FORM OF
INVESTMENT ADVISORY AGREEMENT
THIS AGREEMENT is made by and between AELTUS INVESTMENT MANAGEMENT, INC. a
Connecticut corporation (the "Adviser") and AETNA SERIES FUND, INC., a Maryland
corporation (the "Fund"), on behalf of its series, ______________________ (the
"Series"), as of the date set forth below the parties' signatures.
W I T N E S S E T H
WHEREAS, the Fund is registered with the Securities and Exchange Commission (the
"Commission") as an open-end, diversified, management investment company under
the Investment Company Act of 1940 (the "1940 Act"); and
WHEREAS, the Fund has established the Series; and
WHEREAS, the Adviser is registered with the Commission as an investment adviser
under the Investment Advisers Act of 1940 (the "Advisers Act"), and is in the
business of acting as an investment adviser; and
WHEREAS, the Fund, on behalf of the Series, and the Adviser desire to enter into
an agreement to provide for investment advisory and management services for the
Series on the terms and conditions hereinafter set forth;
NOW THEREFORE, the parties agree as follows:
I. APPOINTMENT AND OBLIGATIONS OF THE ADVISER
Subject to the terms and conditions of this Agreement and the policies and
control of the Fund's Board of Directors (the "Board"), the Fund, on behalf of
the Series, hereby appoints the Adviser to serve as the investment adviser to
the Series, to provide the investment advisory services set forth below in
Section II. The Adviser agrees that, except as required to carry out its duties
under this Agreement or otherwise expressly authorized, it is acting as an
independent contractor and not as an agent of the Series and has no authority to
act for or represent the Series in any way.
II. DUTIES OF THE ADVISER
In carrying out the terms of this Agreement, the Adviser shall do the following:
1. supervise all aspects of the operations of the Series;
2. select the securities to be purchased, sold or exchanged by the
Series or otherwise represented in the Series' investment
portfolio, place trades for all such securities and regularly
report thereon to the Board;
3. formulate and implement continuing programs for the purchase and
sale of securities and regularly report thereon to the Board;
4. obtain and evaluate pertinent information about significant
developments and economic, statistical and financial data,
domestic, foreign or otherwise, whether affecting the economy
generally, the Series, securities held by or under consideration
for the Series, or the issuers of those securities;
5. provide economic research and securities analyses as the Adviser
considers necessary or advisable in connection with the Adviser's
performance of its duties hereunder;
6. obtain the services of, contract with, and provide instructions
to custodians and/or subcustodians of the Series' securities,
transfer agents, dividend paying agents, pricing services and
other service providers as are necessary to carry out the terms
of this Agreement; and
7. take any other actions which appear to the Adviser and the Board
necessary to carry into effect the purposes of this Agreement.
III. REPRESENTATIONS AND WARRANTIES
A. Representations and Warranties of the Adviser
Adviser hereby represents and warrants to the Fund as follows:
1. Due Incorporation and Organization. The Adviser is duly
organized and is in good standing under the laws of the
State of Connecticut and is fully authorized to enter
into this Agreement and carry out its duties and
obligations hereunder.
2. Registration. The Adviser is registered as an investment
adviser with the Commission under the Advisers Act. The
Adviser shall maintain such registration in effect at all
times during the term of this Agreement.
3. Best Efforts. The Adviser at all times shall provide its
best judgment and effort to the Series in carrying out
its obligations hereunder.
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B. Representations and Warranties of the Series and the Fund
The Fund, on behalf of the Series, hereby represents and warrants to the
Adviser as follows:
1. Due Incorporation and Organization. The Fund has been
duly incorporated under the laws of the State of Maryland
and it is authorized to enter into this Agreement and
carry out its obligations hereunder.
2. Registration. The Fund is registered as an investment
company with the Commission under the 1940 Act and shares
of the Series are registered or qualified for offer and
sale to the public under the Securities Act of 1933 (the
"1933 Act") and all applicable state securities laws.
Such registrations or qualifications will be kept in
effect during the term of this Agreement.
IV. DELEGATION OF RESPONSIBILITIES
Subject to the approval of the Board and the shareholders of the Series,
the Adviser may enter into a Subadvisory Agreement to engage a
subadviser to the Adviser with respect to the Series.
V. BROKER-DEALER RELATIONSHIPS
A. Series Trades
The Adviser shall place all orders for the purchase and sale of
portfolio securities for the Series with brokers or dealers selected by
the Adviser, which may include brokers or dealers affiliated with the
Adviser. The Adviser shall use its best efforts to seek to execute
portfolio transactions at prices that are advantageous to the Series and
at commission rates that are reasonable in relation to the benefits
received.
