EXHIBIT d(1)
AMENDED INVESTMENT MANAGEMENT AGREEMENT
This AGREEMENT made this 1st day of April, 2004 between ING VARIABLE
PORTFOLIOS, INC. (the "Fund"), a Maryland corporation, and ING INVESTMENTS, LLC
(the "Manager"), an Arizona limited liability company (the "Agreement").
WHEREAS, the Fund is an open-end management investment company
registered under the Investment Company Act of 1940, as amended (the "1940
Act");
WHEREAS, the Fund is authorized to issue shares of common stock in
separate series with each such series representing interests in a separate
portfolio of securities and other assets;
WHEREAS, the Fund may offer shares of additional series in the future;
WHEREAS, the Fund desires to avail itself of the services of the
Manager for the provision of advisory and management services for the Fund; and
WHEREAS, the Manager is willing to render such services to the Fund;
NOW, THEREFORE, in consideration of the premises, the promises and
mutual covenants herein contained, it is agreed between the parties as follows:
1. Appointment. The Fund hereby appoints the Manager, subject to
the direction of the Board of Directors, for the period and on the terms set
forth in this Agreement, to provide advisory, management, and other services, as
described herein, with respect to each series of the Fund (individually and
collectively referred to herein as "Series"). The Manager accepts such
appointment and agrees to render the services herein set forth for the
compensation herein provided.
In the event the Fund establishes and designates additional series with
respect to which it desires to retain the Manager to render advisory services
hereunder, it shall notify the Manager in writing. If the Manager is willing to
render such services, it shall notify the Fund in writing, whereupon such
additional series shall become a Series hereunder.
With respect to those Series that have obtained shareholder approval,
subject to the approval of the Board of Directors of the Fund, the Manager is
authorized to enter into sub-advisory agreements with other registered
investment advisers to serve as investment sub-advisors, whether or not
affiliated with the Manager (each a "Sub-Adviser"). The Manager will continue to
have responsibility for all services furnished pursuant to any sub-advisory
agreement (each a "Sub-Advisory Agreement"). The Fund and Manager understand and
agree that the Manager may manage each Series in a "manager-of-managers" style
with either a single or multiple sub-advisers, which contemplates that the
Manager will, among other things and pursuant to an Order issued by the
Securities and Exchange Commission (SEC): (i) continually evaluate the
performance of the Sub-Advisers to the Fund; and (ii) periodically make
recommendations to the Fund's Board of Directors regarding the results of its
evaluation and monitoring functions. The Fund recognizes that, subject to the
approval of the Board of
Directors of the Fund, a sub-adviser's services may be terminated or modified
and that the Manager may appoint a new Sub-Adviser for a Series, subject to an
applicable SEC Order.
2. Services of the Manager. The Manager represents and warrants
that it is registered as an investment adviser under the Investment Advisers Act
of 1940 and will maintain such registration for so long as required by
applicable law. Subject to the general supervision of the Board of Directors of
the Fund, the Manager shall provide the following advisory, management, and
other services with respect to the Series:
(a) Provide general investment advice and guidance with
respect to the Series and provide advice and guidance to the Fund's Directors,
and oversee the management of the investments of the Series and the composition
of each Series' portfolio of securities and investments, including cash, and the
purchase, retention and disposition thereof, in accordance with each Series'
investment objective or objectives and policies as stated in the Fund's current
registration statement, which management may be provided by others selected by
the Manager and approved by the Board of Directors as provided below or directly
by the Manager as provided in Section 3 of this Agreement;
(b) In the event that the Manager wishes to select others
to render investment management services, the Manager shall analyze, select and
recommend for consideration and approval by the Fund's Board of Directors
investment advisory firms (however organized) to provide investment advice to
one or more of the Series, and, at the expense of the Manager, engage (which
engagement may also be by the Fund) such investment advisory firms to render
investment advice and manage the investments of such Series and the composition
of each such Series' portfolio of securities and investments, including cash,
and the purchase, retention and disposition thereof, or any offering thereof, in
accordance with the Series' investment objective or objectives and policies as
stated in the Fund's current registration statement (any such firms approved by
the Board of Directors and engaged by the Fund and/or the Manager are referred
to herein as "Sub-Advisers");
(c) Periodically monitor and evaluate the performance of
the Sub-Advisers with respect to the investment objectives and policies of the
Series;
(d) Monitor the Sub-Advisers for compliance with the
investment objective or objectives, policies and restrictions of each Series,
the 1940 Act, Subchapter M of the Internal Revenue Code, and if applicable,
regulations under such provisions, and other applicable law;
(e) If appropriate, analyze and recommend for
consideration by the Fund's Board of Directors termination of a contract with a
Sub-Adviser under which the Sub-Adviser provides investment advisory services to
one or more of the Series;
(f) Supervise Sub-Advisers with respect to the services
that such Sub- Advisers provide under respective portfolio management agreements
("Sub-Adviser Agreements");
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(g) Render to the Board of Directors of the Fund such
periodic and special reports as the Board may reasonably request; and
(h) Make available its officers and employees to the
Board of Directors and officers of the Fund for consultation and discussions
regarding the administration and management of the Series and services provided
to the Fund under this Agreement.
