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EXHIBIT 5.1
INVESTMENT ADVISORY AGREEMENT AND ADDENDUMS TO
AGREEMENT BETWEEN REGISTRANT AND AMERICAN UNITED
LIFE INSURANCE COMPANY AND THE EXPENSE LIMITATION
AGREEMENT BETWEEN REGISTRANT AND AMERICAN UNITED
LIFE INSURANCE COMPANY
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INVESTMENT ADVISORY AGREEMENT
Agreement made this 8th day of March, 1990, between AUL American Series
Fund, Inc. (the "Fund") and American United Life Insurance Company (the
"Adviser").
WITNESSETH:
WHEREAS, the Fund is an open-end, diversified management investment company
registered under the Investment Company Act of 1940, as amended (the "1940
Act"), the securities of which are registered under the Securities Act of 1933,
as amended (the "1933 Act"); and
WHEREAS, the Adviser is registered as an investment adviser under the
Investment Advisers Act of 1940, as amended (the "Advisers Act"); and
WHEREAS, the Fund is authorized to issue shares of common stock ("Shares")
in separate classes or portfolios, with each such portfolio representing
interests in a separate portfolio of securities and other assets; and
WHEREAS, the Fund has initially established four portfolios, designated the
AUL American Equity Portfolio, the AUL American Bond Portfolio, the AUL American
Money Market Portfolio, and the AUL American Managed Portfolio, such portfolios
together with all other portfolios subsequently established by the Fund with
respect to which the Fund desires to retain the Adviser to render investment
advisory services hereunder and with respect to which the Adviser is willing so
to do being herein collectively referred to as the "Portfolios"; and
WHEREAS, the Fund and the Adviser have entered into an agreement dated
March 8TH 1990 (the "Expense Assumption Agreement"), pursuant to which the
Adviser has agreed, during the term of the Expense Assumption Agreement, first,
to reduce its advisory fee, and then to pay amounts equal to all or a part of
certain Fund expenses, to the extent necessary to prevent the ordinary operating
expenses of any of the Portfolios from exceeding 1 0% of the Portfolio's average
daily net assets during the year
NOW, THEREFORE, in consideration of the premises and mutual covenants
herein contained, it is agreed between the parties as follows:
1. APPOINTMENT. The Fund hereby appoints the Adviser to act as investment
adviser to the Fund with respect to the Portfolios for the period and on the
terms set forth in this Agreement The Adviser accepts such appointment and
agrees to render the services herein set forth, for the compensation herein
provided.
In the event the Fund establishes one or more additional Portfolios with
respect to which it desires to retain the Adviser to render management and
investment advisory services hereunder, it shall notify the Adviser in writing.
If the Adviser is willing to render such services, it shall notify the Fund in
writing, whereupon such class shall become a Portfolio hereunder.
2. ADVISER'S DUTIES. (a) Subject to the supervision of the Fund's Board of
Directors, the Adviser will provide a continuous investment program for the
Portfolios and determine the composition of the assets of the Portfolios,
including determination of the purchase, retention, or sale of the securities,
cash, and other investments contained in the Portfolios. The Adviser will
provide investment research and conduct a continuous program of evaluation,
investment, sales, and reinvestment of the Portfolios' assets by determining the
securities and other investments that shall be purchased, entered into, sold,
closed, or exchanged for the Portfolios, when these transactions should be
executed, and what portion of the assets of the Portfolios should be held in the
various securities and other investments in which they may invest, and the
Adviser is hereby authorized to execute and perform such services on behalf of
the Portfolios. To the extent permitted by the investment policies of a
Portfolio, the Adviser shall make decisions for the Portfolios as to foreign
currency matters and make determinations as to and execute and perform foreign
currency exchange contracts on behalf of the Portfolios. The Adviser will
provide the services under this Agreement in accordance with each Portfolio's
investment objective or objectives, policies, and restrictions as stated in the
Fund's Registration Statement filed with the Securities and Exchange Commission
("SEC"), as amended, and with the 1940 Act and the provisions of the Internal
Revenue Code relating to regulated investment companies, subject to policy
decisions adopted by the Fund's Board of Directors.
