FORM OF INVESTMENT ADVISORY AGREEMENT
AGREEMENT, dated as of May 1, 1999, by and between EQ Financial
Consultants, Inc., a Delaware corporation (the "Manager"), and Alliance Capital
Management L.P., a Delaware limited partnership (the "Adviser").
WHEREAS, EQ Advisors Trust (the "Trust") is registered as an investment
company under the Investment Company Act of 1940, as amended (the "Investment
Company Act");
WHEREAS, the Trust's shareholders are and will be separate accounts
maintained by insurance companies for variable life insurance policies and
variable annuity contracts under which income, gains, and losses, whether or not
realized, from assets allocated to such accounts are, in accordance with such
policies and contracts, credited to or charged against such accounts without
regard to other income, gains, or losses of such insurance companies;
WHEREAS, the Trust is and will continue to be a series fund having two
or more investment portfolios, each with its own investment objectives, policies
and restrictions;
WHEREAS, the Manager is registered as an investment adviser under the
Investment Advisers Act of 1940, as amended ("Advisers Act"), and is the
investment manager to the Trust;
WHEREAS, the Adviser is registered as an investment adviser under the
Advisers Act;
WHEREAS, the Investment Company Act prohibits any person from acting as
an investment adviser to a registered investment company except pursuant to a
written contract; and
WHEREAS, the Board of Directors of the Trust and the Manager desire that
the Manager retain the Adviser to render investment advisory services to the
portfolios to be known as EQ/Alliance Premier Growth Portfolio (the "Portfolio")
in the manner and on the terms hereinafter set forth, which Portfolio is more
particularly described in Post-Effective Amendment No. 8 to the Registration
Statement on Form N-1A for the Trust filed with the Securities and Exchange
Commission (the "SEC") on February 16. 1999;
NOW, THEREFORE, the Manager and the Adviser agree as follows:
1. APPOINTMENT OF ADVISER
The Manager hereby appoints the Adviser to act as investment adviser for
the Portfolio, subject to the supervision and control of the Manager and the
Trustees of the Trust, and in accordance with the terms and conditions of this
Agreement. The Adviser
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will be an independent contractor and will have no authority to act for or
represent the Trust or the Manager in any way or otherwise be deemed an agent of
the Trust or the Manager except as expressly authorized in this Agreement or
another writing by the Trust, the Manager and the Adviser.
2. SERVICES TO BE RENDERED BY THE ADVISER TO THE TRUST
A. As investment adviser to the Portfolio, the Adviser will manage the
investment and reinvestment of the assets of the Portfolio and determine the
composition of the assets of the Portfolio, subject always to the supervision
and control of the Manager and the Trustees of the Trust.
B. As part of the services it will provide hereunder, the Adviser will:
(i) obtain and evaluate pertinent economic, statistical,
financial, and other information affecting the economy generally and
individual companies or industries, the securities of which are included
in the Portfolio or are under consideration for inclusion in the
Portfolio;
(ii) formulate and implement a continuous investment program for
the Portfolio;
(iii) take whatever steps are necessary to implement the
investment program for the Portfolio by the purchase and sale of
securities and other investments, including the placing of orders for
such purchases and sales;
(iv) keep the Trustees of the Trust and the Manager fully
informed in writing on an ongoing basis of all material facts concerning
the investment and reinvestment of the assets in the Portfolio, the
Adviser and its personnel and operations, make regular and special
written reports of such additional information concerning the same as
may reasonably be requested from time to time by the Manager or the
Trustees of the Trust and attend meetings with the Manager and/or the
Trustees, as reasonably requested, to discuss the foregoing,
(v) provide determinations of the fair value of certain portfolio
securities when market quotations are not readily available for the
purpose of calculating the Portfolio's net asset value in accordance
with procedures and methods established by the Trustees of the Trust;
(vi) provide any and all information, records and supporting
documentation about accounts the Adviser manages that have investment
objectives, policies, and strategies substantially similar to those
employed by the Adviser in managing the Portfolio which may be
reasonably necessary, under applicable laws, to allow the Portfolio or
its agent to present information concerning the Adviser's prior
performance in the Trust Prospectus and SAI (as
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hereinafter defined) and any permissible reports and materials prepared
by the Portfolio or its agent; and
(vii) cooperate with and provide reasonable assistance to the
Manager, the Trust administrator, the Trust's custodian and foreign
custodians, the Trust's transfer agent and pricing agents and all other
agents and representatives of the Trust and the Manager, keep all such
persons fully informed as to such matters as they may reasonably deem
necessary to the performance of their obligations to the Trust and the
Manager, provide prompt responses to reasonable requests made by such
persons and establish appropriate interfaces with each so as to promote
the efficient exchange of information.
