SUBADVISORY AGREEMENT
EX-23.d.2.p
THIS AGREEMENT is made and entered into effective the 4th day of May, 2009, by and among
NATIONWIDE VARIABLE INSURANCE TRUST (the “Trust”), a Delaware statutory trust, NATIONWIDE FUND
ADVISORS (the “Adviser”) a Delaware business trust registered under the Investment Advisers Act of
1940, as amended (the “Advisers Act”), and XXXXXXXXX XXXXXX FIXED INCOME LLC a limited liability
company organized under the laws of the State of Delaware (the “Subadviser”), and also registered
under the Advisers Act.
WITNESSETH:
WHEREAS, the Trust is registered with the U.S. Securities and Exchange Commission (the “SEC”)
as an open-end management investment company under the Investment Company Act of 1940, as amended
(the “1940 Act”);
WHEREAS, the Adviser has, pursuant to an Investment Advisory Agreement with the Trust dated of
the 1st day of May, 2007, as amended March 24, 2008 (the “Advisory Agreement”), been
retained to act as investment adviser for certain of the series of the Trust that are listed on
Exhibit A to this Agreement (each, a “Fund”);
WHEREAS, the Adviser represents that it is willing and possesses legal authority to render
such services subject to the terms and conditions set forth in this Agreement;
WHEREAS, the Trust and the Adviser each represent that the Advisory Agreement permits the
Adviser to delegate certain of its duties under the Advisory Agreement to other investment
advisers, subject to the requirements of the 1940 Act; and
WHEREAS, the Adviser desires to retain Subadviser to assist it in the provision of a
continuous investment program for that portion of each Fund’s assets that the Adviser will assign
to the Subadviser, and Subadviser is willing to render such services subject to the terms and
conditions set forth in this Agreement,
NOW, THEREFORE, the parties do mutually agree and promise as follows with respect to each
Fund:
1. Appointment as Subadviser. The Adviser hereby appoints the Subadviser to act as
investment adviser for and to manage that portion or all of the assets of the Fund that the Adviser
from time to time upon reasonable prior notice allocates to, and puts under the control of, the
Subadviser (the “Subadviser Assets”) subject to the supervision of the Adviser and the Board of
Trustees of the Trust and subject to the terms of this Agreement. The Subadviser hereby accepts
such appointment and, in such capacity, agrees to be responsible for the investment management of
the Subadviser Assets. It is recognized that the Subadviser and certain of its affiliates now act,
and that from time to time hereafter may act, as investment adviser to one or more other investment
companies and to fiduciary or other managed accounts and that the Adviser and the Trust cannot
object to such activities.
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2. Duties of Subadviser.
(a) Investments. The Subadviser is hereby authorized and directed and hereby
agrees, subject to the stated investment policies and restrictions of the Fund as set forth
in the Fund’s prospectus and statement of additional information as currently in effect and,
as soon as practical after the Trust, the Fund or the Adviser notifies the Subadviser
thereof, as supplemented or amended from time to time (collectively referred to hereinafter
as the “Prospectus”) and subject to the written directions (including email) of the Adviser
and the Trust’s Board of Trustees, to monitor on a continuous basis the performance of the
Subadviser Assets and to conduct a continuous program of investment, evaluation and, if
appropriate, sale and reinvestment of the Subadviser Assets. The Adviser agrees to provide
the Subadviser with such assistance as may be reasonably requested by the Subadviser in
connection with the Subadviser’s activities under this Agreement, including, without
limitation, providing information concerning the Fund, its funds available or to become
available for investment, and generally as to the conditions of the Fund’s or the Trust’s
affairs.
(b) Compliance with Applicable Laws and Governing Documents. In the
performance of its services under this Agreement, the Subadviser shall act in conformity
with the Prospectus and the Trust’s Agreement and Declaration of Trust and By-Laws as
currently in effect and, as soon as practical after the Trust, the Fund or the Adviser
notifies the Subadviser thereof, as supplemented, amended and/or restated from time to time
(referred to hereinafter as the “Declaration of Trust” and “By-Laws,” respectively), which
Prospectus, Declaration of Trust and By-Laws shall be timely provided to Subadviser, and
with the instructions and directions received in writing from the Adviser or the Trustees of
the Trust and will conform to, and comply with, the requirements of the 1940 Act, the
Investment Advisers Act of 1940, as amended (the “Advisers Act”), and Subchapter M and
Section 817(h) of the Internal Revenue Code of 1986, as amended (the “Code”). Without
limiting the preceding sentence, the Adviser promptly shall notify the Subadviser as to any
act or omission of the Subadviser hereunder that the Adviser reasonably deems to constitute
or to be the basis of any noncompliance or nonconformance with any of the Trust’s
Declaration of Trust and By-Laws and the Prospectus, the instructions and directions
received in writing from the Adviser or the Trustees of the Trust or the 1940 Act, the
Advisers Act, and Subchapter M and Section 817(h) of the Code. Notwithstanding the
foregoing, the Adviser shall remain responsible for ensuring the Fund’s and the Trust’s
overall compliance with the 1940 Act, the Code and all other applicable federal and state
laws and regulations and the Subadviser is only obligated to comply with this subsection (b)
with respect to the Subadviser Assets. The Adviser timely will provide the Subadviser with
a copy of the minutes of the meetings of the Board of Trustees of the Trust to the extent
they may affect the Fund or the services of the Subadviser, copies of any financial
statements or reports made by the Fund to its shareholders, and any further materials or
information which the Subadviser may reasonably request to enable it to perform its
functions under this Agreement.
