METROPOLITAN SERIES FUND, INC.
SUBADVISORY AGREEMENT
(Capital Guardian U.S. Equity Portfolio)
This Subadvisory Agreement (this "Agreement") is entered into as of May
1, 2003 by and between MetLife Advisers, LLC, a Delaware limited liability
company (the "Manager"), and Capital Guardian Trust Company (the "Subadviser").
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 Capital Guardian U.S. Equity Portfolio of the
Fund (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 subadvisers;
WHEREAS, the Manager desires to retain the Subadviser 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 Subadviser agree as follows:
1. Subadvisory Services.
a. The Subadviser shall, subject to the supervision of the Manager and
in cooperation with the Manager, as administrator, or with any other
administrator appointed by the Manager (the "Administrator"), manage the
investment and reinvestment of the assets of the Portfolio. The Subadviser shall
invest and reinvest the assets of 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 Subadviser 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), 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 Subadviser 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 Subadviser promptly of any changes in such Insurance
Restrictions. Subject to the foregoing, the Subadviser 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 Subadviser shall determine. Notwithstanding the
foregoing provisions of this Section 1.a, however, the Subadviser 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 Subadviser shall furnish the Manager and the Administrator
daily, weekly, monthly, quarterly and/or annual reports concerning portfolio
transactions and the investment 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. The Subadviser 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 Subadviser 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 by the Directors of the Fund pursuant to Section 15(c) of the
1940 Act. The Subadviser shall furnish the Manager (which may also provide it to
the Fund's Board of Directors) with copies of all material comments relevant to
the Portfolio received from the SEC following routine or special SEC
examinations or inspections subject to any restrictions imposed by the SEC or
other regulatory authority on the dissemination of the SEC's comments.
c. The Subadviser shall provide to the Manager a copy of the
Subadviser's Form ADV, Part II as filed with the SEC and any amendments or
restatements thereof in the future and a list of the persons whom the Subadviser
wishes to have authorized to give written and/or oral instructions to custodians
of assets of the Portfolio.
d. Provided that the Subadviser receives proxies in a timely manner,
the Subadviser 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, in accordance with the Subadviser's proxy
voting policies and procedures, solicited by or with respect to the issuers of
securities in which assets of the Portfolio are invested. The Manager shall take
all actions necessary to effect delivery of the proxy solicitations to the
Subadviser in a timely manner, including, but not limited to, effecting delivery
of any proxy solicitation received by a third party who may hold securities on
behalf of the Fund.
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2. Obligations of the Manager.
a. The Manager shall provide (or cause the Fund's custodian to provide)
information to the Subadviser in a timely manner 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 Subadviser to perform its responsibilities hereunder.
b. The Manager has furnished the Subadviser a copy of the Prospectus
and agrees during the continuance of this Agreement to furnish the Subadviser
copies of any revisions or supplements thereto at, or, if practicable, before
the time the revisions or supplements become effective. The Manager agrees to
furnish the Subadviser 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 Subadviser, and with copies of any financial statements or
reports of the Fund with respect to the Portfolio to its shareholders, and any
further materials or information which the Subadviser may reasonably request to
enable it to perform its functions under this Agreement, including, but not
limited to, timely information relating to any Insurance Restrictions.
3. Custodian. The Manager shall provide the Subadviser 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"). 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 Subadviser shall provide timely instructions
directly to the Fund's custodian, in the manner and form as required by the
Fund's Custody Agreement (including with respect to exchange offerings and other
corporate actions) necessary to effect the investment and reinvestment of the
Portfolio's assets. Any assets added to the Portfolio shall be delivered
directly to the Custodian. The Subadviser may reasonably rely without further
inquiry upon any information furnished to it by the Custodian hereunder, and
shall not be responsible for any errors or omissions arising from any
inaccuracies in asset information provided by the Custodian.
4. Expenses. Except for expenses specifically assumed or agreed to be paid
by the Subadviser pursuant hereto, the Subadviser 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 Subadviser will pay its
own expenses incurred in furnishing the services to be provided by it pursuant
to this Agreement.
