Exhibit (d)(19)
INVESTMENT ADVISORY AGREEMENT
AGREEMENT, dated as of July 24, 2000, by and between The Equitable Life
Assurance Society of the United States, a New York Stock life insurance
corporation (the "Manager"), and Fidelity Management & Research Company, a
Massachusetts corporation ("Adviser").
WHEREAS, EQ Advisors Trust ("Trust") is registered as an investment
company under the Investment Company Act of 1940, as amended ("Investment
Company Act");
WHEREAS, the Trust's shareholders are and will be separate accounts
maintained by insurance companies for variable life insurance policies and
variable annuity contracts under which income, gains, and losses, whether or not
realized, from assets allocated to such accounts are, in accordance with such
policies and contracts, credited to or charged against such accounts without
regard to other income, gains, or losses of such insurance companies and for
qualified retirement plans ("Qualified Plans");
WHEREAS, the Trust is and will continue to be a series fund having two
or more investment portfolios, each with its own investment objectives, policies
and restrictions;
WHEREAS, the Manager is registered as an investment adviser under the
Investment Advisers Act of 1940, as amended ("Advisers Act"), and is the
investment manager to the Trust;
WHEREAS, the Adviser is registered as an investment adviser under the
Advisers Act;
WHEREAS, the Investment Company Act prohibits any person from acting as
an investment adviser to a registered investment company except pursuant to a
written contract; and
WHEREAS, the Board of Trustees of the Trust and the Manager desire that
the Manager retain the Adviser to render investment advisory and other services
to the portfolios to be known as FI Mid Cap Portfolio and FI Small/Mid Cap Value
Portfolio (each a "Portfolio" and collectively, the "Portfolios") in the manner
and on the terms hereinafter set forth.
NOW, THEREFORE, the Manager and the Adviser agree as follows:
1. APPOINTMENT OF ADVISER
The Manager hereby appoints the Adviser to act as investment adviser
for each Portfolio, subject to the supervision and control of the Manager and
the Trustees of the Trust, and in accordance with the terms and conditions of
this Agreement. The Adviser will be an independent contractor and will have no
authority to act for or represent the Trust or the Manager in any way or
otherwise be deemed an agent of the Trust or the Manager except as expressly
authorized in this Agreement or another writing by the Trust, the Manager and
the Adviser.
2. SERVICES TO BE RENDERED BY THE ADVISERS TO THE TRUST
A. As investment adviser to the Portfolios, the Adviser will coordinate
the investment and reinvestment of the assets of the Portfolios and determine
the composition of the assets of the Portfolios, subject always to the
supervision and control of the Manager and the Trustees of the Trust.
B. As part of the services it will provide hereunder, the Adviser will:
(i) obtain and evaluate pertinent economic, statistical,
financial, and other information affecting the economy generally and
individual companies or industries, the securities of which are
included in the Portfolio or are under consideration for inclusion in
the Portfolio;
(ii) formulate and implement a continuous investment program
for the Portfolios;
(iii) take whatever steps are necessary to implement the
investment program for the Portfolios by the purchase and sale of
securities and other investments, including the placing of orders for
such purchases and sales;
(iv) keep the Trustees of the Trust and the Manager fully
informed in writing on an ongoing basis of all material facts
concerning the investment and reinvestment of the assets in the
Portfolios, the Adviser and its personnel and operations, make regular
and special written reports of such additional information concerning
the same as may reasonably be requested from time to time by the
Manager or the Trustees of the Trust and will attend meetings with the
Manager and/or the Trustees, as reasonably requested, to discuss the
foregoing,
(v) provide assistance in determining the fair value of
certain portfolio securities when market quotations are not readily
available for the purpose of calculating the Portfolios' net asset
value in accordance with procedures and methods established by the
Trustees of the Trust;
(vi) provide any and all information, records and supporting
documentation about accounts the Adviser manages, if appropriate, that
have investment objectives, policies, and strategies substantially
similar to those
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employed by the Adviser in managing the Portfolios that may be
reasonably necessary, under applicable laws, to allow the Portfolio or
its agent to present information concerning Adviser's prior performance
in the Trust's Prospectus and SAI (as hereinafter defined) and any
permissible reports and materials prepared by the Portfolio or its
agent; and
(vii) cooperate with and provide reasonable assistance to the
Manager, the Trust's administrator, the Trust's custodian and foreign
custodians, the Trust's transfer agent and pricing agents and all other
agents and representatives of the Trust and the Manager, keep all such
persons fully informed as to such matters as they may reasonably deem
necessary to the performance of their obligations to the Trust and the
Manager, provide prompt responses to reasonable requests made by such
persons and establish appropriate interfaces with each so as to promote
the efficient exchange of information.
