AMERICAN SKANDIA TRUST
SUB-ADVISORY AGREEMENT
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THIS AGREEMENT is between American Skandia Investment Services, Incorporated (the "Investment Manager") and
Xxxxxxx X. Xxxxxxxxx & Co., LLC (the "Value Sub-Adviser") and Alliance Capital Management L.P. (the "Growth
Sub-Adviser") (each a "Sub-Adviser" and collectively, the "Sub-Advisers") .
W I T N E S S E T H
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WHEREAS, American Skandia Trust (the "Trust") is a Massachusetts business trust organized with one or more series
of shares and is registered as an open-end management investment company under the Investment Company Act of
1940, as amended (the "ICA"); and
WHEREAS, the Investment Manager is an investment adviser registered under the Investment Advisers Act of 1940, as
amended (the "Advisers Act"); and
WHEREAS, the Board of Trustees of the Trust (the "Trustees") have engaged the Investment Manager to act as
investment manager for the AST Alliance/ Xxxxxxxxx Growth + Value Portfolio (the "Portfolio"), one series of the
Trust, under the terms of a management agreement, dated May 1, 2001, with the Trust (the "Management Agreement");
and
WHEREAS, the Investment Manager, acting pursuant to the Management Agreement, wishes to engage the Value
Sub-Adviser to provide investment advice and other investment services set forth below for the value portion of
the Portfolio (the "Value Portfolio") which will consist of approximately 50 per cent of the investable assets of
the Portfolio and to engage the Growth Sub-Adviser to provide investment advice and other investment services for
the remainder of the investable assets of the Portfolio (the "Growth Portfolio") (together, the "Portfolios"),
and the Trustees have approved the engagement of the Sub-Advisers, to provide such investment advice and other
investment services.
NOW, THEREFORE, the Investment Manager and the Sub-Advisers agree as follows:
1. Investment Services. The Sub-Advisers together will formulate and implement a continuous investment
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program for the Portfolio conforming to the investment objective, investment policies and restrictions as set
forth in the Prospectus and Statement of Additional Information of the Trust as in effect from time to time
(together, the "Registration Statement"), the Agreement and Declaration of Trust and By-laws of the Trust, and
any investment guidelines or other instructions received by the Sub-Advisers in writing from the Investment
Manager from time to time. Any amendments to the foregoing documents will not be deemed effective with respect
to either of the Sub-Advisers until such Sub-Adviser's receipt thereof. The appropriate officers and employees
of the Sub-Advisers will be available to consult with the Investment Manager, the Trust and the Trustees at
reasonable times and upon reasonable notice concerning the business of the Trust, including valuations of
securities which are not registered for public sale, not traded on any securities market or otherwise may be
deemed illiquid for purposes of the ICA; provided it is understood that the Sub-Advisers are not responsible for
daily pricing of the Portfolio's assets.
Subject to the supervision and control of the Investment Manager, which in turn is subject to the
supervision and control of the Trustees, the Sub-Advisers in their discretion will determine which issuers and
securities will be purchased, held, sold or exchanged by the portions of the Portfolio under their management or
otherwise represented in the Portfolio's investment portfolios from time to time and, subject to the provisions
of paragraphs 3 and 4 of this Agreement, will place orders with and give instructions to brokers, dealers and
others for all such transactions and cause such transactions to be executed. Either of the Sub-Advisers may
delegate its investment advisory and other responsibilities and duties hereunder to an affiliated person of such
Sub-Adviser, subject to such Sub-Adviser retaining overall responsibility for such powers and functions and any
and all obligations and liabilities in connection therewith. The Value Sub-Adviser shall be responsible for and
supervise the activities of the Sub-Advisers, including the Sub-Advisers' compliance responsibilities hereunder
and allocation of Portfolio assets between the Growth and Value Portfolios as described in the Registration
Statement. The Sub-Advisers shall be jointly responsible for the provision of the investment advisory and other
services contemplated by this Agreement. Custody of the Portfolio will be maintained by a custodian bank (the
"Custodian") and the Investment Manager will authorize the Custodian to honor orders and instructions by
employees of the Sub-Advisers designated by the Sub-Advisers to settle transactions in respect of the Portfolios
under their respective management, and to honor orders and instructions by employees of the Value Sub-Adviser
regarding allocation of daily net Portfolio purchase proceeds between the Growth and Value Portfolios. No assets
may be withdrawn from the Portfolio other than for settlement of transactions on behalf of the Portfolio except
upon the written authorization of appropriate officers of the Trust who shall have been certified as such by
proper authorities of the Trust prior to the withdrawal.
