Exhibit(d)(3)
FORM OF
AMENDED AND RESTATED
INVESTMENT MANAGEMENT AGREEMENT
AGREEMENT, dated as of June 1, 2006, among DWS Value Equity Trust, a
Massachusetts business trust (the "Trust"), on its own behalf and on behalf of
each of the Funds listed on Schedule I to this Agreement, as may be amended from
time to time, (each a "Fund" and together, the "Funds"), and Deutsche Investment
Management Americas Inc., a Delaware corporation (the "Adviser").
WHEREAS, the Trust is engaged in business as an open-end investment
company registered under the Investment Company Act of 1940, as amended (the
"Investment Company Act");
WHEREAS, the Trust engages in the business of investing and reinvesting
the assets of each Fund in accordance with the investment objectives, policies
and restrictions specified in the currently effective Prospectus (the
"Prospectus") and Statement of Additional Information (the "SAI") of each Fund
included in the Trust's Registration Statement on Form N-1A, as amended from
time to time (the "Registration Statement"), filed by the Trust under the
Investment Company Act and the Securities Act of 1933, as amended;
WHEREAS, the Adviser is engaged principally in rendering investment
management services and is registered as an investment adviser under the
Investment Advisers Act of 1940, as amended (the "Advisers Act");
WHEREAS, the Trust desires to retain the Adviser to provide investment
management services to each Fund on the terms set out in this Agreement, and the
Adviser is willing to provide investment management services to each Fund on the
terms set out in this Agreement; and
WHEREAS, the Trust and the Adviser desire to amend and restate the
current Investment Management Agreement for each Fund, dated March 17, 2003 for
DWS Enhanced S&P 500 Index Fund and August 29, 2003 for DWS Equity Income Fund.
NOW, THEREFORE, in consideration of the premises and the covenants
contained in this Agreement, the Trust, each Fund and the Adviser agree as
follows:
1. Appointment and Services.
(a) The Trust appoints the Adviser to act as investment
manager to each Fund. The Adviser accepts its appointment and agrees to
provide the services set out in this Agreement for the compensation set
out in this Agreement.
(b) Subject to the terms of this Agreement, and the
supervision of the Board of Trustees, the Adviser will provide
continuing investment management of the assets of each Fund in
accordance with the investment objectives, policies and restrictions
set forth
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in the Prospectus and SAI of the Fund; the applicable provisions of the
Investment Company Act, the rules and regulations thereunder; the
provisions of the Internal Revenue Code of 1986, as amended (the
"Code"), relating to regulated investment companies and all rules and
regulations thereunder; and all other applicable federal and state laws
and regulations. In connection with the services provided under this
Agreement, the Adviser will use best efforts to manage each Fund so
that it will qualify as a regulated investment company under Subchapter
M of the Code and regulations issued under the Code. The Adviser will
also monitor, to the extent not monitored by the Fund's administrator
or other agent, each Fund's compliance with its investment and tax
guidelines and other compliance policies. Each Fund will have the
benefit of the investment analysis and research, the review of current
economic conditions and trends and the consideration of long-range
investment policy generally available to the Adviser's investment
advisory clients. In managing each Fund in accordance with the
requirements set out in this Section 1, the Adviser will be entitled to
receive and act upon advice of counsel for the Trust or a Fund.
(c) The Adviser will determine the securities and other
instruments to be purchased, sold or entered into by each Fund and
place orders with broker-dealers, foreign currency dealers, futures
commission merchants or others pursuant to the Adviser's determinations
and all in accordance with each Fund's policies as set out in the
Prospectus and SAI of the Fund or as adopted by the Board of Trustees
and disclosed to the Adviser. The Adviser will determine what portion
of each Fund's portfolio will be invested in securities and other
assets and what portion, if any, should be held uninvested in cash or
cash equivalents.
(d) The Adviser will provide assistance to the Board of
Trustees in valuing the securities and other instruments held by each
Fund, to the extent reasonably required by such valuation policies and
procedures as may be adopted by each Fund.
(e) The Adviser will maintain in accordance with applicable
law all books and records required of investment advisers under the
Advisers Act, and will make available to the Board of Trustees such
records upon request.
(f) The Adviser also agrees to make available to the Board of
Trustees the following:
(i) periodic reports on the investment performance of each
Fund;
(ii) additional reports and information related to the
Adviser's duties under this Agreement as the Board of Trustees
may reasonably request; and
(iii) to the extent held by the Adviser, all of each Fund's
investment records and ledgers as are necessary to assist the
Trust in complying with
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the requirements of the Investment Company Act and other
applicable laws.
