Document:

Exhibit 4(e)

                        SUB-INVESTMENT ADVISORY AGREEMENT

            AGREEMENT dated September 29, 2006, between BlackRock Advisors, LLC,
a Delaware limited liability company (the "Advisor"), and BlackRock
Institutional Management Corporation, a Delaware corporation (the
"Sub-Advisor").

            WHEREAS, the Advisor has agreed to furnish investment advisory
services to the BlackRock Money Market V.I. Fund (the "Fund"), a series of
BlackRock Variable Series Funds, Inc. (the "Corporation"), an open-end
management investment company registered under the Investment Company Act of
1940, as amended (the "1940 Act");

            WHEREAS, the Advisor wishes to retain the Sub-Advisor to provide it
with certain sub-advisory services as described below in connection with
Advisor's advisory activities on behalf of the Fund;

            WHEREAS, the advisory agreement between the Advisor and the
Corporation, dated September 29, 2006 (such agreement or the most recent
successor agreement between such parties relating to advisory services to the
Corporation is referred to herein as the "Advisory Agreement") contemplates that
the Advisor may sub-contract investment advisory services with respect to the
Fund to a sub-advisor pursuant to a sub-advisory agreement agreeable to the
Corporation and approved in accordance with the provisions of the 1940 Act; and

            WHEREAS, this Agreement has been approved in accordance with the
provisions of the 1940 Act, and the Sub-Advisor is willing to furnish such
services upon the terms and conditions herein set forth; and

            NOW, THEREFORE, in consideration of the mutual premises and
covenants herein contained and other good and valuable consideration, the
receipt of which is hereby acknowledged, it is agreed by and between the parties
hereto as follows:

      1. Appointment. The Advisor hereby appoints the Sub-Advisor to act as
sub-advisor with respect to the Fund and the Sub-Advisor accepts such
appointment and agrees to render the services herein set forth for the
compensation herein provided.

      2. Services of the Sub-Advisor. Subject to the succeeding provisions of
this section, the oversight and supervision of the Advisor and the direction and
control of the Corporation's Board of Directors, the Sub-Advisor will perform
certain of the day-to-day operations of the Fund, which may include one or more
of the following services, at the request of the Advisor: (a) acting as
investment advisor for and managing the investment and reinvestment of those
assets of the Fund as the Advisor may from time to time request and in
connection therewith have complete discretion in purchasing and selling such
securities and other assets for the Fund and in voting, exercising consents and
exercising all other rights appertaining to such securities and other assets on
behalf of the Fund; (b) arranging, subject to the provisions of paragraph 3
hereof, for the purchase and sale of securities and other assets of the Fund;
(c) providing investment research and credit analysis concerning the Fund's
investments, (d) assist the Advisor in determining what portion of the Fund's
assets will be invested in cash, cash equivalents and money market instruments,
(e) placing orders for all purchases and sales of such investments

<PAGE>

made for the Fund, and (f) maintaining the books and records as are required to
support Fund investment operations. At the request of the Advisor, the
Sub-Advisor will also, subject to the oversight and supervision of the Advisor
and the direction and control of the Corporation's Board of Directors, provide
to the Advisor or the Fund any of the facilities and equipment and perform any
of the services described in Section 3 of the Advisory Agreement. In addition,
the Sub-Advisor will keep the Fund and the Advisor informed of developments
materially affecting the Fund and shall, on its own initiative, furnish to the
Fund from time to time whatever information the Sub-Advisor believes appropriate
for this purpose. The Sub-Advisor will periodically communicate to the Advisor,
at such times as the Advisor may direct, information concerning the purchase and
sale of securities for the Fund, including: (a) the name of the issuer, (b) the
amount of the purchase or sale, (c) the name of the broker or dealer, if any,
through which the purchase or sale is effected, (d) the CUSIP number of the
instrument, if any, and (e) such other information as the Advisor may reasonably
require for purposes of fulfilling its obligations to the Fund under the
Advisory Agreement. The Sub-Advisor will provide the services rendered by it
under this Agreement in accordance with the Fund's investment objectives,
policies and restrictions (as currently in effect and as they may be amended or
supplemented from time to time) as stated in the Fund's Prospectus and Statement
of Additional Information and the resolutions of the Corporation's Board of
Directors.