The Sub-Advisers will not be responsible for the provision of administrative, bookkeeping or accounting
services to the Portfolio except as specifically provided herein, as required by the ICA or the Advisers Act or
as may be necessary for the Sub-Advisers to supply to the Investment Manager, the Portfolio or the Portfolio's
shareholders the information required to be provided by the Sub-Advisers hereunder. Any records maintained
hereunder shall be the property of the Portfolio and surrendered promptly upon request.
In furnishing the services under this Agreement, the Sub-Advisers will comply with and use its best
efforts to enable the Portfolio to conform to the requirements of: (i) the ICA and the regulations promulgated
thereunder; (ii) Subchapter M of the Internal Revenue Code and the regulations promulgated thereunder; (iii)
other applicable provisions of state or federal law; (iv) the Agreement and Declaration of Trust and By-laws of
the Trust; (v) policies and determinations of the Trust and the Investment Manager provided to the Sub-Advisers
in writing; (vi) the fundamental and non-fundamental investment policies and restrictions applicable to the
Portfolio, as set out in the Registration Statement of the Trust in effect, or as such investment policies and
restrictions from time to time may be amended by the Portfolio's shareholders or the Trustees and communicated to
the Sub-Advisers in writing; (vii) the Registration Statement; and (viii) investment guidelines or other
instructions received in writing from the Investment Manager. Notwithstanding the foregoing, the Sub-Advisers
shall have no responsibility to monitor compliance with limitations or restrictions for which information from
the Investment Manager or its authorized agents is required to enable the Sub-Advisers to monitor compliance with
such limitations or restrictions unless such information is provided to the Sub-advisers in writing. The
Sub-Advisers shall supervise and monitor the activities of their respective representatives, personnel and agents
in connection with the investment program of the Portfolio.
Nothing in this Agreement shall be implied to prevent the Investment Manager from engaging other
sub-advisers to provide investment advice and other services to the Portfolio or to series or portfolios of the
Trust for which the Sub-Advisers do not provide such services, or to prevent the Investment Manager from
providing such services itself in relation to the Portfolio or such other series or portfolios. In the event
that the Investment Manager engages another sub-adviser to provide investment advice and/or services to the
Portfolio or to the Portfolios, the Investment Manager agrees to provide the Sub-Advisers with written notice of
such engagement.
The Sub-Advisers shall be responsible for exercising any voting rights on any securities held by their
respective Portfolios of the Portfolio. The Sub-Advisers shall be responsible for the preparation and filing of
Schedule 13G and Form 13-F reflecting the Portfolio's securities holdings as part of the Sub-Advisers' overall
holdings. The Sub-Advisers 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 in writing.
2. Investment Advisory Facilities. The Sub-Advisers, at their expense, will furnish all necessary
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investment facilities, including salaries of personnel, required for them to execute their respective duties
hereunder.
3. Execution of Portfolio Transactions. In connection with the investment and reinvestment of the assets
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of the Portfolio, the Sub-Advisers are responsible for the selection of broker-dealers to execute purchase and
sale transactions for their respective Portfolios of the Portfolio in conformity with the policy regarding
brokerage as set forth in the Registration Statement, or as the Trustees may determine from time to time, as well
as the negotiation of brokerage commission rates with such executing broker-dealers. Generally, the
Sub-Advisers' primary consideration in placing Portfolio investment transactions with broker-dealers for execution
will be to obtain, and maintain the availability of, best execution at the best available price. To the extent
permitted by applicable law, the Value Sub-Adviser may receive investment transactions/instructions from the
Growth Sub-Adviser for execution on behalf of the Growth Portfolio.