To the extent required by law, the Adviser will
furnish to regulatory authorities having the requisite authority any
information or reports in connection with the services provided under
this Agreement that may be requested.
(g) The Adviser will also provide to each Fund's
administrator, custodian, fund accounting agent, shareholder service
agents, transfer agents and other service providers, as required, and
to the extent held by the Adviser, information relating to all
transactions concerning the assets belonging to the Fund, in each case
subject to compliance with applicable privacy standards.
2. Investment Management Fee.
(a) For all services to be rendered, payments to be made and
costs to be assumed by the Adviser as provided under this Agreement,
the Trust on behalf of each Fund will pay the Adviser in United States
Dollars following the last day of each month the unpaid balance of a
fee equal to the sum of all the daily management accruals from the
previous month. The daily management accrual is calculated on a daily
basis by multiplying a Fund's prior day's net assets by the fee rates
set forth on Schedule II to this Agreement and dividing that product by
the number of days in that year. The Adviser will be entitled to
receive during any month such interim payments of its fee under this
Section 2 as it will request, provided that no such payment will exceed
75 percent of the amount of its fee then accrued on the books of a Fund
and unpaid.
(b) The "average daily net assets" of each Fund will mean the
average of the values placed on the Fund's net assets as of 4:00 p.m.
(New York time) on each day on which the net asset value of the Fund is
determined consistent with the provisions of Rule 22c-1 under the
Investment Company Act or, if the Fund lawfully determines the value of
its net assets as of some other time on each business day, as of such
time. The value of the net assets of each Fund will always be
determined pursuant to the applicable provisions of the Trust's
Declaration of Trust, as amended from time-to-time (the "Declaration")
and the Registration Statement. If the determination of net asset value
for a Fund does not take place for any particular day, then for the
purposes of this Section 2, the value of the net assets of the Fund as
last determined will be deemed to be the value of its net assets as of
4:00 p.m. (New York time), or as of such other time as the value of the
net assets of the Fund's portfolio may be lawfully determined on that
day. If a Fund 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 will be deemed to be the sole determination thereof on that
day for the purposes of this Section 2.
(c) The Adviser may from time to time agree not to impose all
or a portion of its fee otherwise payable under this Agreement and/or
undertake to pay or reimburse a Fund for all or a portion of its
expenses not otherwise required to be paid by or
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reimbursed by the Adviser. Unless otherwise agreed, any fee reduction
or undertaking may be discontinued or modified by the Adviser at any
time. For the month and year in which this Agreement becomes effective
or terminates, there will be an appropriate pro ration of any fee based
on the number of days that the Agreement is in effect during such month
and year, respectively.
(d) All rights to compensation under this Agreement for
services performed as of the termination of this Agreement shall
survive the termination.
3. Expenses.
(a) Except as otherwise specifically provided in this Section
3 or as determined by the Board of Trustees, to the extent permitted by
applicable law, the Adviser will pay the compensation and expenses of
all Trustees, officers and executive employees of the Trust (including
a Fund's share of payroll taxes) who are affiliated persons of the
Adviser, and the Adviser will make available, without expense to any
Fund, the services of such of its directors, officers and employees as
may duly be elected officers of the Trust, subject to their individual
consent to serve and to any limitations imposed by law. The Adviser
will provide at its expense the services described in this Agreement.
(b) The Adviser will not be required to pay any expenses of
the Trust or of a Fund other than those specifically allocated to it in
this Section 3. In particular, but without limiting the generality of
the foregoing, the Adviser will not be responsible, except to the
extent of the reasonable compensation of such of the Trust's Trustees
and officers as are directors, officers or employees of the Adviser
whose services may be involved, for the following expenses of a Fund:
fees payable to the Adviser; outside legal, accounting or auditing
expenses including with respect to expenses related to negotiation,
acquisition, or distribution of portfolio investments; maintenance of
books and records which are maintained by the Trust, a Fund's custodian
or other agents of the Trust; taxes and governmental fees; fees and
expenses of a Fund's accounting agent, custodians, sub-custodians,
depositories (for securities and/or commodities), transfer agents,
dividend disbursing agents and registrars; payment for portfolio
pricing or valuation services to pricing agents, accountants, bankers
and other specialists, if any; brokerage commissions or other costs of
acquiring or disposing of any portfolio securities or other instruments
of a Fund; and litigation expenses and other extraordinary expenses not
incurred in the ordinary course of a Fund's business.
