INVESTMENT ADVISORY AGREEMENT
AGREEMENT made this 1st day of May, 2006, by and between Federated
Investment Management Company, a Delaware statutory business trust ("Federated")
(the "Adviser"), and Met Investors Advisory LLC, a Delaware limited liability
company (the "Manager").
WHEREAS, the Manager serves as investment manager of Met Investors Series
Trust (the "Trust"), a Delaware business trust which has filed a registration
statement (the "Registration Statement") under the Investment Company Act of
1940, as amended (the "1940 Act") and the Securities Act of 1933, as amended
(the "1933 Act") pursuant to a management agreement dated December 8, 2000, as
amended from time to time (the "Management Agreement"), a copy of which is
attached as Exhibit A hereto; and
WHEREAS, the Trust is comprised of several separate investment portfolios,
one of which is the Federated High Yield Portfolio (the "Portfolio"); and
WHEREAS, as permitted by the Management Agreement, the Manager desires to
avail itself of the services, information, advice, assistance and facilities of
an investment adviser to assist the Manager in performing investment advisory
services for the Portfolio; and
WHEREAS, the Adviser is registered under the Investment Advisers Act of
1940, as amended (the "Advisers Act"), and is engaged in the business of
rendering investment advisory services to investment companies and other
institutional clients and desires to provide such services to the Manager with
respect to the Portfolio;
NOW, THEREFORE, in consideration of the terms and conditions hereinafter
set forth, it is agreed as follows:
1. Employment of the Adviser. The Manager hereby employs the Adviser as
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subadviser to manage the investment and reinvestment of the assets of the
Portfolio, subject to the control and supervision of the Trust's Board of
Trustees, for the period and on the terms hereinafter set forth. The Adviser
hereby accepts such employment and agrees during such period to render the
services and to assume the obligations herein set forth for the compensation
herein provided. The Adviser shall for all purposes herein be deemed to be an
independent contractor and shall, except as expressly provided or authorized
(whether herein or otherwise), have no authority to act for or represent the
Manager, the Portfolio or the Trust in any way. The Adviser may execute account
documentation, agreements, contracts and other documents requested by brokers,
dealers, counterparties and other persons in connection with its management of
the assets of the Portfolio, provided the Adviser receives the express agreement
and consent of the Manager and/or the Trust's Board of Trustees to execute
futures account agreements, ISDA Master Agreements and other documents related
thereto, which consent shall not be unreasonably withheld. In such respect, and
only for this limited purpose, the Adviser shall act as the Manager's and the
Trust's agent and attorney-in-fact.
Copies of the Trust's Registration Statement, as it relates to the
Portfolio (the "Registration Statement"), and the Trust's Declaration of Trust
and Bylaws (collectively, the "Charter Documents"), each as currently in effect,
have been or will be delivered to the Adviser. The Manager agrees, on an ongoing
basis, to notify the Adviser of each change in the fundamental and
non-fundamental investment policies and restrictions of the Portfolio before
they become effective and to provide to the Adviser as promptly as practicable
copies of all amendments and supplements to the Registration Statement before
filing with the Securities and Exchange Commission ("SEC") and amendments to the
Charter Documents. The Manager will promptly provide the Adviser with any
procedures applicable to the Adviser adopted from time to time by the Trust's
Board of Trustees and agrees to promptly provide the Adviser copies of all
amendments thereto. The Adviser will not be bound to follow any change in the
Registration Statement, Charter Documents or investment policies, restrictions
or procedures of the Portfolio or Trust, however, until it has received written
notice of any such change from the Manager and has had a reasonable period of
time to implement such change.
The Manager shall timely furnish the Adviser with such additional
information as may be reasonably necessary for or requested by the Adviser to
perform its responsibilities pursuant to this Agreement. If Manager fails to
timely furnish the Adviser with any additional information (e.g., amendments to
the Registration Statement, Charter Documents, etc.), Adviser shall not be
responsible for acting in accordance with such additional information until a
reasonable time after such information is received by Adviser. The Manager shall
cooperate with the Adviser in setting up and maintaining brokerage accounts and
other accounts the Adviser deems advisable to allow for the purchase or sale of
various forms of securities pursuant to this Agreement.
