FORM OF EXPENSE LIMITATION AGREEMENT
EXPENSE LIMITATION AGREEMENT, effective as of [April 1, 2004] by and
between The Equitable Life Assurance Society of the United States (the
"Manager") and EQ Advisors Trust (the "Trust"), on behalf of each portfolio of
the Trust set forth in Schedule A attached hereto (each, a "Portfolio", and
collectively, the "Portfolios").
WHEREAS, the Trust is a Delaware business trust organized under the
Agreement and Declaration of Trust ("Declaration of Trust"), and is registered
under the Investment Company Act of 1940, as amended ("1940 Act"), as an
open-end management company of the series type, and each Portfolio is a series
of the Trust;
WHEREAS, the Trust and the Manager have entered into an Investment
Management Agreement dated [insert date], ("Management Agreement"), pursuant to
which the Manager provides investment management services to each Portfolio for
compensation based on the value of the average daily net assets of each such
Portfolio;
WHEREAS, the Trust and the Manager have determined that it is appropriate
and in the best interests of each Portfolio and its shareholders to maintain the
expenses of each Portfolio at a level below the level to which each such
Portfolio would normally be subject during its start-up period; and
NOW THEREFORE, the parties hereto agree that the Expense Limitation
Agreement is hereby modified, amended and restated in its entirety as of the
date hereof as follows:
1. EXPENSE LIMITATION.
1.1. APPLICABLE EXPENSE LIMIT. To the extent that the aggregate expenses of
every character incurred by a Portfolio in any fiscal year, including but not
limited to organizational costs and investment management fees of the Manager
(but excluding interest, taxes, brokerage commissions, other expenditures which
are capitalized in accordance with generally accepted accounting principles,
other extraordinary expenses not incurred in the ordinary course of such
Portfolio's business and amounts payable pursuant to a plan adopted in
accordance with Rule 12b-1 under the 1940 Act) ("Portfolio Operating Expenses"),
exceed the Maximum Annual Operating Expense Limit, as defined in Section 1.2
below, such excess amount (the "Excess Amount") shall be the liability of the
Manager.
1.2. MAXIMUM ANNUAL OPERATING EXPENSE LIMIT. The Maximum Annual Operating
Expense Limit with respect to each Portfolio shall be the amount specified in
Schedule A based on a percentage of the average daily net assets of each
Portfolio.
1.3. METHOD OF COMPUTATION. To determine the Manager's liability with
respect to the Excess Amount, each month the Portfolio Operating Expenses for
each Portfolio shall be annualized as of the last day of the month. If the
annualized Portfolio Operating Expenses for any month of a Portfolio exceed the
Maximum Annual Operating Expense Limit of such Portfolio, the Manager shall
first waive or reduce its investment management fee for such month by an amount
sufficient to reduce the annualized Portfolio Operating Expenses to an amount no
higher than the Maximum Annual Operating Expense Limit. If the amount of the
waived or reduced investment management fee for any such month is insufficient
to pay the Excess Amount, the Manager may also remit to the appropriate
Portfolio or Portfolios an amount that, together with the waived or reduced
investment management fee, is sufficient to pay such Excess Amount.
1.4. YEAR-END ADJUSTMENT. If necessary, on or before the last day of the
first month of each fiscal year, an adjustment payment shall be made by the
appropriate party in order that the amount of the investment management fees
waived or reduced and other payments remitted by the Manager to the Portfolio or
Portfolios with respect to the previous fiscal year shall equal the Excess
Amount.
2. REIMBURSEMENT OF FEE WAIVERS AND EXPENSE REIMBURSEMENTS.
2.1. REIMBURSEMENT. If in any year in which the Management Agreement is
still in effect, the estimated aggregate Portfolio Operating Expenses of such
Portfolio for the fiscal year are less than the Maximum Annual Operating Expense
Limit for that year, the Manager shall be entitled to reimbursement by such
Portfolio, in whole or in part as provided below, of the investment management
fees waived or reduced and other payments remitted by the Manager to such
Portfolio pursuant to Section 1 hereof. The total amount of reimbursement to
which the Manager may be entitled ("Reimbursement Amount") shall equal, at any
time, the sum of all investment management fees previously waived or reduced by
the Manager and all other payments remitted by the Manager to the Portfolio,
pursuant to Section 1 hereof, during any of the previous three (3) fiscal years,
less any reimbursement previously paid by such Portfolio to the Manager,
pursuant to Section 2.2 hereof, with respect to such waivers, reductions, and
payments. The Reimbursement Amount shall not include any additional charges or
fees whatsoever, including, e.g., interest accruable on the Reimbursement
Amount.
