INVESTMENT MANAGEMENT AGREEMENT
INVESTMENT MANAGEMENT AGREEMENT ("AGREEMENT"), dated as of February 16,
2005, between The Enterprise Group of Funds II, Inc., a Maryland corporation
("Corporation"), and AXA Equitable Life Insurance Company (formerly, The
Equitable Life Assurance Society of the United States), a New York Stock life
insurance company ("AXA Equitable" or "Manager").
WHEREAS, the Corporation is registered as an investment company under the
Investment Company Act of 1940, as amended ("Investment Company Act");
WHEREAS, AXA Equitable is registered as an investment adviser under the
Investment Advisers Act of 1940, as amended ("Advisers Act");
WHEREAS, the Corporation is and will continue to be a series fund having
one or more investment portfolios, each with its own investment objectives,
investment policies and restrictions;
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; and
WHEREAS, the Board of Directors of the Corporation wishes to appoint AXA
Equitable as the investment manager of the Corporation;
NOW, THEREFORE, the Corporation and AXA Equitable hereby agree as follows:
1. APPOINTMENT OF MANAGER
The Corporation hereby appoints AXA Equitable as the investment
manager for each of the Funds of the Corporation specified in Appendix A to this
Agreement, as such Appendix A may be amended by Manager and the Corporation from
time to time ("Funds"), subject to the supervision of the Directors of the
Corporation and in the manner and under the terms and conditions set forth in
this Agreement. Manager accepts such appointment and agrees to render the
services and to assume the obligations set forth in this Agreement commencing on
its effective date. Manager will be an independent contractor and will have no
authority to act for or represent the Corporation in any way or otherwise be
deemed an agent unless expressly authorized in this Agreement or another writing
by the Corporation and Manager.
2. DUTIES OF THE MANAGER
A. Subject to the general supervision and control of the Directors of the
Corporation and under the terms and conditions set forth in this Agreement, the
Corporation acknowledges and agrees that it is contemplated that Manager will,
at its own expense, select and contract with one or more investment advisers
("Advisers") to manage the investment operations and composition of each and
every Fund of the Corporation and render investment advice for each Fund,
including the purchase, retention, and disposition of the investments,
securities and cash contained in each Fund, in accordance with each Fund's
investment objectives, policies and restrictions as stated in the Corporation's
Articles of Incorporation, By-Laws, and such Fund's Prospectus, Statement of
Additional Information ("SAI") and Compliance Manual, as is from time to time in
effect; provided, that any contract with an Adviser (an "Advisory Agreement")
shall be in compliance with and approved as required by the Investment Company
Act or in accordance with exemptive relief granted by the Securities and
Exchange Commission ("SEC") under the Investment Company Act.
B. Subject always to the direction and control of the Directors of the
Corporation, Manager will have (i) overall supervisory responsibility for the
general management and investment of each Fund's assets; (ii) full discretion to
select new or additional Advisers for each Fund; (iii) full discretion to enter
into and materially modify existing Advisory Agreements with Advisors; (iv) full
discretion to terminate and replace any Adviser; and (v) full investment
discretion to make all determinations with respect to the investment of a Fund's
assets not then managed by an Adviser. In connection with Manager's
responsibilities herein, Manager will assess each Fund's investment focus and
will seek to implement decisions with respect to the allocation and reallocation
of each Fund's assets among one or more current or additional Advisers from time
to time, as the Manager deems appropriate, to enable each Fund to achieve its
investment goals. In addition, Manager will monitor compliance of each Adviser
with the investment objectives, policies and restrictions of any Fund or Funds
(or portions of any Fund) under the management of such Adviser, and review and
report to the Directors of the Corporation on the performance of each Adviser.
Manager will furnish, or cause the appropriate Adviser(s) to furnish, to the
Corporation such statistical information, with respect to the investments that a
Fund (or portions of any Fund) may hold or contemplate purchasing, as the
Corporation may reasonably request. On Manager's own initiative, Manager will
apprise, or cause the appropriate Adviser(s) to apprise, the Corporation of
important developments materially affecting each Fund (or any portion of a Fund
that they advise) and will furnish the Corporation, from time to time, with such
information as may be appropriate for this purpose. Further, Manager agrees to
furnish, or cause the appropriate Adviser(s) to furnish, to the Directors of the
Corporation such periodic and special reports as the Directors of the
Corporation may reasonably request. In addition, Manager agrees to cause the
appropriate Adviser(s) to furnish to third-party data reporting services all
currently available standardized performance information and other customary
data.