The Adviser shall perform quarterly and annual tax compliance tests to ensure that the
Fund is in compliance with Subchapter M and Section 817(h) of the Code. In connection with
such compliance tests, the Adviser shall inform the Subadviser at least
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ten (10) business days prior to a calendar quarter end if the Subadviser Assets are out
of compliance with the diversification requirements under either Subchapter M or
Section 817(h). If the Adviser notifies the Subadviser that the Subadviser Assets are not
in compliance with such requirements noted above, the Subadviser will take prompt action to
bring the Subadviser Assets back into compliance within the time permitted under the Code
thereunder.
The Adviser will provide the Subadviser with reasonable advance notice of any change in
the Fund’s investment objectives, policies and restrictions as stated in the Prospectus, and
the Subadviser shall, in the performance of its duties and obligations under this Agreement,
manage the Subadviser Assets consistent with such changes, provided that the Subadviser has
received prompt notice of the effectiveness of such changes from the Trust or the Adviser.
In addition to such notice, the Adviser shall provide to the Subadviser a copy of a modified
Prospectus reflecting such changes. The Adviser acknowledges and will ensure that the
Prospectus will at all times be in compliance with all disclosure requirements under all
applicable federal and state laws and regulations relating to the Trust or the Fund,
including, without limitation, the 1940 Act, and the rules and regulations thereunder, and
that the Subadviser shall have no liability in connection therewith, except as to the
accuracy of material information furnished in writing by the Subadviser to the Trust or to
the Adviser specifically for inclusion in the Prospectus. The Subadviser hereby agrees to
provide to the Adviser in a timely manner such information relating to the Subadviser and
its relationship to, and actions for, the Trust as may be required to be contained in the
Prospectus or in the Trust’s Registration Statement on Form N-1A.
(c) Voting of Proxies. The Adviser hereby delegates to the Subadviser the
Adviser’s discretionary authority to exercise voting rights with respect to the securities
and other investments in the Subadviser Assets and authorizes the Subadviser to delegate
further such discretionary authority to a designee identified in a notice given to the Trust
and the Adviser. The Subadviser, including without limitation its designee (for which the
Subadviser shall remain liable), shall have the power to vote, either in person or by proxy,
all securities in which the Subadviser Assets may be invested from time to time, and shall
not be required to seek or take instructions from, the Adviser, the Fund or the Trust or
take any action with respect thereto. If both the Subadviser and another entity managing
assets of the Fund have invested the Fund’s assets in the same security, the Subadviser and
such other entity will each have the power to vote its pro rata share of the Fund’s
security.
The Subadviser will establish a written procedure for proxy voting in compliance with
current applicable rules and regulations, including but not limited to Rule 30b1-4 under the
1940 Act. The Subadviser will provide the Adviser or its designee, a copy of such procedure
and establish a process for the timely distribution of the Subadviser’s voting record with
respect to the Fund’s securities and other information necessary for the Fund to complete
information required by Form N-1A under the 1940 Act and the Securities Act of 1933, as
amended (the “Securities Act”), Form N-PX under the 1940 Act, and Form N-CSR under the
Xxxxxxxx-Xxxxx Act of 2002, as amended, respectively.
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(d) Agent. Subject to any other written instructions of the Adviser or the
Trust, the Subadviser is hereby appointed the Adviser’s and the Trust’s agent and
attorney-in-fact for the limited purposes of executing account documentation, agreements,
contracts and other documents as the Subadviser shall be requested by brokers, dealers,
counterparties and other persons in connection with its management of the Subadviser Assets.
The Subadviser agrees to provide the Adviser and the Trust with copies of any such
agreements executed on behalf of the Adviser or the Trust.
(e) Brokerage. The Subadviser is authorized, subject to the supervision of the
Adviser and the plenary authority of the Trust’s Board of Trustees, to establish and
maintain accounts on behalf of the Fund with, and place orders for the investment and
reinvestment, including without limitation purchase and sale of the Subadviser Assets with
or through, such persons, brokers (including, to the extent permitted by applicable law, any
broker affiliated with the Subadviser) or dealers (collectively “Brokers”) as Subadviser may
elect and negotiate commissions to be paid on such transactions. The Subadviser, however,
is not required to obtain the consent of the Adviser or the Trust’s Board of Trustees prior
to establishing any such brokerage account. The Subadviser shall place all orders for the
purchase and sale of portfolio investments for the Fund’s account with Brokers selected by
the Subadviser. In the selection of such Brokers and the placing of such orders, the
Subadviser shall seek to obtain for each Fund the most favorable price and execution
available, except to the extent it may be permitted to pay higher brokerage commissions for
brokerage and research services, as provided below. In using its reasonable efforts to
obtain for the Fund the most favorable price and execution available, the Subadviser,
bearing in mind the best interests of the Fund at all times, shall consider all factors it
deems relevant, including price, the size of the transaction, the breadth and nature of the
market for the security, the difficulty of the execution, the amount of the commission, if
any, the timing of the transaction, market prices and trends, the reputation, experience and
financial stability of the Broker involved, and the quality of service rendered by the
Broker in other transactions. Notwithstanding the foregoing, neither the Trust, the Fund
nor the Adviser shall instruct the Subadviser to place orders with any particular Broker(s)
with respect to the Subadviser Assets. Subject to such policies as the Trustees may
determine, or as may be mutually agreed to by the Adviser and the Subadviser, the Subadviser
is authorized but not obligated to cause, and 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 Fund to pay a Broker that provides brokerage and research services
(within the meaning of Section 28(e) of the Securities Exchange Act of 1934) to the
Subadviser an amount of commission for effecting a Subadviser Assets’ investment transaction
that is in excess of the amount of commission that another Broker would have charged for
effecting that transaction if, but only if, the 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 viewed in terms of either that particular transaction or
the overall responsibility of the Subadviser with respect to the accounts as to which it
exercises investment discretion.
