Exhibit (D)(8)
SUB-ADVISORY AGREEMENT
ING MUTUAL FUNDS
AGREEMENT made this 1st day of March, 2005 between ING Investments, LLC, an
Arizona limited liability company (the "Manager"), and Xxxxxxx Investment
Partners, L.P., a Delaware limited partnership (the "Sub-Adviser").
WHEREAS, ING Mutual Funds (the "Fund") is registered under the Investment
Company Act of 1940, as amended (the "1940 Act"), as an open-end, management
investment company;
WHEREAS, the Fund is authorized to issue separate series, each series
having its own investment objective or objectives, policies, and limitations;
WHEREAS, the Fund may offer shares of additional series in the future;
WHEREAS, pursuant to an Investment Management Agreement, dated September
23, 2002, as amended (the "Management Agreement"), a copy of which has been
provided to the Sub-Adviser, the Fund has retained the Manager to render
advisory and management services with respect to certain of the Fund's series;
and
WHEREAS, pursuant to authority granted to the Manager in the Management
Agreement, the Manager wishes to retain the Sub-Adviser to furnish investment
advisory services to one or more of the series of the Fund, and the Sub-Adviser
is willing to furnish such services to the Fund and the Manager.
NOW, THEREFORE, in consideration of the promises and mutual covenants
herein contained, it is agreed between the Manager and the Sub-Adviser as
follows:
1. Appointment. The Manager hereby appoints the Sub-Adviser to act as the
investment adviser and manager to the series of the Fund set forth on SCHEDULE A
hereto (the "Series") for the periods and on the terms set forth in this
Agreement. The Sub-Adviser accepts such appointment and agrees to furnish the
services herein set forth for the compensation herein provided.
In the event the Fund designates one or more series (other than the Series)
with respect to which the Manager wishes to retain the Sub-Adviser to render
investment advisory services hereunder, it shall notify the Sub-Adviser in
writing. If the Sub-Adviser is willing to render such services, it shall notify
the Manager in writing, whereupon such series shall become a Series hereunder,
and be subject to this Agreement.
2. Sub-Adviser's Authority. In connection with the management of the assets
of each Series' portfolio, the Sub-Adviser has the discretionary authority to
buy, sell, exchange, convert and otherwise trade in any and all stocks, bonds
and other securities as the Sub-Adviser
selects in accordance with the Series' current and effective prospectus,
statement of additional information and any applicable provisions of the 1940
Act.
3. Sub-Adviser's Duties. Subject to the supervision of the Fund's Board of
Trustees and the Manager, the Sub-Adviser will provide a continuous investment
program for each Series' portfolio and determine in its discretion the
composition of the assets of each Series' portfolio, including determination of
the purchase, retention, or sale of the securities, cash, and other investments
contained in the portfolio. The Sub-Adviser will provide investment research and
conduct a continuous program of evaluation, investment, sales, and reinvestment
of each Series' assets by determining the securities and other investments that
shall be purchased, entered into, sold, closed, 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. To the extent permitted by the investment policies of each
Series, the Sub-Adviser 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 Sub-Adviser will
provide the services under this Agreement in accordance with each Series'
investment objective or objectives, policies, and restrictions as stated in the
Fund's Registration Statement filed with the U.S. Securities and Exchange
Commission ("SEC"), as amended, copies of which shall be sent to the Sub-Adviser
by the Manager prior to the commencement of this Agreement and promptly
following any such amendment. The Sub-Adviser further agrees as follows:
(a) The Sub-Adviser will comply with (1) the 1940 Act and all rules
and regulations thereunder; (2) all other applicable federal and state laws
and regulations; (3) any applicable procedures adopted by the Fund's Board
of Trustees in accordance with the foregoing, of which the Sub-Adviser has
been sent a copy; and (4) the provisions of the Registration Statement of
the Fund filed under the Securities Act of 1933, as amended (the "1933
Act"), and the 1940 Act, as supplemented or amended, of which the
Sub-Adviser has received a copy, and with the Manager's portfolio manager
operating policies and procedures as in effect on the date hereof, as such
policies and procedures may be revised or amended by the Manager and agreed
to by the Sub-Adviser. In carrying out its duties under the Sub-Advisory
Agreement, the Sub-Adviser will comply with the following policies and
procedures:
(i) The Sub-Adviser will manage each Series so that it meets the
income and asset diversification requirements of Section 851 of the
Internal Revenue Code.
(ii) The Sub-Adviser will have no duty to vote any proxy
solicited by or with respect to the issuers of securities in which
assets of the Series are invested unless the Manager gives the
Sub-Adviser written instructions to the contrary. The Sub-Adviser will
immediately forward any proxy solicited by or with respect to the
issuers of securities in which assets of the Series are invested to
the Manager or to any agent of the Manager designated by the Manager
in writing.