3. Investment Management Authority. In the event the Manager
wishes to render investment management services directly to a Series, then with
respect to any such Series, the Manager, subject to the supervision of the
Fund's Board of Directors, will provide a continuous investment program for the
Series' portfolio and determine the composition of the assets of the Series'
portfolio, including determination of the purchase, retention, or sale, or any
offering, of the securities, cash, and other investments contained in the
portfolio. The Manager will provide investment research and conduct a continuous
program of evaluation, investment, sales, and reinvestment of the Series' assets
by determining the securities and other investments that shall be purchased,
entered into, sold, closed, offered to the public, or exchanged for the Series,
when these transactions should be executed, and what portion of the assets of
the Series should be held in the various securities and other investments in
which it may invest, and the Manager is hereby authorized to execute and perform
such services on behalf of the Series. To the extent permitted by the investment
policies of the Series, the Manager shall make decisions for the Series as to
foreign currency matters and make determinations as to, and execute and perform,
foreign currency exchange contracts on behalf of the Series. The Manager will
provide the services under this Agreement in accordance with the Series'
investment objective or objectives, policies, and restrictions as stated in the
Fund's Registration Statement filed with the Securities and Exchange Commission
(the "SEC"), as amended. Furthermore:
(a) The Manager will manage the Series so that each will
qualify as a regulated investment company under Subchapter M of the Internal
Revenue Code. In managing the Series in accordance with these requirements, the
Manager shall be entitled to receive and act upon advice of counsel to the Fund
or counsel to the Manager.
(b) The Manager will conform with the 1940 Act and all
rules and regulations thereunder, all other applicable federal and state laws
and regulations, with any applicable procedures adopted by the Fund's Board of
Directors, and the provisions of the Registration Statement of the Fund under
the Securities Act of 1933 and the 1940 Act, as supplemented or amended.
(c) On occasions when the Manager deems the purchase or
sale of a security to be in the best interest of the Series as well as any other
investment advisory clients, the Manager may, to the extent permitted by
applicable laws and regulations and any applicable procedures adopted by the
Fund's Board of Directors, but shall not be obligated to, aggregate the
securities to be so sold or purchased with those of its other clients where such
aggregation is not inconsistent with the policies set forth in the Registration
Statement. In such event, allocation of the securities so purchased or sold, as
well as the expenses incurred in the transaction, will be made by the Manager in
a manner that is fair and equitable in the judgment of the Manager in the
exercise of its fiduciary obligations to the Fund and to such other clients.
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(d) In connection with the purchase and sale of
securities of the Series, the Manager will arrange for the transmission to the
custodian for the Fund on a daily basis, of such confirmation, trade tickets,
and other documents and information, including, but not limited to, Cusip,
Cedel, or other numbers that identify securities to be purchased or sold on
behalf of the Series, as may be reasonably necessary to enable the custodian to
perform its administrative and recordkeeping responsibilities with respect to
the Series. With respect to portfolio securities to be purchased or sold through
the Depository Trust Company, the Manager will arrange for the prompt
transmission of the confirmation of such trades to the Fund's custodian.