(b) The Adviser also shall provide to the officers of the Fund
administrative assistance in connection with the operation of the Fund and the
Portfolios, which shall include (i) compliance with all reasonable requests of
the Fund for information, including information required in connection with the
Fund's filings with the SEC and state securities or insurance commissions, and
(ii) such other services as the Fund's officers shall, from time to time,
determine to be necessary or useful to the administration of the Fund and the
Portfolios.
(c) The Adviser shall place orders for the purchase and sale of securities,
futures and options contracts, and other assets. The Adviser is authorized to
select brokers, dealers, and futures commission merchants and to open and
maintain
brokerage accounts and trading accounts for the purchase and sale of securities
and futures and options contracts with such broker dealers and futures
commission merchants for and on behalf of the Portfolios in accordance with any
procedures established by the Adviser and the Fund's Board of Directors.
(d) The Adviser shall furnish to the Fund's Board of Directors periodic
reports on the investment performance of the Fund and its Portfolios and on the
performance of its obligations under this Agreement and shall supply such
additional reports and information as the Fund's officers or Board of Directors
shall reasonably request.
(e) On occasions when the Adviser deems the purchase or sale of a security
to be in the best interest of a Portfolio as well as other of its clients or
accounts, the Adviser, to the extent permitted by applicable law, may aggregate
the securities to be so sold or purchased in order to obtain the best execution
or lower brokerage commissions, if any. The Adviser may also, on occasion,
purchase or sell a particular security for one or more clients or accounts in
different amounts. On either occasion, and to the extent permitted by applicable
law and regulations, allocation of the securities so purchased or sold, as well
as the expenses incurred in the transaction, will be made by the Adviser in a
manner that is fair and equitable in the judgment of the Adviser and consistent
with its fiduciary obligations to the Fund and to such other customers or
accounts.
(f) The Adviser's primary consideration in effecting a security transaction
for a Portfolio will be to obtain the best execution for the Portfolio, taking
into account the factors specified in the prospectus and statement of additional
information for the Fund, which include, among other things, price (including
the applicable brokerage commission or dollar spread), the size of the order,
the nature of the market for the security, the timing of the transaction, the
reputation, the experience and financial stability of the broker-dealer
involved, the quality of the service, the difficulty of execution, and the
execution capabilities and operational facilities of the firm involved, and the
firm's risk in positioning a block of securities. Accordingly, the price to a
Portfolio in any transaction may be less favorable than that available from
another broker-dealer if the difference is reasonably justified, in the judgment
of the Adviser in the exercise of its fiduciary obligations to the Fund, by
other aspects of the execution services offered. Subject to such policies as the
Board of Directors may determine and consistent with Section 28(e) of the
Securities Exchange Act of 1934, the Adviser shall not be deemed to have acted
unlawfully or to have breached any duty created by this Agreement or otherwise
solely by reason of its having caused
a Portfolio to pay a broker-dealer for effecting an investment transaction in
excess of the amount of commission another broker-dealer would have charged for
effecting that transaction, if the Adviser 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 broker-dealer, viewed in terms of either
that particular transaction or the Adviser's overall responsibilities with
respect to the Portfolio and to its other clients and/or accounts as to which it
exercises investment discretion. To the extent consistent with these standards,
the Adviser is further authorized to allocate the orders placed by it on behalf
of a Portfolio to the Adviser if it is registered as a broker-dealer with the
SEC, to its affiliated broker-dealer, or to such brokers and dealers who also
provide research or statistical material, or other services to the Fund, the
Adviser, or an affiliate of the Adviser.. Such allocation shall be in such
amounts and proportions as the Adviser shall determine consistent with the above
standards, and the Adviser will report on said allocation regularly to the Board
of Directors of the Fund indicating the broker-dealers to which such allocations
have been made and the basis therefor.
