Investment Company Act No. 811-5186
As filed with the Securities and Exchange Commission on November 30, 1998
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934
Filed by the Registrant [x]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted by
Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to ss. 240.14a-11(c) or ss. 240.14a-12
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American Skandia Trust
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Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
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1) Title of each class of securities to which transaction applies:
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2) Aggregate number of securities to which transaction applies:
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3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):
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[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number, or
the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
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4) Date Filed:
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<PAGE>
American Skandia Life
Assurance Corporation
1 Corporate Drive
P.O. Box 883
Shelton, CT 06484-0883
Telephone (203) 926-1888
Fax (203) 929-8071
November 30, 1998
Dear Valued Customer,
As an American Skandia Life Assurance Corporation ("ASLAC") contract owner who
beneficially owns shares of the Robertson Stephens Value + Growth Portfolio (the
"Portfolio") of American Skandia Trust ("AST"), you are cordially invited to a
special meeting of the shareholders of the Portfolio to be held at the offices
of ASLAC, One Corporate Drive, Shelton, CT, on December 30, 1998 at 10:30 a.m.
At the special meeting, shareholders are being asked to approve or disapprove
proposals (1) to approve a new Sub-Advisory Agreement between American Skandia
Investment Services, Incorporated and OppenheimerFunds, Inc. regarding
investment advice to the Portfolio, (2) to approve a change in the Portfolio's
investment objective, (3) to approve changes in the Portfolio's fundamental
investment restrictions. If the new Sub-Advisory Agreement is approved by the
Portfolio's shareholders, the name of the Portfolio will be changed to the "AST
Oppenheimer Large-Cap Growth Portfolio" effective December 31, 1998.
Your vote is important no matter how large or small your holdings are. We urge
you to read the Proxy Statement thoroughly and to indicate your voting
instructions on the enclosed Proxy Card, date and sign it, and return it
promptly in the envelope provided to be received by American Skandia on or
before the close of business on December 28, 1998. The shares that you
beneficially own will be voted in accordance with instructions received by that
date. All shares of the Portfolio for which instructions are not received will
be voted in the same proportion as the votes cast by contract owners on the
proxy issues presented.
Any questions or concerns you may have regarding the special meeting or the
proxy should be directed to your financial representative.
Sincerely,
/s/ Gordon C. Boronow
Gordon C. Boronow
President and Deputy Chief Executive Officer
American Skandia Life Assurance Corporation
<PAGE>
AMERICAN SKANDIA TRUST
One Corporate Drive
P.O. Box 883
Shelton, Connecticut 06484
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS OF THE
ROBERTSON STEPHENS VALUE + GROWTH PORTFOLIO
To be held
December 30, 1998
To the Shareholders of the Robertson Stephens Value + Growth Portfolio of
American Skandia Trust:
Notice is hereby given that a Special Meeting of Shareholders of the
Robertson Stephens Value + Growth Portfolio (the "Portfolio") of American
Skandia Trust (the "Trust"), will be held at One Corporate Drive, Shelton,
Connecticut 06484 on December 30, 1998 at 10:30 a.m. Eastern Time, or at such
adjourned time as may be necessary for the holders of a majority of the
outstanding shares of the Portfolio to vote (the "Meeting"), for the following
purposes:
I. To consider the approval of a new Sub-Advisory Agreement between
American Skandia Investment Services, Incorporated and OppenheimerFunds, Inc.
regarding investment advice to the Portfolio.
II. To consider the approval of a change in the Portfolio's investment
objective.
III. To consider the approval of a change in the Portfolio's fundamental
investment restriction concerning diversification and industry concentration of
investments.
IV. To consider the approval of a change in the Portfolio's fundamental
investment restriction concerning loans.
V. To consider the approval of a change in the Portfolio's fundamental
investment restriction concerning borrowings.
VI. To consider the approval of a change in the Portfolio's fundamental
investment restriction concerning underwriting the securities of other issuers.
VII. To consider the approval of a change in the Portfolio's fundamental
investment restriction concerning issuing senior securities.
VIII. To consider the approval of the elimination of the Portfolio's
fundamental investment restriction concerning the purchase of securities on
margin.
IX. To consider the approval of the elimination of the Portfolio's
fundamental investment restriction concerning investment in securities of
issuers in which management of the Trust or of the Trust's investment manager
owns securities.
X. To transact such other business as may properly come before the Meeting
or any adjournment thereof.
The matters referred to above are discussed in detail in the Proxy
Statement attached to this Notice. The Board of Trustees has fixed the close of
business on November 13, 1998 as the record date for determining shareholders
entitled to notice of, and to vote at, the Meeting, and only holders of record
of shares at the close of business on that date are entitled to notice of, and
to vote at, the Meeting. Each share of the Portfolio is entitled to one vote on
each proposal.
You are cordially invited to attend the Meeting. If you do not expect
to attend, you are requested to complete, date and sign the enclosed form of
proxy and return it promptly in the envelope provided for that purpose. The
enclosed proxy is being solicited on behalf of the Board of Trustees.
YOUR VOTE IS IMPORTANT. IN ORDER TO AVOID THE UNNECESSARY EXPENSE OF FURTHER
SOLICITATION, WE URGE YOU TO INDICATE VOTING INSTRUCTIONS ON THE ENCLOSED PROXY,
DATE AND SIGN IT, AND RETURN IT PROMPTLY IN THE ENVELOPE PROVIDED, NO MATTER HOW
LARGE OR SMALL YOUR HOLDINGS MAY BE. YOU MAY REVOKE IT AT ANY TIME PRIOR TO ITS
USE. THEREFORE, BY APPEARING AT THE MEETING, AND REQUESTING REVOCATION PRIOR TO
THE VOTING, YOU MAY REVOKE THE PROXY AND YOU CAN THEN VOTE IN PERSON.
By order of the Board of Trustees
/s/ Eric C. Freed
Eric C. Freed
Secretary
American Skandia Trust
November 30, 1998
<PAGE>
PROXY STATEMENT
AMERICAN SKANDIA TRUST
One Corporate Drive
P.O. Box 883
Shelton, Connecticut 06484
SPECIAL MEETING OF SHAREHOLDERS
OF THE ROBERTSON STEPHENS VALUE + GROWTH PORTFOLIO
OF
AMERICAN SKANDIA TRUST
To be held
December 30, 1998
This proxy statement and enclosed form of proxy are being furnished in
connection with the solicitation of proxies by the Board of Trustees of American
Skandia Trust (the "Trust") for use at a Special Meeting of Shareholders of the
Robertson Stephens Value + Growth Portfolio (the "Portfolio") of the Trust to be
held at One Corporate Drive, Shelton, Connecticut 06484 on December 30, 1998 at
10:30 a.m. Eastern Time (the "Meeting"), or at any adjournment thereof, for the
purposes set forth in the accompanying Notice of Meeting ("Notice"). The first
mailing of proxies and proxy statements to shareholders is anticipated to be on
or about December 1, 1998.
The costs of the Meeting, including the solicitation of proxies, will
be paid by American Skandia Investment Services, Incorporated ("ASISI" or the
"Manager"), the Investment Manager to the Portfolio. Voting instructions will be
solicited principally by mailing this Proxy Statement and its enclosures, but
proxies also may be solicited by telephone, telegraph, or in person by officers
or agents of the Trust or American Skandia Life Assurance Corporation ("ASLAC").
The Trust will forward proxy materials to record owners for any beneficial
owners that such record owners may represent.
The Annual Report of the Trust (the "Report"), including audited
financial statements for the fiscal year ended December 31, 1997, has been
previously sent to shareholders. The most recent Semi-annual Report of the
Trust, including unaudited semi-annual financial statements for the period ended
June 30, 1998, was also previously sent to shareholders. The Trust will furnish
an additional copy of the Report, as well as the most recent Semi-annual Report
of the Trust, to a shareholder upon request, without charge, by writing to the
Trust at the above address or by calling 1-800-752-6342.
Shareholders of record at the close of business on November 13, 1998
(the "Record Date") are entitled to notice of, and to vote at, the Meeting. Each
shareholder is entitled to one vote for each full share. As of the Record Date,
the following number of shares of beneficial interest of the Portfolio were
outstanding: 18,807,049.758. As of the Record Date, there is no beneficial owner
of more than 5% of the shares of the Portfolio to the knowledge of the Trust.
Currently, the Trust serves as an underlying mutual fund for variable
annuity contracts and variable life insurance policies issued by life insurance
companies, including ASLAC. As of the Record Date, 100% of the Portfolio's
shares were legally owned by ASLAC. ASLAC holds Portfolio shares attributable to
variable annuity contracts in ASLAC Variable Account B (Class 1 Sub-Accounts),
ASLAC Variable Account B (Class 2 Sub-Accounts), ASLAC Variable Account B (Class
3 Sub-Accounts), ASLAC Variable Account F and ASLAC Variable Account Q
(collectively, for purposes of this Proxy Statement, "ASLAC Variable Accounts"),
each of which except for ASLAC Variable Account Q is an investment company
registered as such under the Investment Company Act of 1940, as amended (the
"Investment Company Act"). ASLAC Variable Accounts have various sub-accounts,
each of which invests exclusively in a corresponding portfolio of an underlying
fund. ASLAC will solicit voting instructions from variable annuity contract
owners who beneficially own shares of the Portfolio represented in the Robertson
Stephens Value + Growth Sub-Account as of the Record Date (the
"Contractowners"). Because Contractowners are indirectly invested in the
Portfolio through their contracts and have the right to instruct ASLAC how to
vote shares of the Portfolio on all matters requiring a shareholder vote,
Contractowners should consider themselves shareholders of the Portfolio for
purposes of this Proxy Statement.
ASISI is the investment manager for all the Trust's investment
portfolios, including the Portfolio. ASISI is a wholly-owned subsidiary of
American Skandia Investment Holding Corporation ("ASIHC"). ASIHC is also the
owner of all the outstanding shares of ASLAC and American Skandia Marketing,
Incorporated ("ASM"), which is the principal underwriter of ASLAC variable
annuity contracts and variable life insurance policies. ASIHC is indirectly
owned by Skandia Insurance Company Ltd., a Swedish company located at Sveavagen
44, S-103, Stockholm, Sweden.
Under a Sub-advisory Agreement with ASISI, Robertson, Stephens &
Company Investment Management, L.P. ("Robertson Stephens"), 555 California
Street, San Francisco, California 94104, presently serves as sub-advisor to the
Portfolio, and, subject to the supervision and control of ASISI and the Board of
Trustees, determines the securities to be purchased for and sold from the
Portfolio. Robertson Stephens is a California limited partnership whose sole
limited partner is Robertson, Stephens & Company, L.L.C. Robertson, Stephens &
Company, L.L.C. in turn is an indirect wholly-owned subsidiary of BankAmerica
Corporation, one of the three largest bank holding companies in the United
States.
The Administrator of the Portfolio, and every other portfolio of the
Trust, is PFPC Inc., a Delaware corporation located at 103 Bellevue Parkway,
Wilmington, Delaware 19809.
All shares of the Portfolio held by the Contractowners will be voted by
ASLAC at the Meeting and any adjournments thereof in accordance with voting
instructions received from such Contractowners. ASLAC is entitled to vote shares
for which voting instructions are not received and will vote such shares in the
same proportion as the votes cast by the Contractowners on the proxy issues
presented. ASLAC has fixed the close of business on December 28, 1998 as the
last day for which voting instructions will be accepted.
Timely, properly executed proxies will be voted as Contractowners
instruct. The Board of Trustees intends to bring before the Meeting the matters
set forth in Proposals I, through IV of the foregoing Notice (collectively, the
"Proposals"). The Trustees do not expect any other business to be brought before
the meeting. If, however, any other matters are properly presented to the
meeting for action, it is intended that the persons named in the enclosed proxy
will vote in accordance with their judgment. A Contractowner executing and
returning a proxy may revoke it at any time prior to its exercise by written
notice of such revocation to the Secretary of the Trust, by execution of a
subsequent proxy, or by voting in person at the Meeting.
