VARIABLE INVESTORS SERIES TRUST
SUB-ADVISORY AGREEMENT
This Agreement is made between FIRST VARIABLE ADVISORY SERVICES CORP., a
Massachusetts corporation and a wholly-owned subsidiary of First Variable Life
Insurance Company ("Life Company"), having its principal place of business in
Boston, Massachusetts (hereinafter referred to as "Adviser"), and CREDIT SUISSE
ASSET MANAGEMENT, LLC, a Delaware limited liability company having its principal
place of business in New York, New York (hereinafter referred to as
"Sub-Adviser").
WHEREAS, Variable Investors Series Trust (the "Trust"), an open-end
diversified management investment company, as that term is defined in the
Investment Company Act of 1940, as amended ("Act"), that is registered as such
with the Securities and Exchange Commission has appointed Adviser as investment
adviser for all its portfolios including the Growth & Income Portfolio (the
"Portfolio"); and
WHEREAS, Sub-Adviser is engaged in the business of rendering investment
management services; and
WHEREAS, Adviser desires to retain Sub-Adviser to provide certain
investment management services for the Portfolio of the Trust as more fully
described below;
NOW, THEREFORE, the parties hereto, intending to be legally bound,
hereby agree as follows:
1. Adviser hereby retains Sub-Adviser to assist Adviser in its capacity
as investment adviser for the Portfolio. Subject to the oversight and review of
Adviser and the Board of Trustees of the Trust, Sub-Adviser shall manage the
investment and reinvestment of the assets of the Portfolio. Sub-Adviser will
determine in its discretion, subject to the oversight and review of Adviser, the
investments to be purchased or sold, will provide Adviser with records
concerning its activities which Adviser or the Trust is required to maintain,
and will render regular reports to Adviser and to officers and Trustees of the
Trust concerning its discharge of the foregoing responsibilities. The services
of Sub-Adviser hereunder are not to be deemed exclusive, and the Sub-Adviser
shall be free to render similar services to others.
2. Neither the Trust, Adviser, nor affiliated persons of the Trust or
Adviser shall give any information or make any representations or statements
concerning Sub-Adviser, except with the prior permission of Sub-Adviser.
3. Sub-Adviser, in its supervision of the investments of the Portfolio,
will be guided by the Portfolio's investment objectives and policies and the
provisions and restrictions contained in the Declaration of Trust and By-Laws of
the Trust and as set forth in the Registration Statement and exhibits as may be
on file with the Securities and Exchange Commission, all as communicated by
Adviser to Sub-Adviser.
4. Adviser shall pay to Sub-Adviser, for all services rendered to the
Portfolio by Sub-Adviser hereunder, the fees set forth in Exhibit A attached
hereto. During the term of this Agreement, Sub-Adviser will bear all expenses
incurred by it in the performance of its duties hereunder, which shall not
include expenses of the Trust or the Portfolio, such as brokerage fees and
commissions and taxes.
5. The term of this Agreement shall begin on the date of its execution
and shall remain in effect for two years from that date and from year to year
thereafter, subject to the provisions for termination and all of the other terms
and conditions hereof if: (a) such continuation shall be specifically approved
at least annually by the vote of a majority of the Trustees of the Trust,
including a majority of the Trustees who are not "interested persons", as
defined in Section 2(a)(19) of the Act, of any party (other than as Trustees of
the Trust) cast in person at a meeting called for that purpose; and (b) Adviser
shall not have notified the Trust in writing at least sixty (60) days prior to
the anniversary date of this Agreement in any year thereafter that it does not
desire such continuation with respect to the Portfolio.
6. Notwithstanding any provision in this Agreement, it may be
terminated at any time without the payment of any penalty, by the Trustees of
the Trust or by a vote of a majority of the outstanding voting securities of the
Portfolio, as defined in Section 2(a)(42) of the Act, on sixty (60) days'
written notice to Sub-Adviser, or by Adviser or Sub-Adviser upon not less than
sixty (60) days' written notice to the other party. Notwithstanding any
provision in this Agreement, if the requisite approval of the Portfolio's
shareholders is not received within 150 days of the date of the acquisition
of Warburg Pincus Asset Management, Inc. by Credit Suisse Group, this Agreement
will terminate automatically.
7. This Agreement may not be assigned by Adviser or Sub-Adviser and
shall automatically terminate in the event of any assignment. Sub-Adviser may
employ or contract with such other person, persons, corporation, or corporations
at its own cost and expense as it shall determine in order to assist it in
carrying out this Agreement.
8. Sub-Adviser represents and warrants that the Portfolio will at all
times be invested in such a manner as to ensure compliance with Section 817(h)
of the Internal Revenue Code of 1986, as amended and Treasury Regulations
Section 1.817-5, relating to the diversification requirements for variable
annuity, endowment, or life insurance contracts and any amendments or other
modifications to such Section or Regulations; provided, however, that Adviser
shall promptly provide Sub-Adviser with copies of such Section 817(h) and
Regulation Section 1.817-5 as currently in effect and as modified or amended
from time to time. Sub-Adviser will be relieved of this obligation and shall be
held harmless when (i) the Portfolio is invested in compliance with the
requirements of Section 817(h) and/or Regulation Section 1.817-5 as most
recently provided to Sub-Adviser by Adviser or (ii) when direction from the
Adviser or Trustees causes noncompliance with Section 817(h) and/or Regulation
Section 1.817-5. Sub-Adviser agrees to provide quarterly reports to Adviser,
executed by a duly authorized officer of Sub-Adviser, within seven (7) days of
the close of each calendar quarter certifying as to compliance with said Section
or Regulations. In addition to the quarterly reports, Adviser may request and
Sub-Adviser agrees to provide Section 817 diversification compliance reports at
more frequent intervals, as reasonably requested by Adviser.