It is recognized that the services provided by such Brokers may be useful to the
Subadviser in connection with the Subadviser’s services to other clients. On occasions when
the Subadviser deems the purchase or sale of a security to be in the best interests of
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the Fund with respect to the Subadviser Assets as well as other clients of the
Subadviser, the Subadviser, to the extent permitted by applicable laws and regulations, may,
but shall be under no obligation to, aggregate the securities to be sold or purchased in
order to obtain the most favorable price or lower brokerage commissions and efficient
execution. In such event, allocation of securities so sold or purchased, as well as the
expenses incurred in the transaction, will be made by the Subadviser in the manner the
Subadviser considers to be the most equitable and consistent with its fiduciary obligations
to each Fund and to such other clients. It is recognized that in some cases, this procedure
may adversely affect the price paid or received by the Fund or the size of the position
obtainable for, or disposed of by, the Fund with respect to the Subadviser Assets.
(f) Securities Transactions. The Subadviser and any affiliated person of the
Subadviser will not purchase securities or other instruments from or sell securities or
other instruments to the Fund; provided, however, the Subadviser or any affiliated person of
the Subadviser may purchase securities or other instruments from or sell securities or other
instruments to the Fund if such transaction is permissible under applicable laws and
regulations, including, without limitation, the 1940 Act and the Advisers Act and the rules
and regulations promulgated thereunder.
The Subadviser, on its own behalf and with respect to its Access Persons (as defined in
subsection (e) of Rule 17j-1 under the 1940 Act), agrees to observe and comply with
Rule 17j-1 and its Code of Ethics (which shall comply in all material respects with
Rule 17j-1), as the same may be amended from time to time. On at least an annual basis, the
Subadviser will comply with the reporting requirements of Rule 17j-1, which may include
either (i) certifying to the Adviser that the Subadviser and its Access Persons have
complied with the Subadviser’s Code of Ethics with respect to the Subadviser Assets or
(ii) identifying any violations which have occurred with respect to the Subadviser Assets.
The Subadviser will have also submitted its Code of Ethics for its initial approval by the
Board of Trustees no later than the date of execution of this agreement and subsequently
within six months of any material change thereto.
(g) Books and Records. The Subadviser shall maintain separate detailed records
as are required by applicable laws and regulations of all matters hereunder pertaining to
the Subadviser Assets (the “Fund’s Records”), including, without limitation, brokerage and
other records of all securities transactions. The Subadviser acknowledges that the Fund’s
Records are property of the Trust; except to the extent that the Subadviser is required to
maintain the Fund’s Records under the Advisers Act or other applicable law and except that
the Subadviser, at its own expense, is entitled to make and keep a copy of the Fund’s
Records for its internal files. The Fund’s Records shall be available to the Adviser or the
Trust at any time upon reasonable request during normal business hours and shall be
available for telecopying promptly to the Adviser during any day that the Fund is open for
business as set forth in the Prospectus.
(h) Information Concerning Subadviser Assets and Subadviser. From time to time
as the Adviser or the Trust reasonably may request in good faith, the Subadviser will
furnish the requesting party reports on portfolio transactions and reports on the Subadviser
Assets, all in such reasonable detail as the parties may reasonably agree in
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good faith. The Subadviser will also inform the Adviser in a timely manner of material
changes in portfolio managers responsible for Subadviser Assets, any changes in the
ownership or management of the Subadviser, or of material changes in the control of the
Subadviser. Upon the Trust’s or the Adviser’s reasonable request, the Subadviser will make
available its officers and employees to meet with the Trust’s Board of Trustees to review
the Subadviser Assets via telephone on a quarterly basis and in person on a less frequent
basis as agreed upon by the parties.
