INVESTMENT MANAGEMENT AGREEMENT
THIS AGREEMENT is made this 1st day of May, 1995, by and
between American Skandia Trust a Massachusetts business trust (the "Fund"),
and American Skandia Investment Services, Incorporated, a Connecticut
corporation (the "Investment Manager");
W I T N E S E T H
WHEREAS, the Fund is registered as an open-end diversified
management investment company under the Investment Company Act of 1940, as
amended (the "Investment Company Act"), and the rules and regulations
promulgated thereunder, and
WHEREAS, the Investment Manager is registered as an investment
adviser under the Investment Advisers Act of 1940, as amended (the
"Investment Advisers Act"); and
WHEREAS, the Fund and the Investment Manager desire to enter
into an agreement to provide for the management of the assets of the X. Xxxx
Price Natural Resources Portfolio (the "Portfolio") on the terms and
conditions hereinafter set forth.
NOW THEREFORE, in consideration of the mutual covenants herein
contained and other good and valuable consideration, the receipt whereof is
hereby acknowledged, the parties hereto agree as follows:
1. Management. The Investment Manager shall act as investment
manager for the Portfolio and shall, in such capacity, manage the investment
operations of the Portfolio, including the purchase, retention, disposition
and lending of duties, subject at all times to the policies and control of
the Fund's Board of Trustees. The Investment Manager shall give the Portfolio
the benefit of its best judgments, efforts and facilities in rendering its
services as investment manager.
2. Duties of Investment Manager. In carrying out its
obligation under paragraph I hereof, the Investment Manager shall.
(a) supervise and manage all aspects of the Portfolio's operations:
(b) provide the Portfolio or obtain for it, and thereafter supervise, such
executive, administrative, clerical and shareholder servicing services as are
deemed advisable by the Fund's Board of Trustees;
(c) arrange, but not pay for, the periodic updating of prospectuses and
supplements thereto, proxy material, tax returns, reports to the Portfolio's
shareholders, reports to and filings with the Securities and Exchange
Commission, state Blue Sky authorities and other applicable regulatory
authorities;
(d) provide to the Board of Trustees of the Fund on a regular basis,
written financial reports and analyses on the Portfolio's securities actions and
the operations of comparable investment companies;
(e) obtain and evaluate pertinent information about significant
developments and economic, statistical and data, domestic, foreign or otherwise,
whether affecting the economy generally or the Portfolio, and whether concerning
the individual issuers whose securities are included in the Portfolio or the
activities in which they engage, or with respect securities which the Investment
Manager considers desirable for inclusion in the Portfolio;
(f) determine what issuers and securities shall be represented in the
Portfolio's portfolio and regularly report them in writing to the Board of
Trustees;
(g) formulate and implement continuing programs for the purchases and sales
of the securities of such issuers and regularly report in writing thereon to the
Board of Trustees; and
(h) take, on behalf of the Portfolio, all actions which appear to the Fund
necessary to carry into effect such purchase and sale programs and supervisory
functions as aforesaid, including the placing of orders for the purchase and
sale of portfolio securities.
3. Broker-Dealer Relationships. The Investment Manager is
responsible for decisions to buy and sell securities for the Portfolio,
broker-dealer selection, and negotiation of its brokerage commission rates.
The Investment Manager shall determine the securities to be purchased or sold
by the Portfolio pursuant to its determinations with or through such persons,
brokers or dealers, in conformity with the policy with respect to brokerage
as set forth in the Funds Portfolio and Statement of Additional information,
or as the Board of Trustees may determine from time to time. Generally, the.
Investment Manager's primary consideration in placing Portfolio securities
transactions with broker-dealers for execution is to obtain and maintain the
availability of, execution at the best net price and in the most effective
manner possible. The Investment Manager may consider sale of the shares of
the Portfolio, subject to the requirements of best net price and most
favorable execution.
Consistent with this policy, the Investment Manager will take
the following into consideration: the best net price available; the
reliability, integrity and financial condition of the broker-dealer; the size
of and difficulty in executing the order and the value of the expected
contribution of the broker-dealer to the investment performance of the
Portfolio on a continuing basis. Accordingly, the cost of the brokerage
commissions to the Portfolio may be greater than that available from other
brokers if the difference is reasonably justified by other aspects of the
portfolio execution services offered. Subject to such policies and procedures
as the Board of Trustees of the Fund may determine, the Investment Manager
shall not be designated to have acted unlawfully or to have breached any duty
solely by reason of its having caused the Portfolio to pay a broker or dealer
that provides research services to the Investment Manager for the Portfolio's
use an amount of commission for effecting a portfolio investment transaction
in excess of the amount of commission another broker or dealer would have
charged for effecting that transaction, if the Investment Manager, determines
in good faith that such amount of commission was reasonable in relation to
the value of the research services provided by such broker, viewed in terms
of either that, particular transaction or the Investment Manager's ongoing
responsibilities with respect to the Portfolio. The Investment Manager is
further authorized to allocate the orders placed by it on behalf of the
Portfolio to such brokers and dealers who also provide research or
statistical material, or other services to the Fund or the Investment
Manager. Such allocation shall be in such amounts and proportions as the
Investment Manager shall determine and the Investment Manager will report on
said allocations to the Board of Trustees of the Fund regularly as requested
by the Board and, in any event, at least once each calendar year if no
specific request is made, indicating the brokers to whom such allocations
have been made and the basis therefor.