C. In furnishing services hereunder, the Adviser shall be subject to,
and shall perform in accordance with, the Trust's Agreement and Declaration of
Trust, as the same may be hereafter modified and/or amended from time to time
(the "Trust Declaration"), the By-Laws of the Trust , as the same may be
hereafter modified and/or amended from time to time (the "By-Laws"), the
currently effective Prospectus and Statement of Additional Information of the
Trust filed with the SEC, as the same may be hereafter modified, amended and/or
supplemented (the "Prospectus and SAI"), the Investment Company Act, with the
requirements applicable to both regulated investment companies and segregated
asset accounts under Subchapters M and L of the Internal Revenue Code of 1986,
as amended, all other applicable state and federal securities and other laws,
all regulations with respect to the foregoing, the policies and procedures
adopted from time to time by the Board of Trustees of the Trust and the written
instructions of the Manager.
D. The Adviser, at its expense, will furnish: (i) all necessary
investment and management facilities and investment personnel, including
salaries, expenses and fees of any personnel required for it to faithfully
perform its duties under this Agreement; and (ii) administrative facilities,
including bookkeeping, clerical personnel and equipment necessary for the
efficient conduct of the investment affairs of the Portfolio (excluding that
necessary for the determination of net asset value and shareholder accounting
services).
E. The Adviser will select brokers and dealers to effect all portfolio
transactions subject to the conditions set forth herein. The Adviser will place
all necessary orders with brokers, dealers, or issuers, and will negotiate
brokerage commissions if applicable. The Adviser is directed at all times to
seek to execute brokerage transactions for the Portfolio in accordance with such
policies or practices as may be established by the Board of Trustees and
described in the Trust's Prospectus and SAI. In placing orders for the purchase
or sale of investments for the Portfolio, in the name of the Portfolio or its
nominees, the Adviser shall use its best efforts to obtain for the Portfolio the
most favorable price and best execution available, considering all of the
circumstances, and shall maintain records adequate to demonstrate compliance
with this requirement.
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F. Subject to the appropriate policies and procedures approved by the
Board of Trustees, the Adviser may, to the extent authorized by Section 28(e) of
the Securities Exchange Act of 1934, cause the Portfolio to pay a broker or
dealer that provides brokerage or research services to the Manager, the Adviser,
and the Portfolio an amount of commission for effecting a portfolio transaction
in excess of the amount of commission another broker or dealer would have
charged for effecting that transaction if the Adviser determines, in good faith,
that such amount of commission is reasonable in relationship to the value of
such brokerage or research services provided viewed in terms of that particular
transaction or the Adviser's overall responsibilities to the Portfolio or its
other advisory clients. To the extent authorized by said Section 28(e) and the
Trust's Board of Trustees, 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 such action. In addition, subject to seeking the most
favorable price and best execution available, the Adviser may also consider
sales of shares of the Trust as a factor in the selection of brokers and
dealers.
G. On occasions when the Adviser deems the purchase or sale of a
security to be in the best interest of the Portfolio as well as other clients of
the Adviser, the Adviser to the extent permitted by applicable laws and
regulations, may, but shall be under no obligation to, aggregate the securities
to be purchased or sold to attempt to obtain a more favorable price or lower
brokerage commissions and efficient execution. In such event, allocation of the
securities so purchased or sold, as well as the expenses incurred in the
transaction, will be made by the Adviser in the manner the Adviser considers to
be the most equitable and consistent with its fiduciary obligations to the
Portfolio and to its other clients.
