Exhibit (d)(9)(ii)
AMENDED AND RESTATED
INVESTMENT ADVISORY AGREEMENT
AMENDED AND RESTATED AGREEMENT, dated as of July 31, 2003, by and
between The Equitable Life Assurance Society of the United States, a New York
stock life insurance company ("Equitable" or the "Manager"), and X.X. Xxxxxx
Investment Management Inc., a Delaware corporation (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 (the "Policies") under which income, gains, and
losses, whether or not realized, from assets allocated to such accounts are, in
accordance with the Policies, 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, Equitable 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 (the "Agreement"); and
WHEREAS, the Board of Directors of the Trust and Equitable desire to
retain the Adviser to render investment advisory services to the portfolio
specified in Schedule A hereto ("Portfolio") in the manner and on the terms
hereinafter set forth;
NOW, THEREFORE, Equitable and Adviser agree as follows:
1. APPOINTMENT OF ADVISER
The Manager hereby appoints the Adviser to act as investment adviser for
the Portfolio and to manage the investment and reinvestment of the assets of the
Portfolio, subject to the supervision of the Trustees of the Trust and the terms
and conditions of this Agreement. The Adviser will be an independent contractor
and will have no authority to act for or represent the Trust or Manager in any
way or otherwise be deemed an agent of the Trust or Manager except as expressly
authorized in this Agreement or another writing by the Trust, Manager and the
Adviser.
2. SERVICES TO BE RENDERED BY THE ADVISER TO THE TRUST
A. 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 direction and control of the Trustees of the
Trust and the Manager and in accordance with the provisions of the Trust's
registration statement, as amended from time to time. In fulfilling its
obligations to manage the investment and reinvestment of the assets of the
Portfolio, 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 (a) consistent with the investment objectives,
policies and restrictions of the Portfolio as stated in the Trust's
Agreement and Declaration of Trust, By-Laws, and such Portfolio's
currently effective Prospectus and Statement of Additional Information
("SAI") as amended from time to time, and (b) in compliance 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;
(iii) take whatever steps are necessary to implement the
investment program for the Portfolio by the purchase and sale of
securities and other investments authorized under the Trust's Agreement
and Declaration of Trust, By-Laws, and such Portfolio's currently
effective Prospectus and SAI, including the placing of orders for such
purchases and sales;
(iv) regularly report to the Trustees of the Trust and the
Manager with respect to the implementation of the investment program
and, in addition, provide such statistical information and special
reports concerning the Portfolio and/or important developments
materially affecting the investments held, or contemplated to be
purchased, by the Portfolio, as may reasonably be requested by the
Manager or the Trustees of the Trust, including attendance at Board of
Trustees Meetings, as reasonably requested, to present such information
and reports to the Board;
(v) assist as required by the Manager or the Board of
Trustees of the Trust in the determination 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 composite private account performance
information for accounts the Adviser manages that have investment
objectives, policies, and strategies substantially similar to those
employed by the Adviser in managing the Portfolio and such supporting
documentation as 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 Prospectus and the SAI of the
Portfolio and any sales materials prepared by the Portfolio or its
agent, as permitted under any applicable law and approved by the
Adviser; and
(vii) establish appropriate interfaces with the Trust's
administrator and Manager in order to provide such administrator and
Manager with all necessary information requested by the administrator
and Manager.
B. 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
2
affairs of the Portfolio (excluding that necessary for the determination of net
asset value and shareholder accounting services).
C. The Adviser will select brokers and dealers to effect all
portfolio transactions subject to the conditions set forth herein. The Adviser
will place all 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 currently effective Prospectus and SAI, as amended from
time to time. 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 best execution available,
considering all of the circumstances, and shall maintain records adequate to
demonstrate compliance with this requirement.
Subject to the appropriate policies and procedures approved by the Board
of Trustees, the Adviser, in assessing the best execution available for any
transaction, will consider factors it deems relevant, including without
limitation, the breadth of the market in the security, the price of the
security, the financial condition and execution capability of the broker or
dealer and the reasonableness of the commission, if any, for the specific
transaction and on a continuing basis. In selecting brokers or dealers to
execute a particular transaction, and in evaluating the best execution
available, the Adviser is authorized to consider the brokerage and research
services (within the meaning of Section 28(e) of the Securities Exchange Act of
1934, as amended) provided to the Portfolio and/or other accounts over which the
Adviser or its affiliates exercise investment discretion. Moreover, the Adviser
may, to the extent authorized by Section 28(e) of the Securities and Exchange
Act of 1934, as amended, 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 provided the Adviser determines, in good faith,
that such amount of commission is reasonable in relationship to the value of
such brokerage or research services 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 best
execution available, the Adviser may also consider sales of shares of the Trust
as a factor in the selection of brokers and dealers.