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The Sub-Adviser will make appropriate personnel available for
consultation for the purpose of reviewing with representatives of the
Manager and/or the Board of Trustees any proxy solicited by or with
respect to the issuers of securities in which assets of the Series are
invested. Upon request, the Sub-Adviser will submit a written voting
recommendation to the Manager for such proxies. In making such
recommendations, the Sub-Adviser shall use its good faith judgment to
act in the best interests of the Series. The Sub-Adviser shall
disclose to the best of its knowledge any conflict of interest with
the issuers of securities that are the subject of such recommendation
including whether such issuers are clients or are being solicited as
clients of the Sub-Adviser or of its affiliates.
(iii) In connection with the purchase and sale of securities for
each Series, the Sub-Adviser will arrange for the transmission to the
custodian and portfolio accounting agent for the Series on a daily
basis such confirmation, trade tickets, and other documents and
information, including, but not limited to, Cusip, Sedol, 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 and
portfolio accounting agent to perform its administrative and
recordkeeping responsibilities with respect to the Series. With
respect to portfolio securities to be settled through the Depository
Trust Company, the Sub-Adviser will arrange for the prompt
transmission of the confirmation of such trades to the Fund's
custodian and portfolio accounting agent.
(iv) The Sub-Adviser will assist the custodian and portfolio
accounting agent for the Fund in determining or confirming, consistent
with the procedures and policies stated in the Registration Statement
for the Fund or adopted by the Board of Trustees, the value of any
portfolio securities or other assets of the Series for which the
custodian and portfolio accounting agent seeks assistance from or
identifies for review by the Sub-Adviser. The parties acknowledge that
the Sub-Adviser is not a custodian of the Series' assets and will not
take possession or custody of such assets.
(v) The Sub-Adviser will provide the Manager, within a mutually
agreed period of time following the end of the second and fourth
fiscal quarters of each Series (currently ten (10) days), a commentary
(to be subject to review and editing by the Manager) containing a
discussion of those factors referred to in Item 5(a) of Form N-1A,
promulgated pursuant to the 1933 and 1940 Acts, in respect of both the
prior reporting period and the fiscal year to date. The Sub-Adviser
will also provide such other periodic reports as the parties may
mutually agree to from time to time.
(vi) The Sub-Adviser will complete and deliver to the Manager a
written compliance checklist in a form provided by the Manager for
each month generally by the 10th day of the following month, unless
otherwise agreed by the parties.
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(vii) The Sub-Adviser will complete and deliver to the Manager by
the 10th business day of each month a written report on each Series of
the Fund that contains the following information as of the immediately
previous month's end.
(a) A performance comparison to the Series' benchmark listed
in the prospectus;
(b) Composition of the assets of each Series' portfolio and
the impact of key portfolio holdings and industry concentrations
on the Series, provided that both parties have mutually agreed
upon the content of the industry; and
(c) Confirmation of each Series' current investment
objective and strategies, as set out in the Prospectus.
(viii) Upon reasonable request, the Sub-Adviser shall participate
in portfolio reviews with Morningstar.
(ix) During the term of this Agreement, the Sub-Adviser agrees to
furnish the Manager at its principal office for prior review and
approval by the Manager all written and/or printed materials,
including but not limited to, PowerPoint(R)or slide presentations,
news releases, advertisements, brochures, fact sheets and other
promotional, informational or marketing materials (the "Marketing
Materials") prepared for public dissemination, that are produced by
the Sub-Adviser or its affiliates in connection with the Series, and
Sub-Adviser shall not use any such materials if the Manager reasonably
objects in writing within five business days (or such other period as
may be mutually agreed) after receipt thereof. Marketing Materials may
be furnished to the Manager by first class or overnight mail,
facsimile transmission equipment, electronic delivery or hand
delivery. The Manager agrees that the Sub-Adviser may identify the
Fund and each Series on its client list for public distribution.
(x) During the term of this Agreement, the Manager agrees to
furnish the Sub-Adviser at its principal office all Registration
Materials (and any constituent components of the Registration
Materials) and any amendments thereto, proxy statements, reports to
shareholders, Marketing Materials or other materials prepared for
distribution to shareholders of each Series or the public that refer
to the Sub-Adviser in any way, prior to the use thereof, and the
Manager shall not use any such materials if the Sub-Adviser reasonably
objects in writing within five business days (or such other period as
may be mutually agreed) after receipt thereof. The Sub-Adviser's right
to object to such materials is limited to the portions of such
materials that expressly relate to the Sub-Adviser, its services,
performance and strategies. Marketing Materials may be furnished to
the Sub-Adviser by first class or overnight mail, facsimile
transmission equipment, electronic delivery or hand delivery.
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(b) The Sub-Adviser will make available to the Fund and the Manager,
promptly upon request, any of the Series' investment records and ledgers
maintained by the Sub-Adviser (which shall not include the records and
ledgers maintained by the custodian or portfolio accounting agent for the
Fund) as are necessary to assist the Fund and the Manager to comply with
requirements of the 1940 Act and the Investment Advisers Act of 1940, as
amended (the "Advisers Act"), as well as other applicable laws. The
Sub-Adviser will furnish to regulatory authorities having the requisite
authority any information or reports in connection with such services in
respect to the Series 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.