C. Manager will also furnish to the Corporation, at its own expense and
without remuneration from or other cost to the Corporation, the following:
(i) Office Space. Manager will provide office space in the offices of
the Manager or in such other place as may be reasonably agreed upon by the
parties hereto from time to time, and all necessary office facilities and
equipment;
(ii) Personnel. Manager will provide necessary executive and other
personnel, including personnel for the performance of clerical and other
office functions, exclusive of those functions: (a) related to and to be
performed under the Corporation's contract or contracts for administration,
custodial, accounting, bookkeeping, transfer, and dividend disbursing
agency or similar services by any entity, including Manager or its
affiliates, selected to perform such services under such contracts; and (b)
related to the services to be provided by any Adviser pursuant to an
Advisory Agreement; and
(iii) Preparation of Prospectus and Other Documents. Manager will
provide other information and services, other than services of outside
counsel or independent accountants or services to be provided by any
Adviser under any Advisory Agreement, required in connection with the
preparation of all registration statements and Prospectuses, prospectus
supplements, SAIs, all annual, semiannual, and periodic reports to
shareholders of the Corporation, regulatory authorities, or others, and all
notices and proxy solicitation materials, furnished to shareholders of the
Corporation or regulatory authorities, and all tax returns.
D. Limitations on Liability. Manager will exercise its best judgment in
rendering its services to the Corporation, and the Corporation agrees, as an
inducement to Manager's undertaking to do so, that the Manager will not be
liable for any error of judgment or mistake of law or for any loss suffered by
the Corporation in connection with the matters to which this Agreement relates,
but will be liable only
2
for willful misconduct, bad faith, gross negligence or reckless disregard of its
duties or obligations in rendering its services to the Corporation as specified
in this Agreement. Any person, even though an officer, director, employee or
agent of Manager, who may be or become an officer, Director, employee or agent
of the Corporation, shall be deemed, when rendering services to the Corporation
or when acting on any business of the Corporation, to be rendering such services
to or to be acting solely for the Corporation and not as an officer, director,
employee or agent, or one under the control or direction of Manager, even though
paid by it.
E. Section 11 of the Securities Exchange Act of 1934, as amended. The
Corporation hereby agrees that any entity or person associated with Manager that
is a member of a national securities exchange is authorized to effect any
transaction on such exchange for the account of a Fund to the extent and as
permitted by Section 11(a)(1)(H) of the Securities Exchange Act of 1934, as
amended ("1934 Act").
F. Section 28(e) of the 1934 Act. Subject to the appropriate policies and
procedures approved by the Board of Directors, the Manager may, to the extent
authorized by Section 28(e) of the 1934 Act, cause a Fund to pay a broker or
dealer that provides brokerage or research services to the Manager, the Adviser,
the Corporation and the Fund an amount of commission for effecting a Fund
transaction in excess of the amount of commission another broker or dealer would
have charged for effecting that transaction if the Manager determines, in good
faith, that such amount of commission is reasonable in relationship to the value
of such brokerage or research services provided in terms of that particular
transaction or the Manager's overall responsibilities to the Fund, the
Corporation or its other investment advisory clients. To the extent authorized
by said Section 28(e) and the Board of Directors, the Manager 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 "best execution" and in compliance with the Conduct Rules of the
National Association of Securities Dealers, Inc., the Manager may also consider
sales of shares of the Corporation as a factor in the selection of brokers and
dealers.
G. Directed Brokerage. Subject to the requirement to seek best execution,
and to the appropriate policies and procedures approved by the Board of
Directors, the Corporation reserves the right to direct the Manager to cause
Advisers to effect transactions in Fund securities through broker-dealers in a
manner that will help generate resources to pay the cost of certain expenses
which the Corporation is required to pay or for which the Corporation is
required to arrange payment pursuant to this Agreement. At the discretion of the
Board of Directors, such resources may be used to pay or cause the payment of
Corporation Expenses or may be used to finance activities that are primarily
intended to result in the sale of Corporation shares.
3. ALLOCATION OF EXPENSES
A. Expenses Paid by the Manager:
(i) Salaries, Expenses and Fees of Certain Persons. Manager (or its
affiliates) shall pay all salaries, expenses, and fees of the Directors and
officers of the Corporation who are officers, directors/trustees, partners,
or employees of Manager or its affiliates; and
(ii) Assumption of Corporation Expenses. The payment or assumption by
Manager of any expense of the Corporation that Manager is not required by
this Agreement to pay or assume shall not obligate Manager to pay or assume
the same or any similar expense of the Corporation on any subsequent
occasion.
