Exhibit (d)(21)
NEW ENGLAND ZENITH FUND
SUBADVISORY AGREEMENT
(FI Structured Equity Series)
This Subadvisory Agreement (this "Agreement") is entered into as of May 1,
2002 by and between MetLife Advisers, LLC, a Delaware limited liability company
(the "Manager"), and Fidelity Management & Research Company (the "Subadviser").
WHEREAS, the Manager has entered into an Advisory Agreement dated August
30, 1996 (the "Advisory Agreement") with New England Zenith Fund (the "Trust"),
pursuant to which the Manager provides portfolio management and administrative
services to the FI Structured Equity Series of the Trust (the "Series");
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.
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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 Series. Subject to the provisions of subparagraph
(b) of this Section 1, the Subadviser agrees to invest and
reinvest the assets of the Series in conformity with (1) the
investment objective, policies and restrictions of the Series set
forth in the Trust's prospectus and statement of additional
information, as revised or supplemented from time to time,
relating to the Series (the "Prospectus"), as provided to the
Subadviser, (2) any additional policies or guidelines established
by the Manager or by the Trust's trustees that have been
furnished in writing to the Subadviser, and (3) the provisions of
the Internal Revenue Code, as amended (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), 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, as amended (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 Series might otherwise make ("Insurance Restrictions"), and
to inform the Subadviser promptly of any changes in such
Insurance Restrictions. In advising the Series, the Subadviser
shall use reasonable efforts to comply with Subchapters L and M
of the Internal Revenue Code of 1986, as amended (the "Code").
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
Series, 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 Series may
be invested in such proportions of stocks, bonds, other
securities or investment instruments, or cash, as the Subadviser
shall determine.
b. Nothwithstanding anything to the contrary herein, the Manager
acknowledges that Subadviser is not the compliance agent for the
Trust or for the Manager, and does not have access to all of the
Trust's books and records necessary to perform certain compliance
testing. The Subadviser's agreement to perform the services
specified in this Section hereof in accordance with applicable
law (including sub-chapters L and M of the Code, and the 1940
Act, as amended ("Applicable Law")) and any additional policies
or guidelines established by the Manager or by the Trust's
trustees that have been furnished in writing to the Subadviser
(collectively, the "Charter Requirements"), is subject to the
understanding that the Subadviser shall perform such services
based upon its books and records with respect to the Series,
which comprise a portion of the Series's books and records, and
shall not be held responsible under this Agreement so long as it
performs such services in accordance with this Agreement, the
Charter Requirements and Applicable Law based upon such books and
records.
c. The Subadviser shall furnish the Manager and the Administrator
quarterly and/or annual reports concerning portfolio transactions
and the investment performance of the Series in such form as may
be mutually agreed upon, and agrees to review the Series and
discuss the management of the Series with representatives or
agents of the Manager, the Administrator or the Trust at their
reasonable request. The Subadviser shall make a senior portfolio
manager of the Series or an appropriate investment professional
available for presentations to the Trustees at a meeting of the
Board of Trustees annually, as well as other meetings as may
reasonably be requested. The Subadviser shall permit all books
and records with respect to the Series to be inspected and
audited by the Manager and the Administrator at all reasonable
times during normal business hours, upon reasonable prior written
notice. The Subadviser shall furnish the Manager (which may also
provide it to the Trust's Board of Trustees) with copies of all
material comments relating to the Series received from the SEC
following routine or special SEC examinations or inspections.
d. Upon request of the Trust's custodian and/or Trust, the
Subadviser shall provide assistance in connection with the
determination of the fair value of securities in the Series for
which market quotations are not readily available and the parties
to this Agreement agree that the Subadviser shall not bear
responsibility or liability for the determination or accuracy of
the valuation of any portfolio securities and other assets of the
Series.
e. The Subadviser shall provide to the Manager a copy of the
Subadviser's Form ADV 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 Series.
f. Unless the Manager gives the Subadviser written instructions to
the contrary 30 days in advance, the Subadviser shall use its
good faith judgment in a manner which it reasonably believes best
serves the interest of the Series' shareholders to vote or
abstain from voting all proxies solicited by or with respect to
the issuers of securities in which assets of the Series are
invested. The Manager shall instruct the Trust's custodian, the
Administrator, and other parties providing services to the Series
to promptly forward misdirected proxy materials to the
Subadviser.
2. Obligations of the Manager.
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a. The Manager shall provide (or cause the Trust's custodian to
provide) information to the Subadviser in a timely manner
regarding such matters as the composition of assets in the
Series, cash requirements and cash available for investment in
the Series, 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 all
Registration Statements and Amendments thereto, including the
Prospectus and Statement of Additional Information, and agrees
during the continuance of this Agreement to furnish the
Subadviser copies of any revisions or supplements thereto within
a reasonable time period 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
Trustees of the Trust applicable to the Series to the extent they
may affect the duties of the Subadviser, and with copies of any
financial statements or reports of the Trust with respect to the
Series 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 and SEC exemptive orders relating to the Series.
c. The Manager shall provide to the Subadviser a copy of the
Manager's Form ADV as filed with the SEC and any amendments or
restatements thereof in the future.
d. The Trust and the Manager will furnish to the Subadviser such
information relating to either of them or the business affairs of
the Trust as the Subadviser shall from time to time request in
order to discharge its obligations hereunder.