H. The Adviser will maintain all accounts, books and records with
respect to the Portfolio as are required of an investment adviser of a
registered investment company pursuant to the Investment Company Act and
Advisers Act and the rules thereunder and shall file with the SEC all forms
pursuant to Section 13 of the Securities Exchange Act of 1934, as amended, with
respect to the discretionary management of the assets of the Portfolio.
3. COMPENSATION OF ADVISER
The Manager will pay the Adviser an advisory fee with respect to the
Portfolio at the annual rate specified in Appendix A to this Agreement. The
advisory fee due and payable hereunder on account of any day shall be calculated
by multiplying the net asset value of the Portfolio at the close of the
immediately preceding business day (as defined in the Prospectus and SAI) by the
annual rate specified in Appendix A and dividing the result by the number of
days in the year. The advisory fee due and payable hereunder on account of the
days in any calendar month shall be due and payable within ten (10) business
days following the end of such calendar month.
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4. LIABILITY OF ADVISER
Except as may otherwise be provided by the Investment Company Act or any
other federal securities law, the Adviser shall not be liable for any losses,
claims, damages, liabilities or litigation (including legal and other expenses)
incurred or suffered by the Manager or the Trust as a result of any error of
judgment or mistake of law with respect to the Portfolio, except that nothing in
this Agreement shall operate or purport to operate in any way to exculpate,
waive or limit the liability of the Adviser for, and the Adviser shall indemnify
and hold the Trust, the Manager, all affiliated persons thereof (within the
meaning of Section 2(a)(3) of the Investment Company Act) and all controlling
persons (as described in Section 15 of the Securities Act of 1933) harmless from
and against, any and all losses, claims, damages, liabilities or litigation
(including legal and other expenses) incurred or suffered by any of such persons
arising out of or based on (a) any willful misconduct, bad faith, reckless
disregard or gross negligence of the Adviser in the performance of any if its
duties or obligations hereunder or (b) any untrue statement of a material fact
contained in the Prospectus and SAI, or the omission to state therein a material
fact known to the Adviser which was required to be stated therein or necessary
to make the statements therein not misleading, if such a statement or omission
was made in reliance upon information furnished to the Trust by the Adviser.
5. NON-EXCLUSIVITY
The services of the Adviser to the Portfolio and the Trust are not to be
deemed to be exclusive, and the Adviser shall be free to render investment
advisory or other services to others (including other investment companies) and
to engage in other activities. It is understood and agreed that the directors,
officers, and employees of the Adviser are not prohibited from engaging in any
other business activity or from rendering services to any other person, or from
serving as partners, officers, directors, trustees, or employees of any other
firm or corporation, including other investment companies.
6. SUPPLEMENTAL ARRANGEMENTS
The Adviser may from time to time employ or associate with itself any
person it believes to be particularly fitted to assist it in providing the
services to be performed by the Adviser hereunder, provided that no such person
shall perform any services with respect to the Portfolio which would constitute
an assignment or require a written advisory agreement pursuant the Investment
Company Act. Any compensation payable to such persons such be the sole
responsibility of the Advisor, and neither the Manager nor the Trust shall have
any obligations with respect thereto.
7. REGULATION
The Adviser shall submit to all regulatory and administrative bodies
having jurisdiction over the services provided pursuant to this Agreement any
information,
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reports, or other material which any such body by reason of this Agreement may
request or require pursuant to applicable laws and regulations.