The presence in person or by proxy of the holders of a majority of the
outstanding shares is required to constitute a quorum at the Meeting. Because
ASLAC is the legal owner of 100% of the Portfolio's shares, ASLAC's presence at
the Meeting will constitute a quorum under the Trust's By-laws. Shares
beneficially held by Contractowners present in person or represented by proxy at
the Meeting will be counted for the purpose of calculating the votes cast on the
issues before the Meeting.
Approval of each of the Proposals requires the vote of a "majority of
the outstanding voting securities" of the Portfolio, as defined in the
Investment Company Act, which means the vote of 67% or more of the shares of the
Portfolio present at the Meeting, if the holders of more than 50% of the
outstanding shares of the Portfolio are present or represented by proxy, or the
vote of more than 50% of the outstanding shares of the Portfolio, whichever is
less. Except for Proposals III through VII (which are contingent upon approval
of each such Proposal), approval of each Proposal is not contingent upon
approval of any other Proposal. Therefore, any of Proposals I, II, VIII or IX
that are approved will be implemented notwithstanding the outcome of the vote on
any other Proposal.
In the event that sufficient votes to approve any Proposal are not
received, the persons named as proxies may propose one or more adjournments of
the Meeting to permit further solicitation of proxies. Any such adjournment will
require the affirmative vote of a majority of those shares represented at the
Meeting in person or by proxy. The persons named as proxies will vote those
proxies that they are entitled to vote FOR or AGAINST any such adjournment in
their discretion. Any Proposals for which sufficient favorable votes have been
received by the time of the Meeting may be acted upon and such vote shall be
considered final regardless of whether the Meeting is adjourned to permit
additional solicitation with respect to any other Proposal. Proxies submitted
without voting instructions will be voted FOR the Proposals.
<PAGE>
PROPOSAL I
APPROVAL OF A NEW SUB-ADVISORY AGREEMENT BETWEEN
AMERICAN SKANDIA INVESTMENT SERVICES, INCORPORATED
AND OPPENHEIMERFUNDS, INC.
Background
Since the Portfolio commenced operations on May 2, 1996, ASISI has
served as Investment Manager to the Portfolio pursuant to an Investment
Management Agreement with the Trust (the "Present Investment Management
Agreement"). The Present Investment Management Agreement, effective May 1, 1996
and as annually renewed thereafter, provides, among other things, that in
carrying out its responsibility to supervise and manage all aspects of the
Portfolio's operations, the Manager may engage, subject to approval of the Board
of Trustees and, where required, the shareholders of the Portfolio, a
sub-advisor to provide advisory services in relation to the Portfolio. The
Manager may delegate to the sub-advisor the duty, among other things, to
formulate and implement the Portfolio's investment program, including the duty
to determine what issuers and securities will be purchased for or sold from the
Portfolio.
In accordance with this provision for delegation of authority, the
Manager has entered into a sub-advisory agreement (the "Present Sub-Advisory
Agreement"), effective October 1, 1997, with Robertson Stephens, pursuant to
which the above duties have been delegated by the Manager to Robertson Stephens.
The Present Sub-Advisory Agreement was approved by shareholders of the Portfolio
on September 30, 1997. The approval of the Present Sub-Advisory Agreement was
required as a result of the transaction in which Robertson Stephens was acquired
by BankAmerica Corporation. Under the Present Sub-Advisory Agreement and
predecessor agreements, Robertson Stephens has served as sub-advisor to the
Portfolio since the Portfolio commenced operations on May 2, 1996.
The Present Sub-Advisory Agreement and predecessor agreements with
Robertson Stephens have been approved annually by the Board of Trustees,
including a majority of the Trustees who are not "interested persons" of the
Trust (as defined under the Investment Company Act) (the "Independent
Trustees"), since the Portfolio's inception. The Present Sub-Advisory Agreement
was most recently approved by the Board on April 8, 1998.
The Board of Trustees has determined to submit for the approval of the
Portfolio's shareholders a proposal to replace Robertson Stephens as Sub-advisor
to the Portfolio. At a telephonic meeting held on October 12, 1998, the Board of
Trustees received a proposal from the Manager to effect various changes to the
investment objective and stated investment policies and restrictions applicable
to the Portfolio, as described in Proposals II and III below, and to engage
OppenheimerFunds, Inc. ("OppenheimerFunds") to provide sub-advisory services for
the Portfolio. In connection with its recommendation, the Manager proposed to
enter into a new sub-advisory agreement (the "New Sub-Advisory Agreement") with
OppenheimerFunds, which would become effective December 31, 1998 (or, if
shareholder approval of Proposal I occurs after December 30, 1998, four business
days after such approval) (such date being hereinafter referred to as the
"Effective Date.") The terms and conditions of the New Sub-Advisory Agreement
are similar in all material respects with those of the Present Sub-Advisory
Agreement.
In addition, the Board of Trustees has determined that, if the New
Sub-Advisory Agreement is approved, it would be in the best interests of the
Portfolio to follow the recommendation of ASISI that the Portfolio enter into a
new Investment Management Agreement with ASISI (the "New Investment Management
Agreement"). Other than the changes to the name of the Portfolio and a decreased
fee rate, no further changes to the Present Investment Management Agreement are
proposed, and therefore shareholder approval of the New Investment Management
Agreement is not required. Under the New Investment Management Agreement, the
fee rate will be .90% of the average daily net assets not in excess of $1
billion; plus .85% of the average daily net assets over $1 billion, compared to
the current investment management fee rate of 1.0% of the average daily net
assets.
In support of its recommendation to engage OppenheimerFunds as
sub-advisor to the Portfolio, the Manager informed the Board of Trustees of its
belief that appointment of OppenheimerFunds as sub-advisor to the Portfolio and
implementation of revised investment policies and restrictions would assist the
Portfolio in efforts to achieve its investment objective and increase its net
assets.
On October 12, 1998, the Board of Trustees, including a majority of the
Independent Trustees, gave preliminary approval to the New Sub-Advisory
Agreement, effective on the Effective Date, and authorized the submission of the
Proposals for shareholder approval and preparation of this proxy statement. It
is anticipated that formal approval of the New Sub-Advisory Agreement by the
Board of Trustees will take place at a meeting scheduled to be held on December
16, 1998. At such meeting, Management will recommend that the Board of Trustees
also approve a change in the name of the Portfolio to the "AST Oppenheimer
Large-Cap Growth Portfolio," subject to shareholder approval of Proposal I. The
Present Sub-Advisory Agreement will be terminated as of the close of business on
December 30, 1998.
The Present Sub-Advisory Agreement
The following description of the Present Sub-Advisory Agreement is
qualified in its entirety by reference to the form of such agreement attached to
this Proxy Statement as Exhibit A-1.
Under the terms of the Present Sub-Advisory Agreement, Robertson
Stephens has agreed to furnish the Manager with investment advisory services in
connection with a continuous investment program for the Portfolio which is to be
managed in accordance with the investment objective, investment policies and
restrictions of the Portfolio as set forth in the Prospectus and Statement of
Additional Information of the Trust and in accordance with the Trust's
Declaration of Trust and By-laws. Subject to the supervision and control of the
Manager, which is in turn subject to the supervision and control of the Board of
Trustees, Robertson Stephens, in its discretion, determines and selects the
securities to be purchased for and sold from the Portfolio from time to time and
places orders with and gives instructions to brokers, dealers and others to
cause such transactions to be executed.
The Present Sub-Advisory Agreement requires Robertson Stephens to use
its best efforts and good faith in the performance of its services under the
Present Sub-Advisory Agreement. However, so long as Robertson Stephens has acted
in good faith and has used its best efforts, then, in the absence of willful
misfeasance, bad faith, gross negligence or reckless disregard of its
obligations under the Present Sub-Advisory Agreement, Robertson Stephens shall
not be liable to the Trust or its shareholders or to the Manager for any act or
omission resulting in any loss suffered in any portfolio of the Trust in
connection with any service to be provided under the Present Sub-Advisory
Agreement.
The Manager is responsible for payment of Robertson Stephens'
compensation under the Present Sub-Advisory Agreement. Robertson Stephens'
compensation for the services provided under the Present Sub-Advisory Agreement
is computed at an annual rate and is payable monthly in arrears, based on the
average daily net assets of the Portfolio for each month. For all services
rendered, the Manager calculates and pays Robertson Stephens at the annual rate
of .60% of the average daily net assets of the Portfolio not in excess of $200
million; and .50% of the portion of the net assets over $200 million. In
computing the fee to be paid to Robertson Stephens, the net asset value of the
Portfolio is determined as set forth in the current registration statement of
the Trust.
The Present Sub-Advisory Agreement provides that it shall remain in
effect for one year from the date of the agreement, and is renewable annually
thereafter by specific approval of the Board of Trustees or by vote of a
majority of the outstanding voting securities of the Portfolio (as defined under
the Investment Company Act). In either event, such renewal shall also be
approved by the vote of a majority of the Independent Trustees. The Present
Sub-Advisory Agreement may be terminated at any time without penalty upon 60
days' written notice to the other party to the agreement, and will automatically
terminate in the event of its "assignment" by either party (as defined under the
Investment Company Act) or (provided Robertson Stephens has received prior
written notice thereof) upon termination of the Present Investment Management
Agreement.
The Present Sub-Advisory Agreement will be terminated by ASISI as of
the close of business on December 30, 1998. The termination, rather than
continuance, of the Present Sub-Advisory Agreement reflects the determination of
the Manager and the Board of Trustees that it would be in the interests of the
Portfolio's shareholders to enter into the New Sub-Advisory Agreement described
below. Robertson Stephens' compensation under the Present Sub-Advisory Agreement
will be prorated to the date of termination.
As of June 30, 1998, Robertson Stephens and its affiliates managed
assets totaling approximately $5.5 billion, including over $269 million in
assets of the Portfolio.
The New Sub-Advisory Agreement
The following description of the New Sub-Advisory Agreement is
qualified in its entirety by reference to the form of such agreement attached to
this Proxy Statement as Exhibit A-2.
The terms and conditions of the New Sub-Advisory Agreement are the same
in all material respects to those of the Present Sub-Advisory Agreement, with
the exception of the identity of the service provider, the decreased
sub-advisory fee rate payable by the Manager, the effective date and the name of
the Portfolio. In addition, the New Sub-Advisory Agreement no longer contains a
provision specifically requiring the Sub-advisor to use its best judgment,
effort and advice in rendering services under the Agreement. However, the New
Sub-Advisory Agreement continues to contain the provision of the Present
Sub-Advisory Agreement requiring the Sub-Advisor to use its best efforts and
good faith in the performance of its services. Finally, certain clarifying
changes that are not believed to be material have been made to the New
Sub-Advisory Agreement.
As compensation for the services to be rendered under the New
Sub-Advisory Agreement, the Manager, and not the Trust or the Portfolio, will
pay OppenheimerFunds a fee at the annual rate of .35% of the Portfolio's average
daily net assets not in excess of $500 million; plus .30% of the Portfolio's
average daily net assets over $500 million but not in excess of $1 billion; plus
.25% of the Portfolio's average daily net assets in excess of $1 billion. In
computing the fee to be paid to OppenheimerFunds, the net asset value of the
Portfolio shall be determined as set forth in the then current registration
statement of the Trust. If the New Sub-Advisory Agreement is terminated, the
payment will be prorated to the date of termination.
For the fiscal year ended December 31, 1997, the amount of the
sub-advisory fee paid by the Manager to Robertson Stephens for services rendered
under the Present Sub-Advisory Agreement was $892,079. If the New Sub-Advisory
Agreement had been effect for the year ending December 31, 1997, the amount of
the sub-advisory fee paid by the Manager to OppenheimerFunds for services
rendered under the New Sub-Advisory Agreement would have been $520,379, a
decrease of 41.7% from the actual amount paid to Robertson Stephens during such
period.
If the New Sub-Advisory Agreement is approved by the shareholders of
the Portfolio, it will become effective on the Effective Date. The New
Sub-Advisory Agreement will remain in effect for an initial one year term and is
renewable thereafter by specific approval of the Board of Trustees or by vote of
a majority of the outstanding voting securities of the Portfolio (as defined
under the Investment Company Act). In either event, such renewal shall also be
required to be approved by the vote of a majority of the Independent Trustees.