Consistent with this policy, the Sub-Advisers, in selecting broker-dealers and negotiating brokerage
commission rates, will take all relevant factors into consideration, including, but not limited to: the best
price available; the reliability, integrity and financial condition of the broker-dealer; the size of and
difficulty in executing the order; and the value of the expected contribution of the broker-dealer to the
investment performance of the Portfolio on a continuing basis. Subject to such policies and procedures as the
Trustees may determine, the Sub-Advisers shall have discretion to effect investment transactions for the
respective Portfolios of the Portfolio under their management through broker-dealers (including, to the extent
permissible under applicable law, broker-dealers affiliated with the Sub-Advisers) qualified to obtain best
execution of such transactions who provide brokerage and/or research services, as such services are defined in
Section 28(e) of the Securities Exchange Act of 1934, as amended (the "1934 Act"), and to cause the Portfolio to
pay any such broker-dealers an amount of commission for effecting a portfolio investment transaction in excess of
the amount of commission another broker-dealer would have charged for effecting that transaction, if the
Sub-Advisers determine in good faith that such amount of commission is reasonable in relation to the value of the
brokerage or research services provided by such broker-dealer, viewed in terms of either that particular
investment transaction or the Sub-Advisers' overall responsibilities with respect to the Portfolio and other
accounts as to which the Sub-Advisers exercise investment discretion (as such term is defined in Section 3(a)(35)
of the 1934 Act). Allocation of orders placed by the Sub-Advisers on behalf of the Portfolio to such
broker-dealers shall be in such amounts and proportions as the Sub-Advisers shall determine in good faith in
conformity with its responsibilities under applicable laws, rules and regulations. The Sub-Advisers will submit
joint or individual reports on such allocations to the Investment Manager regularly as requested by the
Investment Manager, in such form as may be mutually agreed to by the parties hereto, indicating the
broker-dealers to whom such allocations have been made and the basis therefor.
Subject to the foregoing provisions of this paragraph 3, the Sub-Advisers may also consider sales of
shares of the Portfolio and of other portfolios of the Trust managed by either Sub-Adviser or their affiliates,
or may consider or follow recommendations of the Investment Manager that such sales take into account, as factors
in the selection of broker-dealers to effect the Portfolio's investment transactions. Notwithstanding the above,
nothing shall require the Sub-Advisers to use a broker-dealer which provides research services or to use a
particular broker-dealer which the Investment Manager has recommended.
In lieu of selecting broker-dealers to execute transactions for the Portfolio, the Value Sub-Adviser may
execute such transactions for the Portfolio provided that the Value Sub-Adviser "steps-out" such transactions to
the broker-dealers selected by the Value Sub-Adviser. A step-out is a service provided by the New York Stock
Exchange and other markets which allows the Value Sub-Adviser to provide the Portfolio with the benefit of the
Value Sub-Adviser's execution capabilities at no additional charge and then transfer or step-out the confirmation
and settlement responsibilities of such transactions to the broker-dealer(s) selected by the Value Sub-Adviser.
In connection with a step-out, transaction charges shall be paid by the Portfolio to the broker-dealers selected
by the Value Sub-Adviser and not to the Value Sub-Adviser.
In addition to selecting brokers or dealers to execute transactions for the Portfolio, the Value
Sub-Adviser may, subject to its duty to seek best execution at the best available price, also act as a broker for
the Portfolio from time to time at rates not exceeding the usual and customary broker's commission. Under Federal
law, the Value Sub-Adviser must obtain the Investment Manager's consent to effect agency cross transactions for
the Portfolio, which consent is hereby granted. The Value Sub-Adviser represents, warrants and covenants that all
agency cross transactions for the Portfolio will be effected by the Value Sub-Adviser strictly in accordance with
Rule 206(3)-2 under the Advisers Act. An agency cross transaction is where the Value Sub-Adviser purchases or
sells securities from or to a non-managed account on behalf of a client's managed account. Pursuant to this
consent, the Value Sub-Adviser will only effect an agency cross transaction for the Portfolio with a non-managed
account. When the Value Sub-Adviser crosses transactions in connection with a step-out, the Value Sub-Adviser
will receive a commission from the transaction only with respect to the non-managed account and will not receive
a commission from the transaction with respect to the Portfolio. In an agency cross transaction where the Value
Sub-Adviser acts as broker for the Portfolio, the Value Sub-Adviser receives commissions from both sides of the
trade and there is a potentially conflicting division of loyalties and responsibilities. However, as both sides
to the trade want to execute the transaction at the best price without moving the market price in either
direction, the Value Sub-Adviser believes that an agency cross transaction will aid both sides to the trade in
obtaining the best price for the trade. THE TRUST OR THE INVESTMENT MANAGER MAY REVOKE THIS CONSENT BY WRITTEN
NOTICE TO THE VALUE SUB-ADVISER AT ANY TIME.