Subject to the other provisions of this Agreement, the Subadviser will also provide
such information/certificates or perform such additional acts with respect to the Subadviser
Assets as are reasonably required for the Trust or the Adviser to comply with their
respective obligations under applicable laws, regulations and/or policies of the Trust’s
Board of Trustees, including without limitation, requirements pertaining to the Code, the
1940 Act, the Advisers Act, and the Securities Act, and any rule or regulation thereunder.
(i) Custody Arrangements. The Trust or the Adviser shall notify the Subadviser
of the identities of its custodian banks and the custody arrangements therewith with respect
to the Subadviser Assets and shall give the Subadviser written notice of any changes in such
custodian banks or custody arrangements. The Subadviser shall on each business day provide
the Adviser and the Trust’s custodian such information as the Adviser and the Trust’s
custodian may reasonably request in good faith relating to all transactions concerning the
Subadviser Assets. The Trust shall instruct its custodian banks to (A) carry out all
investment instructions as may be directed by the Subadviser with respect to the Subadviser
Assets (which instructions may be orally given if confirmed in writing); and (B) provide the
Subadviser with all operational information necessary for the Subadviser to trade the
Subadviser Assets on behalf of the Fund. The Subadviser shall have no liability for the
acts or omissions of the authorized custodian(s), unless such act or omission is required by
and taken in reliance upon instructions given to the authorized custodian(s) by a
representative of the Subadviser properly authorized (pursuant to written instruction by the
Adviser) to give such instructions.
3. Independent Contractor. In the performance of its services hereunder, the
Subadviser is and shall be an independent contractor and unless otherwise expressly provided herein
or otherwise authorized in writing, shall have no authority to act for or represent the Fund, the
Trust or the Adviser in any way or otherwise be deemed an agent of the Fund, the Trust or the
Adviser.
4. Expenses. During the term of this Agreement, Subadviser will pay all expenses
incurred by it in connection with its activities under this Agreement. The Subadviser shall, at
its sole expense, employ or associate itself with such persons as it believes to be particularly
fitted to assist it in the execution of its duties under this Agreement. The Subadviser shall not
be responsible for the Trust’s, the Fund’s or Adviser’s expenses, which shall include, but not be
limited to, the cost of securities, commodities and other investments (including brokerage
commissions and other transaction charges, if any) purchased for the Fund and any losses incurred
in connection therewith, expenses of holding or carrying Subadviser Assets, including,
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without limitation, expenses of dividends on stock borrowed to cover a short sale and
interest, fees or other charges incurred in connection with leverage and related borrowings with
respect to the Subadviser Assets, organizational and offering expenses (which include, but are not
limited to, out-of-pocket expenses, but not overhead or employee costs of the Subadviser); expenses
for legal, accounting and auditing services; taxes and governmental fees; dues and expenses
incurred in connection with membership in investment company organizations; costs of printing and
distributing shareholder reports, proxy materials, prospectuses, stock certificates and
distribution of dividends; charges of the Fund’s custodians and sub-custodians, administrators and
sub-administrators, registrars, transfer agents, dividend disbursing agents and dividend
reinvestment plan agents; payment for portfolio pricing services to a pricing agent, if any;
registration and filing fees of the SEC; expenses of registering or qualifying securities of the
Fund for sale in the various states; freight and other charges in connection with the shipment of
the Fund’s portfolio securities; fees and expenses of non-interested Trustees; salaries of
shareholder relations personnel; costs of shareholders meetings; insurance; interest; brokerage
costs; and litigation and other extraordinary or non-recurring expenses. The Trust or the Adviser,
as the case may be, shall reimburse the Subadviser for any expenses of the Fund or the Adviser as
may be reasonably incurred by such Subadviser on behalf of the Fund or the Adviser. The Subadviser
shall keep and supply to the Trust and the Adviser reasonable records of all such expenses.
5. Compensation. For the services provided pursuant to this Agreement, the
Subadviser is entitled to the fee listed for the Fund on Exhibit A hereto. Such fees will be
computed daily and paid no later than the seventh (7th) business day following the end
of each month, from the Adviser, calculated at an annual rate based on the Subadviser Assets’
average daily net assets.
The method of determining the net asset value of the Subadviser Assets for purposes hereof
shall be the same as the method of determining net asset value for purposes of establishing the
offering and redemption price of the shares of the Trust as described in the Fund’s Prospectus. If
this Agreement shall be effective for only a portion of a month with respect to the Fund, the
aforesaid fee shall be prorated for the portion of such month during which this Agreement is in
effect for the Fund.
6. Representations and Warranties of Subadviser. The Subadviser represents and
warrants to the Adviser and the Trust as follows:
(a) The Subadviser is registered as an investment adviser under the Advisers Act;
(b) The Subadviser is registered as a Commodity Trading Advisor under the Commodity
Exchange Act, as amended (the “CEA”), with the Commodity Futures Trading Commission (the
“CFTC”), or is not required to file such registration;
(c) The Subadviser is a limited liability company duly organized and properly
registered and operating 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 and as proposed to
be conducted hereunder;
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(d) The execution, delivery and performance by the Subadviser of this Agreement are
within the Subadviser’s powers and have been duly authorized by all necessary actions of its
directors or shareholders, and no action by, or in respect of, or filing with, any
governmental body, agency or official is required on the part of the Subadviser for
execution, delivery and performance by the Subadviser of this Agreement, and the execution,
delivery and performance by the Subadviser of this Agreement do not contravene or constitute
a violation of, or a material default under, (i) any provision of applicable law, rule or
regulation, (ii) the Subadviser’s governing instruments, or (iii) any agreement, judgment,
injunction, order, decree or other instrument binding upon the Subadviser; and
(e) The Form ADV of the Subadviser previously provided to the Adviser and the Trust is
a true and complete copy of the form, including that part or parts of the Form ADV filed
with the SEC, that part or parts maintained in the records of the Adviser, and/or that part
or parts provided or offered to clients, in each case as required under the Advisers Act and
rules thereunder. The Subadviser represents that its Form ADV provided to the Adviser
complies in all materials respects with the requirements of the Advisers Act to the extent
it relates to the Subadviser’s services hereunder.