4. Control by Board of Trustees. Any investment program
undertaken by the Investment Manager pursuant to this Agreement, as well as
any other activities undertaken by the Investment Manager on behalf of the
Fund pursuant thereto, shall at all times be subject to arty directives of
the Board of Trustees of the Fund.
5. Compliance with Applicable Requirements. In carrying out
its obligations under this Agreement, the Investment Manager shall at all
times conform to:
(a) all applicable provisions of the Investment Company Act and Investment
Advisers Act and any rules and regulations adopted thereunder, as amended; and
(b) the provisions of the Registration Statements of the Fund under the
Securities Act of 1933 and the Investment Company Act, including the investment
objectives, policies and restrictions, and permissible investments specified
therein; and
(c) the provisions of the Declaration of Trust of the Fund, as amended; and
(d) the provisions of the By-laws the Fund, as amended; and
(e) any other applicable provisions of state and federal law.
6. Expenses. The expenses connected with the Fund shall be
allocable between the Fund and the Investment Manager as follows:
(a) The Investment Manager shall furnish, at its expense and without cost
to the Fund; the services of a President, Secretary and one or more Vice
Presidents of the Fund, to the extent at such additional officers may be
required by the Fund for the proper conduct of its affairs.
(b) The Investment Manager shall further maintain at its expense and
without cost to the Fund, a trading function in order to carry out its
obligations under subparagraphs (f), (g) and (h) of paragraph 2 hereof to place
orders for the purchase and sale of portfolio securities for the Portfolio.
(c) Nothing in subparagraph (a) hereof shall be construed to require the
Investment Manager to bear:
(i) any of the costs (including applicable office
space, facilities and equipment) of the services of a
principal financial officer of the Fund whose normal duties
consist of maintaining the financial accounts and books and
records of the Fund; including the reviewing of calculations
of net asset value and preparing tax returns; or
(ii) any of the costs (including applicable office
space, facilities and equipment) of the services of any of the
personnel operating under the direction of such principal
financial officer. Notwithstanding the obligation of the Fund
to bear the expense of the functions referred to in clauses
(i) and (ii) of this subparagraph (c), the Investment Manager
may pay the salaries, including any applicable employment or
payroll taxes and other salary costs, of the principal
financial officer and other personnel carrying out such
functions and the Fund shall reimburse the Investment Manager
therefor upon proper accounting.
(d) All of the ordinary business expenses incurred in the operations a. the
Fund and the offerings of its shares shall be borne by the Fund unless
specifically provided otherwise in this paragraph 6. These expenses include but
are not limited to broker commissions, legal, auditing, taxes or governmental
fees, the cost of preparing share certificates custodian, depository, transfer
and shareholder service agent costs, expenses of issue, sale, redemption and
repurchase of shares, expenses of registering and quailing shares for sale,
insurance premiums on property or personnel (including officers and trustees if
available) of the Fund which inure to its benefit, expenses relating to trustee
and shareholder meetings, the cost of preparing and distributing reports and
notices to shareholders, the fees and other expenses incurred by the Fund in
connection with membership in investment company organizations and the cost of
printing copies of pros and statements of additional information distributed to
shareholders.
7. Delegation of Responsibilities. Upon the request of the
Fund's Board of Trustees, the Investment Manager may perform services on
behalf of the Fund which are not required by this Agreement. Such services
will be performed on behalf of the Fund and the Investment Manager's cost in
rendering such services may be billed monthly to the Fund, subject to
examination by the Fun's independent accountants. Payment or assumption by
the Investment Manager of any Fund expense that the Investment Manager is not
required to pay or assume under this Agreement shall not relieve the
Investment Manager of any of its obligations to the Fund nor obligate the
Investment Manager to pay or assume any similar Fund expense on any
subsequent occasion.
8. Engagement of Sub-advisors and Broker-Dealers. The
Investment Manager may engage, subject to approval of the Fund's Board of
Trustees, and where required, the shareholders of the Portfolio, a
sub-advisor to provide advisory services in relation to the Portfolio. Under
such sub-advisory agreement, the Investment Manager may delegate to the
sub-adviser the duties outlined in subparagraph (e), (i), (g) and (h) of
paragraph 2 hereof.
9. Compensation. The Fund shall pay the Investment Manager in
full compensation for services rendered an annual investment advisory fee,
payable monthly, of .90% of the average daily net assets of the Portfolio.
