Exhibit 6(d)(36)
SUBADVISORY AGREEMENT
AGREEMENT made as of the 5th day of April, 2002, between Deutsche
Investment Management Americas Inc., a Delaware corporation (hereinafter called
the "Manager"), and INVESCO Funds Group, Inc., a Delaware corporation
(hereinafter called the "Subadviser").
WITNESSETH:
WHEREAS, Xxxxxxx Variable Series II (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, as amended (the
"Investment Company Act"); and
WHEREAS, the Board of Trustees of the Trust (the "Board" and its
members, the "Trustees") is authorized to issue the Trust's shares of beneficial
interest in separate series and has authorized SVS Dynamic Growth Portfolio (the
"Series"); and
WHEREAS, the Manager acts as manager for the Series pursuant to an
Investment Management Agreement between the Manager and the Trust, on behalf of
the Series, dated April 5, 2002, and is responsible for the day-to-day
management and overall administration of the Series; and
WHEREAS, the Manager desires to utilize the services of the Subadviser
to provide subadvisory services with respect to the investment portfolio of the
Series; and
WHEREAS, the Subadviser is willing to perform such services on the
terms and conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the mutual agreements herein
contained, it is agreed as follows:
1. The Subadviser's Services. The Subadviser shall serve the Manager
as investment counsel with respect to the Series.
The Subadviser is hereby authorized and directed and hereby agrees,
subject to the stated investment policies and restrictions of the Series as set
forth in the current Prospectus and Statement of Additional Information of the
Trust relating to the Series (including amendments), and in accordance with the
Declaration of Trust and By-laws of the Trust, as both may be amended from time
to time, governing the offering of its shares and subject to such resolutions,
policies and procedures as from time to time may be adopted by the Board and
furnished to the Subadviser, and in accordance with the instructions and
procedures of the Manager furnished to the Subadviser, to develop, recommend and
implement such discretionary investment program and strategy for the Series, to
provide research and analysis relative to the investment program and securities
and other investments ("investments") of the Series, to determine what
investments should be purchased, sold and loaned by the Series and to monitor on
a continuing basis the performance of the investments of the Series. In
addition, the Subadviser shall place orders for the purchase and sale of
investments for the Series and, subject to the provisions of this section, shall
take reasonable steps to assure that those portfolio transactions are effected
subject to the best execution under the circumstances. The Subadviser shall
advise the custodian for the Series ("Custodian") and the Manager on a prompt
basis of each purchase and sale of an
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investment specifying the name of the issuer, the CUSIP number (if available),
the description and amount (or number of shares) of the investment purchased,
the market price, commission and gross or net price, trade date, settlement date
and identity of the effecting broker or dealer. From time to time as the Board
or the Manager may reasonably request, the Subadviser shall furnish to the
Manager, the Trust's officers and to each of its Trustees reports on portfolio
transactions and reports on assets held in the Series, all in such detail as the
Trust or the Manager may reasonably request. The Subadviser shall also inform
the Manager, the Trust's officers and the Board on a current basis of changes in
investment strategy or tactics or any other developments materially affecting
the Series. The Subadviser shall make its officers and employees available to
meet with the Manager, the Trust's officers and the Board at least quarterly on
due notice and at such other times as may be mutually agreeable, to review the
investments and investment performance of the Series in the light of the Series'
investment objectives and policies and market conditions.
It shall be the duty of the Subadviser to furnish to the Trustees such
information as may reasonably be requested in order for the Board to evaluate
this Agreement or any proposed amendments thereto for the purposes of casting a
vote pursuant to Section 9 hereof.
In the performance of its duties hereunder, the Subadviser is and shall
be an independent contractor and except as otherwise expressly provided herein
or otherwise authorized in writing, shall have no authority to act for or
represent the Trust, the Series or the Manager in any way or otherwise be deemed
to be an agent of the Trust, the Series or the Manager.