B. Selection of Broker-Dealers
In selecting broker-dealers qualified to execute a particular
transaction, brokers or dealers may be selected who also provide
brokerage or research services (as those terms are defined in Section
28(e) of the Securities Exchange Act of 1934) to the Adviser and/or the
other accounts over which the Adviser or its affiliates exercise
investment discretion. The Adviser may also select brokers or dealers to
effect transactions for the Series that provide payment for expenses of
the Series. The Adviser is authorized to pay a broker or dealer who
provides such brokerage or research services or expenses, and that has
provided assistance in the distribution of shares of the Series to the
extent permitted by law, a commission for executing a portfolio
transaction for the Series that is 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 relation to the value of the brokerage or
research services provided by such broker or dealer and is paid in
compliance with Section 28(e). This determination may
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be viewed in terms of either that particular transaction or the overall
responsibilities that the Adviser and its affiliates have with respect
to accounts over which they exercise investment discretion. The Board
shall periodically review the commissions paid by the Series to
determine if the commissions paid over representative periods of time
were reasonable in relation to the benefits received.
VI. CONTROL BY THE BOARD
Any investment program undertaken by the Adviser pursuant to this Agreement, as
well as any other activities undertaken by the Adviser on behalf of the Series
pursuant thereto, shall at all times be subject to any directives of the Board.
VII. COMPLIANCE WITH APPLICABLE REQUIREMENTS
In carrying out its obligations under this Agreement, the Adviser shall at all
times conform to:
1. all applicable provisions of the 1940 Act;
2. the provisions of the current Registration Statement of the Fund;
3. the provisions of the Fund's Articles of Incorporation, as
amended;
4. the provisions of the Bylaws of the Fund, as amended; and
5. any other applicable provisions of state and federal law.
VIII. COMPENSATION
For the services to be rendered, the facilities furnished and the expenses
assumed by the Adviser, the Fund, on behalf of the Series, shall pay to the
Adviser an annual fee, payable monthly, based upon the following average daily
net assets of the Series:
Rate Assets
---- ------
Except as hereinafter set forth, compensation under this Agreement shall be
calculated and accrued daily at the rate of 1/365 of the annual advisory fee
applied to the daily net assets of the Series. If this Agreement becomes
effective subsequent to the first day of a month or terminates before the last
day of a month, compensation for that part of the month this Agreement is in
effect shall be prorated in a manner
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consistent with the calculation of the fees set forth above. Subject to the
provisions of Section X hereof, payment of the Adviser's compensation for the
preceding month shall be made as promptly as possible.
IX. EXPENSES
The expenses in connection with the management of the Series shall be allocated
between the Series and the Adviser as follows:
A. Expenses of the Adviser
The Adviser shall pay:
1. the salaries, employment benefits and other related
costs and expenses of those of its personnel engaged in
providing investment advice to the Series, including
without limitation, office space, office equipment,
telephone and postage costs; and
2. all fees and expenses of all directors, officers and
employees, if any, of the Fund who are employees of the
Adviser, including any salaries and employment benefits
payable to those persons.
B. Expenses of the Series
The Series shall pay:
1. investment advisory fees pursuant to this Agreement;
2. brokers' commissions, issue and transfer taxes or other
transaction fees payable in connection with any
transactions in the securities in the Series' investment
portfolio or other investment transactions incurred in
managing the Series' assets, including portions of
commissions that may be paid to reflect brokerage
research services provided to the Adviser;
3. fees and expenses of the Series' independent accountants
and legal counsel and the independent Directors' legal
counsel;
4. fees and expenses of any administrator, transfer agent,
custodian, dividend, accounting, pricing or disbursing
agent of the Series;
5. interest and taxes;
6. fees and expenses of any membership in the Investment
Company Institute or any similar organization in which
the Board deems it advisable for the Fund to maintain
membership;
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7. insurance premiums on property or personnel (including
officers and directors) of the Fund;
8. all fees and expenses of the Company's directors, who are
not "interested persons" (as defined in the 0000 Xxx) of
the Fund or the Adviser;
9. expenses of preparing, printing and distributing proxies,
proxy statements, prospectuses and reports to
shareholders of the Series, except for those expenses
paid by third parties in connection with the distribution
of Series shares and all costs and expenses of
shareholders' meetings;
10. all expenses incident to the payment of any dividend,
distribution, withdrawal or redemption, whether in shares
of the Series or in cash;
11. costs and expenses (other than those detailed in
paragraph 9 above) of promoting the sale of shares in the
Series, including preparing prospectuses and reports to
shareholders of the Series, provided, nothing in this
Agreement shall prevent the charging of such costs to
third parties involved in the distribution and sale of
Series shares;
12. fees payable by the Series to the Commission or to any
state securities regulator or other regulatory authority
for the registration of shares of the Series in any state
or territory of the United States or of the District of
Columbia;
13. all costs attributable to investor services,
administering shareholder accounts and handling
shareholder relations, (including, without limitation,
telephone and personnel expenses), which costs may also
be charged to third parties by the Adviser; and
14. any other ordinary, routine expenses incurred in the
management of the Series' assets, and any nonrecurring or
extraordinary expenses, including organizational
expenses, litigation affecting the Series and any
indemnification by the Fund of its officers, directors or
agents.
