SUB-ADVISORY AGREEMENT
MFS VALUE PORTFOLIO
This Sub-Advisory Agreement (this "Agreement") is entered into as of
January 7th, 2008 by and between MetLife Advisers, LLC, a Delaware limited
liability company (the "Manager"), Massachusetts Financial Services Company, a
Delaware corporation (the "Sub-Adviser").
WHEREAS, the Manager has entered into an Advisory Agreement dated as of May
1, 2003 (the "Advisory Agreement") with Metropolitan Series Fund, Inc. (the
"Fund"), pursuant to which the Manager provides portfolio management and
administrative services to the MFS Large Cap Value Portfolio (the "Portfolio");
WHEREAS, the Advisory Agreement provides that the Manager may delegate any
or all of its portfolio management responsibilities under the Advisory Agreement
to one or more sub-advisers;
WHEREAS, the Manager desires to retain the Sub-Adviser to render portfolio
management services in the manner and on the terms set forth in this Agreement;
NOW, THEREFORE, in consideration of the mutual covenants and agreements set
forth in this Agreement, the Manager and the Sub-Adviser agree as follows:
1. Sub-Advisory Services.
a. The Sub-Adviser shall, subject to the supervision of the Manager and
in cooperation with any administrator appointed by the Manager (the
"Administrator"), manage the investment and reinvestment of the assets
of the Portfolio. Subject to paragraph 1.g. below, the Sub-Adviser
shall manage the Portfolio in conformity with (1) the investment
objective, policies and restrictions of the Portfolio set forth in the
Fund's prospectus and statement of additional information, as revised
or supplemented from time to time, relating to the Portfolio (the
"Prospectus"), (2) any additional policies or guidelines established
by the Manager or by the Fund's Directors that have been furnished in
writing to the Sub-Adviser and (3) the provisions of the Internal
Revenue Code (the "Code") applicable to "regulated investment
companies" (as defined in Section 851 of the Code) and "segregated
asset accounts" (as defined in Section 817 of the Code) including, but
not limited to, the diversification requirements of Section 817(h) of
the Code and the regulations thereunder, all as from time to time in
effect (collectively, the "Policies"), and with all applicable
provisions of law, including without limitation all applicable
provisions of the Investment Company Act of 1940 (the "1940 Act"), the
rules and regulations thereunder and the interpretive opinions thereof
of the staff of the Securities and Exchange Commission ("SEC") ("SEC
Positions"); provided, however, that the Manager agrees to inform the
Sub-Adviser of any and all applicable state insurance law restrictions
that operate to limit or restrict the investments the Portfolio might
otherwise make ("Insurance Restrictions"), and to inform the
Sub-Adviser promptly of any changes in such Insurance Restrictions.
Subject to the foregoing, the Sub-Adviser is authorized, in its
discretion and without prior consultation with the Manager, to buy,
sell, lend and otherwise trade in any stocks, bonds and other
securities and investment instruments on behalf of the Portfolio,
without regard to the length of time the securities have been held and
the resulting rate of portfolio turnover or any tax considerations;
and the majority or the whole of the Portfolio may be invested in such
proportions of stocks, bonds, other securities or investment
instruments, or cash, as the Sub-Adviser shall determine.
Notwithstanding the foregoing provisions of this Section 1.a, however,
the Sub-Adviser shall, upon written instructions from the Manager,
effect such portfolio transactions for the Portfolio as the Manager
shall determine are necessary in order for the Portfolio to comply
with the Policies.
b. The Sub-Adviser shall furnish the Manager and the Administrator daily,
weekly, monthly, quarterly and/or annual reports concerning
transactions and performance of the Portfolio in such form as may be
mutually agreed upon, and agrees to review the Portfolio and discuss
the management of the Portfolio with representatives or agents of the
Manager, the Administrator or the Fund at their reasonable request.
Subject to Section 1(g) of this Agreement, the Sub-Adviser shall as a
part of complete portfolio compliance testing program, perform
quarterly diversification testing under section 817(h) of the Code.