In furnishing the services under this Agreement, the Subadviser shall
comply with the requirements of the Investment Company Act and of the Investment
Advisers Act of 1940 ("Advisers Act") applicable to it, the regulations
promulgated thereunder, and all other applicable laws and regulations. The
Subadviser shall immediately notify the Manager and the Trust in the event that
the Subadviser: (1) becomes subject to a statutory disqualification that
prevents the Subadviser from serving as an investment adviser pursuant to this
Agreement; or (2) is or expects to become the subject of an administrative
proceeding or enforcement action by the Securities and Exchange Commission
("SEC") or other regulatory authority (including, without limitation, any
self-regulatory organization). The Subadviser shall immediately forward, upon
receipt, to the Manager any correspondence from the SEC or other regulatory
authority that relates to the Series.
The Subadviser's primary consideration in effecting a security
transaction shall be to obtain the best execution under the circumstances for
the Series, taking into account the factors specified in the Prospectus and
Statement of Additional Information of the Trust relating to the Series. Subject
to such policies as the Board may determine and consistent with Section 28(e) of
the Securities Exchange Act of 1934, the Subadviser shall not be deemed to have
acted unlawfully or to have breached any duty created by this Agreement or
otherwise solely by reason of its having caused the Series to pay a
broker-dealer for effecting a portfolio investment transaction an amount of
commission in excess of the amount of commission another broker-dealer would
have charged for effecting that transaction, if the Subadviser determines in
good faith that such amount of commission was reasonable in relation to the
value of the brokerage and research services provided by such broker-dealer
viewed in terms of either that particular transaction or its overall
responsibilities with respect to accounts as to which it exercises investment
discretion. The Subadviser shall provide such reports as the Board or the
Manager
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may request with respect to the Series' brokerage and the manner in which that
brokerage was allocated.
The Series' assets shall be maintained in the custody of the Custodian
(who shall be identified by the Manager in writing). The Subadviser shall not
have custody of any securities, cash or other assets of the Series and shall not
be liable for any loss resulting from any act or omission of the Custodian other
than acts or omissions arising in reliance on instructions of the Subadviser.
The Subadviser shall promptly notify the Manager if the Subadviser becomes an
affiliated person of the Custodian.
2. Delivery of Documents to the Subadviser. The Manager shall furnish
to the Subadviser 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 Board approving the engagement of the
Subadviser as subadviser for the Series and approving this
Agreement;
(d) The resolutions of the Board selecting the Manager as
investment manager to the Series and approving the form of
the Investment Management Agreement with the Trust, on
behalf of the Series;
(e) The Investment Management Agreement with the Trust, on behalf
of the Series;
(f) The Code of Ethics of the Trust and of the Manager as
currently in effect;
(g) Current copies of the Prospectus and Statement of Additional
Information of the Trust relating to the Series; and
(h) Resolutions, policies and procedures adopted by the Board in
respect of the management or operation of the Series.
The Manager shall furnish the Subadviser 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) though (h) above shall be provided within 30 days of the time such materials
became available to the Manager and, until so provided, the Subadviser may
continue to rely on those documents previously provided.
During the term of this Agreement, the Manager also shall furnish to
the Subadviser prior to use thereof copies of all Trust documents, proxy
statements, reports to shareholders, sales literature, or other material
prepared for distribution to shareholders of the Series or the public that refer
in any way to the Subadviser, and shall not use such material if the Subadviser
reasonably objects in writing within five business days (or such other time
period as may be mutually agreed) after receipt thereof. However, the Manager
and the Subadviser may mutually agree that certain of the above-mentioned
documents do not need to be furnished to the Subadviser prior to the document's
use.
In the event of termination of this Agreement, the Manager shall
continue to furnish to
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the Subadviser copies of any of the above-mentioned materials that refer in any
way to the Subadviser. The Manager shall furnish or otherwise make available to
the Subadviser such other information relating to the business affairs of the
Trust as the Subadviser at any time, or from time to time, reasonably requests
in order to discharge its obligations hereunder.
3. Delivery of Documents to the Manager. The Subadviser shall furnish
the Manager with copies of each of the following documents:
(a) The Subadviser's most recent balance sheet;
(b) Separate lists of persons whom the Subadviser wishes to have
authorized to give written and/or oral instructions to the
Custodian and the fund accounting agent of Trust assets for
the Series;
(c) The Code of Ethics of the Subadviser as currently in effect;
and
(d) Any compliance policies, trading, commission and other
reports, confirmation of the Subadviser's insurance coverage
(in form and substance satisfactory to the Manager), and
such other management or operational documents as the
Manager may reasonably request in writing (on behalf of
itself or the Board) in assessing the Subadviser.