X. ADDITIONAL SERVICES
Upon the request of the Board, the Adviser may perform certain accounting,
shareholder servicing or other administrative services on behalf of the Series
that are not required by this Agreement. Such services will be performed on
behalf of the Series and the Adviser may receive from the Series such
reimbursement for costs or reasonable compensation for such services as may be
agreed upon between the Adviser and the Board on a finding by the Board that the
provision of such services by the Adviser is in the best interests of the Series
and its shareholders. Payment or assumption by the Adviser of any Series expense
that the Adviser is not otherwise required to pay or assume under this Agreement
shall
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not relieve the Adviser of any of its obligations to the Series nor obligate the
Adviser to pay or assume any similar Series expense on any subsequent occasions.
Such services may include, but are not limited to, (a) the services of a
principal financial officer of the Fund (including applicable office space,
facilities and equipment) whose normal duties consist of maintaining the
financial accounts and books and records of the Fund and the Series and the
services (including applicable office space, facilities and equipment) of any of
the personnel operating under the direction of such principal financial officer;
(b) the services of staff to respond to shareholder inquiries concerning the
status of their accounts, providing assistance to shareholders in exchanges
among the investment companies managed or advised by the Adviser, changing
account designations or changing addresses, assisting in the purchase or
redemption of shares; or otherwise providing services to shareholders of the
Series; and (c) such other administrative services as may be furnished from time
to time by the Adviser to the Fund on the Series at the request of the Board.
XII. NONEXCLUSIVITY
The services of the Adviser to the Series 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,
so long as its services under this Agreement are not impaired thereby. It is
understood and agreed that officers and directors of the Adviser may serve as
officers or directors of the Fund, and that officers or directors of the Fund
may serve as officers or directors of the Adviser to the extent permitted by
law; and that the officers and directors 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 or trustees of any
other firm or trust, including other investment companies.
XIII. TERM
This Agreement shall become effective at the close of business on January __,
1998, and shall remain in force and effect through December 31, 1998, unless
earlier terminated under the provisions of Article XV.
XIV. RENEWAL
Following the expiration of its initial term, the Agreement shall continue in
force and effect from year to year, provided that such continuance is
specifically approved at least annually:
1. a. by the Board, or
b. by the vote of a majority of the Series' outstanding
voting securities (as defined in Section 2(a)(42) of the
1940 Act), and
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2. by the affirmative vote of a majority of the directors who are
not parties to this Agreement or interested persons of a party to
this Agreement (other than as a director of the Fund), by votes
cast in person at a meeting specifically called for such purpose.
XV. TERMINATION
This Agreement may be terminated at any time, without the payment of any
penalty, by vote of the Board or by vote of a majority of the Series'
outstanding voting securities (as defined in Section 2(a)(42) of the 1940 Act),
or by the Adviser, on sixty (60) days' written notice to the other party. The
notice provided for herein may be waived by the party required to be notified.
This Agreement shall automatically terminate in the event of its "assignment."
XVI. LIABILITY
The Adviser shall be liable to the Fund and shall indemnify the Fund for any
losses incurred by the Fund, whether in the purchase, holding or sale of any
security or otherwise, to the extent that such losses resulted from an act or
omission on the part of the Adviser or its officers, directors or employees,
that is found to involve willful misfeasance, bad faith or negligence, or
reckless disregard by the Adviser of its duties under this Agreement, in
connection with the services rendered by the Adviser hereunder.
XVII. NOTICES
Any notices under this Agreement shall be in writing, addressed and delivered,
mailed postage paid, or sent by other delivery service, or by facsimile
transmission to each party at such address as each party may designate for the
receipt of notice. Until further notice, such addresses shall be:
if to the Fund, on behalf of the Series:
000 Xxxxxxxxxx Xxxxxx
Xxxxxxxx, Xxxxxxxxxxx 00000
Fax number 860/000-0000
if to the Adviser:
000 Xxxxxxxx Xxxxxx
Xxxxxxxx, Xxxxxxxxxxx 00000-0000
Fax number 860/000-0000
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XVIII. QUESTIONS OF INTERPRETATION
This Agreement shall be governed by the laws of the State of Connecticut. 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 1940 Act
shall be resolved by reference to such term or provision of the 1940 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 or orders of the
Commission issued pursuant to the 1940 Act, or contained in no-action and
interpretive positions taken by the Commission staff. In addition, where the
effect of a requirement of the 1940 Act reflected in the provisions of this
Agreement is revised by rule or order of the Commission, such provisions shall
be deemed to incorporate the effect of such rule or order.