      3. Covenants. (a) In the performance of its duties under this Agreement,
the Sub-Advisor shall at all times conform to, and act in accordance with, any
requirements imposed by: (i) the provisions of the 1940 Act and the Investment
Advisers Act of 1940, as amended (the "Advisers Act"), and all applicable Rules
and Regulations of the Securities and Exchange Commission (the "SEC"); (ii) any
other applicable provision of law; (iii) the provisions of the Agreement and
Charter and By-Laws of the Corporation, as such documents are amended from time
to time; (iv) the investment objectives and policies of the Fund as set forth in
its Registration Statement on Form N-1A and/or the resolutions of the Board of
Directors; and (v) any policies and determinations of the Board of the Directors
of the Corporation and

            (b) In addition, the Sub-Advisor will:

                  (i) place orders either directly with the issuer or with any
broker or dealer. Subject to the other provisions of this paragraph, in placing
orders with brokers and dealers, the Sub-Advisor will attempt to obtain the best
price and the most favorable execution of its orders. In placing orders, the
Sub-Advisor will consider the experience and skill of the firm's securities
traders as well as the firm's financial responsibility and administrative
efficiency. Consistent with this obligation, the Sub-Advisor may select brokers
on the basis of the research, statistical and pricing services they provide to
the Fund and other clients of the Advisor or the Sub-Advisor. Information and
research received from such brokers will be in addition to, and not in lieu of,
the services required to be performed by the Sub-Advisor hereunder. A commission
paid to such brokers may be higher than that which another qualified broker
would have charged for effecting the same transaction, provided that the
Sub-Advisor determines in good faith that such commission is reasonable in terms
either of the transaction or the overall responsibility of the Advisor and the
Sub-Advisor to the Fund's and their other clients and that the total commissions
paid by the Fund will be reasonable in relation to the benefits to the Fund over
the long-term. Subject to the foregoing and the provisions of the 1940 Act, the
Securities

                                      -2-
<PAGE>

Exchange Act of 1934, as amended, and other applicable provisions of law, the
Advisor may select brokers and dealers with which it or the Corporation is
affiliated;

            (ii) maintain books and records with respect to the Fund's
securities transactions and will render to the Advisor and the Corporation's
Board of Directors such periodic and special reports as they may request;

            (iii) maintain a policy and practice of conducting its investment
advisory services hereunder independently of the commercial banking operations
of its affiliates. When the Sub-Advisor makes investment recommendations for the
Fund, its investment advisory personnel will not inquire or take into
consideration whether the issuer of securities proposed for purchase or sale for
the Fund's account are customers of the commercial department of its affiliates;
and

            (iv) treat confidentially and as proprietary information of the Fund
all records and other information relative to the Fund, and the Fund's prior,
current or potential shareholders, and will not use such records and information
for any purpose other than performance of its responsibilities and duties
hereunder, except after prior notification to and approval in writing by the
Fund, which approval shall not be unreasonably withheld and may not be withheld
where the Sub-Advisor may be exposed to civil or criminal contempt proceedings
for failure to comply, when requested to divulge such information by duly
constituted authorities, or when so requested by the Fund.

      4. Services Not Exclusive. Nothing in this Agreement shall prevent the
Sub-Advisor or any officer, employee or other affiliate thereof from acting as
investment advisor for any other person, firm or corporation, or from engaging
in any other lawful activity, and shall not in any way limit or restrict the
Sub-Advisor or any of its officers, employees or agents from buying, selling or
trading any securities for its or their own accounts or for the accounts of
others for whom it or they may be acting; provided, however, that the
Sub-Advisor will undertake no activities which, in its judgment, will adversely
affect the performance of its obligations under this Agreement.

      5. Books and Records. In compliance with the requirements of Rule 31a-3
under the 1940 Act, the Sub-Advisor hereby agrees that all records which it
maintains for the Corporation are the property of the Corporation and further
agrees to surrender promptly to the Corporation any such records upon the
Corporation's request. The Sub-Advisor further agrees to preserve for the
periods prescribed by Rule 31a-2 under the 1940 Act the records required to be
maintained by Rule 31a-1 under the 1940 Act (to the extent such books and
records are not maintained by the Advisor).

      6. Expenses. During the term of this Agreement, the Sub-Advisor will bear
all costs and expenses of its employees and any overhead incurred by the
Sub-Advisor in connection with its duties hereunder; provided that the Board of
Directors of the Corporation may approve reimbursement to the Sub-Advisor of the
pro-rata portion of the salaries, bonuses, health insurance, retirement benefits
and all similar employment costs for the time spent on Fund operations
(including, without limitation, compliance matters) (other than the provision of
investment advice and administrative services required to be provided hereunder)
of all

                                      -3-
<PAGE>

personnel employed by the Sub-Advisor who devote substantial time to the Fund
operations or the operations of other investment companies advised or
sub-advised by the Sub-Advisor.