7. Representations and Warranties of Adviser. The Adviser represents and warrants to
the Subadviser as follows:
(a) The Adviser is registered as an investment adviser under the Advisers Act;
(b) The Adviser has filed a notice of exemption pursuant to Rule 4.14 under the CEA
with the CFTC and the National Futures Association or is not required to file such
exemption;
(c) The Adviser is a business trust 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 and as proposed to be conducted hereunder;
(d) The execution, delivery and performance by the Adviser of this Agreement are within
the Adviser’s powers and have been duly authorized by all necessary action on the part of
its directors, shareholders or managing unitholder, and no action by, or in respect of, or
filing with, any governmental body, agency or official is required on the part of the
Adviser for the execution, delivery and performance by the Adviser of this Agreement, and
the execution, delivery and performance by the Adviser of this Agreement do not contravene
or constitute a violation of, or a material default under, (i) any provision of applicable
law, rule or regulation, (ii) the Adviser’s governing instruments, or (iii) any agreement,
judgment, injunction, order, decree or other instrument binding upon the Adviser;
(e) The Form ADV of the Adviser previously provided to the Subadviser and the Trust is
a true and complete copy of the form, including that part or parts of the Form ADV filed
with the SEC, that part or parts maintained in the records of the Adviser, and/or that part
or parts provided or offered to clients, in each case as required under the
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Advisers Act and rules thereunder, 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;
(f) The Adviser acknowledges that it received a copy of the Subadviser’s Form ADV at
least 48 hours prior to the execution of this Agreement; and
(g) The Adviser and the Trust have duly entered into the Advisory Agreement pursuant to
which the Trust authorized the Adviser to delegate certain of its duties under the Advisory
Agreement to other investment advisers, including without limitation, the appointment of a
subadviser with respect to assets of each of the Trust’s mutual fund series, including
without limitation the Adviser’s entering into and performing this Agreement.
8. Representations and Warranties of the Trust. The Trust represents and warrants to
the Adviser and the Subadviser as follows:
(a) The Trust is a statutory trust duly formed 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 and as proposed to be conducted hereunder;
(b) The Trust is registered as an investment company under the 1940 Act and has elected
to qualify and has qualified, together with the Fund, as a regulated investment company
under the Code, and the Fund’s shares are registered under the Securities Act;
(c) The execution, delivery and performance by the Trust of this Agreement are within
the Trust’s powers and have been duly authorized by all necessary action on the part of the
Trust and its Board of Trustees, and no action by, or in respect of, or filing with, any
governmental body, agency or official is required on the part of the Trust for the
execution, delivery and performance by the Adviser of this Agreement, and the execution,
delivery and performance by the Trust of this Agreement do not contravene or constitute a
default under (i) any provision of applicable law, rule or regulation, (ii) the Trust’s
governing instruments, or (iii) any agreement, judgment, injunction, order, decree or other
instrument binding upon the Trust; and
(d) The Trust acknowledges that it received a copy of the Subadviser’s Form ADV at
least 48 hours prior to the execution of this Agreement.
(e) On the date of this Agreement the Trust is a “qualified institutional buyer” as
that term is defined in Rule 144A of the Securities Act and shall inform Subadviser promptly
if the Trust loses its status as a qualified institutional buyer.
9. Survival of Representations and Warranties; Duty to Update Information. All
representations and warranties made by the Subadviser, the Adviser and the Trust pursuant to the
recitals above and Sections 6, 7 and 8, respectively, shall survive for the duration of this
Agreement and the parties hereto shall promptly notify each other in writing upon becoming
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aware that any of the foregoing representations and warranties are no longer true or accurate
in all material effects.
10. Liability and Indemnification.
(a) Liability. The Subadviser shall exercise its best judgment in rendering
its services in accordance with the terms of this Agreement, but otherwise, in the absence
of willful misfeasance, bad faith or gross negligence on the part of the Subadviser or a
reckless disregard of its duties hereunder, the Subadviser, each of its affiliates and all
respective partners, officers, directors and employees (“Affiliates”) and each person, if
any, who within the meaning of the Securities Act controls the Subadviser (“Controlling
Persons”), if any, shall not be subject to any expenses or liability to the Adviser, any
other subadviser to the Fund, the Trust or the Fund or any of the Fund’s shareholders, in
connection with the matters to which this Agreement relates, including without limitation
for any losses that may be sustained in the purchase, holding or sale of Subadviser Assets.