D. 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. The Manager recognizes that, in some cases,
this procedure may limit the size of the position that may be acquired or sold
for the Portfolio.
E. 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.
F. The Adviser will, unless and until otherwise directed by the
Manager or the Board of Trustees, exercise all rights of security holders with
respect to securities held by the Portfolio, including,
3
but not limited to: voting proxies; converting, tendering, exchanging or
redeeming securities; acting as a claimant in class action litigation (including
litigation with respect to securities previously held); and exercising rights in
the context of a bankruptcy or other reorganization.
3. COMPENSATION OF ADVISER
The Manager will pay the Adviser, with respect to the Portfolio, the
compensation specified in Appendix A to this Agreement. Payments shall be made
to the Adviser on the first day of each month; however, this advisory fee will
be calculated on the daily average value of the Portfolio's assets and accrued
on a daily basis.
4. LIABILITY OF ADVISER
Neither the Adviser nor any of its directors, officers, or employees
shall be liable to the Manager for any loss suffered by the Manager resulting
from the Adviser's acts or omissions as Adviser to the Portfolio, except for
losses to the Manager or the Trust resulting from willful misconduct, bad faith,
or gross negligence in the performance of, or from reckless disregard of, the
duties of the Adviser or any of its directors, officers or employees. The
Adviser, its directors, officers or employees shall not be liable to the Manager
or the Trust for any loss suffered as a consequence of any action or inaction of
other service providers to the Trust in failing to observe the instructions of
the Adviser, provided such action or inaction of such other service providers to
the Trust is not a result of the willful misconduct, bad faith or gross
negligence in the performance of, or from reckless disregard of, the duties of
the Adviser under this Agreement.
5. INDEMNIFICATIONS
A. The Manager shall indemnify the Adviser and it controlling
persons, officers, directors, employees, agents, legal representatives and
persons controlled by it (which shall not include the Trust or any Portfolio)
(collectively, "Adviser Related Persons") to the fullest extent permitted by law
against any and all loss, damage, judgments, fines, and reasonable expenses,
including attorneys' fees (collectively "Losses"), incurred by the Adviser or
Adviser Related Persons arising from or in connection with this Agreement or the
performance by the Adviser or Adviser Related Persons of its or their duties
hereunder so long as such Losses arise out of the Manager's gross negligence,
willful misconduct or bad faith, in performing its responsibilities hereunder or
under its agreement with the Trust or the gross negligence, willful misconduct
or bad faith of any companies affiliated with the Manager that provide services
to the Trust, including, without limitation, such Losses that may be based upon
any untrue statement of material fact contained in the Trust's Registration
Statement, or any amendment thereof or any supplement thereto, or the omission
to state therein a material fact known or which should have been known and was
required to be stated therein or necessary to make the statements therein not
misleading, unless such statement or omission was made in reasonable reliance
upon written information furnished to the Manager or the Trust by the Adviser or
an Adviser Related Person specifically for inclusion in the Registration
Statement or any amendment or supplement thereto, except to the extent any such
Losses referred to in this paragraph (i.e. paragraph A.) result from willful
misfeasance, bad faith, gross negligence or reckless disregard on the part of
the Adviser or an Adviser Related Person in the performance of any of its duties
under, or in connection with, this Agreement.
B. The Adviser shall indemnify the Manager and it controlling
persons, officers, directors, employees, agents, legal representatives and
persons controlled by it (which shall not include the Trust or any Portfolio)
(collectively, "Manager Related Persons") to the fullest extent permitted by law
against any and all losses, incurred by the Manager or Manager Related Persons
arising from or in connection
4
with this Agreement or the performance by the Manager or Manager Related Persons
of its or their duties hereunder so long as such Losses arise out of the
Adviser's gross negligence, willful misconduct or bad faith, in performing it
responsibilities hereunder, including, without limitation, such Losses that may
be based upon any untrue statement of a material fact contained in the Trust's
Registration Statement, or any amendment thereof or any supplement thereto, or
the omission to state therein a material fact known or which should have been
known and was required to be stated therein or necessary to make the statements
therein not misleading, in any case only to the extent that such statement or
omission was made in reasonable reliance upon written information furnished by
the Adviser or Adviser Related Person to the Manager or the Trust specifically
for inclusion in the Registration Statement or any amendment or supplement
thereto, except to the extent any such Losses referred to in this paragraph
(i.e. paragraph B.) result from willful misfeasance, bad faith, gross negligence
or reckless disregard on the part of the Manager or Manager Related Person in
the performance of any of its duties under, or in connection with, this
Agreement.