5. Purchase and Sale of Assets. Absent instructions from the Manager to
the contrary, the Subadviser shall place all orders for the purchase and sale of
securities for the Portfolio with brokers or dealers selected by the Subadviser,
which may include brokers or dealers affiliated with the Subadviser, provided
such orders comply with Rule 17e-1 (or any
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successor or other relevant regulations) under the 1940 Act in all respects. To
the extent consistent with applicable law and then-current SEC positions,
purchase or sell orders for the Portfolio may be aggregated with contemporaneous
purchase or sell orders of other clients of the Subadviser. The Subadviser shall
seek to obtain best execution of transactions for the Portfolio. However, the
Subadviser may select brokers or dealers on the basis that they provide
brokerage, research or other services or products to the Portfolio and/or other
accounts serviced by the Subadviser. Not all such services or products need to
be used by the Subadviser in managing the Portfolio. The Subadviser undertakes
to use all reasonable care and diligence in its choice of brokers and, in the
event that any broker fails on the due date, or within such reasonable period as
the Subadviser may decide, to deliver any necessary documents or, as the case
may be, to pay any amount due, the Subadviser will, on request, endeavor to
pursue on behalf of the Fund all appropriate legal remedies against such broker
to recover such documents or amount due or compensation in lieu thereof. The
costs and expenses properly incurred by the Subadviser in connection with the
pursuit of such remedies shall be debited to the Portfolio, unless paid by the
Manager.
6. Compensation of the Subadviser. As full compensation for all
services rendered, facilities furnished and expenses borne by the Subadviser
hereunder, the Manager shall pay the Subadviser compensation at the annual rate
of 0.45% of the first $100 million of the average daily net assets of the
Portfolio during the Portfolio's then-current fiscal year, 0.40% of the next
$400 million of such assets, 0.35% of the next $500 million of such assets and
0.30% of such assets in excess of $1 billion. Such compensation shall be payable
monthly in arrears as the Manager is paid by the Portfolio pursuant to the
Advisory Agreement. If the Subadviser shall serve for less than the whole of any
month or other agreed-upon interval, 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 Subadviser the compensation provided for
herein.
7. Non-Exclusivity. The Manager agrees that the services of the Subadviser
are not to be deemed exclusive and that the Subadviser 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 Subadviser 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 Subadviser 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 Subadviser of its duties and
obligations under this Agreement. The Manager recognizes and agrees that the
Subadviser 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 Subadviser 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 except in connection
with the investment management services provided by the Subadviser hereunder.
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8. Responsibility for Diversification. Unless the Subadviser has sole
investment authority over all assets of the Fund, the Subadviser shall have no
responsibility for the manner in which the Fund assets, considered in the
aggregate, shall be diversified; provided, however, the Subadviser shall
diversify the assets of the Portfolio to the extent necessary to minimize the
risk of large losses.
9. Representations and Warranties. By entering into this Agreement, the
Subadviser represents and warrants that:
(i) it is a state-chartered trust company, authorized by the California
Department of Financial Institutions to carry on a trust banking business;
(ii) it has full power and authority to enter into this Agreement, and
that the undersigned has full power and authority to execute this Agreement on
the Subadviser's behalf;
(iii) it is an Investment Adviser registered under the Investment
Advisers Act of 1940 (the "Advisers Act"); and
(iv) it has adopted and maintains a written code of ethics complying
with the requirements of Rule 17j-1 of the 1940 Act, and will provide the
Manager and/or the Fund, upon reasonable request, with copies of such code of
ethics as amended from time to time.
By entering into this Agreement, the Manager represents and warrants that:
(i) it is registered as an investment adviser under the Advisers Act
and will continue to be so registered for as long as this Agreement remains in
effect, or else will immediately notify the Subadviser of the occurrence of any
event that would disqualify the Manager from serving as an investment advisor to
the Fund or any investment company pursuant to Section 9(a) of the 1940 Act or
otherwise;
(ii) it is not prohibited by the 1940 Act or the Advisers Act from
performing the services contemplated by this Agreement, that it duly authorized
and empowered by the Fund to enter into this Agreement, and that the undersigned
has full power and authority to execute this Agreement on the Manager's behalf;
(iii) it shall not transact in or remove from the Portfolio any
securities, funds or other assets without first giving reasonable written notice
to the Subadviser or terminating this Agreement; and
(iv) it has received a copy of Part II of the Subadviser's Form ADV
(the "ADV"). The Manager understands that if it has received the ADV less than
48 hours prior to its entering into this Agreement, the Manager may terminate
the Agreement without penalty within 5 (five) business days after entering into
the Agreement.