The Subadviser maintains a written Code of Ethics that complies with
the requirements of Rule 17j-1 under the Investment Company Act, as amended. The
Subadviser certifies that it has adopted procedures reasonably necessary to
prevent its "access persons," as such term is defined in Rule 17j-1, from
violating the Code of Ethics. The Subadviser shall notify the Board upon the
adoption of any material change to its Code of Ethics so that the Board,
including a majority of the Trustees who are not interested persons of the
Trust, may approve such change not later than six months after its adoption by
the Subadviser, as required by Rule 17j-1. The Subadviser also shall provide the
Trust with a copy of any amendments to its Code of Ethics that do not represent
a material change to such Code. Within 45 days of the end of each year while
this Agreement is in effect (or more frequently if required by Rule 17j-1 or as
the Trust may reasonably request), the Subadviser shall provide the Board with a
written report that, as required by Rule 17j-1: (1) describes any issue arising
under the Subadviser's Code of Ethics or procedures since the last report to the
Board, including, but not limited to, information about material violations of
the Code or procedures and sanctions imposed in response to the material
violations, and (2) certifies that the Subadviser has adopted procedures
reasonably necessary to prevent its access persons from violating its Code of
Ethics. Upon the written request of the Trust, the Subadviser shall permit the
Trust to examine the reports to be made by the Subadviser under Rule 17j-1(d)
and the records the Subadviser maintains pursuant to Rule 17j-1(f).
The Subadviser shall furnish the Manager from time to time with copies,
properly certified or otherwise authenticated, of all material amendments of or
supplements to the foregoing, if any. Additionally, the Subadviser shall provide
to the Manager such other documents relating to its services under this
Agreement as the Manager may reasonably request on a periodic basis. Such
amendments or supplements as to items (a) through (c) above shall be provided
within 30 days of the time such materials became available to the Subadviser.
The Subadviser shall promptly notify the Manager of any transaction or
other event that
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results in an "assignment" of this Agreement within the meaning of the
Investment Company Act. In addition, the Subadviser shall promptly complete and
return to the Manager or the Trust any compliance questionnaires or other
inquiries submitted to the Subadviser in writing.
4. Other Agreements, etc. It is understood that any of the
shareholders, the Trustees, officers and employees of the Trust or the Series
may be a shareholder, director, officer or employee of, or be otherwise
interested in, the Subadviser, any interested person of the Subadviser, any
organization in which the Subadviser may have an interest or any organization
which may have an interest in the Subadviser, and that any such interested
person or any such organization may have an interest in the Trust or the Series.
It is also understood that the Subadviser, the Manager and the Trust may have
advisory, management, service or other contracts with other individuals or
entities, and may have other interests and businesses. On occasions when the
Subadviser deems the purchase or sale of an investment to be in the best
interest of the Series, as well as other clients of the Subadviser, the
Subadviser, to the extent permitted by applicable laws and regulations, may, but
shall be under no obligation to, aggregate the investments to be sold or
purchased in order to obtain best execution under the circumstances. In such
event, allocation of the investments so purchased or sold, as well as the
expenses incurred in the transactions, shall be made by the Subadviser in the
manner the Subadviser considers to be most equitable and consistent with its
fiduciary obligations to the Series and to such other clients. Nothing in this
Agreement shall impose upon the Subadviser any obligation to purchase or sell,
or recommend for purchase or sale, for the Series any investment which it or its
officers, directors, affiliates or employees may purchase or sell for the
Subadviser or such officer's, director's, affiliate's or employee's own accounts
or for the account of any of the Subadviser's clients, advisory or otherwise.
The Subadviser may give advice and take action with respect to other
funds or clients, or for its own account that may differ from the advice or the
timing or nature of action taken with respect to the Series.
Nothing in this Agreement shall be implied to prevent (1) the Manager
from engaging other subadvisers to provide investment advice and other services
in relation to other series of the Trust for which the Subadviser does not
provide such services, or to prevent the Manager from providing such services
itself in relation to such series; or (2) the Subadviser from providing
investment advice and other services to other funds or clients.