(c) The Adviser will not be required to pay expenses of any
activity which is primarily intended to result in sales of shares of a
Fund (the "Shares") if and to the extent that (i) such expenses are
required to be borne by a principal underwriter that acts as the
distributor of the Fund's Shares pursuant to an underwriting agreement
that provides that the underwriter will assume some or all of such
expenses, or (ii) the Trust on behalf of the Fund will have adopted a
plan in conformity with Rule 12b-1 under the Investment Company Act
providing that the Fund (or some other party) will assume some or all
of
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such expenses. The Adviser will pay such sales expenses as are not
required to be paid by the principal underwriter pursuant to the
underwriting agreement or are not permitted to be paid by a Fund (or
some other party) pursuant to such a plan.
4. Delegation of Investment Management Services. Subject to the prior
approval of a majority of the members of the Board of Trustees, including a
majority of the Trustees who are not "interested persons", and, to the extent
required by applicable law, by the shareholders of a Fund, the Adviser may,
through a sub-advisory agreement or other arrangement, delegate to a sub-advisor
any of the duties enumerated in this Agreement, including the management of all
or a portion of the assets being managed. Subject to the prior approval of a
majority of the members of the Board of Trustees, including a majority of the
Trustees who are not "interested persons", and, to the extent required by
applicable law, by the shareholders of a Fund, the Adviser may adjust such
duties, the portion of assets being managed, and the fees to be paid by the
Adviser; provided, that in each case the Adviser will continue to oversee the
services provided by such company or employees and any such delegation will not
relieve the Adviser of any of its obligations under this Agreement.
5. Selection of Brokers and Affiliated Transactions.
(a) Subject to the policies established by, and any direction
from the Trust's Board of Trustees, the Adviser will be responsible for
selecting the brokers or dealers that will execute the purchases and
sales for a Fund. Subject to the foregoing, it is understood that the
Adviser will not be deemed to have acted unlawfully, or to have
breached a fiduciary duty to the Trust or be in breach of any
obligation owing to the Trust under this Agreement, or otherwise,
solely by reason of its having directed a securities transaction on
behalf of a series to a broker-dealer in compliance with the provisions
of Section 28(e) of the Securities Exchange Act of 1934 or as otherwise
permitted from time to time by a series' Prospectus and SAI.
(b) Subject to the policies established by, and any direction
from, a Fund's Board of Trustees, the Adviser may direct any of its
affiliates to execute portfolio transactions for a Fund on an agency
basis. The commissions paid to the Adviser's affiliates must be in
accordance with Rule 17e-1 under the Investment Company Act.
(c) The Adviser and any of its affiliates will not deal with a
Trust or any of its affiliates in any transaction in which the Adviser
or any of its affiliates acts as a principal with respect to any part
of a Fund order, except in compliance with the Investment Company Act,
the rules and regulations under the Investment Company Act and any
applicable SEC or SEC staff guidance or interpretation. If the Adviser
or any of its affiliates is participating in an underwriting or selling
group, a Fund may not buy securities from the group except in
accordance with policies established by the Board of Trustees in
compliance with the Investment Company Act, the rules and regulations
under the Investment Company Act and any applicable SEC or SEC staff
guidance or interpretation.
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(d) The Adviser will promptly communicate to a Fund's
administrator and to the officers and the Trustees of a Trust such
information relating to portfolio transactions as they may reasonably
request.
6. Limitation of Liability of Manager.
(a) As an inducement to the Adviser undertaking to provide
services to the Trust and each Fund pursuant to this Agreement, the
Trust and each Fund agrees that the Adviser will not be liable under
this Agreement for any error of judgment or mistake of law or for any
loss suffered by the Trust or a Fund in connection with the matters to
which this Agreement relates, provided that nothing in this Agreement
will be deemed to protect or purport to protect the Adviser against any
liability to the Trust, a Fund or its shareholders to which the Adviser
would otherwise be subject by reason of willful misfeasance, 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.
(b) The rights of exculpation provided under this Section 6
are not to be construed so as to provide for exculpation of any person
described in this Section for any liability (including liability under
U.S. federal securities laws that, under certain circumstances, impose
liability even on persons that act in good faith) to the extent (but
only to the extent) that exculpation would be in violation of
applicable law, but will be construed so as to effectuate the
applicable provisions of this Section 6 to the maximum extent permitted
by applicable law.