2. Obligations of and Services to be Provided by the Adviser. The Adviser
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undertakes to provide the following services and to assume the following
obligations:
a. The Adviser shall manage the investment and reinvestment of the
portfolio assets of the Portfolio, and may invest the Portfolio in such portions
of stocks, bonds, instruments, financial contracts, cash and other investment
assets as the Adviser shall determine and may dispose of securities without
regard to the length of time the securities have been held, the resulting rate
of portfolio turnover or any tax considerations, all without prior consultation
with the Manager, subject to and in accordance with the investment objective and
policies of the Portfolio set forth in the Trust's Registration Statement and
the Charter Documents, as such Registration Statement and Charter Documents may
be amended from time to time, in compliance (subject to Section 2.e. below) with
the requirements applicable to registered investment companies under applicable
laws and those requirements applicable to both regulated investment companies
and segregated asset accounts under Subchapters M and Section 817(h) of the
Internal Revenue Code of 1986, as amended (the "Code") including but not limited
to, the diversification requirements of Section 817(h) of the Code and the
regulations thereunder and any written instructions which the Manager or the
Trust's Board of Trustees may issue from time-to-time in accordance therewith.
In pursuance of the foregoing, the Adviser shall make all determinations with
respect to the purchase and sale of portfolio securities and shall take such
action necessary to implement the same.
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The Adviser shall render such reports to the Trust's Board of Trustees and the
Manager as they may reasonably request concerning the investment activities of
the Portfolio, provided that the Adviser shall not be responsible for Portfolio
accounting. Unless the Manager gives the Adviser written instructions to the
contrary, the Adviser shall be authorized to act in good faith and in a manner
which it reasonably believes best serves the interests of the Portfolio's
shareholders and consistent with the Adviser's proxy voting procedures, to vote
such proxies as may be necessary or advisable in connection with any matters
submitted to a vote of shareholders of securities held by the Portfolio. The
Manager acknowledges and agrees, on its behalf and on behalf of the Trust and
the Portfolio, that the Adviser may delegate the performance of its proxy voting
obligations to a third party service provider. The Adviser shall have no
obligation under this Agreement to vote any proxy that is not received in a
timely manner by the Adviser.
b. To the extent provided in the Trust's Registration Statement, as
such Registration Statement may be amended from time to time, the Adviser shall,
in the name of the Portfolio, place orders for the execution of portfolio
transactions with or through such brokers, dealers or other financial
institutions as it may select including affiliates of the Adviser and, complying
with Section 28(e) of the Securities Exchange Act of 1934, may pay a commission
on transactions in excess of the amount of commission another broker-dealer
would have charged. In fulfilling its obligation to seek best execution, the
Adviser may consider factors it deems relevant, including, but not limited to,
the breadth and nature of the market in the security, the price of the security,
the size of the order, the timing of the transaction, the reputation,
experience, financial condition and execution capability of the broker or
dealer, the quality of the service and the reasonableness of the commission, if
any, for the specific transaction and on a continuing basis. Notwithstanding the
foregoing, the Board of Trustees or the Manager may cause the Adviser to effect
transactions in portfolio securities through broker-dealers in a manner that
will help generate resources to pay the cost of certain expenses which the Trust
is required to pay or for which the Trust is required to arrange payment.
If the Board of Trustees or the Manager directs Adviser to use a
particular broker-dealer, or broker-dealers, to execute transactions in
portfolio securities, the Manager acknowledges, on behalf of itself, the Trust
and the Portfolio, that Adviser may not be in a position where it can negotiate
commission rates or spreads, obtain volume discounts, aggregate transactions, or
otherwise seek to obtain best execution, and that directed transactions may
result in less favorable execution than might be the case if Adviser could
select broker-dealers only in accordance with its duty to seek to obtain best
execution.
To the extent consistent with applicable law, the Adviser may (but
shall not be obligated to) aggregate purchase or sell orders for the Portfolio
with contemporaneous purchase or sell orders of other clients of Adviser or its
affiliated persons. In such event, allocation of securities so purchased or
sold, as well as the expenses incurred in the transaction, will be made by
Adviser in the manner Adviser considers to be the most equitable and consistent
with its and its affiliates' fiduciary obligations to the Portfolio and to such
other clients. Manager hereby acknowledges that
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such aggregations of orders may not result in a more favorable price or lower
brokerage commissions in all instances.