5. Fees, Expenses and Other Charges.
(a) For its services hereunder, the Subadviser shall be paid a
management fee by the Manager according to the fee schedule
attached hereto as Schedule A.
(b) The Subadviser, at its expense, shall furnish all necessary
investment facilities, including salaries of personnel
required for it to execute its duties under this Agreement.
6. Confidential Treatment. It is understood that any information or
recommendation supplied by the Subadviser in connection with the performance of
its obligations hereunder is to be regarded as confidential and for use only by
the Manager, the Trust or such persons as the Manager may designate in
connection with the Series. It is also understood that any information supplied
to the Subadviser in connection with the performance of its obligations
hereunder,
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particularly, but not limited to, any list of investments which, on a temporary
basis, may not be bought or sold for the Series, is to be regarded as
confidential and for use only by the Subadviser in connection with its
obligation to provide investment advice and other services to the Series.
The Subadviser shall maintain and enforce adequate security procedures with
respect to all materials, records, documents and data relating to any of its
responsibilities pursuant to this Agreement including all means for the
effecting of investment transactions.
7. Representations and Covenants of the Parties. The Subadviser hereby
acknowledges that it is registered as an investment adviser under the Advisers
Act and that neither it nor any affiliated person of it, as such term is defined
in Section 2(a)(3) of the Investment Company Act ("affiliated person"), is
subject to any disqualification that would make the Subadviser unable to serve
as an investment adviser to a registered investment company under Section 9 of
the Investment Company Act. The Subadviser covenants that it will carry out
appropriate compliance procedures necessary to the operation of the Series as
the Subadviser and the Manager may agree. The Subadviser also covenants that it
will manage the Series in conformity with all applicable rules and regulations
of the SEC in all material respects and so that the Series will qualify as a
regulated investment company under Subchapter M of the Internal Revenue Code
(the "Code") and will be adequately diversified for purposes of Section 817(h)
of the Code and the Treasury regulations thereunder.
8. Reports by the Subadviser and Records of the Series. The Subadviser
shall furnish the Manager monthly, quarterly and annual reports concerning the
transactions and performance of the Series, including information required to be
disclosed in the Trust's registration statement, in such form as may be mutually
agreed, to review the Series and discuss the management of it. If requested by
the Manager, the Subadviser shall also furnish the Manager quarterly compliance
certifications. The Subadviser shall permit its financial statements, books and
records with respect to the Series to be inspected and audited by the Trust, the
Manager or their agents at all reasonable times during normal business hours.
The Subadviser shall immediately notify and forward to both the Manager and
legal counsel for the Series any legal process served upon it on behalf of the
Manager or the Trust. The Subadviser shall promptly notify the Manager of any
changes in any information concerning the Subadviser of which the Subadviser
becomes aware that would be required to be disclosed in the Trust's registration
statement.
In compliance with the requirements of Rule 31a-3 under the Investment
Company Act, the Subadviser agrees that all records it maintains for the Trust
with respect to the Series are the property of the Trust and further agrees to
surrender promptly to the Trust or the Manager any such records upon the Trust's
or the Manager's request. However, the Subadviser may retain copies of such
records to comply with the recordkeeping requirements of the Investment Advisers
Act and Investment Company Act. The Subadviser further agrees to maintain for
the Trust the records the Trust is required to maintain under Rule 31a-1(b) of
the Investment Company Act insofar as such records relate to the investment
affairs of the Series. The Subadviser further agrees to preserve for the periods
prescribed by Rule 31a-2 under the Investment Company Act the records it
maintains for the Trust.
9. Continuance and Termination. This Agreement shall remain in full force
and effect through September 30, 2002, and is renewable annually thereafter by
specific approval of the Board or by the affirmative vote of a majority of the
outstanding voting securities of the Series. Any such renewal shall be approved
by the vote of a majority of the Trustees who are not
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interested persons under the Investment Company Act, 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 Board, by vote of a majority of
the outstanding voting securities of the Series, or by the Manager or by the
Subadviser upon 60 days' written notice. This Agreement shall automatically
terminate in the event of its assignment by either party to this Agreement, as
defined in the Investment Company Act, or upon termination of the Manager's
Investment Management Agreement with the Trust, on behalf of the Series. In
addition, the Manager or the Trust may terminate this Agreement upon immediate
notice if the Subadviser becomes statutorily disqualified from performing its
duties under this Agreement or otherwise is legally prohibited from operating as
an investment adviser.