C. In furnishing services hereunder, the Adviser shall be subject to,
and shall perform in accordance with the following: (i) the Trust's Agreement
and Declaration of Trust, as the same may be hereafter modified and/or amended
from time to time ("Trust Declaration"); (ii) the By-Laws of the Trust, as the
same may be hereafter modified and/or amended from time to time ("By-Laws");
(iii) the currently effective Prospectus and Statement of Additional Information
of the Trust filed with the SEC, as the same may be hereafter modified, amended
and/or supplemented ("Prospectus and SAI"); (iv) the Investment Company Act; (v)
all other applicable state and federal securities and other laws; (vi) all
regulations with respect to the foregoing; (vii) the Trust's Compliance Manual
and other policies and procedures adopted from time to time by the Board of
Trustees of the Trust; and (viii) the written instructions of the Manager. The
Manager shall provide the Adviser with current copies of the Trust Declaration,
By-Laws, Prospectus and SAI. In advising the Portfolios, the Adviser shall use
reasonable best efforts and diligence to comply with Subchapter M and Subchapter
L of the Internal Revenue Code of 1986, as amended, ("Code"). In this regard,
the Adviser shall promptly notify the Manager, the Administrator or their
designated agent if the Adviser determines that any Portfolio is not in
compliance with Subchapter M or Subchapter L of the Code.
D. The Adviser, at its expense, will furnish: (i) all necessary
facilities and personnel, including salaries, expenses and fees of any personnel
required for them to faithfully perform their duties under this Agreement; and
(ii) administrative facilities, including bookkeeping, clerical personnel and
equipment necessary for the efficient conduct of the Adviser's duties under this
Agreement.
E. The Adviser will select brokers and dealers to effect all portfolio
transactions subject to the conditions set forth herein. The Adviser will place
all necessary orders with brokers, dealers, or issuers, and will negotiate
brokerage commissions, if applicable. The Adviser is directed at all times to
seek to execute brokerage transactions for the Portfolios (i) in accordance with
any written policies, practices or procedures that may be established by the
Board of Trustees or the Manager from time to time or (ii) as described in the
Trust's Prospectus and SAI. In placing any orders for the purchase or
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sale of investments for the Portfolios, in the name of the Portfolios or its
nominees, the Adviser shall use its best efforts to obtain for the Portfolios
the most favorable overall terms, considering all of the circumstances, and
shall maintain records adequate to demonstrate compliance with this requirement.
F. Subject to the appropriate policies and procedures approved by the
Board of Trustees, each Adviser may, to the extent authorized by Section 28(e)
of the Securities Exchange Act of 1934, as amended ("Exchange Act") cause the
Portfolios to pay a broker or dealer that provides brokerage or research
services to the Manager, the Adviser and the Portfolio an amount of commission
for effecting a portfolio transaction in excess of the amount of commission
another broker or dealer would have charged for effecting that transaction if
the Adviser determines, in good faith, that such amount of commission is
reasonable in relationship to the value of such brokerage or research services
provided viewed in terms of that particular transaction or the Adviser's overall
responsibilities to the Portfolios or its other advisory clients. To the extent
authorized by Section 28(e) and the Trust's Board of Trustees, the Adviser shall
not be deemed to have acted unlawfully or to have breached any duty created by
this Agreement or otherwise solely by reason of such action. In addition,
subject to seeking the most favorable price and best execution available, the
Manager or the Adviser may also consider sales of shares of the Trust as a
factor in the selection of brokers and dealers. Subject to seeking the most
favorable price and execution, 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: (i) pay the
cost of certain expenses which the Trust is required to pay or for which the
Trust is required to arrange payment; or (ii) finance activities that are
primarily intended to result in the sale of Trust shares.