Like the Present Sub-Advisory Agreement, the New Sub-Advisory Agreement may be
terminated at any time without penalty upon 60 days' written notice to the other
party to the agreement, and will automatically terminate in the event of its
"assignment" by either party (as defined under the Investment Company Act) or
(provided OppenheimerFunds has received prior written notice thereof) upon
termination of the New Investment Management Agreement.
As discussed in more detail below, the Board of Trustees and the
Manager believe that approval of the New Sub-Advisory Agreement is in the best
interests of the Portfolio and its shareholders because of the high quality of
the services expected to be provided under the New Sub-Advisory Agreement. In
addition, the New Sub-Advisory Agreement could facilitate efforts to increase
the Portfolio's assets, which may have beneficial effects on Portfolio and Trust
expenses.
The Proposed Sub-Advisor
OppenheimerFunds, Two World Trade Center, New York, New York
10048-0203, has operated as an investment adviser to mutual funds since 1959.
OppenheimerFunds (including subsidiaries) currently manages investment companies
with assets of more than $85 billion as of September 30, 1998, and with more
than 4 million shareholder accounts. OppenheimerFunds is owned by Oppenheimer
Acquisition Corp., a holding company that is owned in part by senior officers of
OppenheimerFunds and controlled by Massachusetts Mutual Life Insurance Company,
which is located at 1295 State Street, Springfield, Massachusetts 01111.
The principal executive officer of OppenheimerFunds is Bridget A. Macaskill
and its directors are Ms. Macaskill, Donald W. Spiro, Andrew J. Donohue and
Robert C. Doll. The principal occupations of these persons are as follows:
Bridget A. Macaskill, President, Chief Executive Officer and Director of
OppenheimerFunds; Donald W. Spiro, Chairman Emeritus and Director of
OppenheimerFunds; Andrew J. Donohue, Executive Vice President; General Counsel
and Director of OppenheimerFunds and Robert C. Doll, Executive Vice President
and Director of OppenheimerFunds. The address of the principal executive officer
and each director listed above is Two World Trade Center, New York, New York,
10048.
OppenheimerFunds acts as an investment adviser to various publicly
owned investment companies, some of which have investment objectives and
programs similar to the investment objective and proposed investment program for
the Portfolio, as described in more detail below (collectively, the "Comparable
Oppenheimer Funds"). As investment adviser to the Comparable Oppenheimer Funds,
OppenheimerFunds performs certain administrative and other duties, which it will
not be required to perform for the Portfolio under the New Sub-Advisory
Agreement. For each Comparable Oppenheimer Fund, the following chart lists the
total assets at September 30, 1998, as well as the current advisory fee rate
payable to OppenheimerFunds.
- ------------------ --------------- ---------------------------------------------
Comparable Total Net Advisory Fee Rate
Oppenheimer Fund Assets
at September
30, 1998
(in millions)
Oppenheimer $1,792.8 An annual rate of .75% of the first $200
Capital million of net assets; plus .72% of the next
Appreciation Fund $200 million; plus .69% of the next $200
million; plus .66% of the next $200 million;
plus .60% of the next $700 million; plus .58%
of the net assets in excess of $1.5 billion.
Oppenheimer $696.9 An annual rate of .625% of the first $300
Disciplined million of net assets; plus .50% of the next
Value Fund $100 million; plus .45% of the net assets in
excess of $400 million.
Oppenheimer $1,953.8 An annual rate of .75% of the first $200
Growth Fund million of net assets; plus .72% of the
next $200 million; plus .69% of the next $200
million; plus .66% of the next $200 million;
plus .60% of the next $700 million; plus .58%
of the next $1 billion; plus .56% of the net
assets in excess of $2.5 billion.
Oppenheimer $22.6 An annual rate of .75% of the first $200
MidCap Fund million of net assets; plus .72% of the
next $200 million; plus .69% of the next $200
million; plus .66% of the next $200 million;
plus .60% of the net assets in excess of $800
million.
Oppenheimer $255.3 An annual rate of 1.00% of the first $400
Quest Capital million of net assets; plus .90% of the next
Value Fund, Inc. $400 million; plus .85% of the net assets in
excess of $800 million.
Oppenheimer $4,254.0 An annual rate of 1.00% of the first $400
Quest million of net assets; plus .90% of the next
Opportunity $400 million; plus .85% of the next $3.2
Value Fund billion; plus .80% of the next $4 billion;
plus .75% of the net assets in excess of $8
billion.
Oppenheimer $1,454.0 An annual rate of 1.00% of the first $400
Quest Value million of net assets; plus .90% of the
Fund, Inc. next $400 million and .85% of the next $3.2
billion; plus .80% of the next $4 billion;
plus .75% of the net assets in excess of $8
billion.
Oppenheimer $852.6 An annual rate of .75% of the first $200
Variable Accounts million of net assets; plus .72% of the
Funds/ next $200 million; plus .69% of the next
Oppenheimer $200 million; plus .66% of the next $200
Aggressive Growth million; plus .60% of the net assets in
Fund excess of $800 million.
Oppenheimer $576.3 An annual rate of .75% of the first $200
Variable million of net assets; plus .72% of the
Accounts Funds/ next $200 million; plus .69% of the next
Oppenheimer $200 million; plus .66% of the next $200
Growth Fund million; plus .60% of the net assets in
excess of $800 million.
Panorama Series $784.4 An annual rate of .625% of the first $300
Fund, Inc./ million of net assets; plus .50% of the next
Growth Fund $100 million; plus .45% of the net assets in
excess of $400 million.
Panorama Series $63.2 An annual rate of .85% of the first $250
Fund, Inc./ million of net assets; plus .75% of the net
LifeSpan Capital assets in excess of $250 million.
Appreciation
Portfolio
The Evaluation by the Board of Trustees
In evaluating the New Sub-Advisory Agreement, the Board of Trustees
received information and reviewed materials furnished by the Manager, including
information about Robertson Stephens' operations and management of the Portfolio
and OppenheimerFunds' personnel, operations and anticipated management of the
Portfolio. Consideration was given to the decreased fee rate payable by the
Manager under the New Sub-Advisory Agreement, and the decreased fee rate payable
by the Portfolio under the New Investment Management Agreement, meaning that the
Portfolio's shareholders will pay lower fees as a result of the change in
sub-advisors.
Consideration was given to the Manager's report of the Portfolio's
under-performance since its inception in May 1996 relative to the Standard &
Poor's 500 Composite Stock Price Index and other mutual funds with similar
investment objectives, and to the Manager's belief that such under-performance
was not accompanied by any reduction in risk relative to such index and the
other mutual funds. Consideration was also given to the uncertainty as to
further continuity of the management of Robertson Stephens, in light of
BankAmerica's announced intention to sell Robertson Stephens or some portion of
its business after acquiring it in 1997. The Manager provided its assessment
that replacement of the Sub-advisor for the Portfolio and approval of the New
Sub-advisory Agreement with OppenheimerFunds could improve the Portfolio's
performance. The Manager's recommendation of OppenheimerFunds was based, among
other factors, on (1) the performance of other funds with similar investment
objectives and investment styles that are managed by OppenheimerFunds, (2) the
OppenheimerFunds personnel who will be involved in the management of the
Portfolio, and (3) the excellent overall reputation and standing of
OppenheimerFunds in the U.S. mutual fund industry.
The Board of Trustees also considered that the terms of the New
Sub-advisory Agreement will remain materially the same as those of the Present
Sub-Advisory Agreement, except for the identity of the sub-advisor, the
effective date, the name of the Portfolio, and the sub-advisory fee rate. In
addition to considering the investment advisory capabilities of OppenheimerFunds
in terms of potential benefits in the investment performance of the Portfolio,
the Board of Trustees also considered that the capabilities and reputation of
OppenheimerFunds may facilitate efforts to increase the Portfolio's assets, with
possible beneficial effects on Portfolio and Trust expenses.
Based upon its evaluation, the Board of Trustees concluded that the
Manager's engagement of OppenheimerFunds as Sub-advisor to the Portfolio likely
would offer the Portfolio access to highly effective management and advisory
services and capabilities. The Board of Trustees concluded further that the
terms of the New Sub-Advisory Agreement, including the fees contemplated
thereby, are fair and reasonable and in the best interests of the Portfolio and
its shareholders.
In order to provide for the services described in the New Sub-Advisory
Agreement, the shareholders are being asked to approve the New Sub-Advisory
Agreement.
Change in Portfolio Name
If Proposal I is approved, as of the Effective Date, the name of the
Portfolio will be changed from the "Robertson Stephens Value + Growth Portfolio"
to the "AST Oppenheimer Large-Cap Growth Portfolio," and the New Investment
Management Agreement and the New Sub-Advisory Agreement will become effective.
THE TRUSTEES, INCLUDING THE INDEPENDENT TRUSTEES,
RECOMMEND THAT THE SHAREHOLDERS VOTE "FOR" PROPOSAL I.
ANY UNMARKED PROXIES THAT ARE RETURNED ON A TIMELY BASIS WILL BE SO VOTED.
PROPOSAL II
APPROVAL OF A CHANGE IN THE
PORTFOLIO'S INVESTMENT OBJECTIVE
Change in Portfolio Investment Objective
The Portfolio's current fundamental investment objective (the
"Investment Objective"), which may not be changed without approval of the
shareholders of the Portfolio, is as follows:
The investment objective of the Portfolio is to seek capital
appreciation.
The Board of Trustees recommends that the shareholders retain the same
investment objective for the Portfolio, but that the shareholders approve making
the investment objective "non-fundamental," which would mean that it could be
changed by the Board of Trustees of the Trust, if appropriate in its judgment,
without the approval of the shareholders of the Portfolio. The Manager proposed
to the Board of Trustees that the Investment Objective be reclassified from
fundamental to non-fundamental to provide the Board of Trustees with flexibility
to change the objective. It is not expected that the Board of Trustees will use
this flexibility frequently. However, the Board of Trustees would be in a
position to change the investment objective in circumstances when such a change
would, in the Board's judgment, be in the best interests of the Portfolio's
shareholders. Such circumstances could include changes in the securities markets
generally that would render achievement of the Portfolio's current investment
objective of capital appreciation or any future objective unlikely on an ongoing
basis, or changes with respect to the Portfolio specifically, such as a change
in the Portfolio's Sub-advisor. The Investment Company Act does not require the
investment objective to be classified as "fundamental."
If the Shareholders of the Portfolio approve this Proposal, the Board
of Trustees thereafter would be permitted to change the Investment Objective
without the delay and expense to the Portfolio of arranging for shareholder
approval. To obtain shareholder approval, the Portfolio would be required to
hold a shareholder meeting at which such change would be voted upon, and to
prepare and send a proxy statement to Contractowners seeking their instructions
as to how to vote shares at such meeting. Therefore, obtaining shareholder
approval to change the Portfolio's investment objective is likely to involve a
delay of at least 2-3 months and, assuming that the number of Contractowners
whose assets are invested in the Portfolio remain constant at current levels, to
involve printing, mailing and legal costs exceeding $40,000 to $60,000.
THE TRUSTEES, INCLUDING THE INDEPENDENT TRUSTEES,
RECOMMEND THAT THE SHAREHOLDERS VOTE "FOR" PROPOSAL II.
ANY UNMARKED PROXIES THAT ARE RETURNED ON A TIMELY BASIS WILL BE SO VOTED.
<PAGE>
PROPOSALS III-IX
APPROVAL OF CHANGES IN THE PORTFOLIO'S
FUNDAMENTAL INVESTMENT RESTRICTIONS
As described in more detail below, the Board of Trustees, including the
Independent Trustees, are recommending to the shareholders of the Portfolio that
they approve a number of changes to the Portfolio's fundamental investment
restrictions. Generally, the purposes behind these proposed changes are (i) to
increase the Portfolio's investment flexibility, and (ii) to conform the
fundamental investment restrictions applicable to the Portfolio to those
applicable to certain other portfolios of the Trust.
The Portfolio currently is subject to certain investment restrictions
that are "fundamental" policies and may not be changed without approval of the
shareholders of the Portfolio (collectively, the "Affected Investment
Restrictions"). The Portfolio also is subject to certain non-fundamental
investment restrictions that may be changed by the Board of Trustees without
shareholder approval.
