Exhibit d(3)
FORM OF SUB-ADVISORY AGREEMENT
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AGREEMENT made as of [_________________] by and between Deutsche Asset
Management VIT Funds, a business trust organized under the laws of the
Commonwealth of Massachusetts (herein called the "Trust") and Deutsche Asset
Management, Inc. (herein called the "Investment Adviser") and DWS International
Portfolio Management GmbH (herein called the "Investment Subadviser").
WHEREAS, the Trust is registered as an open-end management investment
company under the Investment Company Act of 1940;
WHEREAS, the Trust desires to retain the Investment Adviser to render
investment advisory and other services to the Trust with respect to certain of
its series of shares of beneficial interests as may currently exist or be
created in the future (each, a "Fund") as listed on Exhibit A hereto, and the
Investment Adviser is willing to so render such services on the terms
hereinafter set forth;
WHEREAS, the Investment Adviser desires to retain the Investment
Subadviser to perform certain of the Investment Adviser's duties under this
Agreement, and the Investment Subadviser is willing to so render such services
on the terms hereinafter set forth;
NOW, THEREFORE, this Agreement
W I T N E S S E T H:
In consideration of the promises and mutual covenants herein contained, it
is agreed between the parties hereto as follows:
1. Appointment. The Investment Adviser hereby appoints the Investment
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Subadviser to act as investment subadviser to each Fund for the period and on
the terms set forth in this Agreement. The Investment Subadviser accepts such
appointment and agrees to render the services herein set forth for the
compensation herein provided.
2. Management. Subject to the supervision of the Investment Adviser, the
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Investment Subadviser will provide a continuous investment program for the Fund,
including investment research and management with respect to all securities,
investments, cash and cash equivalents in the Fund. The Investment Subadviser
will determine from time to time what securities and other investments will be
purchased, retained or sold by each Fund. The Investment Subadviser will provide
the services rendered by it hereunder in accordance with the investment
objective(s) and policies of each Fund as stated in the Fund's then-current
prospectus and statement of additional information (or the Fund's then current
registration statement on Form N-1A as filed with the Securities and Exchange
Commission (the "SEC") and the then-current offering memorandum if the Fund is
not registered under the Securities Act of 1933, as amended ("1933 Act"). The
Investment Subadviser further agrees that:
(a) it will conform with all applicable rules and regulations of the
SEC (herein called the "Rules") and with all applicable provisions of the 1933
Act; as amended, the Securities Exchange Act of 1934, as amended (the "1934
Act"), the Investment Company Act of 1940, as amended (the "1940 Act"); and the
Investment Advisers Act of 1940, as amended (the "Advisers Act"), and will, in
addition, conduct its activities under this Agreement in accordance with
applicable regulations of the Board of Governors of the Federal Reserve System
pertaining to the investment advisory activities of bank holding companies and
their subsidiaries;
(b) it will place orders pursuant to its investment determinations
for each Fund either directly
with the issuer or with any broker or dealer selected by it. In placing orders
with brokers and dealers, the Investment Subadviser will use its reasonable best
efforts to obtain the best net price and the most favorable execution of its
orders, after taking into account all factors it deems relevant, including the
breadth of the market in the security, the price of the security, the financial
condition and execution capability of the broker or dealer, and the
reasonableness of the commission, if any, both for the specific transaction and
on a continuing basis. Consistent with this obligation, the Investment
Subadviser may, to the extent permitted by law, purchase and sell portfolio
securities to and from brokers and dealers who provide brokerage and research
services (within the meaning of Section 28(e) of the ▇▇▇▇ ▇▇▇) to or for the
benefit of any fund and/or other accounts over which the Investment Subadviser
or any of its affiliates exercises investment discretion. Subject to the review
of the Investment Adviser from time to time with respect to the extent and
continuation of the policy, the Investment Subadviser is authorized to pay to a
broker or dealer who provides such brokerage and research services a commission
for effecting a securities transaction which is in excess of the amount of
commission another broker or dealer would have charged for effecting that
transaction if the Investment Subadviser determines in good faith that such
commission was reasonable in relation to the value of the brokerage and research
services provided by such broker or dealer, viewed in terms of either that
particular transaction or the overall responsibilities of the Investment
Subadviser with respect to the accounts as to which it exercises investment
discretion; and
(c) it will maintain books and records with respect to the
securities transactions of each Fund and will render to the Investment Adviser
such periodic and special reports as the Board may request.
3. Subject to the provisions of this Agreement, the duties of the
Investment Subadviser, the portion of portfolio assets that the Subadviser shall
manage, and the fees to be paid the Investment Subadviser by the Investment
Adviser under and pursuant to this Agreement may be adjusted from time to time
by the Investment Adviser with and upon the approval of the Board and the
members of the Trust's Board of Trustees who are not "interested persons," as
defined in the Act
4. Services Not Exclusive. The investment advisory services rendered by
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the Investment Subadviser hereunder are not to be deemed exclusive, and the
Investment Subadviser shall be free to render similar services to others so long
as its services under this Agreement are not impaired thereby.