C. The indemnifications provided in this Section 5 shall survive
the termination of this Agreement.
6. 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.
7. SUPPLEMENTAL ARRANGEMENTS
The Adviser may enter into arrangements with other persons affiliated
with the Adviser for the provision of certain personnel and facilities to the
Adviser to better enable it to fulfill its duties and obligations under this
Agreement.
8. REGULATION
The Adviser shall submit to all regulatory and administrative bodies
having jurisdiction over the services provided pursuant to this Agreement any
information, reports, or other material which any such body by reason of this
Agreement may request or require pursuant to applicable laws and regulations.
9. 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 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.
5
10. DURATION OF AGREEMENT
This Agreement shall become effective with respect to the Portfolio on
the date of its execution. This Agreement shall continue in effect for a period
more than year from the date of its execution only so long as such continuance
is specifically approved at least annually either by the Board of Trustees or by
a majority of the outstanding voting securities of the Portfolio, provided that
in either 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.
The required shareholder approval of the Agreement or of any continuance of the
Agreement shall be effective with respect to the Portfolio if a majority of the
outstanding voting securities of the series (as defined in Rule 18f-2(h) under
the Investment Company Act) of shares of the Portfolio votes to approve the
Agreement or its continuance, notwithstanding that the Agreement or its
continuance may not have been approved by a majority of the outstanding voting
securities of (a) any other portfolio affected by the Agreement or (b) all the
portfolios of the Trust.
If the shareholders of the Portfolio fail to approve the Agreement or
any continuance of the Agreement, the Adviser will continue to act as investment
adviser with respect to the Portfolio pending the required approval of the
Agreement or its continuance or of any contract with the Adviser or a different
adviser or subadviser or other definitive action; provided, that the
compensation received by the Adviser in respect of the Portfolio during the
period will be in compliance with Rule 15a-4 under the Investment Company Act.
11. 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) days' written notice to the Manager and the Adviser, or
by the Manager or Adviser on sixty (60) days' 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.
12. 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
6
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.
13. USE OF ADVISER'S NAME
The Manager will not use the Adviser's name (or that of any affiliate)
in Trust advertisements, sales literature or promotional materials without prior
review and approval by the Adviser, which may not be unreasonably withheld or
delayed. The Manager will be permitted to use the Adviser's name (or that of any
affiliate) in required regulatory filings or in updates of its Prospectus or
SAI.
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. ENTIRE AGREEMENT
This Agreement contains the entire understanding and agreement of the
parties with respect to the Portfolio listed in Appendix A.
16. HEADINGS
The headings in the sections of this Agreement are inserted for
convenience of reference only and shall not constitute a part hereof.
17. 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.
18. 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.
7
19. 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.
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 under seal by their duly authorized officers as of the
date first mentioned above.
THE EQUITABLE LIFE ASSURANCE SOCIETY
OF THE UNITED STATES.
By: /s/ Xxxxx X. Xxxxx
----------------------------
Xxxxx X. Xxxxx
Executive Vice President
X.X. XXXXXX INVESTMENT MANAGEMENT INC.
By: /s/ Xxxxx Xxxxxxx
----------------------------
Xxxxx Xxxxxxx
Vice President
8
APPENDIX A
The Manager shall pay the Adviser, at the end of each calendar month,
compensation computed daily at an annual rate equal to the following:
Portfolio Advisory Fee
--------- ------------
EQ/X. X. Xxxxxx Core Bond Portfolio 0.30% of the Portfolio's average daily
net assets up to and including $125
million; 0.25% of the Portfolio's
average daily net assets up to and
including $200 million; 0.22% of the
Portfolio's average daily net assets up
to and including $350 million; and 0.15%
of the Portfolio's average daily net
assets in excess of $350 million.
Amended and Restated: July 31, 2003
9