The Manager, after discussions with OppenheimerFunds, has proposed to
the Board of Trustees that certain of the Portfolio's fundamental investment
restrictions described below be replaced or eliminated. As noted above, these
changes will increase the Portfolio's investment flexibility and conform the
Portfolio's restrictions with the restrictions applicable to other portfolios of
the Trust. Except to the extent that they will be embodied in similar
fundamental investment restrictions, the Investment Company Act does not require
these investment restrictions to be classified as "fundamental." Moreover,
certain of the prohibitions underlying these investment restrictions reflect the
requirements of the Investment Company Act and, in the absence of such
restrictions, would still be applicable to the Portfolio. Certain of the
prohibitions underlying other investment restrictions reflect the requirements
of state securities laws that no longer are applicable to the Portfolio (or
other mutual funds).
The Manager does not believe that approval of the changes to the
Portfolio's fundamental restrictions would significantly affect the day-to-day
management of, and the investment decisions made for, the Portfolio, either as
the Portfolio is currently managed or as it would be managed under the New
Sub-Advisory Agreement.
Elimination and Replacement of Certain Affected Investment Restrictions
If Proposals III-VII are approved by the shareholders, the Portfolio
will be subject to the following fundamental investment restrictions
(collectively, the "Continuing Investment Restrictions") which are substantially
identical to those applicable to certain other portfolios of the Trust and which
will be the only fundamental investment restrictions applicable to the
Portfolio. The nature and scope of these Continuing Investment Restrictions
compared to certain Affected Investment Restrictions are discussed in more
detail below.
1. The Portfolio may not issue senior securities, except as permitted under the
Investment Company Act. 2. The Portfolio may not borrow money, except that the
Portfolio may (i) borrow money for non-leveraging, temporary or emergency
purposes, and (ii) engage in reverse repurchase agreements and make other
investments or engage in other transactions, which may involve a borrowing, in a
manner consistent with the Portfolio's investment objective and policies;
provided that the combination of (i) and (ii) shall not exceed 33 1/3% of the
value of the Portfolio's assets (including the amount borrowed) less liabilities
(other than borrowings) or such other percentage permitted by law. Any
borrowings which come to exceed this amount will be reduced in accordance with
applicable law. Subject to the above limitations, the Portfolio may borrow from
banks or other persons to the extent permitted by applicable law. 3. The
Portfolio may not underwrite securities issued by other persons, except to the
extent that the Portfolio may be deemed to be an underwriter (within the meaning
of the Securities Act of 1933) in connection with the purchase and sale of
portfolio securities. 4. The Portfolio may not purchase or sell real estate
unless acquired as a result of the ownership of securities or other instruments;
provided that this restriction shall not prohibit a Portfolio from investing in
securities or other instruments backed by real estate or in securities of
companies engaged in the real estate business. 5. The Portfolio may not purchase
or sell physical commodities unless acquired as a result of the ownership of
securities or instruments; provided that this restriction shall not prohibit the
Portfolio from (i) engaging in permissible options and futures transactions and
forward foreign currency contracts in accordance with the Portfolio's investment
policies, or (ii) investing in securities of any kind. 6. The Portfolio may not
make loans, except that the Portfolio may (i) lend portfolio securities in
accordance with the Portfolio's investment policies in amounts up to 33 1/3% of
the total assets of the Portfolio taken at market value, (ii) purchase money
market securities and enter into repurchase agreements, and (iii) acquire
publicly distributed or privately placed debt securities. 7. The Portfolio may
not purchase any security if, as a result, more than 25% of the value of the
Portfolio's assets would be invested in the securities of issuers having their
principal business activities in the same industry; provided that this
restriction does not apply to investments in obligations issued or guaranteed by
the U.S. Government or any of its agencies or instrumentalities (or repurchase
agreements with respect thereto). 8. The Portfolio may not, with respect to 75%
of the value of its total assets, purchase the securities of any issuer (other
than securities issued or guaranteed by the U. S. Government or any of its
agencies or instrumentalities) if, as a result, (i) more that 5% of the value of
the Portfolio's total assets would be invested in the securities of such issuer,
or (ii) more than 10% of the outstanding voting securities of such issuer would
be held by the Portfolio.
If a restriction on the Portfolio's investments is adhered to at the
time an investment is made, a subsequent change in the percentage of Portfolio
assets invested in certain securities or other instruments, or change in average
duration of the Portfolio's investment portfolio, resulting from changes in the
value of the Portfolio's total assets, will not be considered a violation of the
restriction; provided, however, that the asset coverage requirement applicable
to borrowings shall be maintained in the manner contemplated by applicable law.
With respect to Continuing Investment Restrictions (2) and (6), the
Portfolio will not borrow from or lend to any other fund unless it applies for
and receives an exemptive order from the Securities and Exchange Commission (the
"Commission"), if so required, or the Commission issues rules permitting such
transactions. There is no assurance the Commission would grant any order
requested by a Portfolio or promulgate any rules allowing such transactions.
The following Affected Investment Restrictions are being proposed to be
eliminated and replaced by similar Continuing Investment Restrictions as
discussed below. Approval of Proposals III through VII is contingent upon
approval of each such Proposal. Therefore, a vote against any of Proposals III,
IV, V, VI or VII will have the effect of a vote against all of these Proposals.
Proposal III. The Portfolio is subject to the following Affected
Investment Restriction concerning diversification and industry concentration of
investments:
The Portfolio may not, as to 75% of the Portfolio's total assets,
purchase any security (other than obligations of the U.S. Government,
its agencies or instrumentalities) if as a result: (i) more than 5% of
the Portfolio's total assets (taken at current value) would then be
invested in securities of a single issuer, or (ii) more than 25% of the
Portfolio's total assets (taken at current value) would be invested in
a single industry.
The Investment Company Act prohibits a diversified fund, such as the
Portfolio, from investing with respect to 75% of its total assets in securities
of an issuer if as a result more than 5% of the Portfolio's assets would be
invested in such issuer. If this Proposal III is adopted, the Portfolio would
continue to be subject to Continuing Investment Restriction 8, which reflects
this limitation of the Investment Company Act, and which also reflects the
Investment Company Act's 10% limitation on the ownership of the voting
securities of any one issuer by a diversified fund.
Additionally, if the fundamental investment restriction set forth above
is eliminated, the Portfolio will continue to be subject to Continuing
Investment Restriction 7 which prohibits investment of more than 25% of the
Portfolio's assets in any one industry while providing greater clarity as to the
application of the percentage limitation. Elimination of the Affected Investment
Restriction set forth above will avoid possible future ambiguity.
Proposal IV. The Portfolio is subject to the following Affected
Investment Restriction concerning loans:
The Portfolio may not make loans, except by purchase of debt
obligations or other financial instruments in which the Portfolio may
invest consistent with its investment policies, by entering into
repurchase agreements, or through the lending of its portfolio
securities.
The Manager has proposed to the Board of Trustees that the Affected Investment
Restriction set forth above be eliminated. If eliminated, the Portfolio would
continue to be subject to Continuing Investment Restriction 6, which is
substantially equivalent to the Affected Investment Restriction, except for the
incorporation in Continuing Investment Restriction 6 of the 33 1/3% limit on
securities loans required under existing regulatory positions.
Proposal V. The Portfolio is subject to the following Affected
Investment Restriction concerning borrowings:
The Portfolio may not borrow more than one-third of the value of its
total assets less all liabilities and indebtedness (other than such
borrowings) not represented by senior securities.
The Manager has proposed to the Board that the Affected Investment
Restriction set forth above be eliminated. If the above fundamental investment
restriction were eliminated, the Portfolio would continue to be subject to
Continuing Restriction 2. The elimination of the Affected Investment Restriction
will clarify the circumstances under which the Portfolio may borrow, including
borrowings for non-leveraging, temporary or emergency purposes and borrowings
that may be deemed to result from other investments and investment practices
(only when consistent with the Portfolio's investment objective and policies and
subject to compliance with legal and regulatory asset coverage requirements).
Continuing Restriction 2 also would clarify that total assets for the purposes
of the one-third limitation on borrowings includes the amount of the borrowings.
Proposal VI. The Portfolio is subject to the following Affected
Investment Restriction concerning underwriting securities of other issuers:
The Portfolio may not act as underwriter of securities of other issuers
except to the extent that, in connection with the disposition of
portfolio securities, it may be deemed to be an underwriter under
certain federal securities laws.
The Manager has proposed to the Board that the Affected Investment
Restriction set forth above be eliminated. Continuing Restriction 3 would
continue to prohibit the Portfolio from acting as an underwriter except to the
extent that it may be deemed to be an underwriter (within the meaning of the
Securities Act of 1933), but would make clear that its provisions apply both to
sales and purchases of portfolio securities.
Proposal VII. The Portfolio is subject to the following Affected
Investment Restriction concerning senior securities:
The Portfolio may not issue any class of securities which is senior to
the Portfolio's shares of beneficial interest, except that the
Portfolio may borrow money to the extent contemplated by Restriction 3
below.
The Manager has proposed to the Board that the Affected Investment
Restriction set forth above be eliminated, as it is substantially equivalent to
Continuing Restriction 1. The issuance of senior securities by an investment
company is governed by and generally prohibited under the requirements of the
Investment Company Act, subject to certain exceptions for borrowing
arrangements. Continuing Restriction 1 prohibits the Portfolio from issuing
senior securities except as permitted by the Investment Company Act.
The Portfolio currently is not subject to any fundamental restriction
that is comparable to Continuing Restriction 4, which limits the Portfolio's
ability to purchase or sell real estate, or Continuing Restriction 5, which
limits the Portfolio's ability to purchase or sell physical commodities.
However, the Investment Company Act provides that a fund may not purchase or
sell real estate or commodities unless authorized by a vote of shareholders, and
Continuing Restrictions 4 and 5 are intended to define clearly the scope of the
Portfolio's ability to make investments in these areas. The Portfolio has no
intention of investing directly in real estate or physical commodities, but may,
if in accordance with its investment policies or if deemed appropriate by the
Board of Trustees in the future, make certain real estate-related investments
and engage in futures, options and forward transactions as permitted by these
Continuing Restrictions.
Elimination of Certain Affected Investment Restrictions
The following Affected Investment Restrictions are being proposed to be
eliminated.
Proposal VIII. The Portfolio is subject to the following Affected
Investment Restriction concerning the purchase of securities on margin:
The Portfolio may not purchase securities on margin (but the Portfolio
may obtain such short-term credits as may be necessary for the
clearance of transactions). (Margin payments or other arrangements in
connection with transactions in short sales, futures contracts,
options, and other financial instruments are not considered to
constitute the purchase of securities on margin for this purpose.)
The Manager has proposed to the Board of Trustees that the Affected
Investment Restriction set forth above be eliminated. The Portfolio has no
current intention of purchasing securities on margin except as may currently be
permitted by the Affected Investment Restriction. Moreover, the Portfolio's
ability to engage in margin transactions is limited by current positions taken
by the Commission that such transactions involve the issuance of senior
securities and by other investment restrictions which permit the Portfolio to
borrow money only in limited circumstances. However, elimination of this
restriction will permit the Board of Trustees, if deemed appropriate in its
judgment, to authorize the Portfolio to purchase securities on margin without
the delay and expense of a future shareholders meeting.
Proposal IX. The Portfolio also is subject to the following Affected
Investment Restriction concerning investment in securities of issuers in which
management of the Trust or the Manager owns securities:
The Portfolio may not invest in securities of any issuer if any officer
or Trustee of the Trust or any officer of director of the Sub-advisor,
as the case may be, owns more than 1/2 of 1% of the outstanding
securities of such issuer, and such officers, Trustees and directors
who own more than 1/2 of 1% own in the aggregate more than 5% of the
outstanding securities of such issuer.
The Manager has proposed to the Board of Trustees that the above
Affected Investment Restriction be eliminated because the prohibitions
underlying the restriction reflect the requirements of state securities laws
that are no longer applicable. Elimination of the Affected Investment
Restriction would permit the Portfolio to invest in securities of any issuer
without regard to ownership in such issuer by management of the Trust or the
Manager, except to the extent prohibited by the Investment Company Act.
