EXHIBIT (h)(3)
EXPENSE LIMITATION AGREEMENT
This EXPENSE LIMITATION AGREEMENT is made as of the 1st day of August,
2003 by and among XXXXXXX ADVISOR FUNDS III, a Massachusetts Business trust (the
"Trust"), and XXXXXXX ASSET MANAGEMENT PORTFOLIO, a New York trust (the
"Portfolio Trust"), DEUTSCHE ASSET MANAGEMENT, INC., a Delaware corporation (the
"Advisor"), and INVESTMENT COMPANY CAPITAL CORPORATION, a Maryland corporation
(the "Administrator"), with respect to the following:
WHEREAS, the Advisor serves as the Portfolio Trust's Investment Advisor
pursuant to Investment Advisory Agreements dated April 25, 2003, and the
Administrator serves as the Trust's and Portfolio Trust's Administrator pursuant
to Administration and Services Agreements dated July 1, 2001 (collectively, the
"Agreements").
NOW, in consideration of the mutual covenants herein contained and other
good and valuable consideration, the receipt whereof is hereby acknowledged, the
parties hereto agree as follows:
1. The Advisor and Administrator agree to waive their fees and/or
reimburse expenses to the extent necessary so that the ordinary
annual operating expenses for each of the Trust's series or
classes set forth on Exhibit A, as may be amended from time to
time, (each a "Fund") do not exceed the percentage of average
daily net assets set forth on Exhibit A for an initial two year
period from the date of this contract (the "Initial Period") and
thereafter as forth in Item 2. For the purposes of this
Agreement, ordinary operating expenses for a Fund generally
consist of costs not specifically borne by the Advisor,
Administrator or a Fund's principal underwriter, including
investment advisory fees, administration and services fees, fees
for necessary professional services, amortization of
organizational expenses and costs associated with regulatory
compliance and maintaining legal existence and shareholder
relations, but excluding: (a) transactions costs (such as
brokerage commissions and dealer and underwriter spreads); (b)
interest charges on fund borrowings; (c) taxes; (d) litigation
and indemnification costs; and (e) extraordinary expenses.
Extraordinary expenses are those that are unusual or expected to
recur only infrequently, including, but not limited to (i)
expenses of the reorganization, restructuring or merger of a
Fund or class or the acquisition of all or substantially all of
the assets of another fund or class; (ii) expenses of holding,
and soliciting proxies for, a meeting of shareholders of a Fund
or class (except to the extent relating to routine items such as
the election of trustees or the approval of
independent public accountants); and (iii) expenses of
converting to a new custodian, transfer agent or other service
provider.
2. This Agreement, after the Initial Period, shall continue in
effect as to each Fund for successive 16 month periods from such
Fund's fiscal year end, provided such continuance is
specifically approved at least annually by the vote of a
majority of the Board of Trustees of the Trust and the Portfolio
Trusts. Upon the termination of any of the Agreements, this
Agreement shall automatically terminate with respect to the
affected Fund.
3. 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 of 1940, as
amended (the "1940 Act") shall be resolved by reference to such
term or provision of the 1940 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 the Securities and Exchange Commission
("SEC") issued pursuant to said Act. In addition, where the
effect of a requirement of the 1940 Act reflected in any
provision of this Agreement is revised by rule, regulation or
order of the SEC, such provision shall be deemed to incorporate
the effect of such rule, regulation or order. Otherwise the
provisions of this Agreement shall be interpreted in accordance
with the laws of Massachusetts.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed in duplicate by their respective officers as of the day and year first
above written.
XXXXXXX ADVISOR FUNDS III and
XXXXXXX ASSET MANAGEMENT PORTFOLIO
Attest: /s/ Xxxx X. Xxxxx By: /s/ Xxxxx X. Xxxxxxxxx
Name: Xxxx X. Xxxxx Name: Xxxxx X. Xxxxxxxxx
Title: Assistant Secretary
DEUTSCHE ASSET MANAGEMENT, INC.
Attest: /s/ Xxxx X. Xxxxx By: /s/ Xxxxxx X. Xxxxxx
Name: Xxxx X. Xxxxx Name: Xxxxxx X. Xxxxxx
Title: Vice President
INVESTMENT COMPANY CAPITAL CORPORATION
Attest: /s/ Xxxx X. Xxxxx By: /s/ Xxxxxxx X. Xxxx
Name: Xxxx X. Xxxxx Name: Xxxxxxx X. Xxxx
Title: President
EXHIBIT A
ORDINARY FUND OPERATING
EXPENSES
(as a percentage of average
FUND daily net assets)
Lifecycle Long Range Fund - Premier Class 0.60%
Lifecycle Long Range Fund - Investment Class 1.00%