      7. Compensation.

            (a) The Advisor agrees to pay to the Sub-Advisor and the Sub-Advisor
agrees to accept as full compensation for all services rendered by the
Sub-Advisor as such, a monthly fee in arrears at an annual rate equal to the
amount set forth in Schedule A hereto. For any period less than a month during
which this Agreement is in effect, the fee shall be prorated according to the
proportion which such period bears to a full month of 28, 29, 30 or 31 days, as
the case may be.

            (b) For purposes of this Agreement, the Net Assets of the Fund shall
be calculated pursuant to the procedures adopted by resolutions of the Directors
of the Corporation for calculating the value of the Fund's assets or delegating
such calculations to third parties.

      8. Indemnity.

            (a) The Fund hereby agrees to indemnify the Sub-Advisor and each of
the Sub-Advisor's directors, officers, employees, agents, associates and
controlling persons and the directors, partners, members, officers, employees
and agents thereof (including any individual who serves at the Sub-Advisor's
request as director, officer, partner, member, trustee or the like of another
entity) (each such person being an "Indemnitee") against any liabilities and
expenses, including amounts paid in satisfaction of judgments, in compromise or
as fines and penalties, and counsel fees (all as provided in accordance with
applicable state law) reasonably incurred by such Indemnitee in connection with
the defense or disposition of any action, suit or other proceeding, whether
civil or criminal, before any court or administrative or investigative body in
which such Indemnitee may be or may have been involved as a party or otherwise
or with which such Indemnitee may be or may have been threatened, while acting
in any capacity set forth herein or thereafter by reason of such Indemnitee
having acted in any such capacity, except with respect to any matter as to which
such Indemnitee shall have been adjudicated not to have acted in good faith in
the reasonable belief that such Indemnitee's action was in the best interest of
the Corporation and furthermore, in the case of any criminal proceeding, so long
as such Indemnitee had no reasonable cause to believe that the conduct was
unlawful; provided, however, that (1) no Indemnitee shall be indemnified
hereunder against any liability to the Corporation or the Fund or its
shareholders or any expense of such Indemnitee arising by reason of (i) willful
misfeasance, (ii) bad faith, (iii) gross negligence or (iv) reckless disregard
of the duties involved in the conduct of such Indemnitee's position (the conduct
referred to in such clauses (i) through (iv) being sometimes referred to herein
as "disabling conduct"), (2) as to any matter disposed of by settlement or a
compromise payment by such Indemnitee, pursuant to a consent decree or
otherwise, no indemnification either for said payment or for any other expenses
shall be provided unless there has been a determination that such settlement or
compromise is in the best interests of the Fund and that such Indemnitee appears
to have acted in good faith in the reasonable belief that such Indemnitee's
action was in the best interest of the Fund and did not involve disabling
conduct by such Indemnitee and (3) with respect to any action, suit or other
proceeding voluntarily prosecuted by any Indemnitee as plaintiff,
indemnification shall be mandatory only if

                                      -4-
<PAGE>

the prosecution of such action, suit or other proceeding by such Indemnitee was
authorized by a majority of the full Board of Directors of the Corporation.

            (b) The Fund shall make advance payments in connection with the
expenses of defending any action with respect to which indemnification might be
sought hereunder if the Corporation receives a written affirmation of the
Indemnitee's good faith belief that the standard of conduct necessary for
indemnification has been met and a written undertaking to reimburse a Fund
unless it is subsequently determined that such Indemnitee is entitled to such
indemnification and if the Directors of the Corporation determine that the facts
then known to them would not preclude indemnification. In addition, at least one
of the following conditions must be met: (A) the Indemnitee shall provide a
security for such Indemnitee-undertaking, (B) the Corporation shall be insured
against losses arising by reason of any unlawful advance, or (C) a majority of a
quorum consisting of Directors of the Corporation who are neither "interested
persons" of the Corporation (as defined in Section 2(a)(19) of the 1940 Act) nor
parties to the proceeding ("Disinterested Non-Party Directors") or an
independent legal counsel in a written opinion, shall determine, based on a
review of readily available facts (as opposed to a full trial-type inquiry),
that there is reason to believe that the Indemnitee ultimately will be found
entitled to indemnification.

            (c) All determinations with respect to indemnification hereunder
shall be made (1) by a final decision on the merits by a court or other body
before whom the proceeding was brought that such Indemnitee is not liable by
reason of disabling conduct, or (2) in the absence of such a decision, by (i) a
majority vote of a quorum of the Disinterested Non-Party Directors of the
Corporation, or (ii) if such a quorum is not obtainable or even, if obtainable,
if a majority vote of such quorum so directs, independent legal counsel in a
written opinion. All determinations that advance payments in connection with the
expense of defending any proceeding shall be authorized shall be made in
accordance with the immediately preceding clause (2) above.