3
B. Expenses Paid by the Corporation: The Corporation will pay all expenses
of its organization, operations, and business not specifically assumed or agreed
to be paid by Manager, as provided in this Agreement, or by an Adviser, as
provided in an Advisory Agreement. Without limiting the generality of the
foregoing, the Corporation shall pay or arrange for the payment of the
following:
(i) Preparing, Printing and Mailing of Certain Documents. The costs of
preparing, setting in type, printing and mailing of Prospectuses,
Prospectus supplements, SAIs, annual, semiannual and periodic reports, and
notices and proxy solicitation materials required to be furnished to
shareholders of the Corporation or regulatory authorities, and all tax
returns;
(ii) Officers and Directors. Compensation of the officers and
Directors of the Corporation who are not officers, directors/trustees,
partners or employees of Manager or its affiliates;
(iii) Registration Fees and Expenses. All legal and other fees and
expenses incurred in connection with the affairs of the Corporation,
including those incurred with respect to registering its shares with
regulatory authorities and all fees and expenses incurred in connection
with the preparation, setting in type, printing, and filing with necessary
regulatory authorities of any registration statement and Prospectus, and
any amendments or supplements that may be made from time to time, including
registration, filing and other fees in connection with requirements of
regulatory authorities;
(iv) Custodian and Accounting Services. All expenses of the transfer,
receipt, safekeeping, servicing and accounting for the Corporation's cash,
securities, and other property, including all charges of depositories,
custodians, and other agents, if any;
(v) Independent Legal and Accounting Fees and Expenses. The charges
for the services and expenses of the independent accountants and legal
counsel retained by the Corporation, for itself or its Independent
Directors (as defined herein);
(vi) Transfer Agent. The charges and expenses of maintaining
shareholder accounts, including all charges of transfer, bookkeeping, and
dividend disbursing agents appointed by the Corporation;
(vii) Brokerage Commissions. All brokers' commissions and issue and
transfer taxes chargeable to the Corporation in connection with securities
transactions to which the Corporation is a party;
(viii) Taxes. All taxes and corporate fees payable by or with respect
to the Corporation to federal, state, or other governmental agencies,
including preparation of such documents as required by any governmental
agency in connection with such taxes;
(ix) Trade Association Fees. Any membership fees, dues or expenses
incurred in connection with the Corporation's membership in any trade
association or similar organizations;
(x) Bonding and Insurance. All insurance premiums for fidelity and
other coverage;
(xi) Shareholder and Board Meetings. All expenses incidental to
holding shareholders and Directors meetings, including the printing of
notices and proxy materials and proxy solicitation fees and expenses;
4
(xii) Pricing. All expenses of pricing of the net asset value per
share of each Fund, including the cost of any equipment or services to
obtain price quotations; and
(xiii) Nonrecurring and Extraordinary Expenses. Such extraordinary
expenses, such as indemnification payments or damages awarded in litigation
or settlements made.
4. COMPENSATION OF MANAGER
For its services performed hereunder, the Corporation will pay Manager with
respect to each Fund the compensation specified in Appendix A to this Agreement.
Such compensation shall be paid to Manager by the Corporation on the first day
of each month; however, the Corporation will calculate this charge on the daily
average value of the assets of each Fund and accrue it on a daily basis.
5. NON-EXCLUSIVITY
The services of Manager to the Corporation are not to be deemed to be
exclusive, and Manager shall be free to render investment management, advisory
or other services to others (including other investment companies) and to engage
in other activities so long as the services provided hereunder by Manager are
not impaired. It is understood and agreed that the directors, officers and
employees of 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, directors/trustees, or employees of any other firm or
corporation, including other investment companies.
6. SUPPLEMENTAL ARRANGEMENTS
Manager may enter into arrangements with its parent or other persons
affiliated or unaffiliated with Manager for the provision of certain personnel
and facilities to Manager to enable Manager to fulfill its duties and
obligations under this Agreement.
7. REGULATION
Manager 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.
8. RECORDS
The records relating to the services provided under this Agreement shall be
the property of the Corporation and shall be under its control; however, the
Corporation shall furnish to Manager 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 Corporation by Manager
free from any claim or retention of rights therein, provided that the Manager
may retain copies of any such records that are required by law. Manager shall
keep confidential any information obtained in connection with its duties
hereunder and disclose such information only if the Corporation has authorized
such disclosure or if such disclosure is expressly required or lawfully
requested by applicable federal or state regulatory authorities.
9. DURATION OF AGREEMENT
This Agreement shall become effective upon the date first above written,
provided that this Agreement shall not take effect unless it has been approved:
(i) by a vote of a majority of those Directors
5
of the Corporation who are not "interested persons" (as defined in the
Investment Company Act) ("Independent Directors") of any party to the Agreement,
cast in person at a meeting called for the purpose of voting on such approval,
and (ii) by vote of a majority of the Corporation's outstanding securities. The
Agreement will continue in effect for a period more than two years from the date
of its execution only so long as such continuance is specifically approved at
least annually either by (i) the Directors of the Corporation or (ii) by the
vote of either a majority of the outstanding voting securities of the
Corporation or, as appropriate, a majority of the outstanding voting securities
of any affected Fund. The required shareholder approval of the Agreement or of
any continuance of the Agreement shall be effective with respect to any affected
Fund if a "majority of the outstanding voting securities" (as defined in Rule
18f-2(h) under the Investment Company Act) of the affected Fund 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 Fund affected by the Agreement or (b) all the Funds
of the Corporation.