3. Custodian. The Manager shall provide the Subadviser with a copy of the
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Series' agreement with the custodian designated to hold the assets of
the Series (the "Custodian") and any modifications thereto (the
"Custody Agreement"). The assets of the Series 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
Custodian, in the manner and form agreed upon by the Manager, the
Subadviser and the Custodian, as necessary to effect the investment
and reinvestment of the Series' assets. The Subadviser shall have no
liability for the acts or omissions of the Custodian.
4. Expenses. Except for expenses specifically assumed or agreed to be
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paid by the Subadviser pursuant hereto, the Subadviser shall not be
liable for any expenses of the Manager or the Trust 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 Series, 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. The Subadviser shall place all orders for
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the purchase and sale of securities for the Series with brokers or
dealers selected by the Subadviser, which may include brokers or
dealers affiliated with the Subadviser, provided such orders comply
with Section 17 and Rule 17e-1 (or any 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 Series may be aggregated with
contemporaneous purchase or sell orders of other clients of the
Subadviser. The Subadviser agrees that, in executing portfolio
transactions and selecting brokers or dealers, if any, it shall use
its best efforts to seek on behalf of the Series the best overall
terms available. In assessing the best overall terms available for any
transaction, the Subadviser shall consider all factors it deems
relevant, including the breadth of the market in and the price of the
security, the financial condition and execution capability of the
broker or dealer, and the reasonableness of the commission, if any,
with respect to the specific transaction and on a continuing basis. In
evaluating the best overall terms available, and in selecting the
broker or dealer, if any, to execute a particular transaction,
Subadviser may also consider the brokerage and research services (as
those terms are defined in Section 28(e) of the Securities Exchange
Act of 1934, as amended ("1934 Act")) provided to the Subadviser with
respect to the Series and/or other accounts over which the Subadviser
exercises investment discretion. The Subadviser may, in its
discretion, agree to pay a broker or dealer that furnishes such
brokerage or research services a higher commission than that which
might have been charged by another broker-dealer for effecting the
same transactions, if the Subadviser determines in
good faith that such commission is reasonable in relation to the
brokerage and research services provided by the broker or dealer,
viewed in terms of either that particular transaction or the overall
responsibilities of the Subadviser with respect to the accounts as to
which it exercises investment discretion (as such term is defined in
Section 3(a)(35) of the 1934 Act).
6. Compensation of the Subadviser. As full compensation for all services
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rendered, facilities furnished and expenses borne by the Subadviser
hereunder, the Manager shall pay the Subadviser compensation at the
following rate, based on the average daily net assets of the Series
determined at the close of the New York Stock Exchange on each day the
exchange is open for trading: at the annual rate of 0.50% of the first
$250 million of the average daily net assets of the Series, 0.40% of
the next $500 million of such assets and 0.35% of such assets in
excess of $750 million. 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 Series 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 Trust;
however, any such waiver will have no effect on the Manager's
obligation to pay the Subadviser the compensation provided for herein.
The Manager shall pay the Subadviser not later than the tenth (10)
business day immediately following the end of the relevant payment
period.
7. Non-Exclusivity. The Manager agrees that the services of the
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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.
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 Series. 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 Trust or the
Manager, in any way or otherwise be deemed an agent of the Trust or
the Manager except in connection with the portfolio management
services provided by the Subadviser hereunder.
8. Liability and Indemnification. Except as may otherwise be provided by
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the 1940 Act or other federal securities laws, neither the Subadviser
nor any of its officers, partners, directors, controlling persons,
shareholders, employees, affiliates or agents (the "Indemnified
Parties") shall be subject to any liability to the Manager, the Trust,
the Series or any shareholder of the Series for any error of judgment,
or any loss,
liability, cost, damage or expense (including reasonable attorneys
fees and costs) 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 any Indemnified Party 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 Series that is not based upon the
obligations of the Subadviser with respect to the Series 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 Trustees. 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 Series or that the Series will perform comparably with any
standard or index, including other clients of the Subadviser, whether
public or private.
9. Effective Date and Termination. This Agreement shall become effective
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as of the date of its execution, and a. unless otherwise terminated,
this Agreement shall continue in effect until August 30, 2003, and
from year to year thereafter so long as such continuance is
specifically approved at least annually (i) by the Board of Trustees
of the Trust or by vote of a majority of the outstanding voting
securities of the Series, and (ii) by vote of a majority of the
trustees of the Trust who are not interested persons of the Trust, 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
Trustees of the Trust or by vote of a majority of the outstanding
voting securities of the Series;
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 Trust, or, if approved by
the Board of Trustees of the Trust, by the Manager on sixty days'
written notice to the Subadviser, and termination of this
Agreement pursuant to this Section 9 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.