4. Re-Allocation of Portfolio Assets. The Value Sub-Adviser shall furnish and maintain systems and
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procedures to monitor and maintain as reasonably practicable an allocation of net assets of the Portfolio between
the Value Portfolio and the Growth Portfolio to conform to the investment objectives and policies described in
the Registration Statement, as may be necessary (the "Target Allocation"). Purchases and sales of securities for
the Portfolio resulting from purchases and redemptions of Portfolio shares shall be coordinated and managed by
the Sub-Advisers for purposes of maintaining the Target Allocation. The Sub-Advisers shall cooperate with each
other and take any and all such actions as may be necessary or appropriate for purposes of maintaining the Target
Allocation.
5. Reports by the Sub-Advisers. The Sub-Advisers shall furnish the Investment Manager individual and/or
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joint monthly, quarterly and annual reports, as may reasonably be requested by the Investment Manager concerning
the transactions, performance, and compliance of the Portfolio so that the Investment Manager may review such
matters and discuss the management of the Portfolio. The Sub-Advisers shall permit the books and records
maintained with respect to the Portfolio to be inspected and audited by the Trust, the Investment Manager or
their respective agents at all reasonable times during normal business hours upon reasonable notice. Each
Sub-Adviser severally shall immediately notify both the Investment Manager and the Trust of any legal process
served upon it in connection with its activities hereunder, including any legal process served upon it on behalf
of the Investment Manager, the Portfolio, the Value Portfolio, the Growth Portfolio or the Trust. Each
Sub-Adviser severally shall immediately notify the Investment Manager of (1) any changes in any information
regarding each Sub-Adviser or the investment program for the Portfolio required to be disclosed in the Trust's
Registration Statement, or (2) any violation of any requirement, provision, policy or restriction that the
Sub-Advisers are required to comply with under Section 1 of this Agreement.
6. Compensation of the Sub-Advisers. The amount of the compensation to each Sub-Adviser is computed at an
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annual rate. The fee shall be payable monthly in arrears, based on the average daily net assets of each
Portfolio for each month, at the annual rate set forth in Exhibit A to this Agreement. For administrative
convenience, the parties may agree to have the aggregate fee due to the Sub-Advisers remitted to one Sub-Adviser.
In computing the fee to be paid to each Sub-Adviser, the net asset value of each Portfolio shall be
valued as set forth in the Registration Statement. If this Agreement is terminated, the payment of compensation
described herein shall be prorated to the date of termination.
The Investment Manager shall not be considered as a partner or participant in a joint venture with the
Sub-Advisers. The Sub-Advisers will pay their own expenses for the services to be provided pursuant to this
Agreement and will not be obligated to pay any expenses of the Investment Manager, the Portfolio or the Trust.
Except as otherwise specifically provided herein, the Investment Manager, the Portfolio and the Trust will not be
obligated to pay any expenses of either Sub-Adviser.
7. Delivery of Documents to the Sub-Advisers. The Investment Manager has furnished the Sub-Advisers with
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true, correct and complete copies of each of the following documents:
(a) The Agreement and Declaration of Trust of the Trust, as in effect on the date hereof;
(b) The By-laws of the Trust, as in effect on the date hereof;
(c) The resolutions of the Trustees approving the engagement of the Sub-Advisers as portfolio
managers of the Portfolio and approving the form of this Agreement;
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(d) The resolutions of the Trustees selecting the Investment Manager as investment manager to the
Portfolio and approving the form of the Management Agreement;
(e) The Management Agreement;
(f) The Code of Ethics of the Trust and of the Investment Manager, as in effect on the date hereof;
(g) The Registration Statement; and
(h) A list of companies the securities of which are not to be bought or sold for the Portfolio.