(g) In connection with the purchase and sale of securities of each
Portfolio, the Adviser will arrange for the transmission to the Fund's Custodian
or other agent on a daily basis, such confirmations, trade tickets and other
documents and shall provide information reasonably requested by the Fund's
Custodian or other agent for helping such agent perform its administrative
responsibilities to the Fund, including the responsibility to identify
securities to be purchased or sold by the Fund, to determine the value of the
Fund's portfolio securities and other assets and to determine the Fund's net
asset. value per share. With respect to portfolio securities to be purchased or
sold through the Depository Trust Company, the Adviser will arrange for the
automatic transmission of the confirmation of such trades to the Fund's
Custodian.
(h) The Adviser shall, at its expense, (i) employ or associate with itself
such persons as it believes appropriate to assist it in performing its
obligations under this Agreement and (ii) provide all services, equipment and
facilities necessary to perform its obligations under this Agreement.
(i) Subject to the approval of the Fund's Board of Directors and, to the
extent required by law, the shareholders of Portfolios, the Adviser may contract
with such other parties as it deems appropriate to obtain investment research,
information, investment advisory and management services and other assistance,
but any fees, compensation or expenses to be paid to any such
party shall be paid by the Adviser, and no obligation shall be incurred on the
Fund's behalf in any respect.
3. LIMITATION OF LIABILITY. The Adviser shall give the Fund the benefit of
the Adviser's best judgment and efforts in rendering services under this
Agreement. As an inducement to the Adviser's undertaking to render these
services, the Fund agrees that the Adviser shall not be liable under this
Agreement for any mistake in judgment or in any other event whatsoever, provided
that nothing in this Agreement shall be deemed to protect or purport to protect
the Adviser against any liability to the Fund or its shareholders to which the
Adviser would otherwise be subject by reason of willful misfeasance, bad faith
or gross negligence in the performance of the Adviser's duties under this
Agreement or by reason of the Adviser's reckless disregard of its obligations
and duties hereunder.
4. EXPENSES. The Fund shall be responsible for all of its expenses and
liabilities, including compensation of its directors who are not interested
persons of the Adviser (as defined in the 1940 Act); taxes and governmental
fees; interest charges; fees and expenses of the Fund's independent accountants
and legal counsel; trade association membership dues; fees and expenses of any
custodian (including maintenance of books and accounts and calculation of the
net asset value of the Fund's Shares), transfer agent, registrar and dividend
disbursing agent of the Fund; expenses of issuing, selling, redeeming,
registering and qualifying the Shares for sale; expenses of preparing and
printing Share certificates, prospectuses and reports to if shareholders,
notices, proxy statements and reports to regulatory agencies; the cost of office
supplies, including stationery; travel expenses of all officers, directors and
employees; insurance premiums; brokerage and other expenses of executing
Portfolio transactions; expenses of shareholders' meetings; organizational
expenses; and extraordinary expenses.
5. RECORDS. The Adviser agrees to maintain and to preserve for the periods
prescribed under the 1940 Act any such records as are required to be maintained
by the Adviser with respect to the Fund by the 1940 Act. The Adviser further
agrees that all records which it maintains for the Fund are the property of the
Fund and it will promptly surrender any of such records upon request.
6. COMPENSATION. In consideration of the services to be rendered by the
Adviser under this Agreement, the Fund shall pay the Adviser a fee with respect
to each Portfolio, calculated and accrued daily and paid each month, according
to the following formula: (A) an amount at an annual rate of 0.50% of the
average daily net assets of the Portfolio; (B) minus, until the later of
the Termination of the Expense Assumption Agreement or December 31, 1990, the
amount by which the Portfolio's aggregate ordinary operating expenses exceed
1.0% of the Portfolio's average daily net assets during the year, but in no
event more than the amount described in (A), above (the "Reduced Amount"), if
any; and (C) plus, if the aggregate ordinary operating expenses of the Portfolio
are less than 1.0% of the Portfolio's average daily net assets during the year
and if this Agreement is still in effect, the lesser of (i) any Reduced Amount
attributable to any of the preceding five years that has not been previously
reflected in a fee increase received by the Adviser, with such Reduced Amounts
considered in the chronological order of their occurrence, or (ii) an amount
which, when added to the Portfolio's other ordinary operating expenses, will
cause the Portfolio's total ordinary operating expenses to equal 1.0% of the
Portfolio's average daily net assets during the year For purposes of this
provision, ordinary operating expenses shall not include interest, taxes,
brokerage commissions, legal claims and liabilities, litigation costs and
indemnification payments in connection with litigation, and other extraordinary
expenses.