The Sub-Adviser shall provide timely notice each calendar quarter that
such diversification was satisfied, or if not satisfied, that the
corrections were made within 30 days of the end of the calendar
quarter. The Sub-Adviser shall permit all books and records with
respect to the Portfolio to be inspected and audited by the Manager
and the Administrator at all reasonable times during normal business
hours, upon reasonable notice. The Sub-Adviser shall also provide the
Manager, the Administrator or the Fund with such other information and
reports as may reasonably be requested by the Manager, the
Administrator or the Fund from time to time, including without
limitation all material as reasonably may be requested to the
Directors of the Fund pursuant to Section 15(c) of the 1940 Act.
c. The Sub-Adviser shall provide to the Manager a copy of the
Sub-Adviser's Form ADV as filed with the Securities and Exchange
Commission and as amended from time to time and a list of the persons
whom the Sub-Adviser wishes to have authorized to give written and/or
oral instructions to custodians of assets of the Portfolio.
d. The Sub-Adviser will consult with and assist the Portfolio's pricing
agent regarding the valuation of securities that are not registered
for public sale, not traded on any securities markets, or otherwise
may be deemed illiquid for purposes of the 1940 Act and for which
market quotations are not readily available.
e. Unless the Manager gives the Sub-Adviser written instructions to the
contrary, the Sub-Adviser shall use its good faith judgment in a
manner which it reasonably believes best serves the interest of the
Portfolio's shareholders to vote or abstain from voting all proxies
solicited by or with respect to the issuers of securities in which
assets of the Portfolio are invested.
f. The Manager shall provide the Sub-Adviser with a list of entities with
which the Sub-Adviser is restricted from engaging in transactions on
behalf of the Portfolio. The Sub-Adviser shall be responsible for
complying with this restricted list and any changes thereto 10
business days after its receipt.
g. The Manager acknowledges that the Sub-Adviser is not the compliance
agent for the Portfolio and does not have access to all of the
Portfolio's books and records necessary to perform certain compliance
testing. However, the Sub-Adviser shall perform compliance testing
with respect to the Portfolio based upon information in its possession
and upon written instructions, if any, received from the Manager or
the Administrator and shall not be held in breach of this Agreement so
long as it performs in accordance with such information and
instructions.
h. The Sub-Adviser shall be responsible for commercially reasonable
expenses relating to the printing and mailing of any prospectus
supplement required by the actions taken by the Sub-Adviser, including
but not limited to, portfolio manager changes, disclosure changes
requested by the Sub-Adviser that affect the investment objective,
principal investment strategies, principal investment risks and
portfolio management sections of the prospectus, where such
disclosures are required under applicable law to be distributed to
existing annuity contract holders and life policy holders that are
invested in the Portfolio. The Manager agrees to provide a detailed
invoice of such expenses not later than six months after the expenses
are incurred, and the Sub-Adviser shall pay the amounts of such
expenses with 60 days of receipt of such invoice from the Manager.
i. In accordance with Rule 17a-10 under the 1940 Act and any other
applicable law, the Sub-Adviser shall not consult with any other
Sub-Adviser to the Portfolio or any Sub-Adviser to any other portfolio
of the Fund or to any other investment company or investment company
series for which the Manager serves as investment adviser concerning
transactions of the Portfolio in securities or other assets, other
than for purposes of complying with conditions of paragraphs (a) and
(b) of Rule 12d3-1 under the 1940 Act.