The Adviser shall exercise its best judgment in rendering its obligations in accordance with
the terms of this Agreement, but otherwise (except as set forth in Section 10(c) below), in
the absence of willful misfeasance, bad faith or gross negligence on the part of the Adviser
or a reckless disregard of its duties hereunder, the Adviser, any of its Affiliates and each
of the Adviser’s Controlling Persons, if any, shall not be subject to any liability to the
Subadviser, for any act or omission in the case of, or connected with, rendering services
hereunder or for any losses that may be sustained in the purchase, holding or sale of
Subadviser Assets. Notwithstanding the foregoing, nothing herein shall relieve the Adviser
and the Subadviser from any of their obligations under applicable law, including, without
limitation, the federal and state securities laws and the CEA.
(b) Indemnification. The Subadviser shall indemnify the Adviser, the Trust and
the Fund, and their respective Affiliates and Controlling Persons for any liability and
expenses, including without limitation reasonable attorneys’ fees and expenses, which the
Adviser, the Trust and/or the Fund and their respective Affiliates and Controlling Persons
may sustain as a result of the Subadviser’s willful misfeasance, bad faith, gross
negligence, reckless disregard of its duties hereunder or violation of applicable law,
including, without limitation, the federal and state securities laws or the CEA. The
Adviser shall indemnify the Subadviser, its Affiliates and its Controlling Persons, for any
liability and expenses, including without limitation reasonable attorneys’ fees and
expenses, which may be sustained as a result of the Adviser’s willful misfeasance, bad
faith, gross negligence, reckless disregard of its duties hereunder or violation of
applicable law, including, without limitation, the federal and state securities laws or the
CEA.
The Trust shall indemnify the Subadviser, its Affiliates and its Controlling Persons,
for any liability and expenses, including without limitation reasonable attorneys’ fees and
expenses, which may be sustained as a result of the Trust’s willful misfeasance, bad faith,
gross negligence, reckless disregard of its duties hereunder or violation of applicable law,
including, without limitation, the federal and state securities laws or the CEA.
10
(c) The Subadviser shall not be liable to the Adviser for (i) any acts of the Adviser
or any other subadviser to the Fund with respect to the portion of the assets of the Fund
not managed by Subadviser, or (ii) acts of the Subadviser which result from acts of the
Adviser, including, but not limited to, a failure of the Adviser to provide accurate and
current information with respect to any records maintained by the Adviser or any other
subadviser to the Fund, which records are not also maintained by or otherwise available to
the Subadviser upon reasonable request. The Adviser agrees that Subadviser shall manage the
Subadviser Assets as if they were a separate operating Fund as set forth in Section 2(b) of
this Agreement. The Adviser shall indemnify the Subadviser, its Affiliates and Controlling
Persons from any liability arising from the conduct of the Adviser and any other subadviser
with respect to the portion of the Fund’s assets not allocated to the Subadviser.
11. Duration and Termination.
(a) Duration. Unless sooner terminated, this Agreement shall continue until
May 1, 2010 with respect to any Fund covered by this Agreement initially and, for any Fund
subsequently added to this Agreement, an initial period of no more than two years that
terminates on the second May 1st that occurs following the effective date of this Agreement
with respect to such Fund, and thereafter shall continue automatically for successive annual
periods with respect to each such Fund, provided such continuance is specifically approved
at least annually by the Trust’s Board of Trustees or vote of the lesser of (a) 67% of the
shares of the Fund represented at a meeting if holders of more than 50% of the outstanding
shares of the Fund are present in person or by proxy or (b) more than 50% of the outstanding
shares of the Fund; provided that in either event its continuance also is approved by a
majority of the Trust’s Trustees who are not “interested persons” (as defined in
the 0000 Xxx) of any party to this Agreement, by vote cast in person at a meeting called for
the purpose of voting on such approval.
(b) Termination. Notwithstanding whatever may be provided herein to the
contrary, this Agreement may be terminated at any time with respect to the Fund, without
payment of any penalty:
(i) By vote of a majority of the Trust’s Board of Trustees, or by “vote of a majority
of the outstanding voting securities” of the Fund (as defined in the 1940 Act), or by the
Adviser, in each case, upon not more than 60 days’ written notice to the Subadviser;
(ii) By any party hereto immediately upon written notice to the other parties in the
event of a material breach of any provision of this Agreement by either of the other
parties; or
(iii) By the Subadviser upon not less than 60 days’ written notice to the Adviser and
the Trust.
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This Agreement shall not be assigned (as such term is defined in the 0000 Xxx) and
shall terminate automatically in the event of its assignment or upon the termination of the
Advisory Agreement.
12. Duties of the Adviser. The Adviser shall continue to have responsibility for all
services to be provided to the Fund pursuant to the Advisory Agreement and shall oversee and review
the Subadviser’s performance of its duties under this Agreement. Nothing contained in this
Agreement shall obligate the Adviser to provide any funding or other support for the purpose of
directly or indirectly promoting investments in the Fund.
13. Reference to Adviser and Subadviser.
(a) Neither the Adviser nor any Affiliate or agent of the Adviser shall make reference
to or use the name of Subadviser or any of its Affiliates, or any of their clients, except
references concerning the identity of and services provided by the Subadviser to the Fund,
which references shall not differ in substance from those included in the Prospectus and
this Agreement, in any advertising or promotional materials without the prior approval of
Subadviser, which approval shall not be unreasonably withheld or delayed. The Adviser
hereby agrees to make all reasonable efforts to cause the Fund and any Affiliate thereof to
satisfy the foregoing obligation.