c. In connection with the placement of orders for the execution of the
portfolio transactions of the Portfolio, the Adviser shall create and maintain
all necessary records pertaining to the purchase and sale of securities by the
Adviser on behalf of the Portfolio in accordance with all applicable laws, rules
and regulations, including but not limited to records required by Section 31(a)
of the 1940 Act. All records shall be the property of the Trust and shall be
available for inspection and use by the SEC, the Trust, the Manager or any
person retained by the Trust at all reasonable times. Where applicable, such
records shall be maintained by the Adviser for the periods and in the places
required by Rule 31a-2 under the 1940 Act. Manager of its designee shall
maintain and preserve all other books and records not related to the Portfolio's
transactions as required under applicable laws and shall make such records
available to the Adviser upon reasonable request.
d. The Adviser shall bear its expenses of providing services pursuant
to this Agreement, but shall not be obligated to pay any expenses of the
Manager, the Trust, or the Portfolio (except as specifically agreed to by the
Adviser in this Agreement), including without limitation: (i) interest and
taxes; (ii) brokerage commissions and other costs in connection with the
purchase or sale of securities or other investment instruments for the
Portfolio; (iii) custodian fees and expenses; (iv) fees and expenses of the
Trust's trustees; (v) legal and audit expenses; (vi) registrar and transfer
agent fees and expenses; (vii) expenses of printing and mailing reports and
notices and proxy material to shareholders of the Portfolio; (viii) all other
expenses incidental to holding meetings of the Portfolio's shareholders,
including proxy solicitations therefore; (ix) expenses of typesetting
prospectuses and statements of additional information and supplements thereto;
(x) insurance or fidelity bond premiums and other coverage; (xi) investment
management fees; and (xii) expenses of printing and mailing prospectuses and
statements of additional information and supplements thereto except as provided
in Section 2.i of this Agreement. In no event will the Sub-Adviser bear
brokerage costs, custodian fees, auditor fees or other expenses to be borne by
the Portfolio of the Trust.
e. The Adviser and the Manager acknowledge that the Adviser is not the
compliance agent for the Portfolio or for the Manager, and does not have access
to all of the Portfolio's books and records necessary to perform certain
compliance testing. To the extent that the Adviser has agreed to perform the
services specified in this Section 2 in accordance with the Trust's Registration
Statement and Charter Documents, written instructions of the Manager and any
policies adopted by the Trust's Board of Trustees applicable to the Portfolio
(collectively, the "Charter Requirements"), and in accordance with applicable
law (including Subchapters M and the diversification requirements of section
817(h) of the Code, the 1940 Act and the Advisers Act ("Applicable Law")), the
Adviser shall perform such services based upon its books and records with
respect to the Portfolio (as specified in Section 2.c. hereof), which comprise a
portion of the Portfolio's books and records, and upon information and written
instructions received from the Trust, the Manager or the Trust's administrator,
and shall not be held responsible under this Agreement so long as it performs
such services in accordance with this Agreement,
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the Charter Requirements and Applicable Law based upon such books and records
and such information and instructions provided by the Trust, the Manager or the
Trust's administrator. The Adviser shall perform quarterly diversification
testing under Section 817(h) of the Code with respect to the assets of the
Portfolio managed by Adviser as contemplated above in this Section 2.e. The
Adviser shall provide timely notice each calendar quarter that such
diversification was satisfied or, if not satisfied, that corrections were made
within 30 days of the end of the calendar quarter. The Adviser shall have no
responsibility to monitor any limitations or restrictions (including, without
limitation, diversification requirements) for which the Adviser does not have or
has not been provided sufficient information in accordance with Section 1 of
this Agreement or otherwise on a timely basis. All such monitoring shall be the
responsibility of the Manager.
f. The Adviser makes no representation or warranty, express or
implied, that any level of performance or investment results will be achieved by
the Portfolio or that the Portfolio will perform comparably with any standard or
index, including other clients of the Adviser, whether public or private.
g. The Adviser shall be responsible for the preparation and filing of
Schedule 13G and Form 13F on behalf of the Portfolio. The Adviser shall not be
responsible for the preparation or filing of any other reports required of the
Portfolio by any governmental or regulatory agency, except as expressly agreed
to in writing.
h. In accordance with procedures and methods established by the
Trustees of the Trust and with the investment objective and policies of the
Portfolio set forth in the Trust's Registration Statement and the Charter
Documents, as such Registration Statement and Charter Documents may be amended
from time to time and shall be provided to the Adviser on a timely basis, and to
the extent not prohibited by applicable law or the Adviser's policies and
procedures, the Adviser shall provide reasonable assistance in determining the
fair value of all securities and other investments/assets in the Portfolio.
