EXHIBIT 99.5(e)
Portfolio Management Agreement - Janus Capital Corporation
PORTFOLIO MANAGEMENT AGREEMENT
This Portfolio Management Agreement (this "Agreement") is entered into as of
January 1, 1994 by and among Pacific Mutual Life Insurance Company, a California
corporation ("Investment Manager"), Janus Capital Corporation, a Colorado
corporation ("Portfolio Manager"), and Pacific Select Fund, a Massachusetts
Business Trust ("Fund").
WHEREAS, Investment Manager has entered into an Advisory Agreement dated
November 9, 1987 (the "Advisory Agreement") with the Fund to act as investment
adviser and manager to the Growth LT Series, a series of the Fund (the
"Portfolio");
WHEREAS, the Advisory Agreement provides that Investment Manager may engage a
portfolio manager to furnish investment information and advice to assist
Investment Manager in carrying out its responsibilities under the Advisory
Agreement;
WHEREAS, Investment Manager and the Trustees of the Fund desire to retain
Portfolio Manager to render investment adviser services to Investment Manager in
the manner and on the terms set forth in this Agreement.
NOW, THEREFORE, in consideration of the mutual covenants and agreements set
forth in this Agreement, Investment Manager and Portfolio Manager agree as
follows:
1. APPOINTMENT. The Fund and Investment Manager hereby appoint Janus Capital
Corporation to act as Portfolio Manager to the Portfolio for the periods and on
the terms set forth in this Agreement. Portfolio Manager accepts such
appointment and agrees to furnish the services herein set forth for the
compensation herein provided. In the event Investment Manager wishes to retain
Portfolio Manager to render investment advisory services to one or more
portfolios other than the Portfolio, Investment Manager shall notify Portfolio
Manager in writing. If Portfolio Manager is willing to render such services, it
shall notify the Fund and Investment Manager in writing, whereupon such
portfolios shall become a Portfolio hereunder, and be subject to this Agreement.
1. PORTFOLIO SERVICES.
(a) Portfolio Manager shall, subject to the supervision of Investment Manager,
manage the investment and reinvestment of the assets of the Portfolio.
Portfolio Manager is authorized, in its discretion and without prior
consultation with Investment Manager, to buy, sell, lend, and otherwise
trade in any stocks, bonds, and other securities and investment instruments
on behalf of the Portfolio, and so long as consistent with the foregoing,
without regard to the length of time the securities have been held and the
resulting rate of portfolio turnover or any tax considerations. Subject to
the investment objectives, policies, and restrictions concerning the
Portfolio set forth in the Fund's declaration of trust and in its
registration statements under the Investment Company Act of 1940 (the "1940
Act"), the majority or the whole of the Portfolio may be invested in such
proportions of stocks, bonds, other securities or investment instruments,
or cash as Portfolio Manager shall
determine. Notwithstanding any other provision of this Agreement, it is
understood and agreed that the Fund shall at all times retain the ultimate
responsibility for and control of all functions performed pursuant to the
Agreement and reserves the right to direct, approve, or disapprove any
action hereunder taken on its behalf by the Portfolio Manager. Portfolio
Manager is responsible for compliance with the provisions of Section 817(h)
of the Internal Revenue Code of 1986, as amended, applicable to the
Portfolio.
(b) Portfolio Manager shall furnish Investment Manager monthly, quarterly, and
annual reports concerning transactions and performance of the Portfolio in
such form as may be mutually agreed upon, and agrees to review the
Portfolio and discuss the management of it. Portfolio Manager shall permit
the financial statements, books and records with respect to the Portfolio
to be inspected and audited by the Investment Manager at all reasonable
times during normal business hours. Portfolio Manager shall also provide
Investment Manager and the Fund with such other information and reports as
may reasonably be requested by Investment Manager and the Fund from time to
time.
(c) Portfolio Manager shall provide to Investment Manager a copy of Portfolio
Manager's Form ADV as filed with the Securities and Exchange Commission and
a list of persons who Portfolio Manager wishes to have authorized to give
written and/or oral instructions to Custodians of Fund assets for the
Portfolio.