(e) The Manager will assist the custodian or portfolio
accounting agent for the Fund in determining, consistent with the procedures and
policies stated in the Registration Statement for the Fund and any applicable
procedures adopted by the Fund's Board of Directors, the value of any portfolio
securities or other assets of the Series for which the custodian or portfolio
accounting agent seeks assistance or review from the Manager.
(f) The Manager will make available to the Fund, promptly
upon request, any of the Series' or the Manager's investment records and ledgers
as are necessary to assist the Fund in complying with the requirements of the
1940 Act, as well as other applicable laws. The Manager will furnish to
regulatory authorities having the requisite authority any information or reports
in connection with its services which may be requested in order to ascertain
whether the operations of the Fund are being conducted in a manner consistent
with applicable laws and regulations.
(g) The Manager will regularly report to the Fund's Board
of Directors on the investment program for the Series and the issuers and
securities represented in the Series' portfolio, and will furnish the Fund's
Board of Directors with respect to the Series such periodic and special reports
as the Directors may reasonably request.
(h) In connection with its responsibilities under this
Section 3, the Manager is responsible for decisions to buy and sell securities
and other investments for the Series' portfolio, broker-dealer selection, and
negotiation of commission rates. The Manager's primary consideration in
effecting a security transaction will be to obtain the best execution for the
Series, taking into account the factors specified in the Prospectus and/or
Statement of Additional Information for the Fund, which include price (including
the applicable brokerage commission or dollar spread), the size of the order,
the nature of the market for the security, the timing of the transaction, the
reputation, experience and financial stability of the broker-dealer involved,
the quality of the service, the difficulty of execution, execution capabilities
and operational facilities of the firms involved, and the firm's risk in
positioning a block of securities. Accordingly, the price to the Series in any
transaction may be less favorable than that available from another broker-dealer
if the difference is reasonably justified, in the judgment of the Manager in the
exercise of its fiduciary obligations to the Fund, by other aspects of the
portfolio execution services offered. Subject to such policies as the Board of
Directors may determine and consistent with Section 28(e) of the Securities
Exchange Act of 1934, as amended, the Manager shall not be deemed to have acted
unlawfully or to have breached any duty created by this Agreement or otherwise
solely by reason of its having caused the Series to pay a broker-dealer for
effecting a
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portfolio investment transaction in excess of the amount of commission another
broker-dealer would have charged for effecting that transaction, if the Manager
determines in good faith that such amount of commission was reasonable in
relation to the value of the brokerage and research services provided by such
broker-dealer, viewed in terms of either that particular transaction or the
Manager's overall responsibilities with respect to the Series and to its other
clients as to which it exercises investment discretion. To the extent consistent
with these standards and in accordance with Section 11(a) of the Securities
Exchange Act of 1934 and Rule 11a2-2(T) thereunder, the Manager is further
authorized to allocate the orders placed by it on behalf of the Series to the
Manager if it is registered as a broker-dealer with the SEC, to an affiliated
broker-dealer, or to such brokers and dealers who also provide research or
statistical material or other services to the Series, the Manager or an
affiliate of the Manager. Such allocation shall be in such amounts and
proportions as the Manager shall determine consistent with the above standards,
and the Manager will report on said allocation regularly to the Board of
Directors of the Fund indicating the broker-dealers to which such allocations
have been made and the basis therefor.
4. Conformity with Applicable Law. The Manager, in the
performance of its duties and obligations under this Agreement, shall act in
conformity with the Registration Statement of the Fund and with the instructions
and directions of the Board of Directors of the Fund and will conform to, and
comply with, the requirements of the 1940 Act and all other applicable federal
and state laws and regulations.
5. Exclusivity. The services of the Manager to the Fund under
this Agreement are not to be deemed exclusive, and the Manager, or any affiliate
thereof, shall be free to render similar services to other investment companies
and other clients (whether or not their investment objectives and policies are
similar to those of any of the Series) and to engage in other activities, so
long as its services hereunder are not impaired thereby.
6. Records. The Fund agrees to maintain and to preserve for the
periods prescribed under the 1940 Act any such records as are required to be
maintained by the Fund with respect to the Series by the 1940 Act. The Manager
further agrees that all records of the Series are the property of the Fund and,
to the extent held by the Manager, it will promptly surrender any of such
records upon request.