7. TERM OF AGREEMENT. (a) This Agreement shall become effective as of the
date indicated above and shall continue in effect until March 8th, 1992. If not
sooner terminated, this Agreement shall continue in effect for successive
periods of 12 months each thereafter, provided that each such continuance shall
be specifically approved at least annually (i) by the vote of a majority of the
outstanding voting securities (as defined in the ▇▇▇▇ ▇▇▇) of the Portfolios or
by the Fund's Board of Directors and (ii) by the vote, cast in person at a
meeting called for the purpose, of a majority of the Fund's Directors who are
not parties to this Agreement or "interested persons" (as defined in the ▇▇▇▇
▇▇▇) of any such party.
(b) This Agreement may be terminated with respect to one or more Portfolios
at any time, without the payment of any penalty, by a vote of a majority of the
outstanding voting securities (as defined in the ▇▇▇▇ ▇▇▇) of the Portfolios or
by a vote of a majority of the Fund's entire Board of Directors on 60 days'
written notice to the Adviser or by the Adviser on 60 days' written notice to
the Fund. This Agreement shall terminate automatically in the event of its
assignment (as defined in the 1940 Act and any rules thereunder).
8. AGREEMENT NOT EXCLUSIVE. (a) Except to the extent necessary to perform
the Adviser's obligations under this Agreement, nothing herein shall be deemed
to limit or restrict the right of the Adviser, or any affiliate of the Adviser,
or any employee of the Adviser, to engage in any other business or to devote
time and attention to the management or other aspects of
any other business, whether of a similar or dissimilar nature, or to render
services of any kind to any other corporation, firm, individual or association.
(b) The investment management services of the Adviser to the Fund under
this Agreement are not to be deemed exclusive as to the Adviser and the Adviser
will be free to render similar services to others.-
9. CONTROLLING LAW. This Agreement shall be construed in accordance with
the laws of the State of Indiana, provided that nothing herein shall be
construed in a manner inconsistent with the 1940 Act.
10. NOTICES. Notices of any kind to be given to the Adviser by the Fund
shall be in writing and shall be duly given if mailed or delivered to the
Adviser at ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇, attention ▇▇▇▇▇▇▇
▇. ▇▇▇▇▇▇, or at such other address or to such individual as shall be specified
by the Adviser to the Fund. Notices of any kind to be given to the Fund by the
Adviser shall be in writing and shall be duly given if mailed or delivered to
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇,
or at such other address or to such individual as shall be specified by the Fund
to the Adviser.
11. USE OF THE NAME "AUL". The Fund acknowledges that all rights in the
name "AUL" are owned by the Adviser. In the event this Agreement is terminated
and the Adviser no longer acts as Adviser to the Fund, the Adviser reserves the
right to withdraw from the Fund the use of the name "AUL" or any name
misleadingly implying a continuing relationship between the Fund and the Adviser
or any of its affiliates.
IN WITNESS WHEREOF, the parties hereto have caused the Agreement to be duly
executed by their duly authorized officers.
AUL AMERICAN SERIES Fund, Inc.
