The first payment of the fee shall be made as promptly as possible at the end of
the month succeeding the Effective Date of this Agreement, and shall constitute
a full payment of the fee due the Subadviser for all services prior to that
date. If this Agreement is terminated as of any date not the last day of a
month, such fee shall be paid as promptly as possible after such date of
termination, and shall be based on the average daily net assets of the
Fund in that period from the beginning of such month to such date of
termination, and shall be that proportion of such average daily net assets as
the number of business days in such period bears to the number of business days
in such month. The average daily net assets of the Fund shall in all cases be
based only on business days and be computed as of the time of the regular close
of business of the New York Stock Exchange, or such other time as stated in the
Fund's then-current Prospectus or as may be determined by the Board.
6. COMPENSATION OF TRUSTEES, OFFICERS AND EMPLOYEES. No Trustee,
officer or employee of the Trust or the Fund shall receive from the Trust or the
Fund any salary or other compensation as such Trustee, officer or employee while
he is at the same time a director, officer, or employee of the Subadviser or any
affiliated company of the Subadviser, except as the Board may decide. This
paragraph shall not apply to Trustees, executive committee members, consultants
and other persons who are not regular members of the Subadviser's or any
affiliated company's staff.
7. TERM. This Agreement shall continue in effect with respect to the
Fund, unless sooner terminated in accordance with its terms, for two years from
its Effective Date, and shall continue in effect from year to year thereafter,
provided such continuance is specifically approved at least annually by the vote
of a majority of the Trustees who are not parties hereto or interested persons
of any such party, cast in person at a meeting called for the purpose of voting
on the approval of the terms of such renewal, and by either the Board or the
affirmative vote of a majority of outstanding voting securities of that Fund.
8. TERMINATION. This Agreement may be terminated with respect to the
Fund at any time, without penalty, by the Board or by the shareholders of the
Fund acting by vote of at least a majority of its outstanding voting securities.
The Subadviser may terminate the Agreements only upon giving 90 days' advance
written notice to TAM and the Fund. This Agreement shall terminate automatically
in the event of its assignment by the Subadviser and shall not be assignable by
TAM without the consent of the Subadviser. For the avoidance of doubt, it is
understood that this Agreement may be amended, terminated or not renewed as to
one or more Funds without affecting the other Funds hereunder.
9. USE OF NAME. It is understood and hereby agreed that "BlackRock" and
any derivative or logo or trademark or service xxxx or trade name, are the
valuable property of the Subadviser and its affiliates for copyright and other
purposes and may not be used by TAM or its affiliates without Subadviser's prior
written approval. TAM further agrees that, in the event that the Subadviser
shall cease to act as an investment adviser with respect to the investment of
assets allocated to the Fund, both TAM and the Fund shall promptly take all
necessary and appropriate action to change their product names to names which do
not include "BlackRock" or any derivative or logo or trademark or service xxxx
or trade name, provided, however, that TAM and the Fund may continue to use the
word "BlackRock" or any derivative or logo or trademark or service xxxx or trade
name if the Subadviser consents specifically in writing to such use.
10. REPRESENTATIONS OF TAM. TAM represents, warrants and agrees
as follows:
(a) TAM (i) is registered as an investment adviser under the
Investment Advisers Act of 1940 (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 Subadviser of
the occurrence of any event that either prevents the Investment
Adviser from serving as an investment adviser of any investment
company pursuant to Section 9(a) of the 1940 Act or otherwise or
disqualifies it from serving in its designated capacities with
respect to the Fund.
(b) TAM acknowledges that it has received a copy of the Subadviser
Form ADV at least 48 hours prior to the execution of this
Agreement and has delivered a copy of the same to the Fund.
(c) The Fund is registered as an open-end management investment
company under the 1940 Act and that the Fund's shares are
registered under the Securities Act of 1933 and under any
applicable state securities laws.
(d) TAM hereby acknowledges that in performing its obligations
pursuant to this agreement the Subadviser will be acting in
reliance on the information provided by TAM relating to the
financial condition, tax status, and investment objectives of
Fund. TAM represents and warrants to the Subadviser that all
such information is, and will be, accurate in all material
respects, and that TAM will not fail to disclose any
information which, if omitted, might render the information
misleading.
11. LIABILITY AND INDEMNIFICATION.
(a) The Subadviser may rely on information reasonably believed by
it to be accurate and reliable. The Subadviser assumes no
responsibility under this Agreement other than to render the
services called for hereunder, in good faith, and shall not be
liable for any error of judgment or mistake of law, or for any
loss arising out of any investment or for any act or omission
in the execution of securities transactions for the Fund,
provided that nothing in this Agreement shall protect the
Subadviser against any liability to TAM or the Fund to which
the Subadviser would otherwise be subject by reason of willful
misfeasance, bad faith, or gross negligence in the performance
of its duties or by reason of its reckless disregard of its
obligations and duties hereunder. As used in this Section 12,
the term the "Subadviser" shall include any affiliates of the
Subadviser performing services for the Trust or the Fund
contemplated hereby and the partners, shareholders, directors,
officers and employees of the Subadviser and such affiliates.
(b) Subject to the foregoing, the Subadviser shall indemnify and
hold harmless TAM, the Fund and their respective directors,
trustees, officers, employees or agents from any and all
claims, losses, expenses, obligation and liabilities
(including, without limitation, reasonable attorney's fees)
arising or resulting from the Subadviser's willful
misfeasance, bad faith or gross negligence in its performance
of its obligations and duties or by reason of its reckless
disregard of its obligations and duties under this Agreement.