(c) The Sub-Adviser will provide reports to the Fund's Board of
Trustees for consideration at meetings of the Board on the investment
program for each Series and the issuers and securities represented in each
Series' portfolio, and will furnish the Fund's Board of Trustees with
respect to each Series such periodic and special reports as the Trustees
and the Manager may reasonably request.
4. Representations and Warranties of the Manager. The Manager represents
and warrants to the Sub-Adviser as follows:
(a) The Manager is registered as an investment adviser under the
Advisers Act;
(b) The Manager is a limited liability company duly organized and
validly existing under the laws of the State of Arizona with the power to
own and possess its assets and carry on its business as it is now being
conducted;
(c) The Manager will comply with the 1940 Act and all rules and
regulations thereunder, all other applicable federal and state laws and
regulations, with any procedures adopted by the Fund's Board of Trustees,
and the provisions of the Registration Statement of the Fund filed under
the 1933 Act, and the 1940 Act, as supplemented or amended.
(d) The execution, delivery and performance by the Manager of this
Agreement are within the Manager's powers and have been duly authorized by
all necessary action on the part of its Board of Directors, and no action
by or in respect of, or filing with, any governmental body, agency or
official is required on the part of the Manager for the execution, delivery
and performance by the Manager of this Agreement, and the execution,
delivery and performance by the Manager of the Agreement do not contravene
or constitute a default under (i) any provision of applicable law, rule or
regulation, (ii) the Manager's governing instruments, or (iii) any
agreement, judgment, injunction, order, decree or other instrument binding
upon the Manager;
(e) The Form ADV of the Manager as provided to the Sub-Adviser is a
true, complete, and current copy of the Form ADV as is currently filed
(Part I) or is currently on file with the Manager (Part II) as is required
by SEC and the information contained therein is accurate and complete in
all material respects and does not omit to state any
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material fact necessary in order to make the statements made, in light of
the circumstances under which they were made, not misleading;
(f) The Manager acknowledges that it received a copy of the
Sub-Adviser's Form ADV prior to the execution of this agreement;
(g) The Manager and each of its officers, directors, employees and
agents, shall comply at all times with all applicable laws pertaining to
its business and to the operation of the Series of the Fund and to the
offering of their shares;
(h) To the best of the Manager's knowledge, the Fund is duly
organized, validly existing and in good standing under the laws of the
state of its organization;
(i) The Manager will take all reasonable and practicable steps to
assure that the Fund will operate in accordance with the 1940 Act and in
accordance with all applicable laws; and
(j) The Manager will notify the Sub-Adviser if the Manager or the Fund
becomes the subject of any legal or regulatory investigation, examination
or judicial proceeding which may affect its ability to perform its
obligations under this Agreement.
5. Representations and Warranties of the Sub-Adviser. The Sub-Adviser
represents and warrants to the Manager as follows:
(a) The Sub-Adviser is registered as an investment adviser under the
Advisers Act;
(b) The Sub-Adviser is a limited partnership duly organized and
validly existing under the laws of the State of Delaware with the power to
own and possess its assets and carry on its business as it is now being
conducted;
(c) The execution, delivery and performance by the Sub-Adviser of this
Agreement are within the Sub-Adviser's powers and have been duly authorized
by all necessary action, and no action by or in respect of, or filing with,
any governmental body, agency or official is required on the part of the
Sub-Adviser for the execution, delivery and performance by the Sub-Adviser
of this Agreement, and the execution, delivery and performance by the
Sub-Adviser of the Agreement do not contravene or constitute a default
under (i) any provision of applicable law, rule or regulation, (ii) the
Sub-Adviser's governing instruments, or (iii) any agreement, judgment,
injunction, order, decree or other instrument binding upon the Sub-Adviser;
(d) The Form ADV of the Sub-Adviser as provided to the Manager is a
true, complete, and current copy of the Form ADV as is currently filed
(Part I) or is currently on file with the Manager (Part II) as is required
by SEC and the information contained therein is accurate and complete in
all material respects and does not omit to state any material fact
necessary in order to make the statements made, in light of the
circumstances under which they were made, not misleading;
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(e) The Sub-Adviser acknowledges that it received a copy of the
Manager's Form ADV prior to the execution of this agreement;
(f) The Sub-Adviser and each of its officers, directors, employees and
agents, shall comply at all times with all applicable laws pertaining to
its business and to the operation of the Series of the Fund and to the
offering of their shares, to the extent applicable;
(g) The Sub-Adviser will take all reasonable and practicable steps to
assure that the Fund will operate in accordance with the 1940 Act and in
accordance with all applicable laws; and
(h) The Sub-Adviser will notify the Manager if the Sub-Adviser becomes
the subject of any legal or regulatory investigation, examination or
judicial proceeding which may affect its ability to perform its obligations
under this Agreement.