i. The Adviser will notify the Trust and the Manager of any assignment
of this Agreement or change of control of the Adviser (as such concepts are
defined under the 1940 Act), as applicable, and any changes in the key personnel
who are either the portfolio manager(s) of the Portfolio or senior management of
the Adviser, in each case prior to or promptly after, such change. The Adviser
agrees to bear all reasonable expenses of the Trust, if any, with respect to any
necessary filings with the SEC or the preparation, printing and mailing of
required documents to Portfolio shareholders, arising out of any assignment by,
or change in control of the Adviser and any changes in the key personnel who are
either the portfolio manager(s) of the Portfolio or senior management of the
Adviser.
3. Compensation of the Adviser. In consideration of services rendered
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pursuant to this Agreement, the Manager will pay the Adviser a fee at the annual
rate of the value of the Portfolio's average daily net assets set forth in
Schedule A hereto. Such fee shall be accrued daily and paid monthly as soon as
practicable after the end of each month.
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The Manager shall use its best efforts to pay such fee no more than 15 days
after the end of each month. If the Adviser shall serve for less than the whole
of any month, the foregoing compensation shall be prorated. For the purpose of
determining fees payable to the Adviser, the value of the Portfolio's net assets
shall be computed at the times and in the manner specified in the Trust's
Registration Statement.
4. Activities of the Adviser. The services of the Adviser hereunder are not
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to be deemed exclusive, and the Adviser shall be free to render similar services
to others and to engage in other activities, so long as the services rendered
hereunder are not impaired. The Manager understands that the persons employed by
the Adviser to assist in the performance of the Adviser's duties under this
Agreement will not devote their full time to such service and nothing contained
in this Agreement shall be deemed to limit or restrict the right of the Adviser
or any affiliate of the Adviser to engage in and devote time and attention to
other businesses or to render services of whatever kind or nature.
The Adviser shall be subject to a written code of ethics adopted by it that
conforms to the requirements of Rule 17j-1(b) of the 1940 Act, and shall not be
subject to any other code of ethics, including the Manager's code of ethics,
unless specifically adopted by the Adviser.
5. Use of Names. The Adviser hereby consents to the Portfolio being named
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the Federated High Yield Portfolio. The Manager and the Trust shall not use the
name "Federated" and any of the other names of the Adviser or its affiliated
companies and any derivative or logo or trade or service xxxx thereof, or
disclose information related to the business of the Adviser or any of its
affiliates in any prospectus, sales literature or other material relating to the
Trust or otherwise in any manner not approved prior thereto by the Adviser;
provided, however, that the Adviser approves all uses of its name and that of
its affiliates which merely refer in accurate terms to its appointment hereunder
or which are required by the SEC or a state securities commission the prior
approval of the Adviser is required; provided, that in no event shall such
approval be unreasonably withheld.
The Adviser reserves to itself and any successor to its business the right
to grant the non-exclusive right to use the aforementioned names or logos, or
trade or service marks, or any derivations thereof, or any similar names or
logos, or trade or service marks, to any other corporation or entity, including,
but not limited to, any investment company of which the Adviser or any
subsidiary or affiliate thereof, or any successor to the business of any
thereof, shall be the investment adviser.
The Manager, on its behalf and on behalf of the Portfolio and the Trust,
together with their affiliated persons, agrees (a) to use best efforts to ensure
that the nature and quality of the services rendered in connection with such
names or logos, or trade or service marks, or derivations thereof, shall conform
to the terms of this Agreement and any amendments thereto, and (b) to comply
with any reasonable requirements for the use of such names or logos, or trade or
service marks, or derivations thereof, provided from time to time by the Adviser
to Manager or the Portfolio, or the Trust, in writing.
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The Adviser shall not use the name of the Trust, the Portfolio, the Manager
or any of their affiliates in any material relating to the Adviser in any manner
not approved prior thereto by the Manager; provided, however, that the Manager
shall approve all uses of its, the Portfolio's or the Trust's name which merely
refer in accurate terms to the appointment of the Adviser hereunder or which are
required by the SEC or a state securities commission; and, provided, further,
that in no event shall such approval be unreasonably withheld.