j. With respect to those activities for which it performs for or on
behalf of the Portfolio, the Sub-Adviser represents, warrants and
agrees that the Sub-Adviser has adopted and implemented, and
throughout the term of this Agreement will maintain in effect and
implement, policies and procedures reasonably designed to prevent,
detect and correct violations by the Sub-Adviser, and its supervisory
persons, and, to the extent the activities of the Sub-Adviser could
affect the Fund, by the Fund, of "federal securities laws" as defined
in Rule 38a-1 under the 1940 Act), and that the Sub-Adviser has
provided the Fund with true and complete copies of such policies and
procedures (or summaries thereof) of the Sub-Adviser and related
information requested by the Fund. The Sub-Adviser agrees to cooperate
with periodic reviews by the Fund's compliance personnel of the
Sub-Adviser's policies and procedures, their operation and
implementation and other compliance matters and to provide to the Fund
from time to time such additional information and certifications in
respect of policies and procedures of the Sub-Adviser, compliance
personnel may reasonably request. The Sub-Adviser agrees to promptly
notify the Manager of any compliance violations detected by the
Sub-Adviser that affect the Portfolio.
2. Obligations of the Manager.
a. The Manager shall provide (or cause the Fund's custodian to provide)
timely information to the Sub-Adviser regarding such matters as the
composition of assets in the Portfolio, cash requirements and cash
available for investment in the Portfolio, and all other information
as may be reasonably necessary for the Sub-Adviser to perform its
responsibilities hereunder.
b. The Manager has furnished the Sub-Adviser a copy of the Prospectus and
statement of additional information of the Portfolio and agrees during
the continuance of this Agreement to furnish the Sub-Adviser copies of
any revisions or supplements thereto at, or, if practicable, before
the time the revisions or supplements become effective. The
Sub-Adviser shall not be responsible for managing the Portfolio in
accordance with changes reflected in any such revision or supplement
until the Sub-Adviser has received such revision or supplement. The
Manager agrees to furnish the Sub-Adviser with relevant sections of
minutes of meetings of the Directors of the Fund applicable to the
Portfolio to the extent they may affect the duties of the Sub-Adviser,
and with copies of any financial statements or reports of the Fund
with respect to the Portfolio which are provided to the Portfolio's
shareholders, and any further materials or information which the
Sub-Adviser may reasonably request to enable it to perform its
functions under this Agreement.
3. Custodian. The Manager shall provide the Sub-Adviser with a copy of the
Portfolio's agreement with the custodian designated to hold the assets of
the Portfolio (the "Custodian") and any modifications thereto (the "Custody
Agreement"), copies of such modifications to be provided to the Sub-Adviser
a reasonable time in advance of the effectiveness of such modifications.
The assets of the Portfolio shall be maintained in the custody of the
Custodian identified in, and in accordance with the terms and conditions
of, the Custody Agreement (or any sub-custodian properly appointed as
provided in the Custody Agreement). The Sub-Adviser shall provide timely
instructions directly to the Fund's custodian, in the manner and form as
required by the Fund's custodian agreement (including with respect to
exchange offerings and other corporate actions) necessary to effect the
investment and reinvestment of the Portfolio's assets. The Sub-Adviser
shall have no liability for the acts or omissions of the Custodian, unless
such act or omission is required by and taken in reliance upon instruction
given to the Custodian by a representative of the Sub-Adviser properly
authorized to give such instruction under the Custody Agreement. Any assets
added to the Portfolio shall be delivered directly to the Custodian.
4. Proprietary Rights. The Manager agrees and acknowledges that the
Sub-Adviser is the sole owner of the name and xxxx "MFS". Without the prior
review and approval of the Sub-Adviser, the Manager shall not, and the
Manager shall use its best efforts to cause the Fund not to, make
representations regarding the Sub-Adviser in any disclosure document,
advertisement or sales literature or other materials relating to the
Portfolio. Upon termination of this Agreement for any reason, the Manager
shall cease, and the Manager shall use its best efforts to cause the
Portfolio to cease, all use of the "MFS" xxxx as soon as reasonably
practicable.
5. Expenses. Except for expenses specifically assumed or agreed to be paid by
the Sub-Adviser pursuant hereto, the Sub-Adviser shall not be liable for
any expenses of the Manager or the Fund including, without limitation, (a)
interest and taxes, (b) brokerage commissions and other costs in connection
with the purchase or sale of securities or other investment instruments
with respect to the Portfolio, and (c) custodian fees and expenses. The
Sub-Adviser will pay its own expenses incurred in furnishing the services
to be provided by it pursuant to this Agreement.