The Investment Manager will furnish the Sub-Advisers from time to time with copies, properly certified
or otherwise authenticated, of all amendments of or supplements to the foregoing, if any. Such amendments or
supplements as to items (a) through (g) above will be provided within 30 days of the time such materials become
available to the Investment Manager. Such amendments or supplements as to item (h) above will be provided not
later than the end of the business day next following the date such amendments or supplements become known to the
Investment Manager. Any amendments or supplements to the foregoing will not be deemed effective with respect to
the Sub-Advisers until the Value Sub-Adviser's receipt thereof. The Investment Manager will provide such
additional information as the Sub-Advisers may reasonably request in connection with the performance of its
duties hereunder.
8. Delivery of Documents to the Investment Manager. Each Sub-Adviser has furnished the Investment Manager
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with true, correct and complete copies of each of the following documents:
(a) The Sub-Adviser's Form ADV as filed with the Securities and Exchange Commission as of the date hereof;
(b) The Sub-Adviser's most recent balance sheet;
(c) Separate lists of persons who each Sub-Adviser wishes to have authorized to give written and/or oral
instructions to Custodians of Trust assets for the Portfolio; and
(d) The Code of Ethics of each Sub-Adviser, as in effect on the date hereof.
Each Sub-Adviser will furnish the Investment Manager from time to time with copies, properly certified
or otherwise authenticated, of all amendments of or supplements to the foregoing, if any. Such amendments or
supplements will be provided within 30 days of the time such materials become available to the Sub-Advisers. Any
amendments or supplements to the foregoing will not be deemed effective with respect to the Investment Manager
until the Investment Manager's receipt thereof. Each Sub-Adviser severally will provide additional information
as the Investment Manager may reasonably request in connection with each Sub-Adviser's performance of its duties
under this Agreement.
9. Confidential Treatment. Except as may be required by law, the parties hereto understand that any
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information or recommendation supplied by either Sub-Adviser in connection with the performance of their
obligations hereunder is to be regarded as confidential and for use only by the Investment Manager, the Trust or
such persons the Investment Manager may designate in connection with the Portfolio. The parties also understand
that any information supplied to either Sub-Adviser in connection with the performance of its obligations
hereunder, particularly, but not limited to, any list of securities which may not be bought or sold for the
Portfolio, is to be regarded as confidential and for use only by the Sub-Adviser in connection with its
obligation to provide investment advice and other services to the Portfolio.
10. Representations of the Parties. Each party hereto hereby further represents and warrants to the other
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that: (i) it is registered as an investment adviser under the Advisers Act and 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; and (ii) it will use its reasonable best efforts to maintain each such registration or license in
effect at all times during the term of this Agreement; and (iii) it will promptly notify the other if it ceases
to be so registered, if its registration is suspended for any reason, or if it is notified by any regulatory
organization or court of competent jurisdiction that it should show cause why its registration should not be
suspended or terminated; and (iv) it is duly authorized to enter into this Agreement and to perform its
obligations hereunder.
Each Sub-Adviser further represents that it has adopted a written Code of Ethics in compliance with Rule
17j-1(b) of the ICA. Each Sub-Adviser shall be subject to such Code of Ethics and shall not be subject to any
other Code of Ethics, including the Investment Manager's Code of Ethics, unless specifically adopted by the
Sub-Adviser. The Investment Manager further represents and warrants to each Sub-Adviser that (i) the appointment
of the Sub-Adviser by the Investment Manager has been duly authorized and (ii) it has acted and will continue to
act in connection with the transactions contemplated hereby, and the transactions by the Investment Manager or
Portfolio contemplated hereby are, in conformity with the ICA, the Trust's governing documents and other
applicable law.