(d) Portfolio Manager will, in connection with the purchase and sale of
securities for the Portfolio, together with Investment Manager, arrange for
the transmission to the custodian, and the recordkeeping agent for the Fund
on a daily basis, such confirmation, trade tickets, and other documents and
information, including, but not limited to Cusip, Sedol, or other numbers
that identify securities to be purchased or sold on behalf of the
Portfolio, as may be reasonably necessary to enable the custodian and
recordkeeping agent to perform its administrative and recordkeeping
responsibilities with respect to the Portfolio, and, with respect to
portfolio securities to be purchased or sold through the Depository Trust
Company, will arrange for the automatic transmission of the confirmation of
such trades to the Fund's custodian, recordkeeping agent, [and, if required
by the Investment Manager].
(e) Portfolio Manager will assist the custodian and recordkeeping agent for the
Fund in determining or confirming, consistent with the procedures and
policies stated in the Registration Statement for the fund, the value of
any portfolio securities or other assets of the Portfolio for which the
custodian and recordkeeping agent seeks assistance from Portfolio Manager
or identifies for review by Portfolio Manager.
(f) Portfolio Manager will report regularly to the Fund's Board of Trustees on
the investment program for the Portfolio and the issuers and securities
represented in the Portfolio and will furnish the Fund's Board of Trustees
with respect to the portfolio such periodic and special reports as the
Trustees and Investment Manager may reasonably request.
(g) Portfolio Manager will not knowingly disclose or use any records or
information obtained pursuant to this Agreement (excluding investment
research and investment advice) in any manner whatsoever except as
expressly authorized in this agreement or in the ordinary course of
business
in connection with placing orders for the purchase and sale of securities,
and will keep confidential any information obtained pursuant to this
Agreement, and disclose such information only if the Board of Trustees of
the Fund has authorized such disclosure, or if such disclosure is required
by applicable federal or state law or regulations or regulatory authorities
having requisite authority. The Fund, the Portfolio, and Investment
Manager will not knowingly disclose or use any records or information
respecting Portfolio Manager obtained pursuant to this Agreement in any
manner whatsoever except as expressly authorized in this Agreement, and
will keep confidential any information obtained pursuant to this Agreement,
and disclose such information only as expressly authorized by this
Agreement, if Portfolio Manager has authorized such disclosure, or if such
disclosure is required by applicable federal or state law or regulations or
regulatory authorities having the requisite authority.
3. OBLIGATIONS OF INVESTMENT MANAGER AND THE PORTFOLIO.
(a) Investment Manager or its agent shall provide timely information to
Portfolio Manager regarding such matters as the composition of assets in
the Portfolio, cash requirements and cash available for investment in the
Portfolio, and all other information as may be reasonably necessary for
Portfolio Manager to perform its responsibilities hereunder.
(b) Investment Manager has herewith furnished Portfolio Manager a copy of the
Portfolio's registration statement currently in effect and agrees during
the continuance of this Agreement to furnish Portfolio Manager copies of
any amendments or supplements thereto before or at the time the amendments
or supplements become effective. Investment Manager agrees to furnish
Portfolio Manager with minutes of meetings of the Trustees of the Fund
applicable to the Portfolio to the extent they may affect the duties of
Investment Manager, a copy of any financial statements or reports prepared
for the Fund, including the Portfolio, by certified or independent public
accountants, and with copies of any financial statements or reports made by
the Portfolio to its shareholders or to any governmental body or securities
exchange, and any further materials or information which Portfolio Manager
may reasonably request to enable it to perform its functions under this
Agreement.
4. CUSTODIAN. Investment Manager shall provide Portfolio Manager with a copy
of the Portfolio's agreement with the Custodian (the "Custodian") designated to
hold the assets in the Portfolio and any modification thereto (excepting any
information concerning the calculation of fees, in particular, the "Fee
Schedule") (the "Custody Agreement") in advance. The Portfolio assets shall be
maintained in the custody of the Custodian identified in, and in accordance with
the terms and conditions of, the Custody Agreement. Portfolio Manager shall
have no liability for the acts or omissions of the Custodian. Any assets added
to the Portfolio shall be delivered directly to the Custodian.
5. PROPRIETARY RIGHTS
(a) Investment Manager agrees and acknowledges that Portfolio Manager is the
sole owner of the name and xxxx "Xxxxx" and that all use of any designation
comprised in whole or part of Janus (a "Xxxxx Xxxx") under this Agreement
shall inure to the benefit of Portfolio Manager. The use by Investment
Manager on its own behalf or on behalf of the Portfolio of any Xxxxx Xxxx
in any
advertisement or sales literature or other materials promoting the
Portfolio shall be with the prior written consent of Portfolio Manager.