THE TRUSTEES, INCLUDING THE INDEPENDENT TRUSTEES, RECOMMEND THAT THE
SHAREHOLDERS VOTE "FOR" PROPOSALS III-IX. ANY UNMARKED PROXIES THAT ARE RETURNED
ON A TIMELY BASIS WILL BE SO VOTED.
Changes in Non-Fundamental Investment Policies
As discussed above, the Portfolio's investment objective of seeking
capital appreciation will not be changed as result of approval of the Proposals,
except to make the objective non-fundamental. However, in order to conform the
investment policies of the Portfolio to the investment program that has been
formulated by OppenheimerFunds, a number of changes to the non-fundamental
investment policies of the Portfolio will be implemented if the New Sub-Advisory
Agreement is approved. The following description outlines the investment
policies of the Portfolio as it is currently managed, and compares such policies
to those under which the Portfolio would be managed under the New Sub-Advisory
Agreement. Shareholder approval of these changes is not required; the following
description is being provided solely for the information of the Portfolio's
shareholders.
In general, Robertson Stephens attempts to fulfill the Portfolio's
investment objective of capital appreciation by utilizing an approach in which
the Portfolio normally will invest primarily in growth companies believed by
Robertson Stephens to have favorable relationships between price/earnings ratios
and growth rates in sectors offering the potential for above-average returns. In
so doing, Robertson Stephen's primary emphasis is typically on evaluating a
company's management, growth prospects, business operations, revenues, earnings,
cash flows, and balance sheet in relation to its share price. Robertson Stephens
may select stocks that it believes are undervalued relative to the current stock
price, which can result from a variety of factors, such as a lack of investor
recognition of (1) the value of a business franchise and continuing growth
potential, (2) a new, improved or upgraded product, service or business
operation, (3) a positive change in either the economic or business condition
for a company, (4) expanding or changing markets that provide a company with
either new earnings direction or acceleration, or (5) a catalyst, such as an
impending or potential asset sale or change in management that could draw
increased investor attention to a company. Robertson Stephens may also use
similar factors to identify stocks that it believes are overvalued, in order to
engage in short sales of such securities.
The Portfolio may invest a substantial portion of its assets in
securities issued by small companies. Small companies offer greater
opportunities for capital appreciation than larger companies, but the value of
their securities may fluctuate more sharply than those of other securities.
While the Portfolio intends to remain primarily invested in growth
companies as described above, it may also invest in other types of securities
and employ special investment techniques. The Portfolio may, from time to time,
take positions in, among other things, debt securities (including zero-coupon
bonds and payment-in-kind bonds), foreign securities, options and futures. In
addition, when Robertson Stephens determines that market conditions make
pursuing the Portfolio's basic investment strategy inconsistent with the best
interest of its shareholders, the Portfolio may invest in U.S. government
securities, other high-quality debt instruments, and other similar securities.
If the New Sub-Advisory Agreement is approved, investment decisions for
the Portfolio will similarly be based upon an approach designed to achieve the
Portfolio's investment objective of capital appreciation. OppenheimerFunds will
seek this investment objective by emphasizing common stocks issued by
large-capitalization "growth companies" that, in OppenheimerFunds' opinion, have
above average earnings prospects but are selling at below-normal valuations.
Growth companies may be developing new products or services, or expanding into
new markets for their products. While these companies may have what
OppenheimerFunds believes to be favorable prospects for the long-term, they
normally retain a large portion of their earnings for research, development and
capital assets. Therefore, they tend not to emphasize the payment of dividends.
Investment opportunities may be sought among securities of smaller, less
well-known companies, but the primary emphasis will be on large-cap issuers. The
Portfolio normally will invest primarily in securities of issuers with market
capitalizations in excess of $3 billion, and will maintain a median market
capitalization of more than $5 billion. The emphasis on investment in
large-capitalization growth companies is not a fundamental policy of the
Portfolio, and may be changed without shareholder approval.
Because the Portfolio intends to invest a substantial portion, if not
all, of its assets in stocks, the value of the portfolio will be affected by
changes in the stock market. The Portfolio will attempt to limit market risks by
diversifying most of its investments, that is, as to 75% of the Portfolio's net
assets, by not investing more than 5% of the Portfolio's assets in any one
company.
In addition to equity securities, the Portfolio may also invest to some
degree in other types of securities and employ special investment techniques.
The Portfolio may take positions in, among other things, foreign securities and
futures contracts and other derivative instruments, although its ability to make
investments other than in stocks of large-cap companies generally would be more
limited than that of the Portfolio under its current investment policies.
<PAGE>
Shareholder Proposals
The Trust is not required to hold and will not ordinarily hold annual
shareholders' meetings. The Board of Trustees may call special meetings of the
shareholders for action by shareholder vote as required by the Investment
Company Act or the Trust's Declaration of Trust.
Pursuant to rules adopted by the Commission, a shareholder may include
in proxy statements relating to annual and other meetings of the shareholders of
the Trust certain proposals for shareholder action which he or she intends to
introduce at such special meetings; provided, among other things, that such
proposal is received by the Trust at least thirty days before a solicitation of
proxies is made for such meeting. Timely submission of a proposal does not
necessarily mean that the proposal will be included.
By order of the Board of Trustees
/s/ Eric C. Freed
Eric C. Freed
Secretary
American Skandia Trust
<PAGE>
Exhibit A-1
SUB-ADVISORY AGREEMENT
THIS AGREEMENT is between American Skandia Investment Services, Incorporated
(the "Investment Manager") and Robertson, Stephens & Company Investment
Management, L.P. (the "Sub-Advisor").
WHEREAS American Skandia Trust (the "Trust") is a Massachusetts business trust
organized with one or more series of shares, and is registered as an investment
company under the Investment Company Act of 1940 (the "ICA"); and
WHEREAS the trustees of the Trust (the "Trustees") have engaged the Investment
Manager to act as investment manager for the Robertson Stephens Value + Growth
Portfolio (the "Portfolio") under the terms of a management agreement, dated May
1, 1996, with the Trust (the "Management Agreement"); and
WHEREAS the Investment Manager has engaged the Sub-Advisor and the Trustees have
approved the engagement of the Sub-Advisor to provide investment advice and
other investment services set forth below;
NOW, THEREFORE the Investment Manager and the Sub-Advisor agree as follows:
1. Investment Services. The Sub-Advisor will furnish the Investment Manager with
investment advisory services in connection with a continuous investment program
for the Portfolio which is to be managed in accordance with the investment
objective, investment policies and restrictions of the Portfolio as set forth in
the Prospectus and Statement of Additional Information of the Trust and in
accordance with the Trust's Declaration of Trust and By-Laws. Officers,
directors, and employees of Sub-Advisor will be available to consult with
Investment Manager and the Trust, their officers, employees and Trustees
concerning the business of the Trust. Investment Manager will promptly furnish
Sub-Advisor with any amendments to such documents. Such amendments will not be
effective with respect to the Sub-Advisor until receipt thereof.
Subject to the supervision and control of the Investment Manager, which
is in turn subject to the supervision and control of the Trust's Board of
Trustees, the Sub-Advisor, will in its discretion determine and select the
securities to be purchased for and sold from the Portfolio from time to time and
will place orders with and give instructions to brokers, dealers and others for
all such transactions and cause such transactions to be executed. 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-Advisor authorized by the Investment Manager to settle
transactions in respect of the Portfolio. 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-Advisor will obtain and evaluate pertinent information about
significant developments and economic, statistical and financial data, domestic,
foreign or otherwise, whether affecting the economy generally or the Portfolio,
and concerning the individual issuers whose securities are included in the
Portfolio or the activities in which they engage, or with respect to securities
which the Sub-Advisor considers desirable for inclusion in the Portfolio.
The Sub-Advisor represents that it reviewed the Registration Statement
of the Trust, including any amendments or supplements thereto, and any Proxy
Statement relating to the approval of this Agreement, as filed with the
Securities and Exchange Commission and represents and warrants that with respect
to disclosure about the Sub-Advisor or information relating directly or
indirectly to the Sub-Advisor, such Registration Statement or Proxy Statement
contains, as of the date hereof, no untrue statement of any material fact and
does not omit any statement of material fact which was required to be stated
therein or necessary to make the statements contained therein not misleading.
The Sub-Advisor further represents and warrants that it is an investment advisor
registered under the Investment Advisers Act of 1940, as amended, and under the
laws of all jurisdictions in which the conduct of its business hereunder
requires such registration.
Sub-Advisor shall use its best judgment, effort, and advice in
rendering services under this Agreement.
In furnishing the services under this Agreement, the Sub-Advisor will
comply with the requirements of the ICA and subchapters L and M (including,
respectively, Section 817(h) and Section 851(b)(1), (2), (3) and (4)) of the
Internal Revenue Code, applicable to the Portfolio, and the regulations
promulgated thereunder. Sub-Advisor shall comply with (i) other applicable
provisions of state or federal law; (ii) the provision of the Declaration of
Trust and By-Laws of the Trust; (iii) policies and determinations of the Trust
and Investment Manager; (iv) the fundamental policies and investment
restrictions of the Trust, as set out in the Trust's registration statement
under the ICA, or as amended by the Trust's shareholders; (v) the Prospectus and
Statement of Additional Information of the Trust; and (vi) investment guidelines
or other instructions received in writing from Investment Manager. Sub-Advisor
shall supervise and monitor the investment program of the Portfolio.
Nothing in this Agreement shall be implied to prevent the Investment
Manager from engaging other sub-advisors to provide investment advice and other
services in relation to portfolios of the Trust for which Sub-Advisor does not
provide such services, or to prevent Investment Manager from providing such
services itself in relation to such portfolios.
2. Delivery of Documents to Sub-Advisor. The Investment Manager has furnished
the Sub-Advisor with copies of each of the following documents:
(a) The Declaration of Trust of the Trust as in effect on the date hereof;
(b) The By-laws of the Trust in effect on the date hereof;
(c) The resolutions of the Trustees approving the engagement of the
Sub-Advisor as Sub-Advisor to the Investment Manager and approving the
form of this agreement;
(d) The resolutions of the Trustees selecting the Investment Manager as
investment manager to the Trust and approving the form of the
Investment Manager's Management Agreement with the Trust;
(e) The Investment Manager's Management Agreement with the Trust;
(f) The Code of Ethics of the Trust and of the Investment Manager as
currently in effect; and
(g) A list of companies the securities of which are not to be bought or
sold for the Portfolio because of non-public information regarding
such companies that is available to Investment Manager or the Trust,
or which, in the sole opinion of the Investment Manager, it believes
such non-public information would be deemed to be available to
Investment Manager and/or the Trust.
The Investment Manager will furnish the Sub-Advisor 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 (f) above will be provided within 30 days of the time such
materials became available to the Investment Manager. Such amendments or
supplements as to item (g) 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.
3. Delivery of Documents to the Investment Manager. The Sub-Advisor has
furnished the Investment Manager with copies of each of the following documents:
(a) The Sub-Advisor's Form ADV as filed with the Securities and Exchange
Commission;
(b) The Sub-Advisor's most recent balance sheet;
(c) Separate lists of persons who the Sub-Advisor wishes to have
authorized to give written and/or oral instructions to Custodians of
Trust assets for the Portfolio;
(d) The Code of Ethics of the Sub-Advisor as currently in effect.
The Sub-Advisor will furnish the Investment Manager from time to time
with copies, properly certified or otherwise authenticated, of all material
amendments of or supplements to the foregoing, if any. Such amendments or
supplements as to items (a) through (d) above will be provided within 30 days of
the time such materials became available to the Sub-Advisor.
4. Investment Advisory Facilities. The Sub-Advisor, at its expense, will furnish
all necessary investment facilities, including salaries of personnel required
for it to execute its duties faithfully.
5. Execution of Portfolio Transactions. Sub-Advisor is responsible for decisions
to buy and sell securities for the Portfolio, broker-dealer selection, and
negotiation of its brokerage commission rates. Sub-Advisor shall determine the
securities to be purchased or sold by the Portfolio pursuant to its
determinations with or through such persons, brokers or dealers, in conformity
with the policy with respect to brokerage as set forth in the Trust's Prospectus
and Statement of Additional Information, or as the Board of Trustees may
determine from time to time. Generally, Sub-Advisor's primary consideration in
placing Portfolio securities transactions with broker-dealers for execution is
to obtain and maintain the availability of best execution at the best net price
and in the most effective manner possible. The Sub-Advisor may consider sale of
the shares of the Portfolio, as well as recommendations of the Investment
Manager, subject to the requirements of best net price and most favorable
execution.