6. Broker-Dealer Selection. The Sub-Adviser is authorized to make decisions
to buy and sell securities and other investments for each Series' portfolio, to
select a broker-dealer to effect a transaction, and to negotiate brokerage
commission rates in effecting a security transaction. The Sub-Adviser's primary
consideration in effecting a security transaction will be to obtain the best
execution for the Series, and, in connection with any applicable commission
reduction or recapture program for the benefit of the Series, determined in
consultation with the Manager, subject to applicable regulation under the 1940
Act with respect to directed brokerage and execution, taking into account the
factors specified in the then-current prospectus and/or statement of additional
information for the Series, 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, the
experience and financial stability of the broker-dealer involved, the quality of
the service, the difficulty of execution, and the execution capabilities and
operational facilities of the firm involved, and the firm's risk in positioning
a block of securities. Accordingly, the price to a 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 Sub-Adviser in the
exercise of its reasonable business judgment and fiduciary obligations to the
Fund, by other aspects of the portfolio execution services offered. Subject to
such policies as the Fund's Board of Trustees or Manager may determine and
consistent with Section 28(e) of the Securities Exchange Act of 1934, as amended
(the "1934 Act"), the Sub-Adviser 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 a Series to pay a broker-dealer for effecting a
portfolio investment transaction in excess of the amount of commission another
broker-dealer would have charged for effecting that transaction, if the
Sub-Adviser 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 Sub-Adviser's or the Manager's overall responsibilities with
respect to the Series and to their respective other clients as to which they
exercise investment discretion. In connection with an applicable commission
recapture or reduction program for the benefit of the Series, the Sub-Adviser
will consult with the Manager with respect to the selection of broker-dealers to
execute portfolio transactions on behalf of a Series on the basis of criteria
reasonably considered appropriate by the Manager, consistent with the applicable
regulation under the 1940
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Act governing direction of brokerage on behalf of mutual funds. To the extent
consistent with these standards, the Sub-Adviser is further authorized to
allocate the orders placed by it on behalf of a Series to the Sub-Adviser 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 Sub-Adviser, or an affiliate of
the Sub-Adviser. Such allocation shall be in such amounts and proportions as the
Sub-Adviser shall determine consistent with the above standards, and the
Sub-Adviser will report on said allocation regularly to the Fund's Board of
Trustees indicating the broker-dealers to which such allocations have been made
and the basis therefor.
7. Disclosure about Sub-Adviser. The Sub-Adviser has reviewed the most
recent Post-Effective Amendment to the Registration Statement for the Fund filed
with the SEC that contains disclosure about the Sub-Adviser, and represents and
warrants that, with respect to the disclosure about the Sub-Adviser or
information relating, directly or indirectly, to the Sub-Adviser, such
Registration Statement contains, as of the date hereof, no untrue statement of
any material fact and does not omit any statement of a material fact which was
required to be stated therein or necessary to make the statements contained
therein, in light of the circumstances under which they were made, not
misleading. The Sub-Adviser further represents and warrants that it is a duly
registered investment adviser under the Advisers Act and will maintain such
registration so long as this Agreement remains in effect. The Sub-Adviser will
provide the Manager with an updated copy of the Sub-Adviser's Form ADV, Part II
at the time the updated Form ADV, Part II is finalized.
8. Expenses. Except to the extent expressly assumed by the Sub-Adviser and
except to any extent required by law to be paid or reimbursed by the
Sub-Adviser, the Sub-Adviser shall have no duty to pay any ordinary operating
expenses incurred in the organization and operation of the Series of the Fund.
Ordinary operating expenses include, but are not limited to, brokerage
commissions and other transaction charges, taxes, legal, auditing, printing, or
governmental fees, other Fund service providers' fees and expenses, expenses
relating to the issue, sale (including any sales loads), redemption and
repurchase of shares, expenses of registering and qualifying shares for sale,
expenses relating to Board and shareholder meetings (other than those payable by
the Sub-Adviser in accordance with the terms of this Section 8), and the cost of
preparing and distributing reports and notices to shareholders. The Sub-Adviser
shall pay all other expenses incurred by it in connection with its services
under this Agreement. Notwithstanding the terms of this Section 8, if the Fund
is required, under applicable law, to supplement the Registration Statement
because of a change requested by the Sub-Adviser due to a mistake on the part of
the Sub-Adviser, the Sub-Adviser will reimburse the Fund and/or the Manager for
the cost of preparing, printing and distributing such supplement, unless the
Sub-Adviser is requesting the change in order to comply with an applicable law,
rule or regulation.
9. Compensation. For the services provided to each Series, the Manager will
pay the Sub-Adviser an annual fee equal to the amount specified for such Series
in SCHEDULE A hereto, payable monthly in arrears. The fee will be appropriately
prorated to reflect any portion of a calendar month that this Agreement is not
in effect among the parties. In accordance with the provisions of the Management
Agreement, the Manager is solely responsible for the payment of fees to the
Sub-Adviser, and the Sub-Adviser agrees to seek payment of its fees solely from
the Manager.
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10. Compliance.
(a) The Sub-Adviser agrees to use such compliance techniques or
procedures as the Manager or the Board of Trustees may formally adopt in
writing, provided the Sub-Adviser is given reasonable advance notice of any
such procedure.