            The rights accruing to any Indemnitee under these provisions shall
not exclude any other right to which such Indemnitee may be lawfully entitled.

      9. Limitation on Liability. The Sub-Advisor will not be liable for any
error of judgment or mistake of law or for any loss suffered by the Advisor or
by the Fund in connection with the performance of this Agreement, except a loss
resulting from a breach of fiduciary duty with respect to the receipt of
compensation for services or a loss resulting from willful misfeasance, bad
faith or gross negligence on its part in the performance of its duties or from
reckless disregard by it of its duties under this Agreement.

      10. Duration and Termination. This Agreement shall become effective as of
the date hereof and, unless sooner terminated with respect to the Fund as
provided herein, shall continue in effect for a period of two years. Thereafter,
if not terminated, this Agreement shall continue in effect with respect to the
Fund for successive periods of 12 months, provided such continuance is
specifically approved at least annually by both (a) the vote of a majority of
the Corporation's Board of Directors or a vote of a majority of the outstanding
voting securities of the Fund at the time outstanding and entitled to vote and
(b) by the vote of a majority of the Directors, who are not parties to this
Agreement or interested persons (as such term is defined in the 1940 Act) of

                                      -5-
<PAGE>

any such party, cast in person at a meeting called for the purpose of voting on
such approval. Notwithstanding the foregoing, this Agreement may be terminated
by the Corporation or the Advisor at any time, without the payment of any
penalty, upon giving the Sub-Advisor 60 days' notice (which notice may be waived
by the Sub-Advisor), provided that such termination by the Corporation, on
behalf of the Fund, or the Advisor shall be directed or approved by the vote of
a majority of the Directors of the Trust in office at the time or by the vote of
the holders of a majority of the voting securities of the Fund at the time
outstanding and entitled to vote, or by the Sub-Advisor on 60 days' written
notice (which notice may be waived by the Corporation, on behalf of the Fund,
and the Advisor), and will terminate automatically upon any termination of the
Advisory Agreement between the Corporation and the Advisor. This Agreement will
also immediately terminate in the event of its assignment. (As used in this
Agreement, the terms "majority of the outstanding voting securities,"
"interested person" and "assignment" shall have the same meanings of such terms
in the 1940 Act.)

      11. Notices. Any notice under this Agreement shall be in writing to the
other party at such address as the other party may designate from time to time
for the receipt of such notice and shall be deemed to be received on the earlier
of the date actually received or on the fourth day after the postmark if such
notice is mailed first class postage prepaid.

      12. Amendment of this Agreement. This Agreement may be amended by the
parties only if such amendment is specifically approved by the vote of the Board
of Directors of the Corporation, including a majority of those Directors 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, where
required by the 1940 Act, by a vote of a majority of the outstanding voting
securities of the Fund.

      13. Miscellaneous. The captions in this Agreement are included for
convenience of reference only and in no way define or delimit any of the
provisions hereof or otherwise affect their construction or effect. 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. This Agreement shall be binding on, and shall inure to the
benefit of the parties hereto and their respective successors.

      14. Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York for contracts to be performed
entirely therein without reference to choice of law principles thereof and in
accordance with the applicable provisions of the 1940 Act. To the extent that
the applicable laws of the State of New York, or any of the provisions, conflict
with the applicable provisions of the 1940 Act, the latter shall control.

      15. Counterparts. This Agreement may be executed in counterparts by the
parties hereto, each of which shall constitute an original counterpart, and all
of which, together, shall constitute one Agreement.

                                      -6-
<PAGE>

            IN WITNESS WHEREOF, the parties hereto have caused this instrument
to be executed by their duly authorized officers designated below as of the day
and year first above written.

                                                BLACKROCK ADVISORS, LLC

                                                By: ____________________________
                                                    Name:  Donald C. Burke
                                                    Title: Managing Director

                                                BLACKROCK INSTITUTIONAL
                                                MANAGEMENT CORPORATION

                                                By: ____________________________
                                                    Name:
                                                    Title:
Agreed and Accepted:

BLACKROCK VARIABLE SERIES FUNDS, INC.

By: _________________________________
    Name:  Donald C. Burke
    Title: Vice President & Treasurer

                                      -7-
<PAGE>

                                   Schedule A

                           Sub-Investment Advisory Fee

59.00% of the monthly advisory fee received by the Advisor from the Fund.