9. In the absence of willful misfeasance, bad faith, gross negligence,
or reckless disregard of the obligations or duties under this Agreement on the
part of Sub-Adviser ("disabling conduct"), neither Sub-Adviser, any affiliated
person of Sub-Adviser nor any person who controls Sub-Adviser, within the
meaning of Section 15 of the Securities Act of 1933, as amended (the "1933 Act")
shall be liable to Adviser, the Trust, the Portfolio or to any shareholder for
any act or omission in the course of or connected in any way with rendering
services or for any losses that may be sustained in the purchase, holding, or
sale of any security.
10. The Sub-Adviser shall place all orders for the purchase and sale of
portfolio securities for the account of the Portfolio with broker-dealers
selected by the Sub-Adviser. In executing portfolio transactions and selecting
broker-dealers, the Sub-Adviser will use its best efforts to seek best execution
on behalf of the Portfolio. In assessing the best execution available for any
transaction, the Sub-Adviser shall consider 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-dealer, and the
reasonableness of the commission, if any (all for the specific transaction and
on a continuing basis). In evaluating the best execution available, and in
selecting the broker-dealer to execute a particular transaction, the Sub-Adviser
may also consider the brokerage and research services (as those terms are used
in Section 28(e) of the Securities Exchange Act of 1934 ("1934 Act")) provided
to the Portfolio and/or other accounts over which the Sub-Adviser, an affiliate
of the Sub-Adviser (to the extent permitted by law) or another investment
adviser of the Portfolio exercises investment discretion. The Sub-Adviser is
authorized to cause the Portfolio to pay a broker-dealer who provides such
brokerage and research services a commission for executing a portfolio
transaction for the Portfolio which is in excess of the amount of commission
another broker-dealer would have charged for effecting that transaction if, but
only if, the Sub-Adviser determines in good faith that such commission was
reasonable in relation to the value of the brokerage and research services
provided by such broker-dealer viewed in terms of that particular transaction or
in terms of all of the accounts over which investment discretion is so
exercised.
11. This Agreement may be amended at any time by agreement of the
parties, provided that the amendment shall be approved both by the vote of a
majority of the Trustees of the Trust, including a majority of the Trustees who
are not "interested persons," as defined in Section 2(a)(19) of the Act, of any
party to this Agreement (other than as Trustees of the Trust) cast in person at
a meeting called for that purpose, and on behalf of the Portfolio by the holders
of a majority of the outstanding voting securities of the Portfolio, as defined
in Section 2(a)(42) of the Act.
12. This Agreement shall be construed in accordance with and governed
by the laws of the Commonwealth of Massachusetts.
13. This Agreement will become binding on the parties hereto upon their
execution of the attached Exhibit A to this Agreement.
14. It is understood that any information or recommendation supplied by
the Sub-Adviser in connection with the performance of its obligations hereunder
is to be regarded as confidential and for use only by the Adviser, the Trust or
such persons as the Adviser may designate in connection with the Portfolio. It
is also understood that any information supplied to Sub-Adviser in connection
with the performance of its obligations hereunder, particularly, but not
necessarily limited to, any list of securities which, on a temporary basis, may
not be bought or sold for the Portfolio, is to be regarded as confidential and
for use only by the Sub-Adviser in connection with its obligation to provide
investment advice and other services to the Portfolio.
15. Each party to this Agreement hereby acknowledges that it is registered
as an investment adviser under the Investment Advisers Act of 1940, it will use
its reasonable best efforts to maintain such registration, and it will promptly
notify the other if it ceases to be so registered, if its registration is
suspended for any reason, or if it is notified by any regulatory organization or
court of competent jurisdiction that it should show cause why its registration
should not be suspended or terminated.
EXHIBIT A
VARIABLE INVESTORS SERIES TRUST
SUB-ADVISORY COMPENSATION
For all services rendered by Sub-Adviser hereunder, Adviser
shall pay to Sub-Adviser and Sub-Adviser agrees to accept as full compensation
for all services rendered hereunder, an annual fee as follows:
Growth & Income Portfolio
.50 of 1% on an annualized basis of the average daily
net assets of the Portfolio.
Such fees shall accrue daily and be paid monthly.
Witness the due execution hereof as of this 6th day of
July, 1999.
FIRST VARIABLE ADVISORY SERVICES CORP.
Attest:
/S/XXXXXX X. XXXXXXX /S/XXXX X. XXXXXX
____________________ By:__________________________
CREDIT SUISSE ASSET MANAGEMENT, LLC
Attest:
/s/XXXXXX X. XXXXX /S/XXX XXXXXX
____________________ By:__________________________
Xxx Xxxxxx
General Counsel