Investment Manager shall not, and Investment Manager shall use its best
efforts to cause the Portfolio not to, without the prior written consent of
Portfolio Manager, make representations regarding Portfolio Manager in any
disclosure document, advertisement or sales literature or other materials
promoting the Portfolio. Upon termination of this Agreement for any
reason, Investment Manager shall cease, and Investment Manager shall use
its best efforts to cause the Portfolio to cease, all use of any Xxxxx
Xxxx(s) as soon as reasonably practicable.
(b) Portfolio Manager agrees and acknowledges that Investment Manager is the
sole owner of the name and xxxx Pacific Mutual ("PM") or Pacific Select
("PS") and that all use of any designation comprised in whole or part of PM
or PS (collectively, the "PM Xxxx") under the Agreement shall inure to the
benefit of Investment Manager. The use by Portfolio Manager on its behalf
or on behalf of the Portfolio of any PM Xxxx in any advertisement or sales
literature or other materials promoting the Portfolio shall be with the
prior written consent of Investment Manager. Portfolio Manager shall not,
and Portfolio Manager shall use its best efforts to cause the Portfolio not
to, without the prior written consent of Investment Manager, make
representations regarding Investment Manager in any disclosure document,
advertisement or sales literature or other materials promoting the
Portfolio. Upon termination of the Agreement for any reason, Portfolio
Manager shall cease all use of any PM Xxxx(s) as soon as reasonably
practicable.
6. EXPENSES. The Fund shall assume and pay all its organizational,
operational, and business expenses not specifically assumed or agreed to be paid
by Portfolio Manager pursuant hereto, including, without limitation, (a)
interest and taxes; (b) brokerage commissions and other costs in connection with
the purchase or sale of securities or other investment instruments with respect
to the Portfolio; and (c) custodian fees and expenses. Any reimbursement of
advisory fees required by any expense limitation provision shall be the sole
responsibility of Investment Manager. The Fund, Investment Manager, and
Portfolio Manager shall not be considered as partners or participants in a joint
venture. Portfolio Manager will pay its own expenses for the services to be
provided pursuant to this Agreement to the extent not assumed by the Fund or
Investment Manager above, and will not be obligated to pay any expenses of the
Fund, Investment Manager, or the Portfolio unless Portfolio Manager is
responsible for expenses incurred pursuant to Section 10 of this Agreement.
7. PURCHASE AND SALE OF ASSETS. Absent instructions from Investment Manager to
the contrary, Portfolio Manager shall place all orders for the purchase and sale
of securities for the Portfolio with brokers or dealers selected by Portfolio
Manager which may include brokers or dealers affiliated with Portfolio Manager.
Purchase or sell orders for the Portfolio may be aggregated with contemporaneous
purchase or sell orders of other clients of Portfolio Manager. Portfolio Manager
shall use its best efforts to obtain execution of Portfolio transactions at
prices which are advantageous to the Portfolio and at commission rates that are
reasonable in relation to the benefits received. However, Portfolio Manager may
select brokers or dealers on the basis that they provide brokerage, research, or
other services or products to the Portfolio and/or other accounts serviced by
Portfolio Manager. Portfolio Manager may pay a broker or dealer an amount of
commission for effecting a securities transaction in excess of the amount of
commission or dealer spread another broker or dealer would have charged for
effecting that transaction if Portfolio
Manager determines in good faith that such amount of commission was reasonable
in relation to the value of the brokerage and research products and/or services
provided by such broker or dealer. This determination, with respect to
brokerage and research services or products, may be viewed in terms of either
that particular transaction or the overall responsibilities which Portfolio
Manager and its affiliates have with respect to the portfolio and to accounts
over which they exercise investment discretion, and not all such services or
products may be used by Portfolio Manager in managing the Portfolio.
8. COMPENSATION OF PORTFOLIO MANAGER. Investment Manager shall pay to
Portfolio Manager a monthly fee in accordance with the fee schedule attached to
this Agreement. Monthly fees shall be calculated by Investment Manager based
upon the average daily net assets of the Portfolio (including cash or cash
equivalents) for the preceding month for investment advisory services rendered
during that preceding month, and shall be payable to Portfolio Manager by the
fifteenth day of the succeeding month. The fee for the first month during which
Portfolio Manager shall render investment advisory services under this Agreement
shall be based upon the number of days the account was open in that month. If
this Agreement is terminated, the fee shall be based upon the number of days the
account was open during the month in which the Agreement is terminated.