7. Expenses. During the term of this Agreement, the Manager will
pay all expenses incurred by it in connection with its activities under this
Agreement, except such expenses as are assumed by the Fund under this Agreement
and such expenses as are assumed by a Sub-Adviser under its Sub-Adviser
Agreement. The Manager further agrees to pay all fees payable to the Sub-
Advisers, executive salaries and expenses of the Directors of the Fund who are
employees of the Manager or its affiliates, and office rent of the Fund. The
Fund shall be responsible for all of the other expenses of its operations,
including, without limitation, the management fee payable hereunder; brokerage
commissions; interest; legal fees and expenses of attorneys; fees of auditors,
transfer agents and dividend disbursing agents, custodians and shareholder
servicing agents; the expense of obtaining quotations for calculating each
Fund's net asset value; taxes, if any, and the preparation of the Fund's tax
returns; cost of stock certificates and any other expenses (including clerical
expenses) of issue, sale, repurchase or redemption of shares;
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expenses of registering and qualifying shares of the Fund under federal and
state laws and regulations (including the salary of employees of the Manager
engaged in the registering and qualifying of shares of the Fund under federal
and state laws and regulations or a pro-rata portion of the salary of employees
to the extent so engaged); expenses of disposition or offering any of the
portfolio securities held by a Series; expenses of printing and distributing
reports, notices and proxy materials to existing shareholders; expenses of
printing and filing reports and other documents filed with governmental
agencies; expenses in connection with shareholder and director meetings;
expenses of printing and distributing prospectuses and statements of additional
information to existing shareholders; fees and expenses of Directors of the Fund
who are not employees of the Manager or any Sub-Adviser, or their affiliates;
trade association dues; insurance premiums; extraordinary expenses such as
litigation expenses. To the extent the Manager incurs any costs or performs any
services which are an obligation of the Fund, as set forth herein, the Fund
shall promptly reimburse the Manager for such costs and expenses. To the extent
the services for which the Fund is obligated to pay are performed by the
Manager, the Manager shall be entitled to recover from the Fund only to the
extent of its costs for such services.
8. Compensation. For the services provided by the Manager to each
Series pursuant to this Agreement, the Fund will pay to the Manager an annual
fee equal to the amount specified for such Series in Schedule A hereto, payable
monthly in arrears. Payment of the above fees shall be in addition to any amount
paid to the Manager for the salary of its employees for performing services
which are an obligation of the Fund as provided in Section 7. The fee will be
appropriately pro-rated to reflect any portion of a calendar month that this
Agreement is not in effect between us.
9. Liability of the Manager. The Manager may rely on information
reasonably believed by it to be accurate and reliable. Except as may otherwise
be required by the 1940 Act or the rules thereunder, neither the Manager nor its
stockholders, officers, directors, employees, or agents shall be subject to any
liability for, or any damages, expenses, or losses incurred in connection with,
any act or omission connected with or arising out of any services rendered under
this Agreement, except by reason of willful misfeasance, bad faith, or
negligence in the performance of the Manager's duties, or by reason of reckless
disregard of the Manager's obligations and duties under this Agreement. Except
as may otherwise be required by the 1940 Act or the rules thereunder, neither
the Manager nor its stockholders, officers, directors, employees, or agents
shall be subject to any liability for, or any damages, expenses, or losses
incurred in connection with, any act or omission by a Sub-Adviser or any of the
Sub-Adviser's stockholders or partners, officers, directors, employees, or
agents connected with or arising out of any services rendered under a
Sub-Adviser Agreement, except by reason of willful misfeasance, bad faith, or
negligence in the performance of the Manager's duties under this Agreement, or
by reason of reckless disregard of the Manager's obligations and duties under
this Agreement. The debts, liabilities, obligations and expenses incurred,
contracted for or otherwise existing with respect to a Series shall be
enforceable against the assets and property of that Series only, and not against
the assets or property of any other series of the Fund.