10. Amendment. No provision of this Agreement may be changed, waived,
discharged or terminated orally, except by an instrument in writing signed by
the party against whom enforcement of the change, waiver, discharge or
termination is sought. No amendment of this Agreement shall be effective until
approved in a manner consistent with the Investment Company Act and rules and
regulations thereunder and any applicable SEC exemptive order therefrom, SEC
no-action letter or SEC interpretive guidance.
11. Voting Rights. The Manager shall be responsible for exercising any
voting rights of any investments of the Series.
12. Indemnification. The Subadviser agrees to indemnify and hold harmless
the Manager, any affiliated person of the 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") the Manager, against any and all losses, claims
damages, liabilities or litigation (including reasonable legal and other
expenses), to which the Manager or such affiliated person or controlling person
may become subject under the 1933 Act, the Investment Company Act, the Advisers
Act, or under any other statute, at common law or otherwise, arising out of the
Subadviser's responsibilities as manager of the Series (1) to the extent of and
as a result of the willful misconduct, bad faith, or gross negligence by the
Subadviser, any of the Subadviser's employees or representatives or any
affiliate of or any person acting on behalf of the Subadviser; (2) as a result
of any untrue statement or alleged untrue statement of a material fact contained
in the Prospectus and Statement of Additional Information of the Trust relating
to the Series 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 by
the Subadviser to the Manager, the Trust or any affiliated person of the Manager
or the Trust expressly for use in the Trust's registration statement, or upon
verbal information confirmed by the Subadviser in writing expressly for use in
the Trust's registration statement; or (3) to the extent of, and as a result of,
the failure of the Subadviser to execute, or cause to be executed, portfolio
transactions according to the standards and requirements of the Investment
Company Act, the Advisers Act and the Securities Exchange Act of 1934.
In no case shall the Subadviser's indemnity in favor of the Manager or any
affiliated person or controlling person of the Manager, or any other provision
of this Agreement, be 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.
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The Manager agrees to indemnify and hold harmless the Subadviser and any
affiliated person or controlling person of the Subadviser against any and all
losses, claims, damages, liabilities or litigation (including reasonable legal
and other expenses), to which the Subadviser or such affiliated person or
controlling person may become subject under the 1933 Act, the Investment Company
Act, the Advisers Act, or under any other statute, at common law or otherwise,
arising out of the Manager's responsibilities as investment manager of the
Series (1) to the extent of and as a result of the willful misconduct, bad
faith, or gross negligence by the Manager, any of the Manager's employees or
representatives or any affiliate of or any person acting on behalf of the
Manager; or (2) as a result of any untrue statement or alleged untrue statement
of a material fact contained in the Prospectus and Statement of Additional
Information of the Trust relating to the Series 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 the Subadviser, or
any affiliated person of the Subadviser, expressly for use in the Trust's
registration statement or other than upon verbal information confirmed by the
Subadviser in writing expressly for use in the Trust's registration statement.
In no case shall the Manager's indemnity in favor of the Subadviser or any
affiliated person or controlling person of the Subadviser, or any other
provision of this Agreement, be 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.
13. Certain Definitions. For the purposes of this Agreement, the "vote of a
majority of the outstanding voting securities of the Series" means the
affirmative vote, at a duly called and held meeting of shareholders of the
Series, (1) of the holders of 67% or more of the shares of the Series present
(in person or by proxy) and entitled to vote at such meeting, if the holders of
more than 50% of the outstanding shares of the Series entitled to vote at such
meeting are present in person or by proxy; or (2) of the holders of more than
50% of the outstanding shares of the Series entitled to vote at such meeting,
whichever is less.
For the purposes of this Agreement, the terms "affiliated person,"
"interested person" and "assignment" shall have their respective meanings
defined in the Investment Company Act, and the term "controlling person" shall
have the meaning defined in the 1933 Act, subject, however, to such exemptions
as may be granted by the SEC under such Acts.