11. Liability. In the absence of willful misfeasance, bad faith, gross negligence or reckless disregard for
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their obligations hereunder, the Sub-Advisers shall not be liable to the Trust, the Portfolio, the Portfolio's
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shareholders or the Investment Manager for any act or omission resulting in any loss suffered by the Trust, the
Portfolio, the Portfolio's shareholders or the Investment Manager in connection with any service to be provided
herein. The Federal laws impose responsibilities under certain circumstances on persons who act in good faith,
and therefore, nothing herein shall in any way constitute a waiver or limitation of any rights which the Trust,
the Portfolio or the Investment Manager may have under applicable law. The liability of the Sub-Advisers under
this Agreement shall be joint and several.
12. Other Activities of the Sub-Advisers. The Investment Manager agrees that the Sub-Advisers and any of
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their partners or employees, and persons affiliated with the Sub-Advisers or with any such partner or employee,
may render investment management or advisory services to other investors and institutions, and that such
investors and institutions may own, purchase or sell, securities or other interests in property that are the same
as, similar to, or different from those which are selected for purchase, holding or sale for the Portfolio. The
Investment Manager further acknowledges that the Sub-Advisers shall be in all respects free to take action with
respect to investments in securities or other interests in property that are the same as, similar to, or
different from those selected for purchase, holding or sale for the Portfolio. The Investment Manager understands
that the Sub-Advisers shall not favor or disfavor any of the Sub-Advisers' clients or class of clients in the
allocation of investment opportunities, so that to the extent practical, such opportunities will be allocated
among the Sub-Advisers' clients over a period of time on a fair and equitable basis. Nothing in this Agreement
shall impose upon the Sub-Advisers any obligation to (i) purchase or sell, or recommend for purchase or sale, for
the Portfolio any security which the Sub-Advisers, their partners, affiliates or employees may purchase or sell
for the Sub-Advisers or such partner's, affiliate's or employee's own accounts or for the account of any other
client of the Sub-Advisers, advisory or otherwise, or (ii) to abstain from the purchase or sale of any security
for the Sub-Advisers' other clients, advisory or otherwise, which the Investment Manager has placed on the list
provided pursuant to paragraph 7(h) of this Agreement.
13. Continuance and Termination. This Agreement shall remain in full force and effect for one year from the
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date hereof, and is renewable annually thereafter by specific approval of the Trustees or by vote of a majority
of the outstanding voting securities of the Portfolio. Any such renewal shall be approved by the vote of a
majority of the Trustees who are not interested persons under the ICA, cast in person at a meeting called for the
purpose of voting on such renewal. This Agreement may be terminated without penalty at any time by the
Investment Manager or each Sub-Adviser upon 60 days written notice, and will automatically terminate in the event
of (i) its "assignment" by each party to this Agreement, as such term is defined in the ICA, subject to such
exemptions as may be granted by the Securities and Exchange Commission by rule, regulation or order, or (ii) upon
termination of the Management Agreement, provided that each Sub-Adviser has received prior written notice thereof.
14. Notification. Each Sub-Adviser will notify the Investment Manager within a reasonable time of any change
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in the personnel of the Sub-Adviser with responsibility for making investment decisions in relation to the
Portfolio (the "Portfolio Manager(s)") or who have been authorized to give instructions to the Custodian. The
Growth Sub-Adviser will notify the Investment Manager of any changes in the membership of its general partners
within a reasonable time after such change. The Sub-Advisers shall be responsible jointly for reasonable
out-of-pocket costs and expenses incurred by the Investment Manager, the Portfolio or the Trust to amend or
supplement the Trust's Prospectus to reflect a change in Portfolio Manager(s) or otherwise to comply with the
ICA, the Securities Act of 1933, as amended (the "1933 Act") or any other applicable statute, law, rule or
regulation, as a result of such change; provided, however, that the Sub-Advisers shall not be responsible for
such costs and expenses where the change in Portfolio Manager(s) reflects the termination of employment of the
Portfolio Manager(s) with the Sub-Advisers and their affiliates or is the result of a request by the Investment
Manager or is due to other circumstances beyond the Sub-Advisers' control.