6. Purchase and Sale of Assets. Absent instructions from the Manager to the
contrary, the Sub-Adviser shall place all orders for the purchase and sale
of securities for the Portfolio with brokers or dealers selected by the
Sub-Adviser, which may include brokers or dealers affiliated with the
Sub-Adviser, provided such orders comply with Rule 17e-1 (or any successor
regulations) under the 1940 Act in all respects. To the extent consistent
with applicable law, purchase or sell orders for the Portfolio may be
aggregated with contemporaneous purchase or sell orders of other clients of
the Sub-Adviser. The Sub-Adviser shall use its best efforts to obtain
execution of transactions for the Portfolio at prices which are
advantageous to the Portfolio and at commission rates that are reasonable
in relation to the benefits received.
7. Compensation of the Sub-Adviser. As full compensation for all services
rendered, facilities furnished and expenses borne by the Sub-Adviser
hereunder, the Manager shall pay the Sub-Adviser compensation at the annual
rate of 0.35% of the first $250 million of the combined average net assets
of the Portfolio and the MFS Value Portfolio, as series of the Met
Investors Series Trust, (the "Combined Assets") during the Portfolio's then
current fiscal year, 0.30% of the next $1 billion of such Combined Assets,
0.25% of the next $250 million of such Combined Assets and 0.20% of such
Combined Assets thereafter. Such compensation shall be payable monthly in
arrears or at such other intervals, not less frequently than quarterly, as
the Manager is paid by the Portfolio pursuant to the Advisory Agreement. If
the Sub-Adviser shall serve for less than the whole of any month, the
foregoing compensation shall be prorated. The Manager may from time to time
waive the compensation it is entitled to receive from the Fund, however,
any such waiver will have no effect on the Manager's obligation to pay the
Sub-Adviser the compensation provided for herein.
8. Non-Exclusivity. The Manager and the Portfolio agree that the services of
the Sub-Adviser are not to be deemed exclusive and that the Sub-Adviser and
its affiliates are free to act as investment manager and provide other
services to various investment companies and other managed accounts, except
as the Sub-Adviser and the Manager or the Administrator may otherwise agree
from time to time in writing before or after the date hereof. This
Agreement shall not in any way limit or restrict the Sub-Adviser or any of
its directors, officers, employees or agents from buying, selling or
trading any securities or other investment instruments for its or their own
account or for the account of others for whom it or they may be acting,
provided that such activities do not adversely affect or otherwise impair
the performance by the Sub-Adviser of its duties and obligations under this
Agreement. The Manager and the Portfolio recognize and agree that the
Sub-Adviser may provide advice to or take action with respect to other
clients, which advice or action, including the timing and nature of such
action, may differ from or be identical to advice given or action taken
with respect to the Portfolio. The Sub-Adviser shall for all purposes
hereof be deemed to be an independent contractor and shall, unless
otherwise provided or authorized, have no authority to act for or represent
the Fund or the Manager in any way or otherwise be deemed an agent of the
Fund or the Manager. The Sub-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 Sub-Adviser receives the express
agreement and consent of the Manager and/or the Fund's Board of Directors
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
Sub-Adviser shall act as the Manager's and the Fund's agent and
attorney-in-fact.