G. On occasions when an Adviser deems the purchase or sale of a
security to be in the best interest of the Portfolios as well as other clients
of the Adviser, the Adviser to the extent permitted by applicable laws and
regulations, may, but shall be under no obligation to, aggregate the securities
to be purchased or sold to attempt to obtain a more favorable price or lower
brokerage commissions and efficient execution. In such event, allocation of the
securities so purchased or sold, as well as the expenses incurred in the
transaction, will be made by the Adviser in the manner such Adviser considers to
be the most equitable and consistent with its fiduciary obligations to the
Portfolio and to its other clients.
H. The Adviser will maintain all accounts, books and records with
respect to the Portfolio as are required of a sub-investment adviser of a
registered investment company pursuant to the Investment Company Act and
Advisers Act and the rules thereunder and shall file with the SEC all forms
pursuant to Section 13 of the Exchange Act, with respect to its duties as are
set forth herein.
I. The Adviser will, unless and until otherwise directed by the Manager
or the Board of Trustees, vote proxies with respect to the Portfolios'
securities and exercise rights in corporate actions or otherwise.
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3. COMPENSATION OF ADVISER
The Manager will pay the Adviser an advisory fee with respect to the
Portfolios specified in Appendix A to this Agreement. Payments shall be made to
the Adviser on or about the fifth day of each month; however, this advisory fee
will be calculated on the average daily net assets of each Portfolio's assets
(based on calendar days) and accrued on a daily basis.
4. LIABILITY AND INDEMNIFICATION
(a) Except as may otherwise be provided by the Investment Company Act
or any other federal securities law, the Adviser shall not be liable for any
losses, claims, damages, liabilities or litigation (including legal and other
expenses) incurred or suffered by the Manager or the Trust as a result of any
error of judgment 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
Investment Company Act) and all controlling persons (as described in Section 15
of the Securities Act of 1933, as amended ("1933 Act")) (collectively, "Manager
Indemnitees") against any and all losses, claims, damages, liabilities or
litigation (including reasonable legal and other expenses) to which any of the
Manager Indemnities may become subject under the 1933 Act, the Investment
Company 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 Prospectus and SAI, proxy materials, reports,
advertisements, sales literature, or other materials pertaining to the
Portfolios 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 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 Investment Company 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 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
Portfolios, except that nothing in this Agreement shall 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
Investment Company Act) 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
and other expenses) to which any of the Adviser Indemnitees may become subject
under the 1933 Act, the Investment Company Act, the Advisers Act, or under any
other statute, at common law or otherwise arising out of or based on (i) any
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willful misconduct, bad faith, reckless disregard or gross negligence of the
Manager in the performance of any of its duties or obligations hereunder or (ii)
any untrue statement of a material fact contained in the Prospectus and SAI,
proxy materials, reports, advertisements, sales literature, or other materials
pertaining to the Portfolios 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 furnished to the Manager or the Trust by
an Adviser Indemnitees for use therein.
5. NON-EXCLUSIVITY
The services of the Adviser to the Manager, the Portfolio and the Trust
are not to be deemed to be exclusive, and the Adviser shall be free to render
investment advisory or other services to others (including other investment
companies) and to engage in other activities. It is understood and agreed that
the directors, officers, and employees of the Adviser are not prohibited from
engaging in any other business activity or from rendering services to any other
person, or from serving as partners, officers, directors, trustees, or employees
of any other firm or corporation, including other investment companies.
6. SUPPLEMENTAL ARRANGEMENTS
The Adviser may from time to time employ or associate with itself any
person it believes to be particularly fitted to assist it in providing the
services to be performed by such Adviser hereunder, provided that no such person
shall perform any services with respect to the Portfolios that would constitute
an assignment or require a written advisory agreement pursuant to the Investment
Company Act. Any compensation payable to such persons shall be the sole
responsibility of the Adviser, and neither the Manager nor the Trust shall have
any obligations with respect thereto.