(b) The Sub-Adviser agrees that it shall promptly notify the Manager
and the Fund (1) in the event that the SEC has (i) censured the
Sub-Adviser; (ii) placed limitations upon its activities, functions or
operations; (iii) suspended or revoked its registration as an investment
adviser; or (iv) commenced proceedings or an investigation that may result
in any of these actions; or (2) upon having a reasonable basis for
believing that the Series has ceased to qualify or might not qualify as a
regulated investment company under Subchapter M of the Internal Revenue
Code. The Sub-Adviser further agrees to notify the Manager and the Fund
promptly of any material fact known to the Sub-Adviser respecting or
relating to the Sub-Adviser that is not contained in the Registration
Statement or prospectus covering shares of any Series covered by this
Agreement, or any amendment or supplement thereto, but which should be
contained therein in order make the statements made, in light of the
circumstances in which they were made, not misleading, or if any statement
contained therein becomes untrue in any material respect.
(c) The Manager agrees that it shall promptly notify the Sub-Adviser
(1) in the event that the SEC has (i) censured the Manager or the Fund;
(ii) placed limitations upon either of their activities, functions, or
operations; (iii) suspended or revoked the Manager's registration as an
investment adviser; or (iv) commenced proceedings or an investigation that
may result in any of these actions; or (2) upon having a reasonable basis
for believing that the Series has ceased to qualify or might not qualify as
a regulated investment company under Subchapter M of the Internal Revenue
Code. The Manager further agrees to notify the Sub-Adviser promptly of any
material fact known to the Manager respecting or relating to the Manager
that is not contained in the Registration Statement or prospectus covering
shares of any Series covered by this Agreement, or any amendment or
supplement thereto, but which should be contained therein in order make the
statements made, in light of the circumstances in which they were made, not
misleading, or if any statement contained therein becomes untrue in any
material respect.
11. Books and Records. The Sub-Adviser hereby agrees to provide access to
and copies of all records which it maintains for the Series (including but not
limited to documents, manuals, computer disks and CD-ROMs) to the Fund and to
provide such records promptly and with no charge upon the Fund's or the
Manager's request in compliance with the requirements of Rule 31a-3 under the
1940 Act. The Sub-Adviser 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-l under the 1940 Act.
12. Cooperation; Confidentiality. Each party to this Agreement agrees to
cooperate with the other party and with all appropriate governmental authorities
having the requisite jurisdiction (including, but not limited to, the SEC) in
connection with any investigation or inquiry relating to this Agreement or the
Fund. Subject to the foregoing, the Sub-Adviser shall
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treat as confidential all information pertaining to the Fund and actions of the
Fund, the Manager and the Sub-Adviser, and the Manager shall treat as
confidential and use only in connection with the Series all information
furnished to the Fund or the Manager by the Sub-Adviser, in connection with its
duties under the Agreement except that the aforesaid information need not be
treated as confidential if required to be disclosed under applicable law, if
generally available to the public through means other than by disclosure by the
Sub-Adviser or the Manager, or if available from a source other than the
Manager, Sub-Adviser or the Fund.
13. Exclusivity. Until the first anniversary of the Effective Date of this
Agreement, the Sub-Adviser agrees that it will not enter into an investment
advisory agreement with respect to any open-end investment company registered
under Section 8 of the 1940 Act, or, alternatively, any portfolio or series
thereof, as the case may be, that (i) has an investment strategy substantially
similar to that of any Series identified at SCHEDULE A to this Agreement; and
(ii) has its shares offered primarily on a retail basis in the United States
through intermediaries (each such investment company, or, alternatively, any
portfolio or series thereof, as the case may be, an, "Excluded Fund"); except
that, during such one-year period, Sub-Adviser may enter into an investment
advisory agreement with an Excluded Fund if the corresponding Series' aggregate
assets under management reach $500,000,000.
14. Prohibited Conduct. The Sub-Adviser may not consult with any other
sub-adviser of the Fund concerning transactions in securities or other assets
for any investment portfolio of the Fund, including the Series, except that such
consultations are permitted between the current and successor sub-advisers of
the Series in order to effect an orderly transition of sub-advisory duties so
long as such consultations are not concerning transactions prohibited by Section
17(a) of the 1940 Act.
15. Representations Respecting Sub-Adviser. The Manager agrees that neither
the Manager, nor affiliated persons of the Manager, shall give any information
or make any representations or statements in connection with the sale of shares
of the Series concerning the Sub-Adviser or the Series other than the
information or representations contained in the Registration Statement,
prospectus, or statement of additional information for the Fund's shares, as
they may be amended or supplemented from time to time, or in reports or proxy
statements for the Fund, or in sales literature or other promotional material
approved in advance by the Sub-Adviser, except with the prior permission of the
Sub-Adviser.
16. Liability.
(a) Except as may otherwise be required by the 1940 Act or the rules
thereunder or other applicable law, the Manager agrees that the
Sub-Adviser, any affiliated person of the Sub-Adviser, and each person, if
any, who, within the meaning of Section 15 of the 1933 Act controls the
Sub-Adviser (1) shall bear no responsibility and shall not be subject to
any liability for any act or omission respecting any series of the Fund
that is not a Series hereunder, and (2) shall not be liable for, or subject
to any damages, expenses, or losses in connection with, any error of
judgment, mistake of law or act or omission connected with or arising out
of any services rendered under this Agreement, except by reason of willful
misfeasance, bad faith, or gross negligence in the
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performance of the Sub-Adviser's duties, or by reason of reckless disregard
of the Sub-Adviser's obligations and duties under this Agreement.