2.2. METHOD OF COMPUTATION. To determine each Portfolio's accrual, if any,
to reimburse the Manager for the Reimbursement Amount, each month the Portfolio
Operating Expenses of each Portfolio shall be annualized as of the last day of
the month. If the annualized Portfolio Operating Expenses of a Portfolio for any
month are less than the Maximum Annual Operating Expense Limit of such
Portfolio, such Portfolio, shall accrue into its net asset value an amount
payable to the Manager sufficient to increase the annualized Portfolio Operating
Expenses of that Portfolio to an amount no greater than the Maximum Annual
Operating Expense Limit of that Portfolio, provided that such amount paid to the
Manager will in no event exceed the total Reimbursement Amount. For accounting
purposes, when the annualized Portfolio Operating Expenses of a Portfolio are
below the Maximum Annual Operating Expense Limit, a liability will be accrued
daily for these amounts.
2.3. YEAR-END ADJUSTMENT. If necessary, on or before the last day of the
first month of each fiscal year, an adjustment payment shall be made by the
appropriate party in order that the actual Portfolio Operating Expenses of a
Portfolio for the prior fiscal year (including any reimbursement payments
hereunder with respect to such fiscal year) do not exceed the Maximum Annual
Operating Expense Limit.
2.4. LIMITATION OF LIABILITY. The Manager shall look only to the assets of
the Portfolio for which it waived or reduced fees or remitted payments for
reimbursement under this Agreement and for payment of any claim hereunder, and
neither the Portfolios, nor any of the Trust's trustees, officers, employees,
agents, or shareholders, whether past, present or future shall be personally
liable therefor.
3. TERM AND TERMINATION OF AGREEMENT.
This Agreement shall continue in effect with respect to all Portfolios
until [April 30, 2005] and shall thereafter continue in effect with respect to
each Portfolio from year to year provided such continuance is specifically
approved by both a majority of the Trustees of the Trust who (i) are not
"interested persons" of the Trust or any other party to this Agreement, as
defined in the 1940 Act, and (ii) have no direct or indirect financial interest
in the operation of this Agreement ("Non-Interested Trustees") and the Manager.
This Agreement shall terminate automatically upon the termination of the
Management Agreement; provided, however, that a Portfolio's obligation to
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reimburse the Manager, as described above, will survive the termination of this
Agreement unless the Trust and the Manager agree otherwise.
4. MISCELLANEOUS.
4.1. CAPTIONS. The captions in this Agreement are included for convenience
of reference only and in no other way define or delineate any of the provisions
hereof or otherwise affect their construction or effect.
4.2. INTERPRETATION. Nothing herein contained shall be deemed to require
the Trust or the Portfolios to take any action contrary to the Trust's
Declaration of Trust or By-Laws, or any applicable statutory or regulatory
requirement to which it is subject or by which it is bound, or to relieve or
deprive the Trust's Board of Trustees of its responsibility for and control of
the conduct of the affairs of the Trust or the Portfolios.
4.3. DEFINITIONS. Any question of interpretation of any term or provision
of this Agreement, including but not limited to the investment management fee,
the computations of net asset values, and the allocation of expenses, having a
counterpart in or otherwise derived from the terms and provisions of the
Management Agreement or the 1940 Act, shall have the same meaning as and be
resolved by reference to such Management Agreement or the 1940 Act.
IN WITNESS WHEREOF, the parties have caused this Expense Limitation
Agreement to be signed by their respective officers thereunto duly authorized
and their respective corporate seals to be hereunto affixed, as of the day and
year first above written.
EQ ADVISORS TRUST
ON BEHALF OF EACH OF ITS
PORTFOLIOS
By:
---------------------------------
Xxxxxx X. Xxxxx
President
THE EQUITABLE LIFE ASSURANCE SOCIETY
OF THE UNITED STATES
By:
---------------------------------
Xxxxx X. Xxxxx
Executive Vice President and
Chief Investment Officer
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SCHEDULE A
MAXIMUM ANNUAL OPERATING EXPENSE LIMITS
This Agreement relates to the following Portfolios of the Trust:
NAME OF PORTFOLIO MAXIMUM ANNUAL
OPERATING EXPENSE LIMIT
Capital Appreciation Portfolio
Deep Value Portfolio
Diversified Portfolio
Equity Growth Portfolio
Equity Income Portfolio I
Equity Income Portfolio II
Equity Portfolio
Global Socially Responsive Portfolio
Government Securities Portfolio
Growth and Income Portfolio
Growth Portfolio
High-Yield Bond Portfolio
Intermediate Term Bond Portfolio
International Growth Portfolio
Long Term Bond Portfolio
Managed Portfolio
Mergers and Acquisitions Portfolio
Money Market Portfolio
Multi-Cap Growth Portfolio
Short Duration Bond Portfolio
Small Company Growth Portfolio
Small Company Value Portfolio
Total Return Portfolio
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