The Manager recognizes that from time to time directors, officers and
employees of the Adviser may serve as directors, trustees, partners, officers
and employees of other corporations, business trusts, partnerships or other
entities (including other investment companies) and that such other entities may
include the name "Federated" or any derivative or abbreviation thereof as part
of their name, and that the Adviser or its affiliates may enter into investment
advisory, administration or other agreements with such other entities.
Upon termination of this Agreement for any reason, the Manager shall within
30 days cease and cause the Portfolio and the Trust to cease all use of the name
and xxxx "Federated" and any associated logos or derivations thereof.
6. Representations and Warranties of Manager. Manager represents and
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warrants to the Sub-Adviser as follows:
(a) Manager is registered with the SEC as an investment adviser under
the Advisers Act;
(b) Manager is registered and licensed as an investment adviser under
the laws of all jurisdictions in which its activities require it to be so
licensed, except in such jurisdictions where the failure to be so licensed would
not have a material effect on its business;
(c) Manager is a limited liability company duly organized and validly
existing under the laws of the State of Delaware with the power to own and
possess its assets and carry on its business as it is now being conducted;
(d) The execution, delivery and performance by Manager of this
Agreement are within Manager's powers and have been duly authorized by all
necessary action on the part of its directors, and no action by or in respect
of, or filing with, any governmental body, agency or official is required on the
part of Manager for the execution, delivery and performance of this Agreement by
the parties hereto, and the execution, delivery and performance of this
Agreement by the parties hereto do not materially contravene or constitute a
material default under (i) any provision of applicable law, rule or regulation,
(ii) Manager's organizational document or By-Laws, or (iii) any material
agreement, judgment, injunction, order, decree or other instruments binding upon
Manager.
(e) This Agreement is a valid and binding Agreement of Manager;
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(f) Manager has provided the Adviser with a copy of its Form ADV as
most recently filed with the SEC and will, within a reasonable time after filing
any amendment to its Form ADV with the SEC, furnish a copy of such amendments to
the Adviser. The information contained in Manager's Form ADV is accurate and
complete in all material respects and does not omit to state any material fact
necessary in order to make the statements made, in light of the circumstances
under which they were made, not misleading;
(g) Manager acknowledges that it received a copy of the Sub-Adviser's
Form ADV at least 48 hours prior to the execution of this Agreement and has
delivered a copy of the same to the Trust;
(h) The Trust and Manager have complied with all shareholder approval
requirements concerning the Management Agreement and this Agreement with respect
to the Portfolio;
(i) The Trust has approved the policies and procedures of the Adviser
in accordance with applicable law and has authorized the Trust's custodian to
receive appropriate instructions from the Adviser with respect to the Portfolio;
and
(j) The Manager and the Trust are in compliance in all material
respects, with applicable federal securities laws, including, without
limitation, the Advisers Act, the 1940 Act, the 1933 Act and the Securities
Exchange Act of 1934.
7. Representations and Warranties of Adviser. The Adviser hereby represents
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and warrants to Manager that:
(a) the Adviser is registered with the SEC as an investment adviser
under the Advisers Act;
(b) The Adviser is registered or licensed as an investment adviser
under the laws of all jurisdictions in which its activities require it to be so
registered or licensed, except where the failure to be so licensed would not
have a material adverse effect on its business;
(c) The Adviser is a statutory trust duly organized and validly
existing under the laws of the State of Delaware with the power to own and
possess its assets and carry on its business as it is now being conducted;
(d) The execution, delivery and performance by the Adviser of this
Agreement are within the Adviser's powers and have been duly authorized by all
necessary action on the part of its directors, and no action by or in respect
of, or filing with, any governmental body, agency or official is required on the
part of the Adviser for the execution, delivery and performance of this
Agreement by the parties hereto, and the execution, delivery and performance of
this Agreement by the parties hereto do not materially contravene or constitute
a material default under (i) any provision of applicable law, rule or
regulation, (ii) the Adviser's organizational document or By-Laws,
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or (iii) any material agreement, judgment, injunction, order, decree or other
instruments binding upon the Adviser;
(e) This Agreement is a valid and binding Agreement of the Adviser;
(f) The Adviser has provided Manager with a copy of its Form ADV as
most recently filed with the SEC and will, promptly after filing any amendment
to its Form ADV with the SEC, furnish a copy of such amendments to Manager. The
information contained in the Adviser's Form ADV is accurate and complete in all
materials respects and does not omit to state any material fact necessary in
order to make the statements made, in light of the circumstances under which
they were made, not misleading; and
(g) The Adviser is in compliance, in all material respects, with
applicable federal securities laws including, without limitation, the Advisers
Act, the 1940 Act, the 1933 Act and the Securities Exchange Act of 1934.