14. Notices. All notices or other communications required or permitted to
be given hereunder shall be in writing and shall be delivered or sent by
pre-paid first class letter post to the following addresses or to such other
address as the relevant addressee provides in writing to the others for the
delivery of such notices and communications, and shall be deemed to have been
given at the time of delivery.
If to the Manager: DEUTSCHE INVESTMENT MANAGEMENT AMERICAS INC.
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: General Counsel
If to the Trust: XXXXXXX VARIABLE SERIES II
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SVS Dynamic Growth Portfolio
Xxx Xxxxxxxxxxxxx Xxxxx
Xxxxxx, XX 00000
Attention: Secretary
If to the Subadviser: INVESCO FUNDS GROUP, INC.
0000 Xxxx Xxxxx Xxxxxx
Xxxxxx, XX 00000
Attention: General Counsel
15. Instructions. The Subadviser is authorized to honor and act on any
notice, instruction or confirmation given by the Trust or Manager in writing
signed or sent by one of the persons whose names, addresses and specimen
signatures shall be provided by the Trust or Manager from time to time.
16. Law. This Agreement is governed by and shall be construed in accordance
with the laws of the Commonwealth of Massachusetts in a manner not in conflict
with the provisions of the Investment Company Act.
17. Limitation of Liability of the Trust, Trustees, and Shareholders. It is
understood and expressly stipulated that none of the Trustees, officers, agents,
or shareholders of the Trust shall be personally liable hereunder. It is
understood and acknowledged that all persons dealing with the Series must look
solely to the property of the Series for the enforcement of any claims against
the Series as neither the Trustees, officers, agents or shareholders assume any
personal liability for obligations entered into on behalf of the Trust or the
Series. No series of the Trust shall be liable for the obligations of any other
series.
18. Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, and all such
counterparts shall constitute a single instrument.
IN WITNESS WHEREOF, the parties hereto have each caused this instrument to
be signed in duplicate on its behalf by the officer designated below thereunto
duly authorized.
DEUTSCHE INVESTMENT MANAGEMENT AMERICAS INC.
Attest: /s/ Xxxxxxx X. Xxxxxx, Xx. By: /s/ Xxxx X. Xxxxxx
-------------------------- ------------------------
Name: Xxxxxx X. Xxxxxx, Xx. Name: Xxxx X. Xxxxxx
Title: Managing Director Title: Managing Director
INVESCO FUNDS GROUP, INC.
Attest: /s/ Xxxx X. Xxxxx By: /s/ Xxxxxx X. Xxxxxx
----------------------- ------------------------
Name: Xxxx X. Xxxxx Name: Xxxxxx X. Xxxxxx
Title: Senior Staff Attorney Title: Financial Officer and Treasurer
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Schedule A to the Subadvisory Agreement
for the SVS Dynamic Growth Portfolio (the
"Series"), a series of Xxxxxxx Variable Series II
(the "Trust"), made as of the 5th day of April, 2002
between Deutsche Investment Management Americas Inc. (the "Manager")
and INVESCO Funds Group, Inc. (the "Subadviser")
FEE SCHEDULE
As compensation for its services described herein, the Subadviser shall receive
from the Manager a monthly fee based on a percentage of the average daily net
assets of the Series calculated according to the following annualized fee
schedule:
Net Assets Annualized Rate
---------- ---------------
On the first $100 million 0.550%
On the next $400 million 0.525%
On the next $500 million 0.500%
On amounts over $1 billion 0.470%
The "average daily net assets" of the Series shall be calculated at such time or
times as the Board may determine in accordance with the provisions of the
Investment Company Act of 1940, as amended. The value of the net assets of the
Series shall always be determined pursuant to the applicable provisions of the
Declaration of Trust and the Registration Statement of the Trust. If the
determination of net asset value does not take place for any particular day, for
the purposes of this Schedule A, the net asset value shall be deemed to be the
net asset value determined as of the close of business on the last day on which
such calculation was made for the purpose of the foregoing computation. If the
Series determines the value of the net assets of its portfolio more than once on
any day, then the last such determination thereof on that day shall be deemed to
be the sole determination thereof on that day for the purposes of this Schedule
A. Fees are charged monthly in arrears based on one-twelfth of the annual fee
rate. Fees shall be prorated appropriately if the Subadviser does not perform
services pursuant to this Subadvisory Agreement for a full month.
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