(b) The Manager acknowledges that the Sub-Adviser has no authority or
responsibility with respect to (1) the structure of the Fund; (2) the
promotion, marketing or sale of the Fund's shares, subject to the exception
noted below; (3) the Fund's relations or dealings with investors and
shareholders; (4) the disclosure provided to investors and shareholders,
unless such disclosure is based upon information furnished to the Manager,
or Fund by the Sub-Adviser or any affiliated person of the Sub-Adviser; (5)
the supervision of the day-to-day activities of the Manager; or (6) the
supervision of the day-to-day activities of any custodian to the Fund
("Custodian") or any administrator to the Fund ("Administrator"). The
Sub-Adviser specifically acknowledges that it does have responsibility with
respect to any sales literature or other promotional material approved by
the Sub-Adviser for use in marketing the Fund.
17. Indemnification.
(a) The Manager agrees to indemnify and hold harmless the Sub-Adviser,
any affiliated person of the Sub-Adviser, and each person, if any, who,
within the meaning of Section 15 of the 1933 Act controls ("controlling
person") the Sub-Adviser (all of such persons being referred to as
"Sub-Adviser Indemnified Persons") against any and all losses, claims,
damages, liabilities, or litigation (including legal and other expenses) to
which a Sub-Adviser Indemnified Person may become subject under the 1933
Act, the 1940 Act, the Advisers Act, under any other statute, at common law
or otherwise, arising out of the Manager's responsibilities to the Fund
which (1) may be based upon the Manager's negligence, willful misfeasance,
or bad faith in the performance of its duties (which could include a
negligent action or a negligent omission to act), or by reason of the
Manager's reckless disregard of its obligations and duties under this
Agreement; (2) may be based upon any untrue statement or alleged untrue
statement of a material fact contained in the Registration Statement or
prospectus covering shares of the Fund or any Series, or any amendment
thereof or any supplement thereto, or the omission or alleged omission to
state therein a material fact required to be stated therein or necessary to
make the statements therein not misleading, unless such statement or
omission was made in reliance upon information furnished to the Manager or
the Fund or to any affiliated person of the Manager by a Sub-Adviser
Indemnified Person; (3) may be based on the issue, sale and distribution of
the Fund's shares to the extent such loss, claim, damages, liabilities or
litigation is based on an action taken or omitted to be taken by the
Manager or ING Funds Distributor, LLC; (4) may be based on any breach by
the Manager of any representation or warranty, or any failure by the
Manager or the Fund to comply with any agreement contained in the
Agreement; or (5) may be based on any action taken or omitted to be taken
by the Administrator or the Custodian, to the extent such action or
omission is the result of an action or omission of the Manager; provided,
however, that in no case shall the indemnity in favor of the Sub-Adviser
Indemnified Person be deemed to protect such person against any liability
to which any such person would otherwise be subject by reason of willful
misfeasance, bad faith, or negligence in the performance of its duties, or
by reason of its reckless disregard of obligations and duties under this
Agreement.
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(b) Notwithstanding Section 16 of this Agreement, the Sub-Adviser
agrees to indemnify and hold harmless the Manager, any affiliated person of
the Manager, and any controlling person of the Manager (all of such persons
being referred to as "Manager Indemnified Persons") against any and all
losses, claims, damages, liabilities, or litigation (including legal and
other expenses) to which a Manager Indemnified Person may become subject
under the 1933 Act, 1940 Act, the Advisers Act, under any other statute, at
common law or otherwise, arising out of the Sub-Adviser's responsibilities
as Sub-Adviser of the Series which (1) may be based upon the Sub-Adviser's
negligence, willful misfeasance, or bad faith in the performance of its
duties (which could include a negligent action or a negligent omission to
act), or by reason of the Sub-Adviser's reckless disregard of its
obligations and duties under this Agreement; (2) may be based upon any
untrue statement or alleged untrue statement of a material fact contained
in the Registration Statement or prospectus covering the shares of the Fund
or any Series, or any amendment or supplement thereto, or the omission or
alleged omission to state therein a material fact known or which should
have been known to the Sub-Adviser and was required to be stated therein or
necessary to make the statements therein not misleading, unless such a
statement or omission was made in reliance upon information furnished to
the Manager, the Fund, or any affiliated person of the Manager or Fund by
the Sub-Adviser or any affiliated person of the Sub-Adviser; (3) may be
based on any breach by the Sub-Adviser of any representation or warranty,
or any failure by the Sub-Adviser to comply with any agreement contained in
the Agreement; or (4) may be based on any action taken or omitted to be
taken by Administrator or Custodian, to the extent such action or omission
is the result of an action or omission of the Sub-Adviser; provided,
however, that in no case shall the indemnity in favor of a Manager
Indemnified Person be deemed to protect such person against any liability
to which any such person would otherwise be subject by reason of willful
misfeasance, bad faith, negligence in the performance of its duties, or by
reason of its reckless disregard of its obligations and duties under this
Agreement.