8. Liability and Indemnification.
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a. Except as may otherwise be provided by the 1940 Act or any other
federal securities law, the Adviser shall not be liable for any losses, claims,
damages, liabilities or litigation (including legal, investigation and other
expenses) incurred or suffered by the Manager or the Trust as a result of any
error of judgment, investment decision, or mistake of law by the Adviser with
respect to the Portfolio, except that nothing in this Agreement shall operate or
purport to operate in any way to exculpate, waive or limit the liability of the
Adviser for, and the Adviser shall indemnify and hold harmless the Trust, the
Manager, all affiliated persons thereof (within the meaning of Section 2(a)(3)
of the 1940 Act ) and all controlling persons (as described in Section 15 of the
1933 Act) (collectively, "Manager Indemnitees") against any and all losses,
claims, damages, liabilities or litigation (including reasonable legal,
investigation and other expenses) to which any of the Manager Indemnitees may
become subject under the 1933 Act, the 1940 Act, the Advisers Act, or under any
other statute, at common law or otherwise arising out of or based on (i) any
willful misconduct, bad faith, reckless disregard or gross negligence of the
Adviser in the performance of any of its duties or obligations hereunder or (ii)
any untrue statement of a material fact contained in the Registration Statement,
proxy materials, reports, advertisements, sales literature, or other materials
pertaining to the Portfolio or the omission to state therein a material fact
known to the Adviser which was required to be stated therein or necessary to
make the statements therein not misleading, if such statement or omission was
made in reliance upon information necessary or required to be included therein
that was furnished to the Manager or the Trust by the Adviser Indemnitees (as
defined below) for use therein.
b. Except as may otherwise be provided by the 1940 Act or any other
federal securities law, the Manager and the Trust shall not be liable for any
losses, claims, damages, liabilities or litigation (including legal,
investigation and other expenses) incurred or suffered by the Adviser as a
result of any error of judgment or mistake of law by the Manager with respect to
the Portfolio, except that nothing in this Agreement shall
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operate or purport to operate in any way to exculpate, waive or limit the
liability of the Manager for, and the Manager shall indemnify and hold harmless
the Adviser, all affiliated persons thereof (within the meaning of Section
2(a)(3) of the 0000 Xxx) and all controlling persons (as described in Section 15
of the 1933 Act) (collectively, "Adviser Indemnitees") against any and all
losses, claims, damages, liabilities or litigation (including reasonable legal,
investigation and other expenses) to which any of the Adviser Indemnitees may
become subject under the 1933 Act, the 1940 Act, the Advisers Act, or under any
other statute, at common law or otherwise arising out of or based on (i) any
willful misconduct, bad faith, reckless disregard or gross negligence of the
Manager in the performance of any of its duties or obligations hereunder, (ii)
any failure by the Manager to properly notify the Adviser of changes to the
Registration Statement or any Charter Requirements that leads to any such
losses, claims, damages, liabilities or litigation, including reasonable legal,
investigation and other expenses to which any of the Adviser Indemnitees may be
subject or (iii) any untrue statement of a material fact contained in the
Registration Statement, proxy materials, reports, advertisements, sales
literature, or other materials pertaining to the Portfolio or the omission to
state therein a material fact known to the Manager which was required to be
stated therein or necessary to make the statements therein not misleading,
unless such statement or omission was made in reliance upon information
necessary or required to be included therein that was furnished to the Manager
or the Trust by an Adviser Indemnitee for use therein.
c. This Section 8 and the obligations of the parties under this
Section 8, shall survive the expiration or termination of this Agreement.
9. Limitation of Trust's Liability. The Adviser acknowledges that it has
_______________________________
received notice of and accepts the limitations upon the Trust's liability set
forth in its Agreement and Declaration of Trust. The Adviser agrees that any of
the Trust's obligations shall be limited to the assets of the Portfolio and that
the Adviser shall not seek satisfaction of any such obligation from the
shareholders of the Trust nor from any Trust officer, employee or agent of the
Trust.
