Exhibit 23(d)(9)
SUB-INVESTMENT MANAGEMENT AGREEMENT
This Sub-Investment Management Agreement (this "Agreement") is entered into
as of April 30, 2007, by and between Lincoln Investment Advisors Corporation, a
New Hampshire corporation ("Investment Manager") and Janus Capital Management
LLC, a Delaware Limited Liability Company ("Sub-Investment Manager").
WHEREAS, the Investment Management Agreement provides that Investment
Manager may engage a sub-investment manager to furnish investment information
and advice to assist Investment Manager in carrying out its responsibilities
under the Investment Management Agreement;
WHEREAS, Investment Manager and the Fund desire to retain Sub-Investment
Manager to render investment advisory services to Investment Manager in the
manner and on the terms set forth in this Agreement.
NOW, THEREFORE, in consideration of the mutual covenants and agreements set
forth in this Agreement, Investment Manager and Sub-Investment Manager agree as
follows:
1. Sub-Investment Management Services.
(a) The LVIP Janus Capital Appreciation Fund (the "Fund") is a series of
the Lincoln Variable Insurance Products Trust (the "Trust"). Sub-Investment
Manager shall, subject always to the control of the Trust's Board of
Trustees and to the supervision of Investment Manager, manage the investment
and reinvestment of the assets of the Fund. Sub-Investment Manager is
authorized, in its discretion and without prior consultation with Investment
Manager, to buy, sell, lend, and otherwise trade in any stocks, bonds, and
other securities and investment instruments on behalf of the Fund. Subject
to the investment objectives, policies, and restrictions concerning the Fund
set forth in the Fund's registration statement under the Investment Company
Act of 1940, the Fund may be invested in such proportions of stocks, bonds,
other securities or investment instruments, or cash, as Sub-Investment
Manager shall determine. Sub-Investment Manager is responsible for
compliance with the provisions of Section 817(h) of the Internal Revenue
Code of 1986, as amended, applicable to the Fund.
(b) Sub-Investment Manager shall furnish Investment Manager monthly,
quarterly, and annual reports concerning transactions and performance of the
Fund in such form as may be mutually agreed upon, and agrees to review the
Fund and discuss the management of it. The Fund shall own and control of all
the pertinent records pertaining to transactions under this Agreement.
Sub-Investment Manager shall permit the financial statements, books and
records with respect to the Fund to be inspected and audited by Investment
Manager (and/or the independent accountants for Investment Manager or the
Fund) at all reasonable times during normal business hours. Sub-Investment
Manager shall also provide Investment Manager with such other information
and reports as may reasonably be requested by Investment Manager from time
to time.
(c) Sub-Investment Manager shall provide to Investment Manager a copy of
Sub-Investment Manager's Form ADV as filed with the Securities and Exchange
Commission and a list of persons who Sub-Investment Manager wishes to have
authorized to give written and/or oral instructions to the Custodian of the
Fund's assets.
(d) Sub-Investment Manager agrees that it will not consult with any other
sub-adviser engaged by Investment Manager with respect to transactions in
securities or other assets concerning the Fund or another sub-advised fund,
except to the extent permitted by certain exemptive rules under the 1940 Act
that permit certain transactions with a sub-adviser or its affiliates.
2. Obligations of Investment Manager and the Fund.
(a) Investment Manager shall provide timely information to Sub-Investment
Manager regarding such matters as the cash requirements and cash available
for investment in the Fund, and all other information as may be reasonably
necessary for Sub-Investment Manager to perform its responsibilities
hereunder.
(b) Investment Manager has herewith furnished Sub-Investment Manager a
copy of the Fund's registration statement currently in effect and agrees
during the continuance of this Agreement to furnish Sub-Investment Manager
copies of any amendments or supplements thereto before or at the time the
amendments or supplements become effective. Investment Manager agrees to
furnish Sub-Investment Manager with minutes of meetings of the Board of
Trustees of the Trust to the extent they may affect the duties of Investment
Manager, a certified copy of any financial statements or reports prepared
for the Fund by certified or independent public accountants, and with copies
of any financial statements or material reports made by the Fund to its
shareholders or to any governmental body or securities exchange, and any
further materials or information which Sub- Investment Manager may
reasonably request to enable it to perform its functions under this
Agreement.
3. Custodian. Investment Manager shall provide Sub-Investment Manager with a
copy of the Fund's agreement with the Custodian (the "Custodian") designated to
hold the assets in the Fund and any modification thereto (the "Custody
Agreement") in advance. The Fund assets shall be maintained in the custody of
the Custodian identified in, and in accordance with the terms and conditions
of, the Custody Agreement. Sub-Investment Manager shall have no liability for
the acts or omissions of the Custodian which do not arise out of the acts or
omissions of Sub-Investment Manager. Any assets added to the Fund shall be
delivered directly to the Custodian.