5. Books and Records. In compliance with the requirements of Rule 31a-3 of
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the Rules under the 1940 Act, the Investment Subadviser hereby agrees that all
records which it maintains for the Trust are the property of the Trust and
further agrees to surrender promptly to the Investment Adviser any of such
records upon request of the Investment Adviser. The Investment Subadviser
further agrees to preserve for the periods prescribed by Rule 31a-2 under the
1940 Act the records required to be maintained by Rule 31a-1 under the 1940 Act
and to comply in full with the requirements of Rule 204-2 under the Advisers Act
pertaining to the maintenance of books and records.
6. Expenses. During the term of this Agreement, the Investment Subadviser
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will pay all expenses incurred by it in connection with its activities under
this Agreement other than the cost of purchasing securities (including brokerage
commissions, if any) for the Fund.
7. Compensation. For the services provided and the expenses assumed
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pursuant to this Agreement, The Investment Adviser will pay the Investment
Subadviser, and the Investment Subadviser will accept as full compensation
therefor, fees, computed daily and payable monthly, on an annual basis equal to
the percentage set forth on Exhibit A hereto of that Fund's average daily net
assets.
8. Limitation of Liability of the Investment Subadviser: Indemnification.
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(a) The Investment Subadviser shall not be liable for any error of
judgment or mistake of law or for any loss suffered by a Fund in connection with
the matters to which this Agreement relates, except a loss resulting from a
breach of fiduciary duty with respect to the receipt of compensation for
services or a loss resulting from willful misfeasance, bad faith or gross
negligence on the part of the Investment Subadviser in the
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performance of its duties or from reckless disregard by it of its obligations
and duties under this Agreement;
(b) Subject to the exceptions and limitations contained in Section
7(c) below:
(i) the Investment Subadviser (hereinafter referred to as a
"Covered Person") shall be indemnified by the respective Fund to the fullest
extent permitted by law, against liability and against all expenses reasonably
incurred or paid by him in connection with any claim, action, suit or proceeding
in which he becomes involved, as a party or otherwise, by virtue of his being or
having been the Investment Subadviser of the Fund, and against amounts paid or
incurred by him in the settlement thereof;
(ii) the words "claim," "action," "suit," or "proceeding"
shall apply to all claims, actions, suits or proceedings (civil, criminal or
other, including appeals), actual or threatened while in office or thereafter,
and the words "liability" and "expenses" shall include, without limitation,
attorneys' fees, costs, judgments, amounts paid in settlement, fines, penalties
and other liabilities.
(c) No indemnification shall be provided hereunder to a Covered
Person:
(i) who shall have been adjudicated by a court or body before
which the proceeding was brought (A) to be liable to the Investment Adviser or
to one or more Funds' investors by reason of willful misfeasance, bad faith,
gross negligence or reckless disregard of the duties involved in the conduct of
his office, or (B) not to have acted in good faith in the reasonable belief that
his action was in the best interest of a Fund; or
(ii) in the event of a settlement, unless there has been a
determination that such Covered Person did not engage in willful misfeasance,
bad faith, gross negligence or reckless disregard of the duties involved in the
conduct of his office;
(A) by the court or other body approving the settlement;
or
(B) by at least a majority of those Trustees who are
neither Interested Persons of the Trust nor are parties to the matter based upon
a review of readily available facts (as opposed to a full trial-type inquiry);
or
(C) by written opinion of independent legal counsel
based upon a review of readily available facts (as opposed to a full trial-type
inquiry); provided, however, that any investor in a Fund may, by appropriate
legal proceedings, challenge any such determination by the Trustees or by
independent counsel.
(d) The rights of indemnification herein provided may be insured
against by policies maintained by the Investment Adviser, shall be severable,
shall not be exclusive of or affect any other rights to which any Covered Person
may now or hereafter be entitled, shall continue as to a person who has ceased
to be a Covered Person and shall inure to the benefit of the successors and
assigns of such person. Nothing contained herein shall affect any rights to
indemnification to which Trust personnel and any other persons, other than a
Covered Person, may be entitled by contract or otherwise under law.
(e) Expenses in connection with the preparation and presentation of
a defense to any claim, suit or proceeding of the character described in
subsection (b) of this Section 7 may be paid by the Investment Adviser on behalf
of the respective Fund from time to time prior to final disposition thereto upon
receipt of an undertaking by or on behalf of such Covered Person that such
amount will be paid over by him to the Investment Adviser on behalf of the
respective Fund if it is ultimately determined that he is not entitled to
indemnification under this Section 7; provided, however, that either (i) such
Covered Person shall have provided appropriate security for such undertaking or
(ii) the Investment Adviser shall be insured against losses arising out of any
such advance payments, or (iii) either a majority of the Trustees who are
neither Interested Persons of the Trust nor parties to the matter, or
independent legal counsel in a written opinion, shall have determined, based
upon a review of readily available facts as opposed to a trial-type inquiry or
full investigation, that there is reason to believe that
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such Covered Person will be entitled to indemnification under this Section 7.