10. Renewal, Termination and Amendment. This Agreement shall continue in
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effect, unless sooner terminated as hereinafter provided, until December 31,
2007 and shall continue in full force and effect for successive periods of one
year thereafter, but only so long as each such continuance as to the Portfolio
is specifically approved at least annually by vote of the holders of a majority
of the outstanding voting securities of the Portfolio or by vote of a majority
of the Trust's Board of Trustees; and further provided that such continuance is
also approved annually by the vote of a majority of the Trustees who are not
parties to this Agreement or interested persons of any such party. This
Agreement may be terminated as to the Portfolio at any time, without payment of
any penalty, by the Trust's Board of Trustees, by the Manager, or by a vote of
the majority of the outstanding voting securities of the Portfolio upon 60 days'
prior written notice to the Adviser, or by the Adviser upon 90 days' prior
written notice to the Manager, or upon such shorter notice as may be mutually
agreed upon. This Agreement shall terminate automatically and immediately upon
termination of the Management Agreement between the Manager and the Trust. The
Manager agrees to provide the Adviser with as much notice as is reasonably
practical under the circumstances in the case of any termination of
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this Agreement by virtue of the termination of the Management Agreement. This
Agreement shall terminate automatically and immediately in the event of its
assignment. The terms "assignment" and "vote of a majority of the outstanding
voting securities" shall have the meaning set forth for such terms in the 1940
Act. This Agreement may be amended at any time by the Adviser and the Manager,
subject to approval by the Trust's Board of Trustees and, if required by
applicable SEC rules, regulations, or orders, a vote of a majority of the
Portfolio's outstanding voting securities. Manager shall provide Adviser with
reasonable prior notice (or, if not practicable, prompt subsequent notice) in
the event that this Agreement will terminate (or has terminated) due to either a
termination of the Management Agreement or because of an assignment of this
Agreement (other than by Adviser).
11. Confidential Relationship. Any information and advice furnished by any
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party to this Agreement to the other party or parties shall be treated as
confidential and shall not be disclosed to third parties without the consent of
the other party hereto except as contemplated herein, as necessary to perform
services under this Agreement or required or expressly permitted by applicable
law, rule or regulation.
The Manager hereby consents to the disclosure to third parties of (i)
investment results and other data of the Manager or the Portfolio in connection
with providing composite investment results of the Adviser and (ii) investments
and transactions of the Manager or the Portfolio in connection with providing
composite information of clients of the Adviser.
12. Severability. If any provision of this Agreement shall be held or made
____________
invalid by a court decision, statute, rule or otherwise, the remainder of this
Agreement shall not be affected thereby.
13. Custodian. The Portfolio assets shall be maintained in the custody of
_________
its custodian. Any assets added to the Portfolio shall be delivered directly to
such custodian. The Adviser shall have no liability for the acts or omissions of
any custodian of the Portfolio's assets. The Adviser shall have no
responsibility for the segregation requirement of the 1940 Act or other
applicable law other than to notify the custodian of investments that require
segregation and appropriate assets for segregation.
14. Information. The Manager hereby acknowledges that it and the Trustees
___________
of the Trust have been provided with all information necessary in connection
with the services to be provided by the Adviser hereunder, including a copy of
Part II of the Adviser's Form ADV at least 48 hours prior to the Manager's
execution of this Agreement, and any other information that the Manager or the
Trustees deem necessary.
15. Miscellaneous. This Agreement constitutes the full and complete
_____________
agreement of the parties hereto with respect to the subject matter hereof. Each
party agrees to perform such further actions and execute such further documents
as are necessary to effectuate the purposes hereof. This Agreement shall be
construed and enforced in accordance with and governed by the laws of the State
of Delaware and the applicable provisions of the 1940 Act. The captions in this
Agreement are included for convenience
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only and in no way define or delimit any of the provisions hereof or otherwise
affect their construction or effect. This Agreement may be executed in several
counterparts, all of which together shall for all purposes constitute one
Agreement, binding on all the parties.
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IN WITNESS WHEREOF, the parties have duly executed this Agreement as of the
date first written above.
MET INVESTORS ADVISORY LLC
BY:
------------------------------------
Authorized Officer
FEDERATED INVESTMENT MANAGEMENT COMPANY
BY:
------------------------------------
Authorized Officer
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SCHEDULE A
Percentage of average daily net assets
______________________________________
Federated High Yield Portfolio 0.35% of first $150 million of such assets
plus 0.30% of such assets over $150 million up
to $250 million plus 0.25% of such assets over
$250 million.
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