10. Expense Limitation. if, for any year of the Fund, the
total of all ordinary business expenses of the Portfolio, including all
investment advisory and administration fees but excluding brokerage
commissions and fees, taxes, into and extraordinary expenses such as
litigation, would exceed 1.35% of the average daily net assets of the
Portfolio, the Investment Manager agrees to pay the Fund such excess , and if
required to do so pursuant to such applicable statute or mandatory authority,
to pay to the Fund such excess expenses no later than the last day of the
first month of next succeeding fiscal year of the Fund. For the purposes of
this paragraph, the term "fiscal year" shall exclude the portion of the
Fund's current fiscal year which shall have elapsed prior to the date hereof
and shall include the portion of the then current fiscal year which shall
have elapsed at the date of termination of this Agreement.
11. Non-Exclusivity. The services of the Investment Manager to
the Portfolio are not to be deemed to be exclusive, and the Investment
Manager shall be free to render investment advisory and corporate
administrative or other services to others (including other investment
companies) and to engage in other activities. It is understood and agreed
that officers or directors of the Investment Manager may serve as officers or
trustees of the Fund, and that officers or trustees of the Fund may serve as
officers or directors of the Investment Manager to the extent permitted by
law, and that the officers and directors of the Investment Manager are not
prohibited from engaging in any other business activity or from rendering
services to any other person, or from serving as partners, officers or
directors of any other firm or corporation including other investment
companies.
12. Term and Approval. This Agreement shall become effective
on May 1, 1995 and shall continue in force and effect from year to year,
provided that such continuance is specifically approved at least annually:
(a) (i) by the Fund's Board of Trustees or (ii) by the vote of a majority
of the Portfolio's outstanding voting securities (as defined in Section 2(a)(42)
of the Investment Company Act); and
(b) by the affirmative vote of a majority of the trustees who are not
parties to this Agreement or interested persons of a party to this Agreement
(other than as Fund trustees), by votes cast in person at a meeting specifically
called for such purpose.
13. Termination. This Agreement may be terminated at any time
without the payment of any penalty or prejudice, to the completion of any
transactions already initiated on behalf of the Portfolio, by vote of the
Fund's Board of Trustees or by vote of a majority of the Portfolios
outstanding voting securities, or by the Investment Manager, on sixty (60)
days' written notice to the other party. The notice provided for herein may
be waived by either party. This Agreement automatically terminates in the
event of its assignment, the term "assignment' for the purpose having the
meaning defined in Section 2(a)(4) of the Investment Company Act,
14. Liability of Investment Manager and Indemnification. In the
absence of willful misfeasance, bad faith, gross negligence or reckless
disregard of obligations or duties hereunder on the part of the Investment
Manager or any of its officers, trustees or employees, it shall not be
subject to liability to the Fund or to any A holder of the Portfolio for any
act omission in the course or, or connected with, rendering services
hereunder or for any losses that may be sustained in the purchase, holding or
sale of any security.
15. Liability of Trustees and Shareholders A copy of the
Agreement and Declaration of Trust of the Fund is on file with the Secretary
of The Commonwealth of Massachusetts, and notice is hereby given that this
intent is executed on behalf of the trustees of the Fund as trustees and not
individually and that the obligations of this instrument are not binding upon
any of the trustees or shareholders individually but are binding only upon
the assets and property of the Fund. Federal and state laws impose abilities
under certain circumstances on persons who act in good faith, and therefore,
nothing herein shall in any way constitute a waiver of limitation of any
rights which the Fund or Investment Manager may have under applicable law.
16. Notices. Any notices under this Agreement shall be in
writing, addressed and delivered or mailed postage paid to the other party at
such address as such other party may designate for the receipt of such
notice. Until further notice, it is agreed that the address of the Fund be
000 Xxxx Xxxxxx Xxxxxx, Xxxxxxxxxxxxx, 00000, and the address of the
Investment Manager shall be Xxx Xxxxxxxxx Xxxxx, Xxxxxxx Xxxxxxxxxxx 00000.
17. Questions of Interpretations 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 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 rues, regulations
or orders of the Securities and Exchange Commission issued pursuant to said
Act. In addition, where the effect of a requirement of the Investment Company
Act, reflected in any provision of this Agreement is released by rules,
regulation or order of the Securities and Exchange Commission 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 in duplicate by their respective officers on the day and year first
above written.
Attest: AMERICAN SKANDIA TRUST
/s/Xxxx Xxxxxx By: /s/Xxxxxx X. Xxxxxxx
Xxxx Xxxxxx Xxxxxx X. Xxxxxxx
Attest: AMERICAN SKANDIA LIFE INVESTMENT
MANAGEMENT, INC.
/s/Xxxxxxxx Xxxxxx By: /s/ Xxxxxx X. Xxxxxxxxxx
Xxxxxxxx Xxxxxx Xxxxxx X. Xxxxxxxxxx