AMERICAN UNITED LIFE INSURANCE COMPANY(R)
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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Title: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Chairman
of the Board and President
Date: March 8, 1990
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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Title: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇, President
and Chief Executive Officer
Date: March 8, 1990
American United Life Insurance Company
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
AUL American Series Fund, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
EXPENSE ASSUMPTION AGREEMENT
March 8, 1990
Dear Sirs:
For good and valuable consideration, we agree, in addition to providing the
advisory services specified in the Investment Advisory Agreement between
American United Life Insurance Company ("AUL") and AUL American Series Fund,
Inc. (the "Fund") dated March 8th 1990 (the "Investment Advisory Agreement"),
first, to reduce our advisory fee, and then to pay amounts equal to all or a
part of the following expenses, to the extent necessary to prevent the ordinary
operating expenses of any of the Fund's investment portfolios (the "Portfolios")
from exceeding 1.0% of the Portfolio's average daily net assets during the year:
(a) expenses of all audits by the Fund's independent public accountants;
(b) expenses of the Fund's transfer agent, registrar, dividend disbursing
agent, and shareholder recordkeeping services;
(c) expenses of the Fund's custodial services including recordkeeping
services provided by the custodian;
(d) expenses of maintaining the Fund's tax records;
(e) salaries and other compensation of any of the Fund's executive
officers and employees, if any, who are not officers, directors,
stockholders, or employees of AUL or an affiliate of AUL;
(f) costs and/or fees incident to meetings of the Fund's shareholders, the
preparation and mailings of prospectuses and reports of the Fund to
its shareholders, the filing of reports with regulatory bodies, the
maintenance of the Fund's existence,
AUL American Series Fund, Inc.
March 8, 1990
Page 2
and the registration of shares with federal and state securities or
insurance authorities;
(g) the Fund's legal fees, including the legal fees related to the
registration and continued qualification of the Fund's shares for
sale;
(h) costs of printing stock certificates representing shares of the Fund;
(i) costs of services required to redeem, issue or repurchase shares of
the Fund;
(j) Directors' fees and expenses to directors who are not officers,
employees, or stockholders of AUL or any affiliate thereof;
(k) premiums payable under the fidelity bond required by Section 17(g) of
the Investment Company Act of 1940, as amended, or other insurance
premiums;
(1) association membership dues;
(m) organizational and offering expenses;
(n) costs of Portfolio pricing services, if any; and
(o) other ordinary operating expenses, as determined by AUL from time to
time.
The listed expenses do not include interest, taxes, brokerage commissions
and other transactional expenses, legal claims and liabilities, litigation costs
and indemnification payments in connection with litigation, or any other
extraordinary costs or expenses. It is agreed that the listed expenses are
incurred with respect to the Fund's business of investing in securities.
No modification or waiver of this agreement or any of its provisions
contained herein shall be binding upon either ~party, unless made in writing and
signed on behalf of each party by a duly authorized person. The Fund agrees that
it may not assign its rights or obligations under this Investment Advisory
Agreement without our prior consent and any assignment without our prior consent
shall be null and void.
AUL American Series Fund, Inc.
March 8, 1990
Page 3
If accepted by you, this agreement shall be effective as of the date set
forth above and shall continue until December 31, 1990, and thereafter, from
month to month unless either (a) the Investment Advisory Agreement is terminated
or (b) either party terminates this agreement by giving the other party at least
30 days' prior written notice.
American United Life Insurance Company
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-----------------------
▇▇▇▇▇ ▇. ▇▇▇▇▇▇, President
and Chief Executive Officer
The foregoing is hereby accepted as
of the date hereof
AUL American Series Fund, Inc.
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-----------------------
▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Chairman
of the Board and President
ADDENDUM TO INVESTMENT ADVISORY AGREEMENT
The Investment Advisory Agreement, made the 8th day of March, 1990, between
the AUL American Series Fund, Inc. (the "Fund"), a Maryland corporation, and
American United Life Insurance Company (the "Adviser"), a life insurance company
domiciled in Indiana, (the "Agreement") is hereby amended by the addition of the
provisions set forth in this addendum to the Agreement, which is made this
15th day of May, 1995.