If the shareholders of any Fund fail to approve the Agreement or any
continuance of the Agreement, Manager will continue to act as investment manager
with respect to such Fund pending the required approval of the Agreement or its
continuance or of a new contract with Manager or a different investment manager
or other definitive action; provided, that the compensation received by Manager
in respect of such Fund during such period will be no more than its actual costs
incurred in furnishing investment advisory and management services to such Fund
or the amount it would have received under the Agreement in respect of such
Fund, whichever is less.
10. TERMINATION OF AGREEMENT
This Agreement may be terminated at any time, without the payment of any
penalty, by the Directors, including a majority of the Independent Directors of
the Corporation, by the vote of a majority of the outstanding voting securities
of the Corporation, or with respect to any affected Fund, by the vote of a
majority of the outstanding voting securities of such Fund, on sixty (60) days'
written notice to Manager, or by Manager on sixty (60) days' written notice to
the Corporation. This Agreement will automatically terminate, without payment of
any penalty, in the event of its assignment.
11. PROVISION OF CERTAIN INFORMATION BY MANAGER
Manager will promptly notify the Corporation in writing of the occurrence
of any of the following events:
A. Manager fails to be registered as an investment adviser under the
Advisers Act or under the laws of any jurisdiction in which Manager is required
to be registered as an investment adviser in order to perform its obligations
under this Agreement;
B. Manager 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 Corporation; and/or
C. the chief executive officer or controlling stockholder of Manager or the
Fund manager of any Fund changes or there is otherwise an actual change in
control or management of Manager.
12. 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
SEC, this Agreement may be amended by
6
the parties only if such amendment, if material, is specifically approved by the
vote of a majority of the outstanding voting securities of each of the Funds
affected by the amendment (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 Directors of the Corporation 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 any Fund if a
majority of the outstanding voting securities of that Fund vote to approve the
amendment, notwithstanding that the amendment may not have been approved by a
majority of the outstanding voting securities of (a) any other Fund affected by
the amendment or (b) all the Funds of the Corporation.
13. ENTIRE AGREEMENT
This Agreement contains the entire understanding and agreement of the
parties.
14. HEADINGS
The headings in the sections of this Agreement are inserted for convenience
of reference only and shall not constitute a part hereof.
15. NOTICES
All notices required to be given pursuant to this Agreement shall be
delivered or mailed to the last known business address of the Corporation or
Manager in person or by registered mail or a private mail or delivery service
providing the sender with notice of receipt. Notice shall be deemed given on the
date delivered or mailed in accordance with this section.
16. FORCE MAJEURE
Manager shall not be liable for delays or errors occurring by reason of
circumstances beyond its control, including but not limited to acts of civil or
military authority, national emergencies, work stoppages, fire, flood,
catastrophe, acts of God, insurrection, war, riot, or failure of communication
or power supply. In the event of equipment breakdowns beyond its control,
Manager shall take reasonable steps to minimize service interruptions but shall
have no liability with respect thereto.
17. 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.
18. INTERPRETATION
Nothing herein contained shall be deemed to require the Corporation to take
any action contrary to its Amended and Restated Agreement and Declaration of
Corporation or By-Laws, or any applicable statutory or regulatory requirements
to which it is subject or by which it is bound, or to relieve or deprive the
Directors of their responsibility for and control of the conduct of the affairs
of the Corporation.
19. GOVERNING LAW
The provisions of this Agreement shall be construed and interpreted in
accordance with the laws of the State of New York (without giving effect to its
conflict of laws principles), or any of the applicable provisions of the
Investment Company Act. To the extent that the laws of the State of New York, or
any of the provisions in this Agreement, conflict with applicable provisions of
the Investment Company Act,
7
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 unless
otherwise stated herein. 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 by their duly authorized officers as of the date first mentioned above.
THE ENTERPRISE GROUP OF FUNDS II, INC.
By: /s/ Xxxxxxx X. Xxxxxxxxx
-------------------------------------
Xxxxxxx X. Xxxxxxxxx
Treasurer and Chief Financial Officer
AXA EQUITABLE LIFE INSURANCE COMPANY
By: /s/ Xxxxxx X. Xxxxx
-------------------------------------
Xxxxxx X. Xxxxx
Senior Vice President
8
APPENDIX A
TO THE
INVESTMENT MANAGEMENT AGREEMENT
Funds
Fund Management Fee
---- --------------
Enterprise Money Market Fund 0.350% of the Fund's average daily net assets