(b) Neither the Subadviser nor any Affiliate or agent of it shall make reference to or
use the name of the Adviser or any of its Affiliates, or any of their clients, except
references concerning the identity of and services provided by the Adviser to the Fund or
the services provided by the Subadviser to the Fund or Adviser, which references shall not
differ in substance from those included in the Prospectus and this Agreement, in any
advertising or promotional materials without the prior approval of Adviser, which approval
shall not be unreasonably withheld or delayed. The Subadviser hereby agrees to make all
reasonable efforts to cause any Affiliate of the Subadviser to satisfy the foregoing
obligation.
14. Amendment. This Agreement may be amended by mutual consent of the parties,
provided that the terms of any material amendment shall be approved by: (a) the Trust’s Board of
Trustees or by a vote of a majority of the outstanding voting securities of the Fund (as required
by the 1940 Act), and (b) the vote of a majority of those Trustees of the Trust 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.
15. Confidentiality. Subject to the duties of the Adviser, the Trust and the
Subadviser to comply with applicable law, including any demand of any regulatory or taxing
authority having jurisdiction, the parties hereto shall treat as confidential and shall not
disclose any and all information pertaining to the Fund and the actions of the Subadviser, the
Adviser and the Fund in respect thereof; except to the extent:
(a) Authorized. The Adviser or the Trust has authorized such disclosure;
(i) The Adviser hereby authorizes the disclosure by the Subadviser of certain
confidential information to an affiliate or agent of the Subadviser, provided that
12
(A) such affiliate or agent has a “need to know” for the furtherance of the
Subadviser’s obligations under this Agreement, (B) such affiliate or agent agrees to be
bound by the Confidentiality provisions of this Section 15 and (C) the Subadviser agrees to
be fully liable to the Trust and the Adviser for any security breach or unauthorized
disclosure of confidential information by the affiliate or agent; and
(ii) The Adviser hereby authorizes the disclosure by the Subadviser of certain
confidential information to the Fund’s custodian or a broker, dealer, counter-party, issuer
or futures commission broker as Subadviser may select in connection with executing
transactions for the Fund in accordance with this Agreement.
(b) Court or Regulatory Authority. Disclosure of such information is expressly
required or requested by a court or other tribunal of competent jurisdiction or applicable
federal or state regulatory authorities; provided that the disclosing party shall use best
efforts to provide prior notice of such requirement or request to the other parties hereto,
if not otherwise prohibited;
(c) Publicly Known Without Breach. Such information becomes known to the
general public without a breach of this Agreement or a similar confidential disclosure
agreement regarding such information;
(d) Already Known. Such information already was known by the party prior to
the date hereof;
(e) Received From Third Party. Such information was or is hereafter
rightfully received by the party from a third party (expressly excluding the Fund’s
custodian, prime broker and administrator), which to the knowledge of the receiver is
without restriction on its disclosure and without breach of this Agreement or of a similar
confidential disclosure agreement regarding them; or
(f) Independently Developed. The party independently developed such
information.
16. Notice. Any notice that is required to be given by the parties to each other
under the terms of this Agreement shall be in writing, delivered, or mailed postpaid to the other
parties, or transmitted by facsimile with acknowledgment of receipt, to the parties at the
following addresses or facsimile numbers, which may from time to time be changed by the parties by
notice to the other party:
| (a) | If to the Subadviser: | |||
| Xxxxxx Brothers Asset Management LLC | ||||
| 000 Xxxxx XxXxxxx Xxxxxx, Xxxxx 0000 | ||||
| Xxxxxxx, XX 00000 | ||||
| Attention: Client Service | ||||
| Facsimile: (000) 000-0000 | ||||
| Email: xxxxxxxxxxx@xxxxxx.xxx | ||||
| (b) | If to the Adviser: |
13
| Nationwide Fund Advisors | ||||
| 0000 Xxxxx Xxxx | ||||
| Xxxxxxxxxxxx, XX 00000 | ||||
| Attention: Legal Department | ||||
| Facsimile: (000) 000-0000 | ||||
| (c) | If to the Trust: | |||
| Nationwide Variable Insurance Trust | ||||
| 0000 Xxxxx Xxxx | ||||
| Xxxxxxxxxxxx, XX 00000 | ||||
| Attention: Legal Department | ||||
| Facsimile: (000) 000-0000 |
17. Jurisdiction. This Agreement shall be governed by and construed in accordance
with substantive laws of the State of Delaware without reference to choice of law principles
thereof and in accordance with the 1940 Act. In the case of any conflict, the 1940 Act shall
control.
18. Counterparts. This Agreement may be executed in one or more counterparts, each of
which shall be deemed an original, all of which shall together constitute one and the same
instrument.
19. Certain Definitions. For the purposes of this Agreement and except as otherwise
provided herein, “interested person,” “affiliated person,” and “assignment” shall have their
respective meanings as set forth in the 1940 Act, subject, however, to such exemptions as may be
granted by the SEC.