10. Amendment. This Agreement may be amended at any time by mutual consent
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of the Manager and the Subadviser, provided that, if required by law
(as may be modified by any exemptions received by the Manager from the
SEC, or any rules or regulations adopted by, or interpretative
releases of, the SEC), such amendment shall also have been approved by
vote of a majority of the outstanding voting securities of the Series
and by vote of a majority of the trustees of the Trust who are not
interested persons of the Trust, the Manager or the Subadviser, cast
in person at a meeting called for the purpose of voting on such
approval.
11. Certain Definitions. For the purpose of this Agreement, the terms
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"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.
12. Confidentiality. All information furnished by one party to the other
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party (including their respective agents, employees and
representatives) hereunder shall be treated as confidential and shall
not be disclosed to third parties, except if it is otherwise in the
public domain or, with notice to the other party, as may be necessary
to comply with applicable laws, rules, regulations, subpoenas or court
orders. Without limiting the foregoing, Manager acknowledges that the
securities holdings of the Series(s) constitute information of value
to the Subadviser, and agrees (1) not to use for any purpose, other
than for Manager or the Trust, or their agents, to supervise or
monitor the Subadviser, the holdings or trade-related information of
the Trust; and (2) not to disclose the Series(s)' holdings, except:
(a) as required by applicable law or regulation; (b) as required by
state or federal regulatory authorities; (c) to the Board, 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 in writing.
Further, Manager agrees that information supplied by the Subadviser,
including approved lists, internal procedures, compliance procedures
and any board materials, is valuable to the Subadviser, and 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 by state or federal regulatory authorities; (iii) to
the Board, 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 in writing.
13. General.
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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 Subadviser shall
promptly notify the Manager of any change in the persons
identified in the Prospectus of the Series as performing the
portfolio management duties described therein.
b. The Subadviser may, at its own expense, delegate any or all of
its duties and responsibilities under this Agreement to its
wholly-owned subsidiary, FMR Co., Inc., provided that the
Subadviser remains responsible to the Manager and the Trust for
the performance of all of its responsibilities and duties
hereunder. The Subadviser will compensate FMR Co., Inc. for its
services to the Trust. Subject to prior notice to the Manager,
the Subadviser may terminate the services of FMR Co., Inc. for
the Series and shall, at such time, assume the responsibilities
of FMR Co., Inc. with respect to the Trust.
c. During the term of this Agreement, Manager shall furnish to the
Subadviser at its principal office all prospectuses, proxy
statements, reports to shareholders, sales literature or other
material prepared for distribution to shareholders of the Trust
or the public, which refer to the Subadviser or its clients in
any way, prior to the use thereof, and Manager shall not use any
such materials if the Subadviser reasonably objects in writing in
ten (10) days (or such other time as may be mutually agreed,
which would include longer time periods for review of the Trust's
prospectus and other parts of the registration statement) after
receipt thereof.
d. 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 may be enforced
to the fullest extent permitted by law.
e. Any notice under this Agreement shall be in writing, addressed
and delivered and mailed, postage prepaid, to the other party,
with a copy to the Trust, at the addressed below or such other
address as such other party may designate for the receipt of such
notice.
If to Manager: Metlife Advisers, LLC
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Attention: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Senior Vice President
If to Subadviser: Fidelity Management & Research Company
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Attention: General Counsel
f. This Agreement shall be governed by and interpreted in accordance
with the laws of The Commonwealth of Massachusetts.
14. Use of Name.
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a. The parties agree that the name of the Subadviser, the names of
any affiliates of the Subadviser and any derivative, logo,
trademark, service ▇▇▇▇ or trade name are the valuable property
of the Subadviser and its affiliates. 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 Subadviser, which approval shall not be
unreasonably withheld or delayed so long as this Agreement is in
effect.
b. Upon termination of this Agreement, the Manager and the Trust
shall forthwith cease to use such name(s), derivatives, logos,
trademarks, service marks or trade names. The Manager and the
Trust agree they will review with the Subadviser any
advertisement, sales literature, or notice prior to its use that
makes reference to the Subadviser or its affiliates or any such
name(s), derivatives, logos, trademarks, service marks or trade
names, it being understood that the Subadviser shall have no
responsibility to ensure of the adequacy of the form or content
of such materials for purposes of the 1940 Act or other
applicable laws and regulations. If Manager or the Trust makes an
unauthorized use of the Subadviser's names, derivatives, logos,
trademarks, service marks or trade names, the parties acknowledge
that the Subadviser shall suffer irreparable hardship for which
monetary damages are inadequate and thus, the Subadviser will be
entitled to injunctive relief.
IN WITNESS WHEREOF, the parties hereto have caused this instrument to be
executed as of the day and year first above written.
METLIFE ADVISERS, LLC
By
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Senior Vice President
FIDELITY MANAGEMENT & RESEARCH COMPANY
By:
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▇▇▇▇▇▇ ▇▇▇▇▇▇
Senior Vice President