                                      -8-Exhibit 4(f)

                        SUB-INVESTMENT ADVISORY AGREEMENT

            AGREEMENT dated September 29, 2006, between BlackRock Advisors, LLC,
a Delaware limited liability company (the "Advisor"), and BlackRock Asset
Management U.K. Limited, a corporation organized under the laws of England and
Wales (the "Sub-Advisor").

            WHEREAS, the Advisor has agreed to furnish investment advisory
services to BlackRock Global Allocation V.I. Fund (the "Fund"), a series of
BlackRock Variable Series Funds, Inc. (the "Corporation"), an open-end
management investment company registered under the Investment Company Act of
1940, as amended (the "1940 Act");

            WHEREAS, the Advisor wishes to retain the Sub-Advisor to provide it
with certain sub-advisory services as described below in connection with
Advisor's advisory activities on behalf of the Funds;

            WHEREAS, the advisory agreement between the Advisor and the
Corporation, dated September 29, 2006 (such agreement or the most recent
successor agreement between such parties relating to advisory services to the
Corporation is referred to herein as the "Advisory Agreement") contemplates that
the Advisor may sub-contract investment advisory services with respect to the
Funds to a sub-advisor pursuant to a sub-advisory agreement agreeable to the
Corporation and approved in accordance with the provisions of the 1940 Act; and

            WHEREAS, this Agreement has been approved in accordance with the
provisions of the 1940 Act, and the Sub-Advisor is willing to furnish such
services upon the terms and conditions herein set forth; and

            NOW, THEREFORE, in consideration of the mutual premises and
covenants herein contained and other good and valuable consideration, the
receipt of which is hereby acknowledged, it is agreed by and between the parties
hereto as follows:

      1. Appointment. The Advisor hereby appoints the Sub-Advisor to act as
sub-advisor with respect to the Fund and the Sub-Advisor accepts such
appointment and agrees to render the services herein set forth for the
compensation herein provided.

      2. Services of the Sub-Advisor. Subject to the succeeding provisions of
this section, the oversight and supervision of the Advisor and the direction and
control of the Corporation's Board of Directors, the Sub-Advisor will perform
certain of the day-to-day operations of the Fund, which may include one or more
of the following services, at the request of the Advisor: (a) acting as
investment advisor for and managing the investment and reinvestment of those
assets of the Fund as the Advisor may from time to time request and in
connection therewith have complete discretion in purchasing and selling such
securities and other assets for the Fund and in voting, exercising consents and
exercising all other rights appertaining to such securities and other assets on
behalf of the Fund; (b) arranging, subject to the provisions of paragraph 3
hereof, for the purchase and sale of securities and other assets of the Fund;
(c) providing investment research and credit analysis concerning the Fund's
investments, (d) assist the Advisor in determining what portion of the Fund's
assets will be invested in cash, cash equivalents and money market instruments,
(e) placing orders for all purchases and sales of such investments

<PAGE>

made for the Fund, and (f) maintaining the books and records as are required to
support Fund investment operations. At the request of the Advisor, the
Sub-Advisor will also, subject to the oversight and supervision of the Advisor
and the direction and control of the Corporation's Board of Directors, provide
to the Advisor or the Fund any of the facilities and equipment and perform any
of the services described in Section 3 of the Advisory Agreement. In addition,
the Sub-Advisor will keep the Fund and the Advisor informed of developments
materially affecting the Fund and shall, on its own initiative, furnish to the
Fund from time to time whatever information the Sub-Advisor believes appropriate
for this purpose. The Sub-Advisor will periodically communicate to the Advisor,
at such times as the Advisor may direct, information concerning the purchase and
sale of securities for the Fund, including: (a) the name of the issuer, (b) the
amount of the purchase or sale, (c) the name of the broker or dealer, if any,
through which the purchase or sale is effected, (d) the CUSIP number of the
instrument, if any, and (e) such other information as the Advisor may reasonably
require for purposes of fulfilling its obligations to the Fund under the
Advisory Agreement. The Sub-Advisor will provide the services rendered by it
under this Agreement in accordance with the Fund's investment objectives,
policies and restrictions (as currently in effect and as they may be amended or
supplemented from time to time) as stated in the Fund's Prospectus and Statement
of Additional Information and the resolutions of the Corporation's Board of
Directors.

