INVESTMENT MANAGEMENT AGREEMENT
THIS AGREEMENT is made this 1st day of May, 2000 by and between
American Skandia Trust, a Massachusetts business trust (the "Fund"), and
American Skandia Investment Services, Inc., 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 AST
American Century International Growth Portfolio II (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
securities, 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 1 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
transactions and the operations of comparable investment companies;
(e) obtain and evaluate pertinent information about significant
developments and economic, statistical financial 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 to 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 Fund's Prospectus 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 deemed 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 any 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 of Fund, as amended; and
(e) (e) any other 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 review 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 of
the Fund and the offering 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 brokerage commissions, legal
auditing, taxes or governmental fees, the cost of preparing share
certificate, custodian, depository, transfer and shareholder service
agent costs, expenses of issue, sale, redemption and repurchase of
shares, expenses of registering and qualifying 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 prospectuses and statements of additional
information distributed to shareholders.
7. Declaration 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 Fund'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-advisor the duties outlined in
subparagraphs (e), (f) (g) and (h) of paragraph 2 hereof.
9. Compensation. The Fund shall pay the Investment Manager in full
compensation for services rendered hereunder an annual investment advisory fee,
payable monthly, of 1.00 % of the average daily net assets of the Portfolio.
10. Expense Limitation. If, for any fiscal 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, interest and extraordinary expenses such as litigation, would exceed
1.75% of the average daily net assets of the Portfolio, the Investment Manager
agrees to pay the Fund such excess expenses, and if required to do so pursuant
to such applicable statute or regulatory authority, to pay to the Fund such
excess expenses no later than the last day of the first month of the 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, 2000
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 Portfolio's 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 shareholder of the Portfolio for any act or omission in the
course of, 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 instrument b
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 responsibilities 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 shall be 000 Xxxx
Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx, 00000, and the address of the Investment Manager
shall be Out Xxxxxxxxx Xxxxx, Xxxxxxx, Xxxxxxxxxxx 00000.
17. Questions of 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 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 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
____________________________ By: _______________________________
Attest: AMERICAN SKANDIA INVESTMENT SERVICES, INC.
______________________________ By: _________________________