7. Term and Termination.
(a) This Agreement will remain in force with respect to each
party until September 30, 2006 and continue in force from year to year
thereafter, but only so long as such continuance is specifically
approved at least annually (a) by the vote of a majority of the
Trustees who are not parties to this Agreement or "interested persons"
of any party to this Agreement, cast in person at a meeting called for
the purpose of voting on such approval, and (b) by the vote of a
majority of the Trustees of the Trust, or by the vote of a majority of
the outstanding voting securities of the respective Fund. The
requirement that continuance of this Agreement be "specifically
approved at least annually" will be construed in a manner consistent
with the Investment Company Act, the rules and regulations under the
Investment Company Act and any applicable SEC or SEC staff guidance or
interpretation.
(b) This Agreement may be terminated with respect to a Fund at
any time, without the payment of any penalty, by the vote of a majority
of the outstanding voting securities of the Fund or by the Trust's
Board of Trustees on 60 days' written notice to the Adviser, or by the
Adviser on 60 days' written notice to the Trust. This Agreement will
terminate automatically in the event of its assignment (as defined
under the Investment Company Act).
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8. Amendment. No provision of this Agreement may be changed, waived,
discharged, or terminated orally, but only by an instrument in writing signed by
the party against whom enforcement of the change, waiver, discharge, or
termination is sought, and no amendment of this Agreement will be effective
until approved in a manner consistent with the Investment Company Act, rules and
regulations under the Investment Company Act and any applicable SEC or SEC staff
guidance or interpretation.
9. Services Not Exclusive. The Adviser's services to the Trust and each
Fund pursuant to this Agreement are not exclusive and it is understood that the
Adviser may render investment advice, management and services to other persons
(including other investment companies) and to engage in other activities, so
long as its services under this Agreement are not impaired by such other
activities. It is understood and agreed that officers or directors of the
Adviser may serve as officers or Trustees of the Trust, and that officers or
Trustees of the Trust may serve as officers or directors of the Adviser to the
extent permitted by law; and that the officers and directors of the Adviser are
not prohibited from engaging in any other business activity or from rendering
services to any other person, or from serving as partners, officers, trustees or
directors of any other firm, trust or corporation, including other investment
companies. Whenever a Fund and one or more other accounts or investment
companies advised by the Adviser have available funds for investment,
investments suitable and appropriate for each will be allocated in accordance
with procedures believed by the Adviser to be equitable to each entity over
time. Similarly, opportunities to sell securities will be allocated in a manner
believed by the Adviser to be equitable to each entity over time. The Trust and
each Fund recognize that in some cases this procedure may adversely affect the
size of the position that may be acquired or disposed of for a Fund.
10. Avoidance of Inconsistent Position. In connection with purchases or
sales of portfolio securities and other investments for the account of a Fund,
neither the Adviser nor any of its directors, officers, or employees will act as
a principal or agent or receive any commission, except in accordance with
applicable law and policies and procedures adopted by the Board of Trustees. The
Adviser or its agent will arrange for the placing of all orders for the purchase
and sale of portfolio securities and other investments for a Fund's account with
brokers or dealers selected by it in accordance with Fund policies as expressed
in the Registration Statement. If any occasion should arise in which the Adviser
gives any advice to its clients concerning the Shares of a Fund, it will act
solely as investment counsel for such clients and not in any way on behalf of
the Fund.
11. Additional Series. In the event the Trust establishes one or more
Funds after the effective date of this Agreement, such Funds will become Funds
under this Agreement upon approval of this Agreement by the Board of Trustees
with respect to the Funds and the execution of an amended Schedule I reflecting
the Funds.
12. Delivery of Documents. Copies of the Registration Statement and
each Fund's Prospectus and SAI have been furnished to the Adviser by the Trust.
The Trust has also furnished the Adviser with copies properly certified or
authenticated of each of the following additional documents related to the Trust
and each Fund:
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(i) The Declaration dated March 17, 1988, as amended and/or restated to
date, together with all filed certificates regarding the establishment
and designation of a series of Shares of the Trust, to the extent
applicable.
(ii) By-Laws of the Trust as in effect on the date hereof.
(iii) Resolutions of the Trustees of the Trust approving the form of
this Agreement.