10. Continuation and Termination. This Agreement shall become
effective on the date first written above, subject to the condition that the
Fund's Board of Directors, including a
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majority of those Directors who are not interested persons (as such term is
defined in the 0000 Xxx) of the Manager, and the shareholders of each Series,
shall have approved this Agreement. Unless terminated as provided herein, the
Agreement shall continue in full force and effect with respect to each Fund
until DECEMBER 31, 2005 and shall continue from year to year thereafter with
respect to each Series so long as such continuance is specifically approved at
least annually (i) by the vote of a majority of the Board of Directors of the
Fund, or (ii) by vote of a majority of the outstanding voting shares of the
Series (as defined in the 1940 Act), and provided continuance is also approved
by the vote of a majority of the Board of Directors of the Fund who are not
parties to this Agreement or "interested persons" (as defined in the 0000 Xxx)
of the Fund or the Manager, cast in person at a meeting called for the purpose
of voting on such approval.
However, any approval of this Agreement by the holders of a majority of
the outstanding shares (as defined in the 0000 Xxx) of a Series shall be
effective to approve or continue this Agreement with respect to such Series
notwithstanding (i) that this Agreement has not been approved by the holders of
a majority of the outstanding shares of any other Series or (ii) that this
Agreement has not been approved by the vote of a majority of the outstanding
shares of the Fund, unless such approval shall be required by any other
applicable law or otherwise. This Agreement may be terminated by the Fund at any
time, in its entirety or with respect to a Series, without the payment of any
penalty, by vote of a majority of the Board of Directors of the Fund or by a
vote of a majority of the outstanding voting shares of the Fund, or with respect
to a Series, by vote of a majority of the outstanding voting shares of such
Series, on sixty (60) days' written notice to the Manager, or by the Manager at
any time, without the payment of any penalty, on sixty (60) days' written notice
to the Fund. This Agreement will automatically and immediately terminate in the
event of its "assignment" as described in the 1940 Act.
11. Amendments. 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 which enforcement of the change, waiver, discharge
or termination is sought. If shareholder approval of an amendment is required
under the 1940 Act, no such amendment shall become effective until approved by a
vote of the majority of the outstanding shares of the Fund. Otherwise, a written
amendment of this Agreement is effective upon the approval of the Board of
Directors and the Manager.
12. Use of Names. It is understood that the names "ING" and "ING
Investments, LLC" or any derivatives thereof or logos associated with those
names is the valuable property of the Manager and its affiliates, and that the
Fund and/or the Series have the right to use such names (or derivatives or
logos) only so long as this Agreement shall continue with respect to such Fund
and/or Series. Upon termination of this Agreement, the Fund (or Series) shall
forthwith cease to use such names (or derivatives or logos) and, in the case of
the Fund, shall promptly amend its Articles of Incorporation to change its name
(if such names are included therein).
13. Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed to be an original.
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14. Applicable Law.
(a) This Agreement shall be governed by the laws of the
State of Arizona, provided that nothing herein shall be construed in a manner
inconsistent with the 1940 Act, the Investment Advisers Act of 1940, or any
rules or order of the SEC thereunder.
(b) 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 and, to this extent, the provisions
of this Agreement shall be deemed to be severable.
(c) The captions of this Agreement are included for
convenience only and in no way define or limit any of the provisions hereof or
otherwise affect their construction or effect.
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.
ING VARIABLE PORTFOLIOS, INC.
By: /s/ Xxxxxx X. Naka
--------------------------------------
Xxxxxx X. Naka
Senior Vice President
ING INVESTMENTS, LLC
By: /s/ Xxxxxxx X. Xxxxxx
--------------------------------------
Xxxxxxx X. Xxxxxx
Executive Vice President
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SCHEDULE A
WITH RESPECT TO THE
AMENDED INVESTMENT MANAGEMENT AGREEMENT
BETWEEN
ING VARIABLE PORTFOLIOS, INC.
AND
ING INVESTMENTS, LLC
Annual Investment Management Fee
Series (as a percentage of average daily net assets)
------ ---------------------------------------------
ING VP Global Science and Technology Portfolio 0.95%
ING VP Growth Portfolio 0.60%
ING VP Index Plus LargeCap Portfolio 0.35%
ING VP Index Plus MidCap Portfolio 0.40%
ING VP Index Plus SmallCap Portfolio 0.40%
ING VP International Equity Portfolio 0.85%
ING VP Small Company Portfolio 0.75%
ING VP Value Opportunity Portfolio 0.60%
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