Consistent with this policy, the Sub-Advisor will take the following
into consideration: the best net 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. Accordingly, the cost of the brokerage commissions to the Portfolio may
be greater than that available from other brokers if the difference is
reasonably justified by other aspects of the portfolio execution services
offered. Subject to such policies and procedures as the Board of Trustees of the
Trust may determine, the Sub-Advisor shall not be deemed to have acted
unlawfully or to have breached any duty solely by reason of its having caused
the Portfolio to pay a broker-dealer that provides research services to the
Sub-Advisor for the Portfolio's use 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-Advisor determines in good faith that such amount of commission was
reasonable in relation to the value of the research services provided by such
broker, viewed in terms of either that particular transaction or the
Sub-Advisor's ongoing responsibilities with respect to the Portfolio. The
Sub-Advisor is further authorized to allocate the orders placed by it on behalf
of the Portfolio to such broker-dealers who also provide research or statistical
material, or other services to the Portfolio or the Sub-Advisor. Such allocation
shall be in such amounts and proportions as the Sub-Advisor shall determine and
the Sub-Advisor will report on said allocations to the Investment Manager
regularly as requested by the Investment Manager and, in any event, at least
once each calendar year if no specific request is made, indicating the brokers
to whom such allocations have been made and the basis therefor.
6. Reports by Sub-Advisor. The Sub-Advisor shall furnish the Investment Manager
monthly, quarterly and annual reports concerning transactions and performance of
the Portfolio, including information required in the Trust's Registration, in
such form as may be mutually agreed, to review the Portfolio and discuss the
management of it. The Sub-Advisor shall permit the financial statements, books
and records with respect to the Portfolio to be inspected and audited by the
Trust, the Investment Manager or their agents at all reasonable times during
normal business hours. The Sub-Advisor shall immediately notify and forward to
both Investment Manager and legal counsel for the Trust any legal process served
upon it on behalf of the Investment Manager or the Trust. The Sub-Advisor shall
promptly notify the Investment Manager of any changes in any information
required to be disclosed in the Trust's Registration Statement.
7. Compensation of Sub-Advisor. The amount of the compensation to the
Sub-Advisor is computed at an annual rate. The fee is payable monthly in
arrears, based on the average daily net assets of the Portfolio for each month,
at the annual rates shown below.
For all services rendered, the Investment Manager will calculate and
pay the Sub-Advisor at the annual rate of: .60 of 1% of the portion of the net
assets of the Portfolio not in excess of $200 million; and .50 of 1% of the
portion of the net assets over $200 million.
In computing the fee to be paid to the Sub-Advisor, the net asset value
of the Portfolio shall be valued as set forth in the then current registration
statement of the Trust. If this agreement is terminated, the payment shall be
prorated to the date of termination.
Investment Manager and Sub-Advisor shall not be considered as partners
or participants in a joint venture. Sub-Advisor will pay its own expenses for
the services to be provided pursuant to this Agreement and will not be obligated
to pay any expenses of Investment Manager or the Trust. Except as otherwise
provided herein, Investment Manager and the Trust will not be obligated to pay
any expenses of Sub-Advisor.
8. Confidential Treatment. It is understood that any information or
recommendation supplied by the Sub-Advisor in connection with the performance of
its 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. It is also understood that any
information supplied to Sub-Advisor in connection with the performance of its
obligations hereunder, particularly, but not limited to, any list of securities
which, on a temporary basis, may not be bought or sold for the Portfolio, is to
be regarded as confidential and for use only by the Sub-Advisor in connection
with its obligation to provide investment advice and other services to the
Portfolio.
9. Representations of the Parties. Each party to this Agreement hereby
acknowledges that it is registered as an investment advisor under the Investment
Advisers Act of 1940, it will use its reasonable best efforts to maintain such
registration, and 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.
10. Liability. The Sub-Advisor shall use its best efforts and good faith in the
performance of its services hereunder. However, so long as the Sub-Advisor has
acted in good faith and has used its best efforts, then in the absence of
willful misfeasance, bad faith, gross negligence or reckless disregard for its
obligations hereunder, it shall not be liable to the Trust or its shareholders
or to the Investment Manager for any act or omission resulting in any loss
suffered in any portfolio of the Trust 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 of limitation of any rights which the Trust
or Investment Manager may have under applicable law.
The Investment Manager agrees that the Sub-Advisor shall not be liable
for any failure to recommend the purchase or sale of any security on behalf of
the Portfolio on the basis of any information which might, in Sub-Advisor's
opinion, constitute a violation of any federal or state laws, rules or
regulations.
11. Other Activities of Sub-Advisor. Investment Manager agrees that the
Sub-Advisor and any of its partners or employees, and persons affiliated with it
or with any such partner or employee may render investment management or
advisory services to other investors and institutions, and such investors and
institutions may own, purchase or sell, securities or other interests in
property the same as or similar to those which are selected for purchase,
holding or sale for the Portfolio, and the Sub-Advisor shall be in all respects
free to take action with respect to investments in securities or other interests
in property the same as or similar to those selected for purchase, holding or
sale for the Portfolio. Purchases and sales of individual securities on behalf
of the Portfolio and other portfolios of the Trust or accounts for other
investors or institutions will be made on a basis that is equitable to all
portfolios of the Trust and other accounts. Nothing in this agreement shall
impose upon the Sub-Advisor any obligation to purchase or sell or recommend for
purchase or sale, for the Portfolio any security which it, its partners,
affiliates or employees may purchase or sell for the Sub-Advisor or such
partner's, affiliate's or employee's own accounts or for the account of any
other client, advisory or otherwise.
12. Continuance and Termination. This Agreement shall remain in full force and
effect for one year from the date hereof, and is renewable annually thereafter
by specific approval of the Board of Trustees of the Trust 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 Sub-Advisor upon 60 days
written notice, and will automatically terminate in the event of its assignment
by either party to this Agreement, as defined in the ICA, or (provided
Sub-Advisor has received prior written notice thereof) upon termination of the
Investment Manager's Management Agreement with the Trust.
13. Notification. Sub-Advisor will notify the Investment Manager within a
reasonable time of any change in the personnel of the Sub-Advisor with
responsibility for making investment decisions in relation to the Portfolio or
who have been authorized to give instructions to a Custodian of the Trust.
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 address for such party.
Investment Manager: American Skandia Investment Services, Incorporated
One Corporate Drive
Shelton, Connecticut 06484
Attention: Thomas M. Mazzaferro
President & Chief Operating Officer
Sub-Advisor: Robertson, Stephens & Company
Investment Management, L.P.
555 California Street
San Francisco, California 94104
Attention: David Elliot
14. Indemnification. The Sub-Advisor agrees to indemnify and hold harmless
Investment Manager, any affiliated person within the meaning of Section 2(a)(3)
of the 1940 Act ("affiliated person") of Investment Manager and each person, if
any who, within the meaning of Section 15 of the Securities Act of 1933 (the
"1933 Act"), controls ("controlling person") Investment Manager, against any and
all losses, claims, damages, liabilities or litigation (including reasonable
legal and other expenses), to which Investment Manager or such affiliated person
or controlling person may become subject under the 1933 Act, the 1940 Act, the
Investment Adviser's Act of 1940 ("Adviser's Act"), under any other statute, at
common law or otherwise, arising out of Sub-Advisor's responsibilities as
portfolio manager of the Portfolio (1) to the extent of and as a result of the
willful misconduct, bad faith, or gross negligence by Sub-Advisor, any of
Sub-Advisor's employees or representatives or any affiliate of or any person
acting on behalf of Sub-Advisor, or (2) as a result of any untrue statement or
alleged untrue statement of a material fact contained in a prospectus or
statement of additional information covering the Portfolio or the Trust or 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 written information furnished to Investment Manager, the
Trust or any affiliated person of the Investment Manager or the Trust or upon
verbal information confirmed by the Sub-Advisor in writing or (3) to the extent
of, and as a result of, the failure of the Sub-Advisor to execute, or cause to
be executed, Portfolio transactions according to the standards and requirements
of the 1940 Act; provided, however, that in no case is Sub-Advisor's indemnity
in favor of Investment Manager or any affiliated person or controlling person of
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
Sub-Advisor, any affiliated person within the meaning of Section 2(a)(3) of the
1940 Act ("affiliated person") of Sub-Advisor and each person, if any who,
within the meaning of Section 15 of the Securities Act of 1933 (the "1933 Act"),
controls ("controlling person") Sub-Advisor, against any and all losses, claims,
damages, liabilities or litigation (including reasonable legal and other
expenses), to which Sub-Advisor or such affiliated person or controlling person
may become subject under the 1933 Act, the 1940 Act, the Investment Adviser's
Act of 1940 ("Adviser's Act"), under any other statute, at common law or
otherwise, arising out of 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 Investment Manager, any of
Investment Manager's employees or representatives or any affiliate of or any
person acting on behalf of Investment Manager, or (2) as a result of any untrue
statement or alleged untrue statement of a material fact contained in a
prospectus or statement of additional information covering the Portfolio or the
Trust or 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 by the Trust other than in reliance upon written
information furnished by Sub-Advisor, or any affiliated person of the
Sub-Advisor or other than upon verbal information confirmed by the Sub-Advisor
in writing; provided, however, that in no case is Investment Manager's indemnity
in favor of Sub-Advisor or any affiliated person or controlling person of
Sub-Advisor 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.
15. Warranty. The Investment Manager represents and warrants that (i) the
appointment of the Sub-Advisor 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 contemplated hereby are,
in conformity with the Investment Company Act of 1940, the Trust's governing
documents and other applicable laws.
The Sub-Advisor represents and warrants that it is authorized to
perform the services contemplated to be performed hereunder.
16. Amendment. This agreement may be amended by mutual written consent of the
parties, subject to the provisions of the ICA.
17. Governing Law. This agreement is made under, and shall be governed by and
construed in accordance with, the laws of the State of Connecticut.
18. Counterparts. This agreement may be executed in one or more counterparts,
each of which shall be deemed an original.
<PAGE>
The effective date of this agreement is October 1, 1997.
FOR THE INVESTMENT MANAGER: FOR THE SUB-ADVISOR:
- -------------------------------- -------------------------
Thomas Mazzaferro
President & Chief Operating Officer
Date: _____________________ Date:____________________
Attest: _____________________ Attest:___________________
<PAGE>
Exhibit A-2
SUB-ADVISORY AGREEMENT
THIS AGREEMENT is between American Skandia Investment Services,
Incorporated (the "Investment Manager") and OppenheimerFunds, Inc. (the
"Sub-Advisor").
WHEREAS American Skandia Trust (the "Trust") is a Massachusetts business trust
organized with one or more series of shares, and is registered as an investment
company under the Investment Company Act of 1940 (the "ICA"); and
WHEREAS the trustees of the Trust (the "Trustees") have engaged the Investment
Manager to act as investment manager for the AST Oppenheimer Large-Cap Growth
Portfolio (the "Portfolio") under the terms of a management agreement, dated
[insert], with the Trust (the "Management Agreement"); and
WHEREAS the Investment Manager has engaged the Sub-Advisor and the Trustees have
approved the engagement of the Sub-Advisor to provide investment advice and
other investment services set forth below;
NOW, THEREFORE the Investment Manager and the Sub-Advisor agree as follows:
1. Investment Services. The Sub-Advisor will furnish the Investment Manager with
investment advisory services in connection with a continuous investment program
for the Portfolio which is to be managed in accordance with the investment
objective, investment policies and restrictions of the Portfolio as set forth in
the Prospectus and Statement of Additional Information of the Trust and in
accordance with the Trust's Declaration of Trust and By-Laws. Officers,
directors, and employees of Sub-Advisor will be available to consult with
Investment Manager and the Trust, their officers, employees and Trustees
concerning the business of the Trust. Investment Manager will promptly furnish
Sub-Advisor with any amendments to such documents. Such amendments will not be
effective with respect to the Sub-Advisor until receipt thereof.