4. Proprietary Rights. Investment Manager agrees and acknowledges that
Sub-Investment Manager is the sole owner of the name and xxxx "Xxxxx" and that
all use of any designation comprised in whole or part of Janus (a "Xxxxx Xxxx")
under this Agreement shall inure to the benefit of Sub-Investment Manager.
Consequently, the use by Investment Manager on its own behalf or on behalf of
the Fund of any Xxxxx Xxxx in any advertisement or sales literature or
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other materials promoting the Fund shall be with the prior written consent of
Sub-Investment Manager. Investment Manager shall not, and Investment Manager
shall use its best efforts to cause the Fund not to, without the prior written
consent of Sub-Investment Manager, make representations regarding
Sub-Investment Manager in any disclosure document, advertisement or sales
literature or other materials promoting the Fund. Upon termination of this
Agreement for any reason, Investment Manager shall cease, and Investment
Manager shall use its best efforts to cause the Fund to cease, all use of any
Xxxxx Xxxx(s) as soon as reasonably practicable.
5. Expenses. Except for expenses that Sub-Investment Manager has
specifically assumed or agreed to pay, it shall not be responsible for the
expenses of the Fund or of Investment Manager. Expenses for which
Sub-Investment Manager shall not be responsible include, without limitation:
(a) interest and taxes; (b) brokerage commissions and other costs in connection
with the purchase or sale of securities or other investment instruments with
respect to the Fund; and (c) custodian fees and expenses. Any reimbursement of
advisory fees required by any expense limitation provision shall be the sole
responsibility of Investment Manager. Investment Manager and Sub-Investment
Manager shall not be considered as partners or participants in a joint venture.
Sub-Investment Manager will pay its own expenses for the services to be
provided pursuant to this Agreement to the extent not assumed by Investment
Manager above, and will not be obligated to pay any expenses of Investment
Manager or the Fund.
6. Purchase and Sale of Assets. Absent instructions from Investment Manager
to the contrary, Sub-Investment Manager shall place all orders for the purchase
and sale of securities for the Fund with brokers or dealers selected by
Sub-Investment Manager which may include brokers or dealers affiliated with
Sub-Investment Manager. Purchase or sell orders for the Fund may be aggregated
with contemporaneous purchase or sell orders of other clients of Sub-Investment
Manager. Sub-Investment Manager shall use its best efforts to obtain execution
of Fund transactions at prices which are advantageous to the Fund and at
commission rates that are reasonable in relation to the benefits received.
However, Sub-Investment Manager may select brokers or dealers on the basis that
they provide brokerage, research, or other services or products to the Fund
and/or other accounts serviced by Sub-Investment Manager. Sub-Investment
Manager may pay a broker or dealer an amount of commission for effecting a
securities transaction in excess of the amount of commission or dealer spread
another broker or dealer would have charged for effecting that transaction if
Sub-Investment Manager determines in good faith that such amount of commission
was reasonable in relation to the value of the brokerage and research products
and/or services provided by such broker or dealer. This determination, with
respect to brokerage and research services or products, may be viewed in terms
of either that particular transaction or the overall responsibilities which
Sub-Investment Manager and its affiliates have with respect to the Fund and to
accounts over which they exercise investment discretion, and not all such
services or products may be used by Sub-Investment Manager in managing the Fund.
7. Compensation of Sub-Investment Manager. Investment Manager shall pay to
Sub-Investment Manager a monthly fee in accordance with the fee schedule
attached to this Agreement. Monthly fees shall be calculated by Investment
Manager based upon the average daily net assets of the Fund (including cash or
cash equivalents) for the preceding month for investment advisory services
rendered during the preceding month, and shall be payable to Sub-
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Investment Manager by the fifteenth day of the succeeding month. The fee for
the first month during which Sub-Investment Manager shall render investment
advisory services under this Agreement shall be based upon the number of days
the account was open in that month. If this Agreement is terminated, the fee
shall be based upon the number of days the account was open during the month in
which the Agreement is terminated.