      3. Covenants. (a) In the performance of its duties under this Agreement,
the Sub-Advisor shall at all times conform to, and act in accordance with, any
requirements imposed by: (i) the provisions of the 1940 Act and the Investment
Advisers Act of 1940, as amended (the "Advisers Act"), and all applicable Rules
and Regulations of the Securities and Exchange Commission (the "SEC"); (ii) any
other applicable provision of law; (iii) the provisions of the Agreement and
Charter and By-Laws of the Corporation, as such documents are amended from time
to time; (iv) the investment objectives and policies of the Fund as set forth in
its Registration Statement on Form N-1A and/or the resolutions of the Board of
Directors; and (v) any policies and determinations of the Board of the Directors
of the Corporation and

            (b) In addition, the Sub-Advisor will:

                  (i) place orders either directly with the issuer or with any
broker or dealer. Subject to the other provisions of this paragraph, in placing
orders with brokers and dealers, the Sub-Advisor will attempt to obtain the best
price and the most favorable execution of its orders. In placing orders, the
Sub-Advisor will consider the experience and skill of the firm's securities
traders as well as the firm's financial responsibility and administrative
efficiency. Consistent with this obligation, the Sub-Advisor may select brokers
on the basis of the research, statistical and pricing services they provide to
the Fund and other clients of the Advisor or the Sub-Advisor. Information and
research received from such brokers will be in addition to, and not in lieu of,
the services required to be performed by the Sub-Advisor hereunder. A commission
paid to such brokers may be higher than that which another qualified broker
would have charged for effecting the same transaction, provided that the
Sub-Advisor determines in good faith that such commission is reasonable in terms
either of the transaction or the overall responsibility of the Advisor and the
Sub-Advisor to the Fund's and their other clients and that the total commissions
paid by the Fund will be reasonable in relation to the benefits to the Fund over
the long-term. Subject to the foregoing and the provisions of the 1940 Act, the
Securities

                                      -2-
<PAGE>

Exchange Act of 1934, as amended, and other applicable provisions of law, the
Advisor may select brokers and dealers with which it or the Corporation is
affiliated;

                  (ii) maintain books and records with respect to the Fund's
securities transactions and will render to the Advisor and the Corporation's
Board of Directors such periodic and special reports as they may request;

                  (iii) maintain a policy and practice of conducting its
investment advisory services hereunder independently of the commercial banking
operations of its affiliates. When the Sub-Advisor makes investment
recommendations for the Fund, its investment advisory personnel will not inquire
or take into consideration whether the issuer of securities proposed for
purchase or sale for the Fund's account are customers of the commercial
department of its affiliates; and

                  (iv) treat confidentially and as proprietary information of
the Fund all records and other information relative to the Fund, and the Fund's
prior, current or potential shareholders, and will not use such records and
information for any purpose other than performance of its responsibilities and
duties hereunder, except after prior notification to and approval in writing by
the Fund, which approval shall not be unreasonably withheld and may not be
withheld where the Sub-Advisor may be exposed to civil or criminal contempt
proceedings for failure to comply, when requested to divulge such information by
duly constituted authorities, or when so requested by the Fund.

      4. Services Not Exclusive. Nothing in this Agreement shall prevent the
Sub-Advisor or any officer, employee or other affiliate thereof from acting as
investment advisor for any other person, firm or corporation, or from engaging
in any other lawful activity, and shall not in any way limit or restrict the
Sub-Advisor or any of its officers, employees or agents from buying, selling or
trading any securities for its or their own accounts or for the accounts of
others for whom it or they may be acting; provided, however, that the
Sub-Advisor will undertake no activities which, in its judgment, will adversely
affect the performance of its obligations under this Agreement.

      5. Books and Records. In compliance with the requirements of Rule 31a-3
under the 1940 Act, the Sub-Advisor hereby agrees that all records which it
maintains for the Corporation are the property of the Corporation and further
agrees to surrender promptly to the Corporation any such records upon the
Corporation's request. The Sub-Advisor further agrees to preserve for the
periods prescribed by Rule 31a-2 under the 1940 Act the records required to be
maintained by Rule 31a-1 under the 1940 Act (to the extent such books and
records are not maintained by the Advisor).

      6. Expenses. During the term of this Agreement, the Sub-Advisor will bear
all costs and expenses of its employees and any overhead incurred by the
Sub-Advisor in connection with its duties hereunder; provided that the Board of
Directors of the Corporation may approve reimbursement to the Sub-Advisor of the
pro-rata portion of the salaries, bonuses, health insurance, retirement benefits
and all similar employment costs for the time spent on Fund operations
(including, without limitation, compliance matters) (other than the provision of
investment advice and administrative services required to be provided hereunder)
of all

                                      -3-
<PAGE>

personnel employed by the Sub-Advisor who devote substantial time to the Fund
operations or the operations of other investment companies advised or
sub-advised by the Sub-Advisor.