9. Liability. Except as may otherwise be provided by the 1940 Act or other
federal securities laws, neither the Sub-Adviser nor any of its officers,
directors, employees or agents (the "Indemnified Parties") shall be subject
to any liability to the Manager, the Fund, the Portfolio or any shareholder
of the Portfolio for any error of judgment, any mistake of law or any loss
arising out of any investment or other act or omission in the course of,
connected with, or arising out of any service to be rendered under this
Agreement, except by reason of willful misfeasance, bad faith or gross
negligence in the performance of the Sub-Adviser's duties or by reason of
reckless disregard by the Sub-Adviser of its obligations and duties. The
Manager shall hold harmless and indemnify the Indemnified Parties against
any loss, liability, cost, damage, or expense (including reasonable
attorneys fees and costs) arising from any claim or demand by any past or
present shareholder of the Portfolio that is not based on the obligations
of the Sub-Adviser with respect to the Portfolio under this Agreement. The
Manager acknowledges and agrees that the Sub-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 Sub-Adviser, whether public or private.
10. Effective Date and Termination. This Agreement shall become effective as of
the date of its execution, and
a. unless otherwise terminated, this Agreement shall continue in effect
for two years from the date of execution, and from year to year
thereafter so long as such continuance is specifically approved at
least annually (i) by the Board of Directors of the Fund or by vote of
a majority of the outstanding voting securities of the Portfolio, and
(ii) by vote of a majority of the directors of the Fund who are not
interested persons of the Fund, the Manager, the Sub-Adviser, cast in
person at a meeting called for the purpose of voting on such approval;
b. this Agreement may at any time be terminated on sixty days' written
notice to the Sub-Adviser either by vote of the Board of Directors of
the Fund or by vote of a majority of the outstanding voting securities
of the Portfolio;
c. this Agreement shall automatically terminate in the event of its
assignment or upon the termination of the Advisory Agreement;
d. this Agreement may be terminated by the Sub-Adviser on sixty days'
written notice to the Manager and the Fund, or, if approved by the
Board of Directors of the Fund, by the Manager on sixty days' written
notice to the Sub-Adviser; and
e. if the Sub-Adviser requires the Portfolio to change its name so as to
eliminate all references to the word "MFS" then this Agreement shall
automatically terminate at the time of such change unless the
continuance of this Agreement after such change shall have been
specifically approved by vote of a majority of the outstanding voting
securities of the Portfolio and by vote of a majority of the Directors
of the Fund who are not interested persons of the Fund or the
Sub-Adviser, cast in person at a meeting called for the purpose of
voting on such approval.
Termination of this Agreement pursuant to this Section 10 shall be without
the payment of any penalty.
11. Amendment. This Agreement may be amended at any time by mutual consent of
the Manager and the Sub-Adviser, provided that, if required by law, such
amendment shall also have been approved by vote of a majority of the
outstanding voting securities of the Portfolio and by vote of a majority of
the directors of the Fund who are not interested persons of the Fund, the
Manager or the Sub-Adviser, cast in person at a meeting called for the
purpose of voting on such approval.
12. Certain Definitions. For the purpose of this Agreement, the terms "vote of
a majority of the outstanding voting securities," "interested person,"
"affiliated person" and "assignment" shall have their respective meanings
defined in the 1940 Act, subject, however, to such exemptions as may be
granted by the Securities and Exchange Commission under the 1940 Act.
13. General.
a. The Sub-Adviser may perform its services through any of its employees,
officers or agents, and the Manager shall not be entitled to the
advice, recommendation or judgment of any specific person; provided,
however, that the persons identified in the prospectus of the
Portfolio shall perform the portfolio management duties described
therein until the Sub-Adviser notifies the Manager that one or more
other employees, officers or agents of the Sub-Adviser, identified in
such notice, shall assume such duties as of a specific date.
b. If any term or provision of this Agreement or the application thereof
to any person or circumstances is held to be invalid or unenforceable
to any extent, the remainder of this Agreement or the application of
such provision to other persons or circumstances shall not be affected
thereby and shall be enforced to the fullest extent permitted by law.
c. This Agreement shall be governed by and interpreted in accordance with
the laws of The Commonwealth of Massachusetts.
METLIFE ADVISERS, LLC
By: _________________________________
Title: ______________________________
MASSACHUSETTS FINANCIAL SERVICES COMPANY
By: _________________________________
Title: ______________________________