8. RECORDS
The records relating to the services provided under this Agreement shall
be the property of the Trust and shall be under its control; however, the Trust
shall furnish to the Adviser such records and permit it to retain such records
(either in original or in duplicate form) as it shall reasonably require in
order to carry out its duties. In the event of the termination of this
Agreement, such records shall promptly be returned to the Trust by the Adviser
free from any claim or retention of rights therein. The Manager and the Adviser
shall keep confidential any information obtained in connection with its duties
hereunder and disclose such information only if the Trust has authorized such
disclosure or if such disclosure is expressly required or requested by
applicable federal or state regulatory authorities.
9. DURATION OF AGREEMENT
This Agreement shall become effective with respect to the Portfolio on
the later of the date of its execution or the date of the commencement of the
Portfolio. This Agreement will continue in effect for a period more than two
years from the date of its execution only so long as such continuance is
specifically approved at least annually by the Board of Trustees provided that
in such event such continuance shall also be approved by the vote of a majority
of the Trustees who are not "interested persons" (as defined in the Investment
Company Act) ("Independent Trustees") of any party to this Agreement cast in
person at a meeting called for the purpose of voting on such approval.
10. TERMINATION OF AGREEMENT
This Agreement may be terminated at any time, without the payment of any
penalty, by the Board of Trustees, including a majority of the Independent
Trustees, by the vote of a majority of the outstanding voting securities of the
Portfolio, on sixty (60) day's written notice to the Manager and the Adviser, or
by the Manager or Adviser on sixty (60) day's written notice to the Trust and
the other party. This Agreement will automatically terminate, without the
payment of any penalty, in the event of its assignment (as defined in the
Investment Company Act) or in the event the Investment Management Agreement
between the Manager and the Trust is assigned or terminates for any other
reason. This Agreement will also terminate upon written notice to the other
party that the other party is in material breach of this Agreement, unless the
other party in material breach of this Agreement cures such breach to the
reasonable satisfaction of the party alleging the breach within thirty (30) days
after written notice.
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11. PROVISION OF CERTAIN INFORMATION BY ADVISER
The Adviser will promptly notify the Manager in writing of the
occurrence of any of the following events:
A. the Adviser fails to be registered as an investment adviser under the
Advisers Act or under the laws of any jurisdiction in which the Adviser is
required to be registered as an investment adviser in order to perform its
obligations under this Agreement;
B. the Adviser is served or otherwise receives notice of any action,
suit, proceeding, inquiry, or investigation, at law or in equity, before or by
any court, public board, or body, involving the affairs of the Trust; and/or
C. the chief executive officer or controlling stockholder of the Adviser
or the portfolio manager of the Portfolio changes or there is otherwise an
actual change in control or management of the Adviser.
12. USE OF ADVISER'S NAME
The Manager will not use the Adviser's name (or that of any affiliate)
in Trust literature without prior review and approval by the Adviser, which may
not be unreasonably withheld or delayed.
13. YEAR 2000 PREPAREDNESS
The Adviser warrants and represents that the Adviser has adopted a
written plan for Year 2000 compliance for the correct operation of the Adviser's
computer systems because of the approaching millennium (the "Plan"), that the
Plan provides for the identification, testing and, where appropriate, upgrading
of the Adviser's computer systems, in accordance with reasonable industry
standards, so that both the Adviser's computer systems and their interfaces with
third party computer systems will function accurately and without interruption
before, during and after December 31, 1999 and that the Adviser is actively in
the process of implementing the Plan and presently has no reason to believe that
the Adviser's computer systems and their interfaces with third party computer
systems will not be able to function accurately and without interruption before,
during and after such date. The Adviser will continue to implement the Plan and
take such other steps as may be necessary and appropriate to be Year 2000
compliant in a timely and efficient manner and will notify the Manager and the
Trust of any Year 2000 compliance problems and the nature thereof on or before
September 1, 1999 if the Adviser determines that it is not or is not likely to
be Year 2000 compliant in a timely and efficient manner. The failure of the
Adviser to be Year 2000 compliant shall not be deemed to be a force majeure
event or provide a defense to performance hereunder.