9. Duration and Termination. This Agreement shall be effective as to a
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Fund as of the date the Fund commences investment operations after this
Agreement shall have been approved by the Board of Trustees of the Trust with
respect to that Fund and the Investor(s) in the Fund in the manner contemplated
by Section 15 of the 1940 Act and, unless sooner terminated as provided herein,
shall continue until the second anniversary of such date. Thereafter, if not
terminated, this Agreement shall continue in effect as to such Fund for
successive periods of 12 months each, provided such continuance is specifically
approved at least annually (a) by the vote of a majority of those members of the
Board of Trustees of the Trust who are not parties to this Agreement or
Interested Persons of any such party, cast in person at a meeting called for the
purpose of voting on such approval, or (b) by Vote of a Majority of the
Outstanding Voting Securities of the Trust; provided, however, that this
Agreement may be terminated by the Trust at any time, without the payment of any
penalty, by the Board of Trustees of the Trust, by Vote of a Majority of the
Outstanding Voting Securities of the Trust on 60 days' written notice to the
Investment Subadviser, or by the Investment Subadviser as to the Investment
Adviser at any time, without payment of any penalty, on 90 days' written notice
to the Investment Adviser. This Agreement will immediately terminate in the
event of its assignment (as used in this Agreement, the terms "Vote of a
Majority of the Outstanding Voting Securities," "Interested Person" and
"Assignment" shall have the same meanings as such terms have in the 1940 Act and
the rules and regulatory constructions thereunder.)
10. Amendment of this Agreement. No material term of this Agreement may be
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changed, waived, discharged or terminated orally, but only by an instrument in
writing signed by the party against which enforcement of the change, waiver,
discharge or termination is sought, and no amendment of a material term of this
Agreement shall be effective with respect to a Fund, until approved by Vote of a
Majority of the Outstanding Voting Securities of that Fund.
11. Representations and Warranties. The Investment Subadviser hereby
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represents and warrants as follows:
(a) [The Investment Subadviser is exempt from registration under the
1940 Act:]
(b) The Investment Subadviser has all requisite authority to enter
into, execute, deliver and perform its obligations under this Agreement;
(c) This Agreement is legal, valid and binding, and enforceable in
accordance with its terms; and
(d) The performance by the Investment Subadviser of its obligations
under this Agreement does not conflict with any law to which it is subject.
12. Covenants. The Investment Subadviser hereby covenants and agrees that,
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so long as this Agreement shall remain in effect:
(a) The Investment Subadviser shall remain either exempt from, or
registered under, the registration provisions of the Advisers Act; and
(b) The performance by the Investment Subadviser of its obligations
under this Agreement shall not conflict with any law to which it is then
subject.
13. Notices. Any notice required to be given pursuant to this Agreement
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shall be deemed duly given if delivered or mailed by registered mail, postage
prepaid, (a) to the Investment Adviser, Mutual Funds Services, ▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇ (One Bankers Trust Plaza), New York, New York 10006 , [(b) to the
Subadviser, [Address] or ](c) to the Trust, c/o BT Alex. ▇▇▇▇▇, Incorporated,
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇.
14. Waiver. With full knowledge of the circumstances and the effect of its
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action, the Investment
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Subadviser hereby waives any and all rights which it may acquire in the future
against the property of any investor in a Fund, other than shares in that Fund,
which arise out of any action or inaction of the Investment Adviser under this
Agreement.
15. Miscellaneous. The captions in this Agreement are included for
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convenience of reference only and in no way define or delimit any of the
provisions hereof or otherwise affect their construction or effect. If any
provision of this Agreement shall be held or made invalid by a court decision,
statute, rule or otherwise, the remainder of this Agreement shall not be
affected thereby.
This Agreement shall be binding upon and shall inure to the benefit of the
parties hereto and their respective successors and shall be governed by the laws
of the ___________________________________, without reference to principles of
conflicts of law. The Trust is organized under the laws of _____________________
___________ pursuant to a ______________ dated ____________. No Trustee, officer
or employee of the Trust shall be personally bound by or liable hereunder, nor
shall resort be had to their private property for the satisfaction of any
obligation or claim hereunder.
IN WITNESS WHEREOF, the parties hereto have caused this instrument to be
executed by their officers designated below as of the day and year first above
written.
[SIGNATORIES]
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EXHIBIT A
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TO
INVESTMENT SUB-ADVISORY AGREEMENT
MADE AS OF ____________________
BETWEEN
[Trust Name] AND [______________]
Fund Investment Advisory Fee
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