8. Non-Exclusivity. Investment Manager and the Fund agree that the services
of Sub-Investment Manager are not to be deemed exclusive and that
Sub-Investment Manager and its affiliates are free to act as investment manager
and provide other services to various investment companies and other managed
accounts. This Agreement shall not in any way limit or restrict Sub-Investment
Manager or any of its directors, officers, employees, or agents from buying,
selling, or trading any securities or other investment instruments for its or
their own account or for the account of others for whom it or they may be
acting, provided that such activities will not adversely affect or otherwise
impair the performance by Sub-Investment Manager of its duties and obligations
under this Agreement. Investment Manager and the Fund recognize and agree that
Sub-Investment Manager may provide advice to or take action with respect to
other clients, which advice or action, including the timing and nature of such
action, may differ from or be identical to advice given or action taken with
respect to the Fund. Sub-Investment Manager shall for all purposes herein be
deemed to be an independent contractor and shall, unless otherwise provided or
authorized, have no authority to act for or represent the Fund or Investment
Manager in any way or otherwise be deemed an agent of the Fund or Investment
Manager other than in furtherance of its duties and responsibilities as set
forth in this Agreement.
9. Liability.
(a) Except as may otherwise be provided by the Investment Company Act of
1940 or federal securities laws, neither Sub-Investment Manager nor any of
its officers, directors, or employees shall be subject to any liability to
Investment Manager, the Fund, or any shareholder of the Fund for any error
of judgment or any loss arising out of any investment or other act or
omission in the course of, connected with, or arising out of any service to
be rendered under this Agreement, except by reason of willful misfeasance,
bad faith, or gross negligence in the performance of its duties or by reason
of reckless disregard of its obligations and duties under this Agreement.
Investment Manager and the Fund shall hold harmless and indemnify
Sub-Investment Manager for any loss, liability, cost, damage, or expense
(including reasonable attorneys fees and costs) arising from any claim or
demand by any past or present shareholder of the Fund, in their capacity as
shareholder, that is not based upon or does not arise from the investment
advice and/or other services provided by Sub-Investment Manager pursuant to
this Agreement. Investment Manager acknowledges and agrees that
Sub-Investment Manager makes no representation or warranty, express or
implied, that any level of performance or investment results will be
achieved by the Fund or that the Fund will perform comparably with any
standard or index, including other clients of Sub-Investment Manager,
whether public or private.
(b) Notwithstanding anything to the contrary in sub-Paragraph (a) just
above, Sub-Investment Manager agrees to indemnify the Fund, Investment
Manager, the Separate Account and the Lincoln National Life Insurance
Company (the "Lincoln Entities") for, and
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hold them harmless against, any and all losses, claims, damages, liabilities
(including amounts paid in settlement with the written consent of the
Sub-Investment Manager) or litigation (including legal and other expenses)
to which the Lincoln Entities, or any of them, may become subject under any
statute, at common law or otherwise, insofar as those losses, claims,
damages, liabilities or expenses (or actions in respect thereof) or
settlements arise as a result of any failure by the Sub-Investment Manager,
whether unintentional or in good faith or otherwise, to adequately diversify
the investment program of the Fund, pursuant to the requirements of
Section 817(h) of the Code, and the regulations issued thereunder
(including, but not by way of limitation, Reg. Sec. 1.817-5, March 2, 1989,
54 F.R. 8730), relating to the diversification requirements for variable
annuity, endowment, and life insurance contracts.
10. Effect of Assignment, Termination of Investment Management Agreement,
and Amendment. This Agreement shall automatically terminate, without the
payment of any penalty, in the event of its assignment or in the event that the
Investment Management Agreement shall have terminated for any reason; and this
Agreement shall not be amended unless such amendment be approved at a meeting
by the affirmative vote of a majority of the outstanding shares of the Fund and
by the vote, cast in person at a meeting called for the purpose of voting on
such approval, of a majority of the Trustees of the Trust who are not
interested persons of the Trust or of Investment Manager or of Sub-Investment
Manager, and with the approval of Sub-Investment Manager.
11. Effective Period; Termination. This Agreement shall become effective
upon its execution, and shall remain in full force and effect continuously
thereafter (unless terminated automatically as set forth in Section 10) until
terminated as follows:
(a) The Fund may at any time terminate this Agreement by giving not less
than 60 days' written notice delivered or mailed by registered mail, postage
prepaid, to Investment Manager and Sub-Investment Manager; or
(b) If (i) the Trustees of the Trust or the shareholders by the
affirmative vote of a majority of the outstanding shares of the Fund and
(ii) a majority of the Trustees who are not interested persons of the Trust
or of Investment Manager or of Sub-Investment Manager by vote cast in person
at a meeting called for the purpose of voting on such approval, do not
specifically approve at least annually the continuance of this Agreement,
then this Agreement shall automatically terminate at the close of business
on the second anniversary of its execution, or upon the expiration of one
year from the effective date of the last such continuance, whichever is
later; provided, however, that if the continuance of this Agreement is
submitted to the shareholders of the Fund for their approval and such
shareholders fail to approve such continuance of this Agreement as provided
herein, Sub-Investment Manager may continue to serve hereunder in a manner
consistent with the Investment Company Act of 1940 and the Rules and
Regulations thereunder; or
(c) Investment Manager may at any time terminate this Agreement by giving
not less than 60 days' written notice delivered or mailed by certified mail,
postage prepaid, to Sub-Investment Manager, and Sub-Investment Manager may
at any time terminate this
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Agreement by giving not less than 60 days' written notice delivered or
mailed by registered mail, postage prepaid, to Investment Manager.