Subject to the supervision and control of the Investment Manager, which
is in turn subject to the supervision and control of the Trust's Board of
Trustees, the Sub-Advisor, will in its discretion determine and select the
securities to be purchased for and sold from the Portfolio from time to time and
will place orders with and give instructions to brokers, dealers and others for
all such transactions and cause such transactions to be executed. 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-Advisor authorized by the Investment Manager to settle
transactions in respect of the Portfolio. 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-Advisor will obtain and evaluate information deemed pertinent
by it about significant developments and economic, statistical and financial
data, domestic, foreign or otherwise, whether affecting the economy generally or
the Portfolio, and concerning the individual issuers whose securities are
included in the Portfolio or the activities in which they engage, or with
respect to securities which the Sub-Advisor considers desirable for inclusion in
the Portfolio.
The Sub-Advisor represents that it reviewed the Registration Statement
of the Trust, including any amendments or supplements thereto, and any Proxy
Statement relating to the approval of this Agreement, as filed with the
Securities and Exchange Commission and represents and warrants that with respect
to disclosure about the Sub-Advisor, or information relating directly or
indirectly to and provided to or reviewed by the Sub-Advisor, such Registration
Statement or Proxy Statement contains, as of the date of such review, no untrue
statement of any material fact and does not omit any statement of material fact
which was required to be stated therein or necessary to make the statements
contained therein not misleading. The Sub-Advisor further represents and
warrants that it is an investment advisor registered under the Investment
Advisers Act of 1940, as amended, and under the laws of all jurisdictions in
which the conduct of its business hereunder requires such registration.
In furnishing the services under this Agreement, the Sub-Advisor will
comply with the requirements of the ICA and subchapters L and M (including,
respectively, Section 817(h) and Section 851(b)(1), (2), (3) and (4)) of the
Internal Revenue Code, applicable to the Portfolio, and the regulations
promulgated thereunder. Sub-Advisor shall comply with the following as provided
(except in the case of clause (i)) to the Sub-Advisor (i) other applicable
provisions of state or federal law; (ii) the provision of the Declaration of
Trust and By-Laws of the Trust; (iii) policies and determinations of the Trust
and Investment Manager; (iv) the fundamental policies and investment
restrictions of the Trust, as set out in the Trust's registration statement
under the ICA, or as amended by the Trust's shareholders; (v) the Prospectus and
Statement of Additional Information of the Trust; and (vi) investment guidelines
or other instructions received in writing from Investment Manager. Sub-Advisor
shall supervise and monitor the investment program of the Portfolio.
Nothing in this Agreement shall be implied to prevent the Investment
Manager from engaging other sub-advisors to provide investment advice and other
services in relation to portfolios of the Trust for which Sub-Advisor does not
provide such services, or to prevent Investment Manager from providing such
services itself in relation to such portfolios.
The Investment Manager shall provide the Sub-Adviser, or shall cause
the Portfolio's Custodian or Administrator to provide to the Sub-Advisor, on
each business day as of a time deadline to be mutually agreed upon, a report or
a computer download in a mutually acceptable software program and format,
detailing the Portfolio's portfolio holdings, uninvested cash, current
valuations and other information reasonably requested by the Sub-Advisor to
assist it in carrying out its duties under this Agreement, as of the close of
the prior business day. In performing its obligations under this Agreement, the
Sub-Advisor may rely upon the accuracy and completeness of information provided
to it by or on behalf of the Investment Manager or the Portfolio's Custodian or
Administrator if the Sub-Advisor cannot readily verify such information from
records that it can reasonably keep as Sub-advisor.
The Sub-Advisor shall be responsible for the preparation and filing of
Schedule 13G and Form 13-F reflecting the Portfolio's securities holdings. The
Sub-Advisor 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 to in writing. It is understood that the Sub-Advisor
is not responsible for daily pricing of the Portfolio's assets.
2. Delivery of Documents to Sub-Advisor. The Investment Manager has furnished
the Sub-Advisor with copies of each of the following documents:
(a) The Declaration of Trust of the Trust as in effect on the date hereof;
(b) The By-laws of the Trust in effect on the date hereof;
(c) The resolutions of the Trustees approving the engagement of the
Sub-Advisor as Sub-Advisor to the Investment Manager and approving the
form of this agreement;
(d) The resolutions of the Trustees selecting the Investment Manager as
investment manager to the Trust and approving the form of the
Investment Manager's Management Agreement with the Trust;
(e) The Investment Manager's Management Agreement with the Trust;
(f) The Code of Ethics of the Trust and of the Investment Manager as
currently in effect;
(g) The Trust's registration statement; and
(h) A list of companies the securities of which are not to be bought or
sold for the Portfolio because of non-public information regarding
such companies that is available to Investment Manager or the Trust,
or which, in the sole opinion of the Investment Manager, it believes
such non-public information would be deemed to be available to
Investment Manager and/or the Trust.
The Investment Manager will furnish the Sub-Advisor 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 reasonably promptly after such
materials became 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.
3. Delivery of Documents to the Investment Manager. The Sub-Advisor has
furnished the Investment Manager with copies of each of the following documents:
(a) The Sub-Advisor's Form ADV as filed with the Securities and Exchange
Commission;
(b) The Sub-Advisor's most recent audited balance sheet;
(c) Separate lists of persons who the Sub-Advisor wishes to have
authorized to give written and/or oral instructions to Custodians of
Trust assets for the Portfolio;
(d) The Code of Ethics of the Sub-Advisor as currently in effect.
The Sub-Advisor will furnish the Investment Manager from time to time
with copies, properly certified or otherwise authenticated, of all material
amendments of or supplements to the foregoing, if any. Such amendments or
supplements as to items (a) through (d) above will be provided within 30 days of
the time such materials became available to the Sub-Advisor.
4. Investment Advisory Facilities. The Sub-Advisor, at its expense, will furnish
all necessary investment facilities for its use, including salaries of personnel
required for it to execute its duties faithfully.
5. Execution of Portfolio Transactions. Sub-Advisor is responsible for decisions
to buy and sell securities for the Portfolio, broker-dealer selection, and
negotiation of its brokerage commission rates. Sub-Advisor shall determine the
securities to be purchased or sold by the Portfolio pursuant to its
determinations with or through such persons, brokers or dealers, in conformity
with the policy with respect to brokerage as set forth in the Trust's Prospectus
and Statement of Additional Information, or as the Board of Trustees may
determine from time to time. Generally, Sub-Advisor's primary consideration in
placing Portfolio securities transactions with broker-dealers for execution is
to obtain and maintain the availability of best execution at the best net price
and in the most effective manner possible. The Sub-Advisor may consider sale of
the shares of the Portfolio and of other funds managed by the Sub-Advisor or its
affiliates, as well as recommendations of the Investment Manager, subject to the
requirements of best net price and most favorable execution.
The Investment Manager recognizes that a broker-dealer affiliated with
the Sub-Adviser (i) may act as one of the Portfolio's regular brokers so long as
it is lawful for it so to act; (ii) may be a major recipient of brokerage
commissions paid by the Portfolio; and (iii) may effect portfolio transactions
for the Portfolio only if expressly approved by the Trustees, and if the
commissions, fees or other remuneration received or to be received by it are
determined in accordance with procedures contemplated by any rule, regulation or
order adopted under the ICA for determining the permissible level of such
commissions.
Consistent with this policy, the Sub-Advisor will take the following
into consideration: the best net 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. Accordingly, the cost of the brokerage commissions to the Portfolio may
be greater than that available from other brokers if the difference is
reasonably justified by other aspects of the portfolio execution services
offered. Subject to such policies and procedures as the Board of Trustees of the
Trust may determine, the Sub-Advisor shall not be deemed to have acted
unlawfully or in violation of this Agreement or to have breached any duty solely
by reason of its having caused the Portfolio to pay a broker-dealer that
provides research services to the Sub-Advisor for the Portfolio's use 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-Advisor determines in good faith that such amount of
commission was reasonable in relation to the value of the research services
provided by such broker, viewed in terms of either that particular transaction
or the ongoing responsibilities of the Sub-Advisor and its affiliates with
respect to the Portfolio and/or other accounts for which they exercise
investment discretion. In reaching such determination, the Sub-Advisor will not
be required to place or attempt to place a specific dollar value on the
brokerage and/or research services provided or being provided by such broker.
The Sub-Advisor is further authorized to allocate the orders placed by it on
behalf of the Portfolio to such broker-dealers who also provide research or
statistical material, or other services to the Portfolio or the Sub-Advisor.
Such allocation shall be in such amounts and proportions as the Sub-Advisor
shall determine and the Sub-Advisor will report on said allocations to the
Investment Manager regularly as requested by the Investment Manager and, in any
event, at least once each calendar year if no specific request is made,
indicating the brokers to whom such allocations have been made and the basis
therefor.
6. Reports by Sub-Advisor. The Sub-Advisor shall furnish the Investment Manager
monthly, quarterly and annual reports concerning transactions and performance of
the Portfolio, including information required in the Trust's Registration, in
such form as may be mutually agreed, to review the Portfolio and discuss the
management of it. The Sub-Advisor shall permit the financial statements, books
and records with respect to the Portfolio to be inspected and audited by the
Trust, the Investment Manager or their agents at all reasonable times during
normal business hours. The Sub-Advisor shall immediately notify and forward to
both Investment Manager and legal counsel for the Trust any legal process served
upon it on behalf of the Investment Manager or the Trust. The Sub-Advisor shall
promptly notify the Investment Manager of any changes in any information
concerning the Sub-Advisor or the Sub-Advisor's management of the Portfolio
required to be disclosed in the Trust's Registration Statement.
7. Compensation of Sub-Advisor. The amount of the compensation to the
Sub-Advisor is computed at an annual rate. The fee is payable monthly in
arrears, based on the average daily net assets of the Portfolio for each month,
at the annual rates shown below.
For all services rendered, the Investment Manager will calculate and
pay the Sub-Advisor at the annual rate of .35% of the portion of the average
daily net assets of the Portfolio not in excess of $500 million; plus .30% of
the portion of the net assets over $500 million but not in excess of $1 billion;
plus .25% of the portion of the net assets over $1 billion.
In computing the fee to be paid to the Sub-Advisor, the net asset value
of the Portfolio shall be valued as set forth in the then current registration
statement of the Trust. If this agreement is terminated, the payment shall be
prorated to the date of termination.
Investment Manager and Sub-Advisor shall not be considered as partners
or participants in a joint venture. Sub-Advisor will pay its own expenses for
the services to be provided by it pursuant to this Agreement and will not be
obligated to pay any expenses of Investment Manager or the Trust. Except as
otherwise provided herein, Investment Manager and the Trust will not be
obligated to pay any expenses of Sub-Advisor.
8. Confidential Treatment. It is understood that any information or
recommendation supplied by the Sub-Advisor in connection with the performance of
its 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. It is also understood that any
information supplied to Sub-Advisor in connection with the performance of its
obligations hereunder, particularly, but not limited to, any list that the
Investment Manager provides to the Sub-Advisor of securities which, on a
temporary basis, may not be bought or sold for the Portfolio, is to be regarded
as confidential and for use only by the Sub-Advisor in connection with its
obligation to provide investment advice and other services to the Portfolio.
9. Representations of the Parties. Each party to this Agreement hereby
acknowledges that it is registered as an investment advisor under the Investment
Advisers Act of 1940, it will use its reasonable best efforts to maintain such
registration for as long as such registration is required for the party to carry
out its obligations under this Agreement, and 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.
10. Liability. The Sub-Advisor shall use its best efforts and good faith in the
performance of its services hereunder. However, so long as the Sub-Advisor has
acted in good faith and has used its best efforts, then in the absence of
willful misfeasance, bad faith, gross negligence or reckless disregard for its
obligations hereunder, it shall not be liable to the Trust or its shareholders
or to the Investment Manager for any act or omission 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 of limitation of any rights which
the Trust or Investment Manager may have under applicable law.
The Investment Manager agrees that the Sub-Advisor shall not be liable
for any failure to recommend the purchase or sale of any security on behalf of
the Portfolio on the basis of any information the use of which might, in
Sub-Advisor's opinion, constitute a violation of any federal or state laws,
rules or regulations.