20. Captions. The captions herein are included for convenience of reference only and
shall be ignored in the construction or interpretation hereof.
21. Severability. If any provision of this Agreement shall be held or made invalid by
a court decision or applicable law, the remainder of the Agreement shall not be affected adversely
and shall remain in full force and effect.
22. Entire Agreement. This Agreement, together with all exhibits, attachments and
appendices, contains the entire understanding and agreement of the parties with respect to the
subject matter hereof
23. Nationwide Variable Insurance Trust and its Trustees. The terms “Nationwide
Variable Insurance Trust” and the “Trustees of Nationwide Variable Insurance Trust” refer
respectively to the Trust created and the Trustees, as trustees but not individually or personally,
acting from time to time under the Amended and Restated Agreement and Declaration of Trust made and
dated as of October 28, 2004, as has been or may be amended and/or restated from time to time, and
to which reference is hereby made.
24. Multi-Manager Funds. In connection with securities transactions for the Fund, the
Subadviser that is (or whose affiliated person is) entering into the transaction, and any other
14
investment manager that is advising an affiliate of the Fund (or portion of the Fund)
(collectively, the “Managers” for the purposes of this section) entering into the transaction are
prohibited from consulting with each other concerning transactions for the Fund in securities or
other assets and, if both Managers are responsible for providing investment advice to the Fund, the
Manager’s responsibility in providing advice is expressly limited to a discrete portion of the
Fund’s portfolio that it manages.
This prohibition does not apply to communications by the Adviser in connection with the
Adviser’s (i) overall supervisory responsibility for the general management and investment of the
Fund’s assets; (ii) determination of the allocation of assets among the Manager(s), if any; and
(iii) investment discretion with respect to the investment of Fund assets not otherwise assigned to
a Manager.
25. CFTC Disclosure Relief. “PURSUANT TO AN EXEMPTION FROM THE COMMODITY FUTURES
TRADING COMMISSION IN CONNECTION WITH ACCOUNTS OF QUALIFIED ELIGIBLE PERSONS, THIS BROCHURE OR
ACCOUNT DOCUMENT IS NOT REQUIRED TO BE, AND HAS NOT BEEN, FILED WITH THE COMMISSION. THE COMMODITY
FUTURES TRADING COMMISSION DOES NOT PASS UPON THE MERITS OF PARTICIPATING IN A TRADING PROGRAM OR
UPON THE ADEQUACY OR ACCURACY OF COMMODITY TRADING ADVISOR DISCLOSURE. CONSEQUENTLY, THE COMMODITY
FUTURES TRADING COMMISSION HAS NOT REVIEWED OR APPROVED THIS TRADING PROGRAM OR THIS BROCHURE OR
ACCOUNT DOCUMENT.”
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15
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the day and year first
written above.
| TRUST | ||||||
| NATIONWIDE VARIABLE INSURANCE TRUST | ||||||
| By: Name: |
/s/ Xxxxxxx X. Xxxxxxxx
|
|||||
| Title: | President | |||||
| ADVISER | ||||||
| NATIONWIDE FUND ADVISORS | ||||||
| By: Name: |
/s/ Xxxxxxx X. Xxxxxxxx
|
|||||
| Title: | President | |||||
| SUBADVISER | ||||||
| XXXXXXXXX XXXXXX FIXED INCOME LLC | ||||||
| By: Name: |
/s/ Xxxx Xxxxx
|
|||||
| Title: | Senior Vice President | |||||
16
EXHIBIT A
SUBADVISORY AGREEMENT
AMONG
NATIONWIDE VARIABLE INSURANCE TRUST,
NATIONWIDE FUND ADVISORS
AND XXXXXXXXX XXXXXX FIXED INCOME LLC
SUBADVISORY AGREEMENT
AMONG
NATIONWIDE VARIABLE INSURANCE TRUST,
NATIONWIDE FUND ADVISORS
AND XXXXXXXXX XXXXXX FIXED INCOME LLC
Effective May 4, 2009*
| Funds of the Trust | Subadvisory Fees | |
NVIT Core Plus Bond Fund
|
0.20% on Subadviser Assets up to $250 million;
0.175% on Subadviser Assets of more than $250 million but less than $750 million; 0.15% on Subadviser Assets of $750 million and more |
| * | As approved at the Board of Trustees Meeting held on March 12, 2009. |
[The remainder of this page is intentionally left blank.]
17
IN WITNESS WHEREOF, the parties hereto have executed this Exhibit A on the effective date set
forth above.
| TRUST | ||||||
| NATIONWIDE VARIABLE INSURANCE TRUST | ||||||
| By: Name: |
/s/ Xxxxxxx X. Xxxxxxxx
|
|||||
| Title: | President | |||||
| ADVISER | ||||||
| NATIONWIDE FUND ADVISORS | ||||||
| By: Name: |
/s/ Xxxxxxx X. Xxxxxxxx
|
|||||
| Title: | President | |||||
| SUBADVISER | ||||||
| XXXXXXXXX XXXXXX FIXED INCOME LLC | ||||||
| By: Name: |
/s/ Xxxx Xxxxx
|
|||||
| Title: | Senior Vice President | |||||
18