      7. Compensation.

            (a) The Advisor agrees to pay to the Sub-Advisor and the Sub-Advisor
agrees to accept as full compensation for all services rendered by the
Sub-Advisor as such, a monthly fee in arrears at an annual rate equal to the
amount set forth in Schedule A hereto. For any period less than a month during
which this Agreement is in effect, the fee shall be prorated according to the
proportion which such period bears to a full month of 28, 29, 30 or 31 days, as
the case may be.

            (b) For purposes of this Agreement, the Net Assets of the Fund shall
be calculated pursuant to the procedures adopted by resolutions of the Directors
of the Corporation for calculating the value of the Fund's assets or delegating
such calculations to third parties.

      8. Indemnity.

            (a) The Fund hereby agrees to indemnify the Sub-Advisor and each of
the Sub-Advisor's directors, officers, employees, agents, associates and
controlling persons and the directors, partners, members, officers, employees
and agents thereof (including any individual who serves at the Sub-Advisor's
request as director, officer, partner, member, trustee or the like of another
entity) (each such person being an "Indemnitee") against any liabilities and
expenses, including amounts paid in satisfaction of judgments, in compromise or
as fines and penalties, and counsel fees (all as provided in accordance with
applicable state law) reasonably incurred by such Indemnitee in connection with
the defense or disposition of any action, suit or other proceeding, whether
civil or criminal, before any court or administrative or investigative body in
which such Indemnitee may be or may have been involved as a party or otherwise
or with which such Indemnitee may be or may have been threatened, while acting
in any capacity set forth herein or thereafter by reason of such Indemnitee
having acted in any such capacity, except with respect to any matter as to which
such Indemnitee shall have been adjudicated not to have acted in good faith in
the reasonable belief that such Indemnitee's action was in the best interest of
the Corporation and furthermore, in the case of any criminal proceeding, so long
as such Indemnitee had no reasonable cause to believe that the conduct was
unlawful; provided, however, that (1) no Indemnitee shall be indemnified
hereunder against any liability to the Corporation or the Fund or its
shareholders or any expense of such Indemnitee arising by reason of (i) willful
misfeasance, (ii) bad faith, (iii) gross negligence or (iv) reckless disregard
of the duties involved in the conduct of such Indemnitee's position (the conduct
referred to in such clauses (i) through (iv) being sometimes referred to herein
as "disabling conduct"), (2) as to any matter disposed of by settlement or a
compromise payment by such Indemnitee, pursuant to a consent decree or
otherwise, no indemnification either for said payment or for any other expenses
shall be provided unless there has been a determination that such settlement or
compromise is in the best interests of the Fund and that such Indemnitee appears
to have acted in good faith in the reasonable belief that such Indemnitee's
action was in the best interest of the Fund and did not involve disabling
conduct by such Indemnitee and (3) with respect to any action, suit or other
proceeding voluntarily prosecuted by any Indemnitee as plaintiff,
indemnification shall be mandatory only if

                                      -4-
<PAGE>

the prosecution of such action, suit or other proceeding by such Indemnitee was
authorized by a majority of the full Board of Directors of the Corporation.

            (b) The Fund shall make advance payments in connection with the
expenses of defending any action with respect to which indemnification might be
sought hereunder if the Corporation receives a written affirmation of the
Indemnitee's good faith belief that the standard of conduct necessary for
indemnification has been met and a written undertaking to reimburse a Fund
unless it is subsequently determined that such Indemnitee is entitled to such
indemnification and if the Directors of the Corporation determine that the facts
then known to them would not preclude indemnification. In addition, at least one
of the following conditions must be met: (A) the Indemnitee shall provide a
security for such Indemnitee-undertaking, (B) the Corporation shall be insured
against losses arising by reason of any unlawful advance, or (C) a majority of a
quorum consisting of Directors of the Corporation who are neither "interested
persons" of the Corporation (as defined in Section 2(a)(19) of the 1940 Act) nor
parties to the proceeding ("Disinterested Non-Party Directors") or an
independent legal counsel in a written opinion, shall determine, based on a
review of readily available facts (as opposed to a full trial-type inquiry),
that there is reason to believe that the Indemnitee ultimately will be found
entitled to indemnification.

            (c) All determinations with respect to indemnification hereunder
shall be made (1) by a final decision on the merits by a court or other body
before whom the proceeding was brought that such Indemnitee is not liable by
reason of disabling conduct, or (2) in the absence of such a decision, by (i) a
majority vote of a quorum of the Disinterested Non-Party Directors of the
Corporation, or (ii) if such a quorum is not obtainable or even, if obtainable,
if a majority vote of such quorum so directs, independent legal counsel in a
written opinion. All determinations that advance payments in connection with the
expense of defending any proceeding shall be authorized shall be made in
accordance with the immediately preceding clause (2) above.