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14. AMENDMENTS TO THE AGREEMENT
Except to the extent permitted by the Investment Company Act or the
rules or regulations thereunder or pursuant to any exemptive relief granted by
the Securities and Exchange Commission ("SEC"), this Agreement may be amended by
the parties only if such amendment, if material, is specifically approved by the
vote of a majority of the outstanding voting securities of the Portfolio (unless
such approval is not required by Section 15 of the Investment Company Act as
interpreted by the SEC or its staff) and by the vote of a majority of the
Independent Trustees cast in person at a meeting called for the purpose of
voting on such approval. The required shareholder approval shall be effective
with respect to the Portfolio if a majority of the outstanding voting securities
of the Portfolio vote to approve the amendment, notwithstanding that the
amendment may not have been approved by a majority of the outstanding voting
securities of any other Portfolio affected by the amendment or all the
portfolios of the Trust.
15. ASSIGNMENT
No assignment (as that term is defined in the Investment Company Act)
shall be made by the Adviser without the prior written consent of the Trust and
the Manager. Notwithstanding the foregoing, no assignment shall be deemed to
result from any changes in the directors, officers or employees of the Adviser
except as may be provided to the contrary in the Investment Company Act. The
Adviser agrees that it will notify the Trust and the Manager of from any changes
in the directors, officers or employees of the Adviser within a reasonable time
thereafter.
16. ENTIRE AGREEMENT
This Agreement contains the entire understanding and agreement of the
parties with respect to the Portfolio.
17. HEADINGS
The headings in the sections of this Agreement are inserted for
convenience of reference only and shall not constitute a part hereof.
18. NOTICES
All notices required to be given pursuant to this Agreement shall be
delivered or mailed to the last known business address of each applicable party
in person or by registered mail or a private mail or delivery service providing
the sender with notice of receipt. The specific person to whom notice shall be
provided for each party will be specified in writing to the other party. Notice
shall be deemed given on the date delivered or mailed in accordance with this
paragraph.
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19. SEVERABILITY
Should any portion of this Agreement for any reason be held to be void
in law or in equity, the Agreement shall be construed, insofar as is possible,
as if such portion had never been contained herein.
20. GOVERNING LAW
The provisions of this Agreement shall be construed and interpreted in
accordance with the laws of the State of Delaware, or any of the applicable
provisions of the Investment Company Act. To the extent that the laws of the
State of Delaware, or any of the provisions in this Agreement, conflict with
applicable provisions of the Investment Company Act, the latter shall control.
21. INTERPRETATION
Any question of interpretation of any term or provision of this
Agreement having a counterpart in or otherwise derived from a term or provision
of the Investment Company Act shall be resolved by reference to such term or
provision of the Investment Company Act and to interpretations thereof, if any,
by the United States courts or, in the absence of any controlling decision of
any such court, by rules, regulations or orders of the SEC validly issued
pursuant to the Investment Company Act. Specifically, the terms "vote of a
majority of the outstanding voting securities," "interested persons,"
"assignment," and "affiliated persons," as used herein shall have the meanings
assigned to them by Section 2(a) of the Investment Company Act. In addition,
where the effect of a requirement of the Investment Company Act reflected in any
provision of this Agreement is relaxed by a rule, regulation or order of the
SEC, whether of special or of general application, such provision shall be
deemed to incorporate the effect of such rule, regulation or order.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their duly authorized officers as of the date first mentioned above.
EQ FINANCIAL CONSULTANTS, INC. ALLIANCE CAPITAL MANAGEMENT L.P.
By: By: ALLIANCE CAPITAL MANAGEMENT
----------------------------- CORPORATION, its General Partner
Xxxxx X. Xxxxx
Executive Vice President By:
-----------------------------
Xxxx X. Xxxxxx
Assistant Secretary
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APPENDIX A
To
INVESTMENT ADVISORY AGREEMENT
With
ALLIANCE CAPITAL MANAGEMENT L.P.
Portfolio Annual Advisory Fee
--------- -------------------
EQ/Alliance Premier Growth .50% of the Portfolio's daily net assets
Portfolio
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