FORM OF SUB-ADVISORY AGREEMENT
AGREEMENT made as of December 8, 1999 by and between BT Investment
Portfolios, a New York trust (herein called the "Trust") Deutsche Asset
Management Inc. (herein called the "Investment Adviser") and Deutsche Asset
Management Investment Services Limited (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 "Portfolio") 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
Subadviser to act as investment adviser subadviser to each Portfolio 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 Investment Subadviser will provide a continuous investment program for the
Portfolio, including investment research and management with respect to all
securities, investments, cash and cash equivalents in the Portfolio. The
Investment Subadviser will determine from time to time what securities and other
investments will be purchased, retained or sold by each Portfolio. The
Investment Subadviser will provide the services rendered by it hereunder in
accordance with the investment objective(s) and policies of each Portfolio as
stated in the Portfolio's then-current prospectus and statement of additional
information as filed with the Securities and Exchange Commission (the "SEC").
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
Securities Act of 1933 (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 Portfolio 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 Portfolio 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
the Investment Subadviser hereunder are not to be deemed exclusive, and the
Investment Subadviser shall be
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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 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 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 Portfolio.
7. Compensation. For the services provided and the expenses assumed
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 Portfolio's average daily
net assets.
8. Limitation of Liability of the Investment Subadviser:
Indemnification.
(a) The Investment Subadviser shall not be liable for any
error of judgment or mistake of law or for any loss suffered by a Portfolio 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
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 8(c) below:
(i) the Investment Subadviser (hereinafter referred to
as a "Covered Person") shall be indemnified by the respective Portfolio 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 Portfolio, 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.
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(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 Portfolios' 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 Portfolio;
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 Portfolio 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 Portfolio 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 Portfolio 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
such Covered Person will be entitled to indemnification under this Section 7.
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9. Duration and Termination. This Agreement shall be effective as to a
Portfolio as of the date the Portfolio commences investment operations after
this Agreement shall have been approved by the Board of Trustees of the Trust
with respect to that Portfolio and the Investor(s) in the Portfolio 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 Portfolio 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 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 Portfolio, until approved by Vote
of a Majority of the Outstanding Voting Securities of that Portfolio.
11. Representations and Warranties. The Investment Subadviser hereby
represents and warrants as follows:
(a) The Investment Subadviser has all requisite authority to
enter into, execute, deliver and perform its obligations under this Agreement;
(b) This Agreement is legal, valid and binding, and
enforceable in accordance with its terms; and
(c) 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 hereby covenants and agrees that, 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
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(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
shall be deemed duly given if delivered or mailed by registered mail, postage
prepaid, (a) to the Investment Adviser, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇,
▇▇▇ ▇▇▇▇ ▇▇▇▇▇, (b) to the Subadviser, ▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇, ▇▇. (c) to the Trust, c/o Deutsche Asset Management, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇.
14. Waiver. With full knowledge of the circumstances and the effect of
its action, the Investment Subadviser hereby waives any and all rights which it
may acquire in the future against the property of any investor in a Portfolio,
other than shares in that Portfolio, 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
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 state of New York, without reference to principles of conflicts of
law. The Trust is organized under the laws of New York pursuant to a Declaration
of Trust 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.
BT INVESTMENT PORTFOLIOS
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Secretary
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DEUTSCHE ASSET MANAGEMENT, INC.
By:
Name:
Title:
DEUTSCHE ASSET MANAGEMENT
INVESTMENT SERVICES LIMITED
By:
Name:
Title:
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EXHIBIT A
TO
INVESTMENT ADVISORY AGREEMENT
MADE AS OF DECEMBER 8, 1999
BETWEEN
DEUTSCHE ASSET MANAGEMENT, INC.
AND DEUTSCHE ASSET MANAGEMENT INVESTMENT SERVICES LIMITED
The fee for services will be such amount as is agreed to from time to time by
Investment Adviser and Investment Sub-Adviser provided, however, that such fee
will not exceed 100% of the fee being paid at any such time to Investment
Adviser by the Portfolios.
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