WITNESSETH:
WHEREAS, the Fund is authorized to issue shares of common stock in separate
portfolios with each such portfolio representing interests in a separate
portfolio of securities and other assets; and
WHEREAS, the Fund currently consists of four separate portfolios designated
as the AUL American Equity Portfolio, the AUL American Bond Portfolio, the AUL
American Money Market Portfolio, and the AUL American Managed Portfolio (each a
"Portfolio"); and
WHEREAS, the Fund intends to establish one additional Portfolio to be
designated as the Tactical Asset Allocation Portfolio; and
WHEREAS, the Fund desires to appoint the Adviser as investment adviser to
the Tactical Asset Allocation Portfolio under the provisions set forth in the
Agreement and in this Addendum to the Agreement; and
WHEREAS, the Adviser is willing to accept such appointment;
NOW THEREFORE, in consideration of the mutual promises and covenants
contained in this Addendum, it is agreed between the parties hereto as follows:
1. In addition to its responsibilities as specified in the Agreement, the
Fund hereby appoints the Adviser to provide investment advisory
services to the Tactical Asset Allocation Portfolio which, in addition
to all other Portfolios previously established, shall be deemed a
Portfolio under the Agreement, subject to the terms and conditions as
specified in the Agreement, including paragraph six (6),
"Compensation," as amended by this Addendum.
2. Paragraph six (6), ("Compensation") of the Agreement is amended by
adding the following underscored language to paragraph six (6), which
is restated as follows:
6. Compensation. In consideration of the services to be rendered by the
Adviser under this Agreement, the Fund shall pay the Adviser a fee
with respect to each of the AUL American Equity, AUL American Bond,
AUL American Money Market, and AUL American Managed Portfolios,
calculated and accrued daily and paid each month, according to the
following formula: (A) an amount
- 1 -
at an annual rate of 0.50% of the average daily net assets of the
Portfolio; (B) minus, until the later of the Termination of the
Expense Assumption Agreement or December 31, 1990, the amount by which
the Portfolio's aggregate ordinary operating expenses exceed 1.0% of
the Portfolio's average daily net assets during the year, but in no
event more than the amount described in (A), above (the "Reduced
Amount"), if any; and (C) plus, if the aggregate ordinary operating
expenses of the Portfolio are less than 1.0% of the Portfolio's
average daily net assets during the year and if this Agreement is
still in effect, the lesser of (i) any Reduced Amount attributable to
any of the preceding five years that has not been previously reflected
in a fee increase received by the Adviser, with such Reduced Amounts
considered in the chronological order of their occurrence, or (ii) an
amount which, when added to the Portfolio's other ordinary operating
expenses, will cause the Portfolio's total ordinary operating expenses
to equal 1.0% of the Portfolio's average daily net assets during the
year. For purposes of this provision, ordinary operating expenses
shall not include interest, taxes, brokerage commissions, legal claims
and liabilities, litigation costs and indemnification payments in
connection with litigation, and other extraordinary expenses. In
consideration of the services to be rendered by the Adviser under this
Agreement, the Fund shall pay the Adviser a fee with respect to the
Tactical Asset Allocation Portfolio, calculated and accrued daily and
paid each month, equal at an annual rate of 0.80% of the average daily
net assets of such Portfolio.
IN WITNESS WHEREOF, the parties hereto have caused this Addendum to be
executed by their officers designated below on the date written above.
AUL AMERICAN SERIES FUND, INC.
Attest:
/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
------------------------- ------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Secretary Chairman of the Board of Directors
and President
AMERICAN UNITED LIFE INSURANCE COMPANY(R)
Attest:
/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
------------------------- -----------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
General Counsel and Secretary Chairman of the Board, President,
and Chief Executive Officer
- 2 -
ADDENDUM TO INVESTMENT ADVISORY AGREEMENT
The Investment Advisory Agreement, made the 8th day of March, 1990 and
amended the 12th day of May, 1995, between the AUL American Series Fund, Inc.
(the "Fund"), a Maryland corporation, and American United Life Insurance
Company" (the "Adviser"), a life insurance company domiciled in Indiana, (the
"Agreement") is hereby amended by the addition of the provisions set forth in
this addendum to the Agreement, which is made this 19th day of November, 1997.