The Trust will promptly furnish the Adviser from time to time with
copies, properly certified or authenticated, of all amendments of or
supplements, if any, to the foregoing, including the Prospectus, the SAI and the
Registration Statement.
13. Limitation of Liability for Claims.
(a) The Declaration, a copy of which, together with all
amendments thereto, is on file in the Office of the Secretary of The
Commonwealth of Massachusetts, provides that the name "DWS Value Equity
Trust" refers to the Trustees under the Declaration collectively as
Trustees and not as individuals or personally, and that no shareholder
of a Fund, or Trustee, officer, employee, or agent of the Trust, will
be subject to claims against or obligations of the Trust or of the Fund
to any extent whatsoever, but that the Trust estate only will be
liable.
(b) The Adviser is hereby expressly put on notice of the
limitation of liability as set forth in the Declaration and it agrees
that the obligations assumed by the Trust on behalf of each Fund
pursuant to this Agreement will be limited in all cases to a Fund and
its assets, and it will not seek satisfaction of any such obligation
from the shareholders or any shareholder of the Fund or any other
series of the Trust, or from any Trustee, officer, employee or agent of
the Trust. The Adviser understands that the rights and obligations of
each Fund, or series, under the Declaration are separate and distinct
from those of any and all other series.
14. Miscellaneous.
(a) The captions in this Agreement are included for convenience of
reference only and in no way define or limit any of the provisions
hereof or otherwise affect their construction or effect. This Agreement
may be executed simultaneously in two or more counterparts, each of
which will be deemed an original, but all of which together will
constitute one and the same instrument.
(b) Any question of interpretation of any term or provision of this
Agreement having a counterpart in or otherwise derived from a term or
provision of the Investment Company Act will be resolved by reference
to such term or provision of the Investment Company Act and to
interpretations thereof, if any, by the United States Courts or in the
absence of any controlling decision of any such court, by rules,
regulations or orders of
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the SEC issued pursuant to the Investment Company Act. In addition,
where the effect of a requirement of the Investment Company Act
reflected in any provision of this Agreement is modified or interpreted
by any applicable order or orders of the SEC or any rules or
regulations adopted by, or interpretative releases of, the SEC
thereunder, such provision will be deemed to incorporate the effect of
such order, rule, regulation or interpretative release.
(c) This Agreement will be construed in accordance with the laws of The
Commonwealth of Massachusetts without regard to choice of law or
conflicts of law principles thereof, provided that nothing in this
Agreement will be construed in a manner inconsistent with the
Investment Company Act, or in a manner which would cause a Fund to fail
to comply with the requirements of Subchapter M of the Code.
(d) This Agreement constitutes the entire agreement between the parties
concerning the subject matter, and supersedes any and all prior
understandings.
(e) If any provision, term or part of this Agreement is deemed to be
void, unenforceable, or invalid for any reason by a court decision,
statute, rule, or otherwise, the remaining provisions of this Agreement
will remain in full force and effect as if such invalid provision, term
or part was not a part of this Agreement.
(f) This Agreement will supersede all prior investment advisory or
management agreements entered into between the Adviser and the Trust on
behalf of a Fund.
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IN WITNESS WHEREOF, the parties have executed and delivered this Agreement as of
the day and year first written above.
DWS Value Equity Trust
By: ____________________________
Name: Xxxx Xxxxxxxx
Title: Vice President & Secretary
DWS Value Equity Trust, on
behalf of the Funds set out on Schedule I
By: ____________________________
Name: Xxxx Xxxxxxxx
Title: Vice President & Secretary
DEUTSCHE INVESTMENT MANAGEMENT
AMERICAS INC.
By: ______________________________
Name: Xxxxxxx Xxxxx
Title: Chief Operating Officer
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SCHEDULE I
FUNDS
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Effective Date
Fund of this Agreement
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DWS Enhanced S&P 500 Index Fund June 1, 2006
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DWS Equity Income Fund July 1, 2006
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SCHEDULE II
INVESTMENT MANAGEMENT FEE RATES
(as a percentage of net assets)
DWS Enhanced S&P 500 Index Fund:
0.415% to $500 million
0.390% next $500 million
0.365% thereafter
DWS Equity Income Fund:
0.665% to $250 million 0.635% next $750 million 0.615% next
$1.5 billion 0.595% next $2.5 billion 0.565% next $2.5 billion
0.555% next $2.5 billion 0.545% next $2.5 billion 0.535%
thereafter
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