(c) The Manager shall not be liable under Paragraph (a) of this
Section 17 with respect to any claim made against a Sub-Adviser Indemnified
Person unless such Sub-Adviser Indemnified Person shall have notified the
Manager in writing within a reasonable time after the summons or other
first legal process giving information of the nature of the claim shall
have been served upon such Sub-Adviser Indemnified Person (or after such
Sub-Adviser Indemnified Person shall have received notice of such service
on any designated agent), but failure to notify the Manager of any such
claim shall not relieve the Manager from any liability which it may have to
the Sub-Adviser Indemnified Person against whom such action is brought,
except to the extent the Manager is prejudiced by the failure or delay in
giving such notice. In case any such action is brought against the
Sub-Adviser Indemnified Person, the Manager will be entitled to
participate, at its own expense, in the defense thereof or, after notice to
the Sub-Adviser Indemnified Person, to assume the defense thereof, with
counsel satisfactory to the Sub-Adviser Indemnified Person. If the Manager
assumes the defense of any such action and the selection of counsel by the
Manager to represent the Manager and the Sub-Adviser Indemnified Person
would result in a conflict of interests and therefore, would not, in the
reasonable judgment of the Sub-Adviser Indemnified Person, adequately
represent the interests of the Sub-Adviser Indemnified Person, the Manager
will, at its own expense,
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assume the defense with counsel to the Manager and, also at its own
expense, with separate counsel to the Sub-Adviser Indemnified Person, which
counsel shall be satisfactory to the Manager and to the Sub-Adviser
Indemnified Person. The Sub-Adviser Indemnified Person shall bear the fees
and expenses of any additional counsel retained by it, and the Manager
shall not be liable to the Sub-Adviser Indemnified Person under this
Agreement for any legal or other expenses subsequently incurred by the
Sub-Adviser Indemnified Person independently in connection with the defense
thereof other than reasonable costs of investigation. The Manager shall not
have the right to compromise on or settle the litigation without the prior
written consent of the Sub-Adviser Indemnified Person if the compromise or
settlement results or may result in a finding of wrongdoing on the part of
the Sub-Adviser Indemnified Person.
(d) The Sub-Adviser shall not be liable under Paragraph (b) of this
Section 17 with respect to any claim made against a Manager Indemnified
Person unless such Manager Indemnified Person shall have notified the
Sub-Adviser in writing within a reasonable time after the summons or other
first legal process giving information of the nature of the claim shall
have been served upon such Manager Indemnified Person (or after such
Manager Indemnified Person shall have received notice of such service on
any designated agent), but failure to notify the Sub-Adviser of any such
claim shall not relieve the Sub-Adviser from any liability which it may
have to the Manager Indemnified Person against whom such action is brought
except to the extent the Sub-Adviser is prejudiced by the failure or delay
in giving such notice. In case any such action is brought against the
Manager Indemnified Person, the Sub-Adviser will be entitled to
participate, at its own expense, in the defense thereof or, after notice to
the Manager Indemnified Person, to assume the defense thereof, with counsel
satisfactory to the Manager Indemnified Person. If the Sub-Adviser assumes
the defense of any such action and the selection of counsel by the
Sub-Adviser to represent both the Sub-Adviser and the Manager Indemnified
Person would result in a conflict of interests and therefore, would not, in
the reasonable judgment of the Manager Indemnified Person, adequately
represent the interests of the Manager Indemnified Person, the Sub-Adviser
will, at its own expense, assume the defense with counsel to the
Sub-Adviser and, also at its own expense, with separate counsel to the
Manager Indemnified Person, which counsel shall be satisfactory to the
Sub-Adviser and to the Manager Indemnified Person. The Manager Indemnified
Person shall bear the fees and expenses of any additional counsel retained
by it, and the Sub-Adviser shall not be liable to the Manager Indemnified
Person under this Agreement for any legal or other expenses subsequently
incurred by the Manager Indemnified Person independently in connection with
the defense thereof other than reasonable costs of investigation. The
Sub-Adviser shall not have the right to compromise on or settle the
litigation without the prior written consent of the Manager Indemnified
Person if the compromise or settlement results or may result in a finding
of wrongdoing on the part of the Manager Indemnified Person.