9. NON-EXCLUSIVITY. Investment Manager and the Portfolio agree that the
services of Portfolio Manager are not to be deemed exclusive and that Portfolio
Manager and its affiliates are free to act as investment manager and provide
other services to various investment companies and other managed accounts.
Subject to Section 17j-1 of the 1940 Act, this Agreement shall not in any way
limit or restrict Portfolio Manager or any of its directors, officers,
employees, or agents from buying, selling, or trading any securities or other
investment instruments for its or their own account or for the account of others
for whom it or they may be acting, provided that such activities will not
adversely affect or otherwise impair the performance by Portfolio Manager of its
duties and obligations under this Agreement. Investment Manager and the
Portfolio recognize and agree that Portfolio Manager may provide advice to or
take action with respect to other clients, which advice or action, including the
timing and nature of such action, may differ from or be identical to advice
given or action taken with respect to the Portfolio. Portfolio Manager shall
for all purposes herein be deemed to be an independent contractor and shall,
unless otherwise provided or authorized, have no authority to act for or
represent the Portfolio or Investment Manager in any way or otherwise be deemed
an agent of the Portfolio or Investment Manager other than in furtherance of its
duties and responsibilities as set forth in this Agreement.
10. LIABILITY. Except as may otherwise be required by the 1940 Act or the
rules thereunder or other federal securities laws, the Fund and Investment
Manager agree that Portfolio Manager, any affiliated person of Portfolio
Manager, and each person, if any, who, within the meaning of Section 15 of the
1933 Act, controls Portfolio Manager shall not be liable for, or subject to any
damages, expenses, or losses in connection with, any act or omission connected
with or arising out of any services rendered under this Agreement, except by
reason of willful misfeasance, bad faith, or gross negligence in the performance
of Portfolio Manager's duties, or by reason of reckless disregard of Portfolio
Manager's obligations and duties under this Agreement. Investment Manager and
the Portfolio shall indemnify and hold harmless Portfolio Manager, individually
and as investment
manager, from and against any and all third-party claims (including reasonable
attorneys' fees, with respect to counsel reasonably satisfactory to Investment
Manager or retained by Investment Manager for Portfolio Manager), arising from
or relating to the performance by or obligations of Portfolio Manager as
investment manager hereunder except to the extent any such claims are caused by
the gross negligence or will misconduct of Portfolio Manager. Investment
Manager acknowledges and agrees that Portfolio Manager makes no representation
or warranty, express or implied, that any level of performance or investment
results will be achieved by the Portfolio or that the Portfolio will perform
comparably with any standard or index, including other clients of Portfolio
Manager, whether public or private.
11. TERMINATION. This Agreement shall remain in full force and effect for one
year from the date hereof, and is renewable annually thereafter by agreement of
the parties to this Agreement and by specific approval of the Board of Trustees
of the Fund or by vote of a majority of the outstanding voting securities of the
Portfolio. Any such renewal shall be approved by a vote of a majority of the
Trustees who are not interested persons under the 1940 Act, cast in person at a
meeting called for the purpose of voting on such renewal. However, any approval
of this Agreement by the holders of a majority of the outstanding shares (as
defined in the 0000 Xxx) of the Portfolio shall be effective to continue this
Agreement with respect to such Portfolio notwithstanding (a) that this Agreement
has not been approved by the holders of a majority of the outstanding shares of
any other portfolio or (b) that this Agreement has not been approved by the vote
of a majority of the outstanding shares of the Fund, unless such approval shall
be required by any other applicable law or otherwise. This Agreement may be
terminated without penalty, forfeiture, compulsory buyout amount, or performance
of any obligation that could deter termination at any time by either party upon
60 days written notice to the other party, and will automatically terminate in
the event of its assignment, as defined in the 1940 Act, or upon termination of
the Investment Manager's Agreement with the Fund.
12. AMENDMENT. This Agreement may be amended only if such amendment is
specifically approved by (a) the vote of a majority of the outstanding voting
securities of the Portfolio, if required by applicable law, and (b) the vote of
a majority of those directors of the Portfolio 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.