            The rights accruing to any Indemnitee under these provisions shall
not exclude any other right to which such Indemnitee may be lawfully entitled.

      9. Limitation on Liability. The Sub-Advisor will not be liable for any
error of judgment or mistake of law or for any loss suffered by the Advisor or
by the Fund in connection with the performance of this Agreement, except a loss
resulting from a breach of fiduciary duty with respect to the receipt of
compensation for services or a loss resulting from willful misfeasance, bad
faith or gross negligence on its part in the performance of its duties or from
reckless disregard by it of its duties under this Agreement.

      10. Duration and Termination. This Agreement shall become effective as of
the date hereof and, unless sooner terminated with respect to the Fund as
provided herein, shall continue in effect for a period of two years. Thereafter,
if not terminated, this Agreement shall continue in effect with respect to the
Fund for successive periods of 12 months, provided such continuance is
specifically approved at least annually by both (a) the vote of a majority of
the Corporation's Board of Directors or a vote of a majority of the outstanding
voting securities of the Fund at the time outstanding and entitled to vote and
(b) by the vote of a majority of the Directors, who are not parties to this
Agreement or interested persons (as such term is defined in the 1940 Act) of

                                      -5-
<PAGE>

any such party, cast in person at a meeting called for the purpose of voting on
such approval. Notwithstanding the foregoing, this Agreement may be terminated
by the Corporation or the Advisor at any time, without the payment of any
penalty, upon giving the Sub-Advisor 60 days' notice (which notice may be waived
by the Sub-Advisor), provided that such termination by the Corporation, on
behalf of the Fund, or the Advisor shall be directed or approved by the vote of
a majority of the Directors of the Trust in office at the time or by the vote of
the holders of a majority of the voting securities of the Fund at the time
outstanding and entitled to vote, or by the Sub-Advisor on 60 days' written
notice (which notice may be waived by the Corporation, on behalf of the Fund,
and the Advisor), and will terminate automatically upon any termination of the
Advisory Agreement between the Corporation and the Advisor. This Agreement will
also immediately terminate in the event of its assignment. (As used in this
Agreement, the terms "majority of the outstanding voting securities,"
"interested person" and "assignment" shall have the same meanings of such terms
in the 1940 Act.)

      11. Notices. Any notice under this Agreement shall be in writing to the
other party at such address as the other party may designate from time to time
for the receipt of such notice and shall be deemed to be received on the earlier
of the date actually received or on the fourth day after the postmark if such
notice is mailed first class postage prepaid.

      12. Amendment of this Agreement. This Agreement may be amended by the
parties only if such amendment is specifically approved by the vote of the Board
of Directors of the Corporation, including a majority of those Directors 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, where
required by the 1940 Act, by a vote of a majority of the outstanding voting
securities of the Fund.

      13. Miscellaneous. The captions in this Agreement are included for
convenience of reference only and in no way define or delimit any of the
provisions hereof or otherwise affect their construction or effect. 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. This Agreement shall be binding on, and shall inure to the
benefit of the parties hereto and their respective successors.

      14. Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York for contracts to be performed
entirely therein without reference to choice of law principles thereof and in
accordance with the applicable provisions of the 1940 Act. To the extent that
the applicable laws of the State of New York, or any of the provisions, conflict
with the applicable provisions of the 1940 Act, the latter shall control.

      15. Counterparts. This Agreement may be executed in counterparts by the
parties hereto, each of which shall constitute an original counterpart, and all
of which, together, shall constitute one Agreement.

                                      -6-
<PAGE>

            IN WITNESS WHEREOF, the parties hereto have caused this instrument
to be executed by their duly authorized officers designated below as of the day
and year first above written.

                                         BLACKROCK ADVISORS, LLC

                                         By: ___________________________________
                                             Name:  Donald C. Burke
                                             Title: Managing Director

                                         BLACKROCK ASSET MANAGEMENT U.K. LIMITED

                                         By: ___________________________________
                                             Name:
                                             Title:
Agreed and Accepted:

BLACKROCK VARIABLE SERIES FUNDS, INC.

By: _________________________________
    Name:  Donald C. Burke
    Title: Vice President & Treasurer

                                      -7-
<PAGE>

                                   Schedule A

                           Sub-Investment Advisory Fee

37.00% of the monthly advisory fee received by the Advisor from the Fund.

                                      -8-

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