11. Other Activities of Sub-Advisor. Investment Manager agrees that the
Sub-Advisor and any of its officers or employees, and persons affiliated with it
or with any such officers or employees may render investment management or
advisory services to other investors and institutions, and such investors and
institutions may own, purchase or sell, securities or other interests in
property the same as or similar to those which are selected for purchase,
holding or sale for the Portfolio, and the Sub-Advisor shall be in all respects
free to take action with respect to investments in securities or other interests
in property the same as or similar to those selected for purchase, holding or
sale for the Portfolio. The Investment Manager understands that the Sub-Advisor
shall not favor or disfavor any of the Sub-Advisor's clients or class of clients
in the allocation of investment opportunities, so that to the extent
practicable, such opportunities will be allocated among the Sub-Advisor's
clients over a period of time on a fair and equitable basis. Nothing in this
agreement shall impose upon the Sub-Advisor any obligation to purchase or sell
or recommend for purchase or sale, for the Portfolio any security which it, its
officers, affiliates or employees may purchase or sell for the Sub-Advisor or
such officer's, affiliate's or employee's own accounts or for the account of any
other client, advisory or otherwise.
12. Continuance and Termination. This Agreement shall remain in full force and
effect for one year from the date hereof, and is renewable annually thereafter
by specific approval of the Board of Trustees of the Trust 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, pursuant to its requirements. This agreement
may be terminated without penalty at any time by the Investment Manager or
Sub-Advisor upon 60 days written notice, and will automatically terminate in the
event of its assignment by either party to this Agreement, as defined in the
ICA, or (provided Sub-Advisor has received prior written notice thereof) upon
termination of the Investment Manager's Management Agreement with the Trust.
13. Notification. Sub-Advisor will notify the Investment Manager within a
reasonable time of any change in the personnel of the Sub-Advisor with
responsibility for making investment decisions in relation to the Portfolio or
who have been authorized to give instructions to a Custodian of the Trust.
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 address for such party.
Investment Manager: American Skandia Investment Services, Incorporated
One Corporate Drive
Shelton, Connecticut 06484
Attention: John Birch
Senior Vice President & Chief Operating Officer
Sub-Advisor: OppenheimerFunds, Inc.
Two World Trade Center, 34th Floor
New York, NY 10048-0203
Attention: Andrew J. Donahue
Executive Vice President & General Counsel
Copy to:
OppenheimerFunds, Inc.
6801 Tucson Way
Englewood, CO 80112
Attention: Treasurer
14. Indemnification. The Sub-Advisor agrees to indemnify and hold harmless
Investment Manager, any affiliated person within the meaning of Section 2(a)(3)
of the 1940 Act ("affiliated person") of Investment Manager and each person, if
any who, within the meaning of Section 15 of the Securities Act of 1933 (the
"1933 Act"), controls ("controlling person") Investment Manager, against any and
all losses, claims, damages, liabilities or litigation (including reasonable
legal and other expenses), to which Investment Manager or such affiliated person
or controlling person may become subject under the 1933 Act, the 1940 Act, the
Investment Adviser's Act of 1940 ("Adviser's Act"), under any other statute, at
common law or otherwise, arising out of Sub-Advisor's responsibilities as
portfolio manager of the Portfolio (1) to the extent of and as a result of the
willful misconduct, bad faith, or gross negligence by Sub-Advisor, any of
Sub-Advisor's employees or representatives or any affiliate of or any person
acting on behalf of Sub-Advisor, or (2) as a result of any untrue statement or
alleged untrue statement of a material fact contained in a prospectus or
statement of additional information covering the Portfolio or the Trust or 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 to
Investment Manager, the Trust or any affiliated person of the Investment Manager
or the Trust or upon verbal information confirmed by the Sub-Advisor in writing
or (3) to the extent of, and as a result of, the failure of the Sub-Advisor to
execute, or cause to be executed, Portfolio transactions according to the
requirements of the 1940 Act; provided, however, that in no case is
Sub-Advisor's indemnity in favor of Investment Manager or any affiliated person
or controlling person of 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 Sub-Advisor shall not be liable to the
Investment Manager or the Portfolio for any losses that may be sustained as a
result of (1) instructions provided by the Sub-Advisor to the Investment Manager
or the Portfolio's Custodian or Administrator if the recipient had reason to
believe that such instruction was not genuine or authorized, or (2) delays in or
the inaccuracy of information that the Sub-Advisor cannot reasonably verify as
provided in paragraph 1 of this Agreement.
The Investment Manager agrees to indemnify and hold harmless
Sub-Advisor, any affiliated person within the meaning of Section 2(a)(3) of the
1940 Act ("affiliated person") of Sub-Advisor and each person, if any who,
within the meaning of Section 15 of the Securities Act of 1933 (the "1933 Act"),
controls ("controlling person") Sub-Advisor, against any and all losses, claims,
damages, liabilities or litigation (including reasonable legal and other
expenses), to which Sub-Advisor or such affiliated person or controlling person
may become subject under the 1933 Act, the 1940 Act, the Investment Adviser's
Act of 1940 ("Adviser's Act"), under any other statute, at common law or
otherwise, arising out of 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 Investment Manager, any of
Investment Manager's employees or representatives or any affiliate of or any
person acting on behalf of Investment Manager, or (2) as a result of any untrue
statement or alleged untrue statement of a material fact contained in a
prospectus or statement of additional information covering the Portfolio or the
Trust or 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 by the Trust other than in reliance upon written
information furnished by Sub-Advisor, or any affiliated person of the
Sub-Advisor or other than upon verbal information confirmed by the Sub-Advisor
in writing; provided, however, that in no case is Investment Manager's indemnity
in favor of Sub-Advisor or any affiliated person or controlling person of
Sub-Advisor 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.
15. Warranty. The Investment Manager represents and warrants that (i) the
appointment of the Sub-Advisor 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 contemplated hereby are,
in conformity with the Investment Company Act of 1940, the Trust's governing
documents and other applicable laws.
The Sub-Advisor represents and warrants that it has obtained all
requisite corporate and governmental authorizations necessary to perform the
services contemplated to be performed by it hereunder.
16. Amendment. This agreement may be amended by mutual written consent of the
parties, subject to the provisions of the ICA.
17. Governing Law. This agreement is made under, and shall be governed by and
construed in accordance with, the laws of the State of Connecticut, except to
the extent governed by the federal securities laws.
18. Counterparts. This agreement may be executed in one or more counterparts,
each of which shall be deemed an original.
The effective date of this agreement is December 31, 1998.
FOR THE INVESTMENT MANAGER: FOR THE SUB-ADVISER:
- -------------------------------- -------------------------
John Birch
Senior Vice President & Chief Operating
Officer
Date: _____________________ Date:____________________
Attest: _____________________ Attest:___________________
<PAGE>
AMERICAN SKANDIA TRUST
Proxy for Special Meeting of Shareholders of
THE ROBERTSON STEPHENS VALUE + GROWTH PORTFOLIO
to be held on
DECEMBER 30, 1998
The undersigned hereby appoints Maureen Gulick and Deirdre Burke and
each of them as the proxy or proxies of the undersigned, with full power of
substitution, to vote on behalf of the undersigned all shares of beneficial
interest of the above stated Portfolio of American Skandia Trust (or "Trust")
which the undersigned is entitled to vote at a Special Meeting of the
Shareholders of the Portfolio to be held at 10:30 a.m., Eastern Time, on
December 30, 1998 at the offices of the Trust at One Corporate Drive, 10th
Floor, Shelton, Connecticut and at any adjournments thereof, upon the matters
described in the accompanying Proxy Statement and upon any other business that
may properly come before the meeting or any adjournment thereof. Said proxies
are directed to vote or to refrain from voting as checked below.
PLEASE SIGN BELOW AND RETURN PROMPTLY IN THE ENCLOSED POSTAGE PAID ENVELOPE.
The undersigned acknowledges receipt with this proxy of a copy of the
Combined Notice of Special Meeting of Shareholders and the Proxy Statement of
the Robertson Stephens Value + Growth Portfolio of the Trust. If a contract is
jointly held, each contract owner named should sign. If only one signs, his or
her signature will be binding. If the contract owner is a trust, custodial
account or other entity, the name of the trust or the custodial account should
be entered and the trustee, custodian, etc. should sign in his or her own name,
indicating that he or she is "Trustee," "Custodian," or other applicable
designation. If the contract owner is a partnership, the partnership should be
entered and the partner should sign in his or her own name, indicating that he
or she is a "Partner."
THIS PROXY IS BEING SOLICITED ON BEHALF OF THE BOARD OF TRUSTEES OF THE TRUST.
ACCOUNT NUMBER:
UNITS:
CONTROL NO:
<TABLE>
<CAPTION>
TO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS: KEEP THIS PORTION FOR YOUR RECORDS
THIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED DETACH AND RETURN THIS PORTION ONLY
AMERICAN SKANDIA TRUST - ROBERTSON STEPHENS VALUE + GROWTH PORTFOLIO
THE BOARD OF TRUSTEES OF THE TRUST RECOMMENDS VOTING FOR THE FOLLOWING PROPOSALS:
THE UNITS REPRESENTED HEREBY WILL BE VOTED AS INDICATED OR FOR THE PROPOSALS IF
NO CHOICE IS INDICATED.
<S> <C> <C> <C> <C>
For Against Abstain
I. PROPOSAL TO APPROVE A NEW SUB-ADVISORY AGREEMENT [] [] []
BETWEEN AMERICAN SKANDIA INVESTMENT SERVICES,
INCORPORATED AND OPPENHEIMERFUNDS, INC.
REGARDING INVESTMENT ADVICE TO THE ROBERTSON
STEPHENS VALUE + GROWTH PORTFOLIO.
II. PROPOSAL TO APPROVE A CHANGE IN THE PORTFOLIO'S [] [] []
INVESTMENT OBJECTIVE.
III. PROPOSAL TO APPROVE A CHANGE IN THE PORTFOLIO'S [] [] []
FUNDAMENTAL INVESTMENT RESTRICTION CONCERNING
DIVERSIFICATION AND INDUSTRY CONCENTRATION OF
INVESTMENTS.
IV. PROPOSAL TO APPROVE A CHANGE IN THE PORTFOLIO'S [] [] []
FUNDAMENTAL INVESTMENT RESTRICTION CONCERNING
LOANS.
V. PROPOSAL TO APPROVE A CHANGE IN THE PORTFOLIO'S [] [] []
FUNDAMENTAL INVESTMENT RESTRICTION CONCERNING
BORROWINGS.
VI. PROPOSAL TO APPROVE A CHANGE IN THE PORTFOLIO'S [] [] []
FUNDAMENTAL INVESTMENT RESTRICTION CONCERNING
UNDERWRITING THE SECURITIES OF OTHER ISSUERS.
VII. PROPOSAL TO APPROVE A CHANGE IN THE PORTFOLIO'S [] [] []
FUNDAMENTAL INVESTMENT RESTRICTION CONCERNING
ISSUING SENIOR SECURITIES.
VIII. PROPOSAL TO APPROVE THE ELIMINATION OF THE [] [] []
PORTFOLIO'S FUNDAMENTAL INVESTMENT RESTRICTION
CONCERNING THE PURCHASE OF SECURITIES ON MARGIN.
IX. PROPOSAL TO APPROVE THE ELIMINATION OF THE [] [] []
PORTFOLIO'S FUNDAMENTAL INVESTMENT RESTRICTION
CONCERNING INVESTMENT IN SECURITIES OF ISSUERS
IN WHICH MANAGEMENT OF THE TRUST OR OF THE TRUST'S
INVESTMENT MANAGER OWNS SECURITIES.
</TABLE>
APPROVAL OF PROPOSALS 3 THROUGH 7 IS MADE CONTINGENT UPON APPROVAL OF EACH
OF PROPOSALS 3 THROUGH 7.
Please be sure to sign and date this Proxy
- ----------------------------- --------------------------------
Signature [PLEASE SIGN WITHIN BOX] Signature (Joint Owners)
Date: ________ Date: ________
- --------------------------------------------------------------------------------
DETACH CARD