13. BOOKS AND RECORDS. In compliance with the requirements of Rule 31a-3 under
the 1940 Act, Portfolio Manager hereby agrees that all records which it
maintains for the Portfolio are the property of the Fund and further agrees to
surrender promptly to the Fund any of such records upon the Fund's or Investment
Manager's request, although Portfolio Manager may, at its own expense, make and
retain a copy of such records. Portfolio Manager further agrees to preserve
such records for the periods prescribed by Rule 31a-2 under the 1940 Act and to
preserve the records required by Rule 204-2 under the Advisers Act for the
period specified in the Rule.
14. LIMITATION AND LIABILITY. A copy of the Amended and Restated Agreement and
Declaration of Fund for the Fund is on file with the Secretary of the
Commonwealth of Massachusetts. The obligations of this Agreement shall be
binding upon the assets and property of the Fund and shall not be binding upon
any Trustee, officer, employee, agent, or shareholder, whether past, present, or
future, of the Fund individually.
15. DISCLOSURE ABOUT PORTFOLIO MANAGER. Portfolio Manager has reviewed the
Registration Statement for the Fund filed with the SEC on December 10, 1993 and
represents and warrants that, with respect to the disclosure about Portfolio
Manager such Registration Statement contains, as of the date thereof, no untrue
statement of any material fact and does not omit any statement of a material
fact which was required to be stated therein or necessary to make the statements
contained therein not misleading. Portfolio Manager further agrees to notify
Investment Adviser and the Fund immediately of any material fact known to
Portfolio Manager respecting or relating to Portfolio Manager that is not
contained in the Registration Statement or prospectus for the Fund, or any
amendment or supplement thereto, or of any statement contained therein that
becomes untrue in any material respect.
16. GENERAL
(a) Portfolio Manager may perform its services through any employee, officer,
or agent of Portfolio Manager, and Investment Manager shall not be entitled
to the advice, recommendation, or judgment of any specific person.
(b) Each party to this Agreement agrees to cooperate with each other party and
with all appropriate governmental authorities having the requisite
jurisdiction (including, but not limited to, the SEC and state insurance
authorities) in connection with any investigation or inquiry relating to
this Agreement or the Fund.
(c) If any term or provision or this Agreement or the application thereof to
any person or circumstances is held to be invalid or unenforceable to any
extent, the remainder of this Agreement or the application of such
provision to other persons or circumstances shall not be affected thereby
and shall be enforced to the greatest extent permitted by law.
(d) This Agreement shall be governed by and interpreted in accordance with the
laws of the State of Colorado exclusive of conflicts of laws, provided that
nothing herein shall be construed in a manner inconsistent with the 1940
Act, the Investment Advisers Act of 1940 or rules or orders of the SEC
thereunder. The term "affiliate" or "affiliated person" as used in this
Agreement shall mean "affiliated person" as defined in Section 2(a)(3) of
the 1940 Act.
PACIFIC MUTUAL LIFE INSURANCE COMPANY
By: /s/ XX XXXXXX
Name: XXXXXX X. XXXXXX
Title: Chairman and
Chief Executive Officer
By: /s/ XXXXXXX X. XXXXXXXX
Name: XXXXXXX X. XXXXXXXX
Title: Chief Investment Officer
JANUS CAPITAL CORPORATION
By: /s/ XXXXXXX X. XXXXXXXXX
Name: XXXXXXX X. XXXXXXXXX
Title: Assistant Vice President
PACIFIC SELECT FUND
By: /s/ XX XXXXXX
Name: XXXXXX X. XXXXXX
Title: President
PACIFIC SELECT FUND
FEE SCHEDULE
Series: Growth LT Series
Fee:
If, at the end of the first six calendar months following the Growth LT Series'
commencement of operations, the Series reaches at least $50 million in net
assets, and during each of the next succeeding six calendar months, maintains
average daily net assets of at least $50 million, computed monthly, based on the
daily net assets during each succeeding calendar month, respectively:
.55% on an annual basis of the Growth LT Series' average daily net assets
If, at the end of the first six calendar months following the Growth LT Series'
commencement of operations, the Series does not reach at least $50 million in
net assets, or, during each of the next succeeding six calendar months, does not
maintain average daily net assets of at least $50 million, computed monthly,
based on the daily net assets during each succeeding calendar month,
respectively:
.60% on an annual basis of the first $100 million of the Growth LT Series'
average daily assets, retroactive to the Series' commencement of operations.
.55% on an annual basis of the Growth LT Series' average daily net assets in
excess of $100 million.