Action by the Fund under (a) above may be taken either (i) by vote of a
majority of its Trustees, or (ii) by the affirmative vote of a majority of
the outstanding shares of the Fund.
Termination of this Agreement pursuant to this Section 11 shall be
without the payment of any penalty.
12. Certain Definitions. For the purposes of this Agreement, the
"affirmative vote of a majority of the outstanding shares" means the
affirmative vote, at a duly called and held meeting of shareholders, (a) of the
holders of 67% or more of the shares of the Fund present (in person or by
proxy) and entitled to vote at such meeting, if the holders of more than 50% of
the outstanding shares of the Fund entitled to vote at such meeting are present
in person or by proxy, or (b) of the holders of more than 50% of the
outstanding shares of the Fund entitled to vote at such meeting, whichever is
less.
For the purposes of this Agreement, the terms "affiliated person,"
"control," "interested person" and "assignment" shall have their respective
meanings defined in the Investment Company Act of 1940 and the Rules and
Regulations thereunder, subject, however, to such exemptions as may be granted
by the Securities and Exchange Commission under said Act; the term
"specifically approve at least annually" shall be construed in a manner
consistent with the Investment Company Act of 1940 and the Rules and
Regulations thereunder; and the term "brokerage and research services" shall
have the meaning given in the Securities Exchange Act of 1934 and the Rules and
Regulations thereunder.
13. Certain Information. Sub-Investment Manager shall promptly notify
Investment Manager in writing of the occurrence of any of the following events:
(a) Sub-Investment Manager shall have been served or otherwise have
notice of any action, suit, proceeding, inquiry or investigation, at law or
in equity, before or by any court, public board or body, involving the
affairs of the Fund;
(b) Any of Sub-Investment Manager's portfolio managers for the Fund shall
have changed.
14. General.
(a) Sub-Investment Manager may perform its services through any employee,
officer, or agent of Sub-Investment Manager, and Investment Manager shall
not be entitled to the advice, recommendation, or judgment of any specific
person.
(b) If any term or provision of this Agreement or the application thereof
to any person or circumstances is held to be invalid or unenforceable to any
extent, the remainder of this
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Agreement or the application of such provision to other persons or
circumstances shall not be affected thereby and shall be enforced to the
greatest extent permitted by law.
(c) This Agreement shall be governed by and interpreted in accordance
with the laws of the State of Colorado exclusive of conflicts of laws.
IN WITNESS WHEREOF, the parties have caused this Agreement to be signed by
their duly authorized representatives, all as of the day and year first above
written.
LINCOLN INVESTMENT ADVISORS
CORPORATION
/s/ Xxxxx Xxxxxxx
-------------------------------------
Name: Xxxxx Xxxxxxx
Title: Second Vice President
JANUS CAPITAL MANAGEMENT LLC
/s/ Xxxxxxxxxxx X. Xxxx
-------------------------------------
Name: Xxxxxxxxxxx X. Xxxx
Title: Vice President
Accepted and Agreed to by:
LVIP JANUS CAPITAL APPRECIATION
FUND,
a series of Lincoln Variable
Insurance
Products Trust
/s/ Xxxxx X. Xxxxxxxxx
---------------------------------
Name: Xxxxx X. Xxxxxxxxx
Title: President
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ATTACHMENT
to the
SUB-INVESTMENT MANAGEMENT AGREEMENT
between
LINCOLN INVESTMENT ADVISORS CORPORATION
and
JANUS CAPITAL MANAGEMENT LLC
Investment Manager shall pay to Sub-Investment Manager a monthly fee,
calculated pursuant to Section 7 of the Agreement, as follows:
0.40% on the first $250,000,000 of average daily net assets of the Fund;
0.35% on the next
$500,000,000; 0.30% on the next $750,000,000; and 0.25% on any excess over
$1,500,000,000.
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