WITNESSETH:
WHEREAS, the Fund is authorized to issue shares of Common Stock in separate
portfolios with each such portfolio representing interests in a separate
portfolio of securities and other assets; and
WHEREAS, the Fund currently consists of five separate portfolios designated
as the AUL American Equity Portfolio, the AUL American Bond Portfolio, the AUL
American Money Market Portfolio, the AUL American Managed Portfolio, and the AUL
American Tactical Asset Allocation Portfolio (each a "Portfolio"); and
WHEREAS, the Fund intends to establish three additional LifeStyle
Portfolios to be designated as the AUL American Conservative Investor Portfolio
(the "Conservative Investor Portfolio"), the AUL American Moderate Investor
Portfolio (the "Moderate Investor Portfolio"), and the AUL American Aggressive
Investor Portfolio (the "Aggressive Investor Portfolio"); hereinafter
collectively referred to as the "LifeStyle Portfolios" and
WHEREAS, the Fund desires to appoint the Adviser as investment adviser to
the LifeStyle Portfolios under the provisions set forth in the Agreement and in
this Addendum to the Agreement; and
WHEREAS, the Adviser is willing to accept such appointment;
NOW THEREFORE, in consideration of the mutual promises and covenants
contained in this Addendum, it is agreed between the parties hereto as follows:
1. In addition to its responsibilities as specified in the Agreement, the
Fund hereby appoints the Adviser to provide investment advisory services to the
LifeStyle Portfolios which, in addition to all other Portfolios previously
established, shall be deemed Portfolios under the Agreement, subject to the
terms and conditions as specified in the Agreement, including paragraph six (6),
" Compensation, " as amended by this Addendum.
2. Paragraph six (6), ("Compensation") of the Agreement is amended by
adding the following underscored language to paragraph six (6), which is
restated as follows:
6. Compensation. In consideration of the services to be rendered by the
Adviser under this Agreement, the Fund shall pay the Adviser a fee with respect
to each of the AUL American Equity, AUL American Bond, AUL American Money
Market, and AUL American Managed Portfolios, calculated and accrued daily and
paid each month, according to the following formula: (A) an amount at an annual
rate of 0.50% of the average daily net assets of the Portfolio; (B) minus, until
the later
- 2 -
of the Termination of the Expense Assumption Agreement or December 31, 1990,
the amount by which the Portfolio's aggregate ordinary operating expenses exceed
1.0% of the Portfolio's average daily net assets during the year, but in no
event more than the amount described in (A), above (the "Reduced Amount"), if
any; and (C) plus, if the aggregate ordinary operating expenses of the Portfolio
are less than 1.0% of the Portfolio's average daily net assets during the year
and if this Agreement is still in effect, the lesser of (i) any Reduced Amount
attributable to any of the preceding five years that has not been previously
reflected in a fee increase received by the Adviser, with such Reduced Amounts
considered in the chronological order of their occurrence, or (ii) an amount
which, when added to the Portfolio's other ordinary operating expenses, will
cause the Portfolio's total ordinary operating expenses to equal 1.0% of the
Portfolio's average daily net assets during the year. For purposes of this
provision, ordinary operating expenses shall not include interest, taxes,
brokerage commissions, legal claims and liabilities, litigation costs and
indemnification payments in connection with litigation, and other extraordinary
expenses. In consideration of the services to be rendered by the Adviser under
this Agreement, the Fund shall pay the Adviser a fee with respect to the
Tactical Asset Allocation Portfolio, calculated and accrued daily and paid each
month, equal at an annual rate of 0. 80 % of the average daily net assets of
such Portfolio and a fee with respect to the LifeStyle Portfolios, calculated
and accrued daily and paid each month, equal at an annual rate of 0.70% of the
average daily net assets of such Portfolios.
IN WITNESS WHEREOF, the parties hereto have caused this Addendum to be
executed by their officers designated below on the date written above.
On Behalf of AUL AMERICAN SERIES FUND, INC.
Attest:
/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
------------------------- ------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Secretary Chairman of the Board of Directors
and President
AMERICAN UNITED LIFE INSURANCE COMPANY(R)
Attest:
/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
General Counsel and Secretary Chairman of the Board, President,
and Chief Executive Officer