Any notice, instruction or other communication required or contemplated by this Agreement shall be in
writing. All such communications shall be addressed to the recipient at the address set forth below, provided
that either party may, by notice, designate a different recipient and/or address for such party.
Investment Manager: American Skandia Investment Services, Incorporated
Xxx Xxxxxxxxx Xxxxx
Xxxxxxx, Xxxxxxxxxxx 00000
Attention: Xxxx Xxxxx
Senior Vice President & Chief Operating Officer
Value Sub-Adviser: Xxxxxxx X. Xxxxxxxxx & Co., LLC
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: J. Xxxxxx Xxxxx
With Copy to: Xxxxx X. Xxxxxx, Senior Vice President and Counsel
Growth Sub-Adviser: Alliance Capital Management L.P.
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxxx Xxxxx
With Copy to: Xxxx X. Xxxxxx, Senior Vice President and Counsel
Trust: American Skandia Trust
Xxx Xxxxxxxxx Xxxxx
Xxxxxxx, Xxxxxxxxxxx 00000
Attention: Xxxxxx X. Xxxxxxxxx, Esq.
15. Indemnification. The Sub-Advisers, jointly and severally, agree to indemnify and hold harmless the
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Investment Manager, any affiliated person within the meaning of Section 2(a)(3) of the ICA ("affiliated person")
of the Investment Manager and each person, if any who, within the meaning of Section 15 of the 1933 Act, controls
("controlling person") the Investment Manager, against any and all losses, claims, damages, liabilities or
litigation (including reasonable legal and other expenses), to which the Investment Manager or such affiliated
person or controlling person of the Investment Manager may become subject under the 1933 Act, the ICA, the
Advisers Act, under any other statute, law, rule or regulation at common law or otherwise, arising out of either
Sub-Adviser's responsibilities hereunder (1) to the extent of and as a result of the willful misconduct, bad
faith, or gross negligence by such Sub-Adviser, any of the Sub-Advisers' employees or representatives or any
affiliate of or any person acting on behalf of such Sub-Adviser, or (2) as a result of any untrue statement or
alleged untrue statement of a material fact contained in the Registration Statement, including any amendment
thereof or any supplement thereto, or the omission or alleged omission to state therein a material fact required
to be stated therein or necessary to make the statement therein not misleading, if such a statement or omission
was made in reliance upon and in conformity with written information furnished by either Sub-Adviser to the
Investment Manager, the Portfolio, the Trust or any affiliated person of the Investment Manager, the Portfolio or
the Trust or upon verbal information confirmed by such Sub-Adviser in writing, or (3) to the extent of, and as a
result of, the failure of either Sub-Adviser to execute, or cause to be executed, portfolio investment
transactions according to the requirements of the ICA; provided, however, that in no case is the Sub-Adviser's
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joint and several indemnity in favor of the Investment Manager or any affiliated person or controlling person of
the Investment Manager deemed to protect such person against any liability to which any such person would
otherwise be subject by reason of willful misconduct, bad faith or gross negligence in the performance of its
duties or by reason of its reckless disregard of its obligations and duties under this Agreement.
The Investment Manager agrees to indemnify and hold harmless each Sub-Adviser, any affiliated person of
each Sub-Adviser and each controlling person of each Sub-Adviser, if any, against any and all losses, claims,
damages, liabilities or litigation (including reasonable legal and other expenses), to which such Sub-Adviser or
such affiliated person or controlling person of each Sub-Adviser may become subject under the 1933 Act, the ICA,
the Advisers Act, under any other statute, law, rule or regulation, at common law or otherwise, arising out of
the Investment Manager's responsibilities as investment manager of the Portfolio (1) to the extent of and as a
result of the willful misconduct, bad faith, or gross negligence by the Investment Manager, any of the Investment
Manager's employees or representatives or any affiliate of or any person acting on behalf of the Investment
Manager, or (2) as a result of any untrue statement or alleged untrue statement of a material fact contained in
the Registration Statement, including any amendment thereof or any supplement thereto or the omission or alleged
omission to state therein a material fact required to be stated therein or necessary to make the statement
therein not misleading, if such a statement or omission was made other than in reliance upon and in conformity
with written information furnished by either Sub-Adviser, or any affiliated person of such Sub-Adviser or other
than upon verbal information confirmed by such Sub-Adviser in writing; provided, however, that in no case is the
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Investment Manager's indemnity in favor of such Sub-Adviser or any affiliated person or controlling person of
each Sub-Adviser deemed to protect such person against any liability to which any such person would otherwise be
subject by reason of willful misconduct, bad faith or gross negligence in the performance of its duties or by
reason of its reckless disregard of its obligations and duties under this Agreement. It is agreed that the
Investment Manager's indemnification obligations under this Section 15 will extend to expenses and costs
(including reasonable attorneys fees) incurred by either Sub-Adviser as a result of any litigation brought by the
Investment Manager alleging such Sub-Adviser's failure to perform its obligations and duties in the manner
required under this Agreement unless judgment is rendered for the Investment Manager.