7. REGULATION
The Adviser shall submit to all regulatory and administrative bodies
having jurisdiction over the services provided pursuant to this Agreement any
information, reports, or other material which any such body by reason of this
Agreement may request or require pursuant to applicable laws and regulations.
8. RECORDS
The records relating to the services provided under this Agreement
shall be the property of the Trust and shall be under its control; however, the
Trust shall furnish to the Adviser such records and permit them to retain such
records (either in original or in duplicate form) as it shall reasonably require
in order to carry out their duties. In the event of the termination of this
Agreement, such records shall promptly be returned to the Trust by the Adviser
free from any claim or retention of rights therein. The Manager and the Adviser
shall keep confidential any information obtained in connection with its duties
hereunder and disclose such information only if the Trust has authorized such
disclosure
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or if such disclosure is expressly required or requested by applicable federal
or state regulatory authorities.
9. DURATION OF AGREEMENT
This Agreement shall become effective with respect to each Portfolio on
the later of the date of its execution or the date of the commencement of the
Portfolio. This 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 by the Board of Trustees provided that
in such event such continuance shall also be approved by the vote of a majority
of the Trustees who are not "interested persons" (as defined in the Investment
Company Act) ("Independent Trustees") of any party to this Agreement cast in
person at a meeting called for the purpose of voting on such approval.
10. TERMINATION OF AGREEMENT
This Agreement may be terminated at any time, without the payment of
any penalty, by the Board of Trustees, including a majority of the Independent
Trustees, by the vote of a majority of the outstanding voting securities of the
Portfolio, on sixty (60) days' written notice to the Manager and the Adviser, or
by the Manager or Adviser on sixty (60) days' written notice to the Trust and
the other party. This Agreement will automatically terminate, without the
payment of any penalty, (i) in the event of its assignment (as defined in the
Investment Company Act), or (ii) in the event the Investment Management
Agreement between the Manager and the Trust is assigned or terminates for any
other reason. This Agreement will also terminate upon written notice to the
other party that the other party is in material breach of this Agreement, unless
the other party in material breach of this Agreement cures such breach to the
reasonable satisfaction of the party alleging the breach within thirty (30) days
after written notice.
11. PROVISION OF CERTAIN INFORMATION BY ADVISER
The Adviser will promptly notify the Manager in writing of the
occurrence of any of the following events:
A. the Adviser fails to be registered as an investment adviser under
the Advisers Act or under the laws of any jurisdiction in which the Adviser is
required to be registered as an investment adviser in order to perform its
obligations under this Agreement;
B. the Adviser is served or otherwise receives notice of any action,
suit, proceeding, inquiry, or investigation, at law or in equity, before or by
any court, public board, or body, involving the affairs of the Trust; and/or
C. the chief executive officer or controlling stockholder of the
Adviser or the portfolio managers of the Adviser changes or there is otherwise
an actual change in control or management of the Adviser.
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12. USE OF ADVISER'S NAME
The parties agree that the name of the Adviser, the names of any
affiliates of the Adviser and any derivative or logo or trademark or service
xxxx or trade name are the valuable property of the Adviser and its affiliates.
The Manager and the Trust shall have the right to use such name(s), derivatives,
logos, trademarks or service marks or trade names only with the prior written
approval of the Adviser, which approval shall not be unreasonably withheld or
delayed so long as this Agreement is in effect.
Upon termination of this Agreement, the Manager and the Trust shall
forthwith cease to use such name(s), derivatives, logos, trademarks or service
marks or trade names. The Manager and the Trust agree that they will review with
the Adviser any advertisement, sales literature, or notice prior to its use that
makes reference to the Adviser or its affiliates or any such name(s),
derivatives, logos, trademarks, service marks or trade names so that the Adviser
may review the context in which it is referred to, it being agreed that the
Adviser shall have no responsibility to ensure the adequacy of the form or
content of such materials for purposes of the Investment Company Act or other
applicable laws and regulations. If the Manager or the Trust makes any
unauthorized use of the Adviser's names, derivatives, logos, trademarks or
service marks or trade names, the parties acknowledge that the Adviser shall
suffer irreparable harm for which monetary damages are inadequate and thus, the
Adviser shall be entitled to injunctive relief.