The Subadviser shall not be liable to TAM, the Fund or their
respective officers, directors, agents, employees, controlling
persons or shareholders for (i) any acts of TAM or any other
subadviser to Underlying Funds and (ii) acts of the Subadviser
which result from or are based upon acts or omissions of TAM,
including, but not limited to, failure of TAM to provide
accurate and current information with respect to records
maintained by TAM or any other subadviser to the Fund.
(c) TAM shall indemnify and hold harmless the Subadviser, and its
trustees/directors, officers, employees or agents, from any
and all claims, losses, expenses, obligations and liabilities
(including, without limitation, reasonable attorney's fees)
arising or resulting from TAM's violation of applicable law,
willful misfeasance, bad faith or gross negligence in TAM's
performance of its respective obligations or by reason of
TAM's reckless disregard of its respective obligations and
duties under this Agreement. TAM acknowledges and agrees that
the Subadviser makes no representation or warranty, express or
implied, that any level of performance or investment results
will be achieved by the Fund or that the Fund will perform
comparably with any standard or index, including other clients
of the Subadviser, whether public or private.
12. DELEGATION. To the extent permitted by law, the Subadviser may from
time to time employ or associate itself with such person or persons, including
affiliates, as it believes to be particularly fitted to assist it in the
execution or performance of its obligations under this Agreement; provided,
however, that the use of such persons does not relieve the Subadviser from any
obligation or duty under
this Agreement, and provided no such person serves or acts as an investment
adviser separate from the Subadviser so as to require a new written contract
pursuant to the 0000 Xxx. The Subadviser shall remain liable for the performance
of its obligations under this Agreement, and for the acts and omissions of its
employees or associates. The compensation of any such person will be paid by the
Subadviser, and no obligation will be incurred by, or on behalf of, TAM, the
Trust or the Fund with respect to them.
13. CONFIDENTIAL INFORMATION. To enable the Subadviser to provide the
subadvisory services specified in Section 2 of this Agreement, the Trust's
custodian, TAM and/or its affiliates will provide the Subadviser with material
non-public information concerning portfolio holdings of the Underlying Funds
("Confidential Information"). Subadviser represents, warrants and agrees that
such Confidential Information will be kept confidential and will be used solely
in connection with the Subadviser's provision of subadvisory services to the
Fund pursuant to this Agreement.
The Trust, the Fund and TAM will keep confidential records or
confidential information respecting the Subadviser obtained pursuant to this
Agreement. The Trust, the Fund and TAM will not disclose such confidential
records or confidential information unless the Subadviser has authorized such
disclosure, or unless such disclosure is required by applicable federal or state
law or regulations or by a court or regulatory or self-regulatory authority
having the requisite authority.
14. MEANINGS OF CERTAIN TERMS. For the purposes of this Agreement, the
Fund's "net assets" shall be determined as provided in the Fund's then-current
Prospectus and Statement of Additional Information and the terms "assignment,"
"interested person," and "majority of the outstanding voting securities" shall
have the meanings given to them by Section 2(a) of the 1940 Act, subject to such
exemptions as may be granted by the SEC by any rule, regulation or order.
15. AMENDMENTS. No provision of this Agreement may be changed, waived,
discharged or terminated orally with respect to the Fund, but only by an
instrument in writing signed by the party against which enforcement of the
change, waiver, discharge or termination is sought. No material amendment of the
Agreement shall be effective with respect to the Fund until approved, if so
required by the 1940 Act, by vote of the holders of a majority outstanding
voting securities of that Fund. Schedule A hereto may be amended at any time to
add additional series of the Trust as agreed by the Trust, TAM and the
Subadviser.
16. BOOKS AND RECORDS. The Subadviser agrees that it will keep records
relating to its services hereunder in accordance with all applicable laws, and
in compliance with the requirements of Rule 31a-3 under the 1940 Act, the
Subadviser hereby agrees that any records that it maintains for the Fund are the
property of the Fund, and further agrees to surrender promptly to the Fund any
of such records upon the Fund's request. The Subadviser further agrees to
arrange for the preservation of the records required to be maintained by Rule
31a-1 under the 1940 Act for the periods prescribed by Rule 31a-2 under the 1940
Act.
17. MISCELLANEOUS. This Agreement embodies the entire agreement and
understanding between the parties hereto, and supersedes all prior agreements
and understandings relating to the subject matter hereof. Should any part of
this Agreement be held or made invalid by a court decision, statute, rule or
otherwise, the remainder of this Agreement shall not be affected thereby. This
Agreement shall be binding on and shall inure to the benefit of the parties
hereto and their respective successors.
18. GOVERNING LAW. This Agreement shall be construed and the
provisions hereof interpreted under and in accordance with the laws of the State
of Florida and the applicable provisions of the 1940 Act.
The parties hereto have caused this Agreement to be executed by their
duly authorized signatories as of the date and year first above written.
TRANSAMERICA ASSET MANAGEMENT, INC.
By:
----------------------------------------------
Name: Xxxxxxxxxxx X. Xxxxxxx
--------------------------------------------
Title: Vice President and Chief Investment Officer
-------------------------------------------
BLACKROCK FINANCIAL MANAGEMENT, INC.
By:
----------------------------------------------
Name:
Title:
SCHEDULE A
PORTFOLIO INVESTMENT SUBADVISORY FEE
First $1 billion ..........0.10%
Transamerica BlackRock Tactical Allocation VP Over $1 billion ...........0.08%