16. Conflict of Laws. The provisions of this Agreement shall be subject to all applicable statutes, laws,
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rules and regulations, including, without limitation, the applicable provisions of the ICA and rules and
regulations promulgated thereunder. To the extent that any provision contained herein conflicts with any such
applicable provision of law or regulation, the latter shall control. The terms and provisions of this Agreement
shall be interpreted and defined in a manner consistent with the provisions and definitions of the ICA. 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 continue in full force and effect and shall not be affected by such invalidity.
17. Amendments, Waivers, etc. Provisions of this Agreement may be changed, waived, discharged or terminated
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only by an instrument in writing signed by the party against which enforcement of the change, waiver, discharge
or termination is sought. This Agreement (including Exhibit A hereto) may be amended at any time by written
mutual consent of the parties, subject to the requirements of the ICA and rules and regulations promulgated and
orders granted thereunder.
18. Governing State Law. This Agreement is made under, and shall be governed by and construed in accordance
--------------------
with, the laws of the State of Connecticut.
(Balance of Page Left Blank Intentionally)
19. Severability. Each provision of this Agreement is intended to be severable. If any provision of this
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Agreement is held to be illegal or made invalid by court decision, statute, rule or otherwise, such illegality or
invalidity will not affect the validity or enforceability of the remainder of this Agreement.
The effective date of this Agreement is May 1, 2001.
FOR THE INVESTMENT MANAGER:
AMERICAN SKANDIA INVESTMENT SERVICES, INCORPPRATED
___________________________________
Xxxx Xxxxx
Senior Vice President & Chief Operating Officer
Date: ____________________________
Attest: ____________________________
FOR THE VALUE SUB-ADVISER:
XXXXXXX X. XXXXXXXXX & CO., LLC
__________________________________
Name:
Title:
Date: ____________________________
Attest: ____________________________
FOR THE GROWTH SUB-ADVISER:
ALLIANCE CAPITAL MANAGEMENT L.P.
BY: Alliance Capital Management
Corporation, its General Partner
___________________________________
Xxxx X. Xxxxxx
Assistant Secretary
Date: ____________________________
Attest: ____________________________
American Skandia Trust
AST Alliance/Xxxxxxxxx Growth + Value Portfolio
Sub-Advisory Agreement
EXHIBIT A
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The following annual rate is applicable to the Growth Sub-Adviser:
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An annual rate equal to .40% of the combined average daily net assets of the Growth Portfolio of the
Portfolio and the Growth Portfolio of the series of American Skandia Advisor Funds that is managed by the
Sub-Adviser and identified by the Sub-Adviser and the Investment Manager as being similar to the Portfolio
(specifically, the Growth portion of the ASAF Alliance/Xxxxxxxxx Growth + Value Fund).
The following annual rate is applicable to the Value Sub-Adviser:
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An annual rate equal to .40% of the combined average daily net assets of the Value Portfolio of the
Portfolio and the Value Portfolio of the series of American Skandia Advisor Funds that is managed by the
Sub-Adviser and identified by the Sub-Adviser and the Investment Manager as being similar to the Portfolio
(specifically, the Value portion of the ASAF Alliance/Xxxxxxxxx Growth + Value Fund).