13. CONFIDENTIALITY
The Manager acknowledges that the securities holdings of the Portfolios
constitutes information of value to the Adviser, and agrees: (1) not to use for
any purpose, other than for the Manager or the Trust, or their agents, to
supervise or monitor the Adviser, the holdings or other trading-related
information of the Portfolio; and (2) not to disclose the Portfolios' holdings,
except: (a) as required by applicable law or regulation; (b) as required by
state or federal regulatory authorities; (c) to the Board of Trustees of the
Trust, counsel to the Board, counsel to the Trust, the administrator or any
sub-administrator, the independent accountants and any other agent of the Trust;
or (d) as otherwise agreed to by the parties hereto in writing. Further, the
Manager agrees that information supplied by the Adviser, including approved
lists, internal procedures, compliance procedures and any board materials, is
valuable to the Adviser, and the Manager agrees not to disclose any of the
information contained in such materials, except: (i) as required by applicable
law or regulation; (ii) as required state or federal regulatory authorities;
(iii) to the Board of Trustees of the Trust, counsel to the Board, counsel to
the Trust, the administrator or any sub-administrator, the independent
accountants and any other agent of the Trust; or (iv) as otherwise agreed to by
the parties hereto in writing.
14. ASSIGNMENT
No assignment (as that term is defined in the Investment Company Act)
shall be made by the Adviser without the prior written consent of the Trust and
the Manager. Notwithstanding the foregoing, no assignment shall be deemed to
result from any changes
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in the directors, officers or employees of such Adviser except as may be
provided to the contrary in the Investment Company Act or the rules or
regulations thereunder. The Adviser agrees that it will notify the Trust and the
Manager of any changes in its directors, officers or employees within a
reasonable time thereafter.
15. ENTIRE AGREEMENT
This Agreement contains the entire understanding and agreement of the
parties with respect to the Portfolio.
16. HEADINGS
The headings in the sections of this Agreement are inserted for
convenience of reference only and shall not constitute a part hereof.
17. NOTICES
All notices required to be given pursuant to this Agreement shall be
delivered or mailed to the last known business address of each applicable party
in person or by registered mail or a private mail or delivery service providing
the sender with notice of receipt. The specific person to whom notice shall be
provided for each party will be specified in writing to the other party. Notice
shall be deemed given on the date delivered or mailed in accordance with this
paragraph.
18. SEVERABILITY
Should any portion of this Agreement for any reason be held to be void
in law or in equity, the Agreement shall be construed, insofar as is possible,
as if such portion had never been contained herein.
19. GOVERNING LAW
The provisions of this Agreement shall be construed and interpreted in
accordance with the laws of the State of New York, 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, the latter shall control.
20. 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 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
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"affiliated persons," as used herein shall have the meanings assigned to them by
Section 2(a) of the Investment Company Act. In addition, where the effect of a
requirement of the Investment Company Act reflected in any provision of this
Agreement is relaxed by a rule, regulation or order of the SEC, whether of
special or of general application, such provision shall be deemed to incorporate
the effect of such rule, regulation or order.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their duly authorized officers as of the date first mentioned above.
THE EQUITABLE LIFE ASSURANCE FIDELITY MANAGEMENT & RESEARCH
SOCIETY OF THE UNITED STATES COMPANY
By: By:
--------------------------------- -------------------------------
Xxxxx X'Xxxx Xxxxxx X. Xxxxx
Executive Vice President President
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APPENDIX A
TO
INVESTMENT ADVISORY AGREEMENT
WITH
FIDELITY MANAGEMENT & RESEARCH COMPANY
PORTFOLIO ANNUAL ADVISORY FEE
--------- -------------------
FI Mid Cap Portfolio .50% of the Portfolio's average daily
net assets up to and including $250 million;
and .40% of the Portfolio's average daily net
assets in excess of $250 million.
FI Small/Mid Cap Value Portfolio .55% of the Portfolio's average daily net assets up
to and including $250 million; and .45% of the
Portfolio's average daily net assets in excess of
$250 million up to and including $750 million; and
.40% of the Portfolio's average daily net assets in
excess of $750 million.
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