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10. Notices. All notices and other communications hereunder shall be in
writing and shall be deemed given if delivered in person or by any other method
in which evidence of receipt is obtained, including registered mail, facsimile
transmission, or reputable messenger or overnight delivery service, to the
parties at the following addresses or facsimile numbers (or at such other
address or number as each respective party may specify in the future):
(a) if to the Subadviser, to:
Capital Guardian Trust Company
000 Xxxxx Xxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Facsimile number: (000) 000-0000
Attention: Treasurer
(b) if to the Manager, to:
MetLife Advisers, LLC
000 Xxxxxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Facsimile number: (000) 000-0000
Attention: Xxxxxx X. Xxxx
Secretary
Each such notice or other communication shall be effective (i) if given by
facsimile, when such facsimile is transmitted to the number specified in this
section and the appropriate confirmation is received, and (ii) if given by any
other means, when delivered at the address specified in this section.
11. Liability and Indemnification. Except as may otherwise be provided by
the 1940 Act or other federal securities laws, neither the Subadviser nor any of
its officers, partners, managing directors, employees, affiliates or agents
(for the purposes of this Agreement brokers shall not be deemed as 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, 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 any Indemnified Party's duties or by
reason of reckless disregard by any Indemnified Party of its obligations and
duties. The Manager shall hold harmless and indemnify the Subadviser for any
loss, liability, cost, damage or expense (including reasonable attorneys fees
and costs) arising (i) from any claim or demand by any past or present
shareholder of the Portfolio that is not based upon the obligations of the
Subadviser with respect to the Portfolio under this Agreement or (ii) resulting
from the failure of the Manager to inform the Subadviser of any applicable
Insurance Restrictions or any changes therein or of any policies and guidelines
as established by the Manager or the Directors. The Subadviser agrees to
indemnify the Manager for any loss, liability, cost, damage or expense
(including reasonable attorney's fees) resulting from Subadviser's material
misstatement or omission in the Portfolio's Prospectus with respect to
disclosure of the Portfolio's investment
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objectives, policies and risks. The Manager acknowledges and agrees that the
Subadviser 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 Subadviser, whether public or private.
12. Effective Date and Termination. This Agreement shall become effective
on the date first written above, 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 or
the Subadviser, 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 Subadviser 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,
subject to the Fund's obligation to fulfill all transactions authorized prior to
such termination;
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 Subadviser 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
Subadviser; and
Termination of this Agreement pursuant to this Section 12 shall be without
the payment of any penalty. In the event of termination of this Agreement, all
compensation due to the Subadviser through the date of termination will be
calculated on a pro rata basis through the date of termination and paid on the
first business day after the next succeeding month end.
13. Amendment. This Agreement may be amended at any time by mutual consent
of the Manager and the Subadviser, provided that, if required by law (as may be
modified by any exemptions received by the Manager), 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 Subadviser, cast in person at
a meeting called for the purpose of voting on such approval.
14. 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 SEC under the 1940 Act.
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15. General.
a. The Subadviser may perform its services through any employee,
officer or agent of the Subadviser, 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 Subadviser notifies the
Manager that one or more other employees, officers or agents of the Subadviser,
identified in such notice, shall assume such duties as of a specific date. The
Subadviser shall use commercially reasonable efforts to inform the Manager of
any such events enough time prior to the event taking effect such that time
allows the Manager sufficient time to prepare and file any necessary supplement
to the Prospectus.
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.
16. Use of Name. It is understood that the name "Capital Guardian",
"Capital Guardian Trust Company," and any of the other names of the Subadviser
or the Subadviser's affiliates, and any derivative or logo or trade or service
xxxx thereof (collectively, the "Names and Trademarks"), associated with that
name are the valuable property of the Subadviser and the Subadviser's
affiliates, and that the Fund has the right to include such name as a part of
the name of its portfolio only so long as this Agreement shall continue. Upon
termination of this Agreement the Fund shall forthwith cease to use such Names
and Trademarks.
Manager agrees that it will review with the Subadviser any advertisement, sales
literature or notice prior to its use or publication that makes reference to the
Names and/or Trademarks, so that the Subadviser may review the context in which
the Names and/or Trademarks are being referred to, it being agreed that the
Subadviser shall have no responsibility to ensure the adequacy of the form or
content of such materials for the purposes of the 1940 Act or other applicable
laws or regulations. If the Manager or the Fund makes any unauthorized use of,
or reference to, the Names or the Trademarks the Manager acknowledges that the
Subadviser shall suffer irreparable harm for which monetary damages may not be
completely adequate, and therefore the Subadviser may also be entitled to
injunctive relief.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the dates
written below.
METLIFE ADVISERS, LLC
By:
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Xxxx X. Xxxxxxx, Xx.
Senior Vice President
Date:
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CAPITAL GUARDIAN TRUST COMPANY
By:
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Date:
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