XIX. SERVICE XXXX
The service xxxx of the Fund and the Series and the name "Aetna" have been
adopted by the Fund with the permission of Aetna Services, Inc. (formerly known
as Aetna Life and Casualty Company) and their continued use is subject to the
right of Aetna Services, Inc. to withdraw this permission in the event the
Adviser or another affiliated corporation of Aetna Services, Inc. should not be
the investment adviser of the Series.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
in duplicate by their respective officers on the ____ day of January, 1998.
Aeltus Investment Management, Inc.
By: ______________________________
Attest: _____________________________ Name: ____________________________
Title: ___________________________
Aetna Series Fund, Inc.
on behalf of its series,
__________________________________
By: ______________________________
Attest: _____________________________ Name: ____________________________
Title: ___________________________
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Schedule of Investment Advisory Fees for the Following Series of
Aetna Series Fund, Inc.
Series Name Investment Advisory Fees
Aetna Money Market Fund .40% on first $500 million
.35% on next $500 million
.34% on next $1 billion
.33% on next $1 billion
.30% over $3 billion
Aetna Bond Fund .50% on first $250 million
.475% on next $250 million
.45% on next $250 million
.425% on next $1.25 billion
.40% over $2 billion
Aetna Balanced Fund .80% on first $500 million
.75% on next $500 million
.70% on next $1 billion
.65% over $2 billion
Aetna Growth and Income .70% on first $250 million
Fund .65% on next $250 million
.625% on next $250 million
.60% on next $1.25 billion
.55% over $2 billion
Aetna International Fund .85% on first $250 million
.80% on next $250 million
.775% on next $250 million
.75% on next $1.25 billion
.70% over $2 billion
Aetna Government Fund .50% on first $250 million
.475% on next $250 million
.45% on next $250 million
.425% on next $1.25 billion
.40% over $2 billion
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Aetna Growth Fund .70% on first $250 million
.65% on next $250 million
.625% on next $250 million
.60% on next $1.25 billion
.55% over $2 billion
Aetna Small Company Fund .85% on first $250 million
.80% on next $250 million
.775% on next $250 million
.75% on next $1.25 billion
.725% over $2 billion
Aetna Index Plus Large Cap .45% on first $250 million
Fund .45% on next $250 million
.425% on next $250 million
.40% on next $250 million
.40% on next $1 billion
.375% over $2 billion
Aetna Ascent Fund .80% on first $500 million
.775% on next $500 million
.75% on next $500 million
.725% on next $500 million
.70% over $2 billion
Aetna Crossroads Fund .80% on first $500 million
.775% on next $500 million
.75% on next $500 million
.725% on next $500 million
.70% over $2 billion
Aetna Legacy Fund .80% on first $500 million
.775% on next $500 million
.75% on next $500 million
.725% on next $500 million
.70% over $2 billion
Aetna High Yield Fund .65% on first $250 million
.60% on next $250 million
.575% on next $250 million
.55% on next $250 million
.55% on next $1 billion
.50% over $2 billion
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Aetna Index Plus Bond Fund .35% on first $250 million
.35% on next $250 million
.325% on next $250 million
.30% on next $250 million
.30% on next $1 billion
.275% over $2 billion
Aetna Index Plus Mid Cap .45% on first $250 million
Fund .45% on next $250 million
.425% on next $250 million
.40% on next $250 million
.40% on next $1 billion
.375% over $2 billion
Aetna Index Plus Small Cap .45% on first $250 million
Fund .45% on next $250 million
.425% on next $250 million
.40% on next $250 million
.40% on next $1 billion
.375% over $2 billion
Aetna Mid Cap Fund .75% on first $250 million
.70% on next $250 million
.675% on next $250 million
.65% on next $250 million
.65% on next $1 billion
.60% over $2 billion
Aetna Real Estate Securities .80% on first $250 million
Fund .75% on next $250 million
.725% on next $250 million
.70% on next $250 million
.70% on next $1 billion
.65% over $2 billion
Aetna Value Opportunity .70% on first $250 million
Fund .65% on next $250 million
.625% on next $250 million
.60% on next $250 million
.60% on next $1 billion
.55% over $2 billion
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