18. Duration and Termination.
(a) This Agreement shall become effective on the date first indicated
above, subject to the condition that the Fund's Board of Trustees,
including a majority of those Trustees who are not interested persons (as
such term is defined in the 0000 Xxx) of the
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Manager or the Sub-Adviser, and the shareholders of each Series, shall have
approved this Agreement. Unless terminated as provided herein, this
Agreement shall remain in full force and effect until NOVEMBER 30, 2006,
and shall continue on an annual basis thereafter with respect to each
Series provided that such annual continuance is specifically approved each
year by (1) the Board of Trustees of the Fund, or by the vote of a majority
of the outstanding voting securities (as defined in the 0000 Xxx) of each
Series, and (2) the vote of a majority of those Trustees who are not
parties to this Agreement or interested persons (as such term is defined in
the 0000 Xxx) of any such party to this Agreement 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
continue this Agreement with respect to such Series notwithstanding (1)
that this Agreement has not been approved by the holders of a majority of
the outstanding shares of any other Series or (2) 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. Notwithstanding the foregoing, this Agreement may be
terminated with respect to any Series covered by this Agreement: (1) by the
Manager at any time, upon sixty (60) days' written notice to the
Sub-Adviser and the Fund, (2) at any time without payment of any penalty by
the Fund, by the Fund's Board of Trustees or a majority of the outstanding
voting securities of each Series, upon sixty (60) days' written notice to
the Manager and the Sub-Adviser, or (3) by the Sub-Adviser upon three (3)
months written notice to the Manager and the Fund unless the Fund or the
Manager requests additional time to find a replacement for the Sub-Adviser,
in which case the Sub-Adviser shall allow the additional time requested by
the Fund or the Manager not to exceed three (3) additional months beyond
the initial three-month period; provided, however, that the Sub-Adviser may
terminate this Agreement at any time without penalty, effective upon
written notice to the Manager and the Fund, in the event either the
Sub-Adviser (acting in good faith) or the Manager ceases to be registered
as an investment adviser under the Advisers Act or otherwise becomes
legally incapable of providing investment management services pursuant to
its respective contract with the Fund, or in the event the Manager becomes
bankrupt or otherwise incapable of carrying out its obligations under this
Agreement, or in the event that the Sub-Adviser does not receive
compensation for its services from the Manager or the Fund as required by
the terms of this Agreement.
In the event of termination for any reason, the Sub-Adviser will
promptly provide, at no charge, copies of all records of each Series for
which the Agreement is terminated to the Manager or the Fund. This
Agreement shall automatically terminate in the event of its assignment (as
such term is described in the 1940 Act). In the event this Agreement is
terminated or is not approved in the manner described above, the Sections
or Paragraphs numbered 11, 12, 15, 16 and 17 of this Agreement shall remain
in effect, as well as any applicable provision of this Section 18 and, to
the extent that only amounts are owed to the Sub-Adviser as compensation
for services rendered while the Agreement was in effect, Section 9.
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(b) Notices.
Any notice must be in writing and shall be sufficiently given when (1)
delivered in person, (2) dispatched by telegram or electronic facsimile
transfer (confirmed in writing by postage prepaid first class air mail
simultaneously dispatched), (3) sent by internationally recognized
overnight courier service (with receipt confirmed by such overnight courier
service), or (4) sent by registered or certified mail, to the other party
at the address of such party set forth below or at such other address as
such party may from time to time specify in writing to the other party.
Notwithstanding the above, any notice under this Agreement may be sent via
electronic mail, provided that the receiving party agrees to such delivery
method orally in advance.
If to the Fund:
ING Mutual Funds
0000 Xxxx Xxxxxxxxxx Xxxxx Xxxx
Xxxxxxxxxx, Xxxxxxx 00000
Attention: Xxxx X. Xxxxxxx, Xx.
If to the Manager:
ING Investments, LLC
0000 Xxxx Xxxxxxxxxx Xxxxx Xxxx
Xxxxxxxxxx, Xxxxxxx 00000
Attention: Xxxxxxx X. Xxxxxx
If to the Sub-Adviser:
Xxxxxxx Investment Partners, L.P.
00000 Xx Xxxxxx Xxxx
Xxx Xxxxx, Xxxxxxxxxx 00000-0000
Attention: General Counsel
19. 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, and no material amendment of this Agreement shall be
effective until the terms of any such material amendment have been approved by
an affirmative vote of (1) the holders of a majority of the outstanding voting
securities of the Series, if such approval is required by applicable law, and
(2) the Trustees of the Fund, including a majority of the Trustees of the Fund
who are not interested persons of any party to this Agreement, cast in person at
a meeting called for the purpose of voting on such approval, if such approval is
required by applicable law.
20. Miscellaneous.
(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 Advisers Act or rules or orders of the
SEC thereunder, and without regard for the
-15-
conflicts of laws principle thereof. The term "affiliate" or "affiliated
person" as used in this Agreement shall mean "affiliated person" as defined
in Section 2(a)(3) of the 0000 Xxx.
(b) The Manager and the Sub-Adviser acknowledge that the Fund enjoys
the rights of a third-party beneficiary under this Agreement, and the
Manager acknowledges that the Sub-Adviser enjoys the rights of a
third-party beneficiary under the Management Agreement.
(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.
(d) 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.
(e) Nothing herein shall be construed as constituting the Sub-Adviser
as an agent or co-partner of the Manager, or constituting the Manager as an
agent or co-partner of the Sub-Adviser.
(f) This Agreement may be executed in counterparts.
IN WITNESS WHEREOF, the parties hereto have caused this instrument to be
executed as of the day and year first above written.
ING INVESTMENTS, LLC
By: /s/ Xxxxxxx X. Xxxxxx
------------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Executive Vice President
XXXXXXX INVESTMENT PARTNERS, L.P.
By: /s/ Xxxxx Xxxxxxx
------------------------------------
Name: Xxxxx Xxxxxxx
Title: Chief Executive Officer
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