Exhibit 77(Q)(e)(1)
SUB-ADVISORY AGREEMENT
ING EQUITY TRUST
AGREEMENT made this 22nd day of July, 2005 between ING Investments,
LLC, an Arizona limited liability company (the "Manager"), and NWQ Investment
Management Company, LLC, a Delaware limited liability company (the
"Sub-Adviser") (the "Agreement").
WHEREAS, ING Equity Trust (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;
and
WHEREAS, the Fund may offer shares of additional series in the future;
and
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 premises and 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 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 as the Fund's agent and attorney-in-fact
with full power
and authority in connection with such assets without prior consultation with any
of the Manager, the Fund or the Fund's Board of Trustees. 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, cash 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' respective investment objective or objectives,
policies, and restrictions as agreed upon by the Manager and the Sub-Adviser and
as set forth in the Fund's Registration Statement filed with the Securities and
Exchange Commission ("SEC"), as amended to reflect such agreement by the parties
hereto, 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 conform with the 1940 Act and all
rules and regulations thereunder, all other applicable federal and
state laws and regulations, with any applicable procedures adopted by
the Fund's Board of Trustees of which the Sub-Adviser has been sent a
copy, and the provisions of the Registration Statement of the Fund
filed under the Securities Act of 1933 (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. If a procedure applicable to a Series is to be
revised, the Manager will provide reasonable prior notice to the
Sub-Adviser of the proposed revisions, including a copy of the
procedure as proposed to be revised.
(b) 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.
The Manager will be solely responsible for making all required
filings of Form N-PX with the appropriate regulatory bodies.
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The Sub-Adviser will make appropriate personnel
reasonably available for consultation for the purpose of
reviewing with representatives of the Manager and/or the Board
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 not be liable to the Manager, the Fund or
any of the Fund's shareholders as a result of any act, conduct
or omission of the Manager in connection with its voting of
proxies associated with securities contained in any 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.
(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, as needed, 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
record keeping 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 nor a
pricing agent or the pricing agent for the Fund. The
Sub-Adviser shall not be liable for any valuation determined
or adopted by the Fund, the Fund's custodian and/or portfolio
accounting agent, as contemplated in this Agreement, unless
such determination is made based upon information provided by
the Sub-Adviser that is materially incorrect or incomplete as
a result of the Sub-Adviser's gross negligence.
(v) The Sub-Adviser will provide the Manager, no
later than the 10th business day following the end of each
Series' semi-annual period and fiscal year, a letter to
shareholders (to be subject to review and editing by the
Manager) containing a discussion of those factors referred to
in Item 5(a) of 1940 Act Form N-1A in respect of both the
prior quarter and the fiscal year to date.
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(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 by the 10th business day of the
following month.
(c) 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.
(i) A performance comparison to the Series benchmark
listed in the prospectus as well as a comparison to other
mutual funds as listed in the rankings prepared by Lipper
Analytical Services, Inc., Morningstar, Inc., or similar
independent services that monitor the performance of mutual
funds or with other appropriate indexes of investment
securities;
(ii) Composition of the assets of each Series'
portfolio and the impact of key portfolio holdings and sector
concentrations on the Series; and
(iii) Confirmation of each Series' current investment
objective and Sub-Adviser's projected plan to realize the
Series' investment objectives.
(d) The Sub-Adviser will assist the Manager, as reasonably
requested, in its discussions with Morningstar to clarify any style box
conflicts with each Series' style and the anticipated timeframe in
which Morningstar will remedy such conflicts, if any.
(e) 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 (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.
(f) The Sub-Adviser will provide reports to the Fund's Board
of Trustees for consideration at meetings of the Board of Trustees 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.
3. Broker-Dealer Selection. The Sub-Adviser is authorized to make
decisions to buy and sell securities and other investments for each Series'
portfolio, broker-dealer selection, and negotiation of 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, taking into account factors specified in the
prospectus and/or statement of additional
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information for the Fund, the price of the security or other investment
(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 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, 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 overall
responsibilities with respect to the Series and to its other clients as to which
it exercises investment discretion. To the extent consistent with these
standards, the Sub-Adviser is further authorized to allocate the orders placed
by it on behalf of a Series managed by the Sub-Adviser to an affiliated
broker-dealer of either the Sub-Adviser or the Manager 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.
4. Representations.
(a) The Sub-Adviser agrees and represents that:
(i) the information it has provided for inclusion in the
Post-Effective Amendment to the Registration Statement for the
Fund filed with the SEC regarding the Series, including the
prospectus and statement of additional information
(collectively, "Registration Materials") is true and does not
omit any statement of a material fact which is 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; and
(ii) the Sub-Adviser has reviewed such information, as
included in the Registration Materials, and, to the
Sub-Adviser's knowledge, with respect to the disclosure
contained in the Registration Materials based upon
information provided by the Sub-Adviser, such disclosure
contains no untrue statement of a material fact and does not
omit any statement of a material fact which is 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.
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(b) 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 a copy of the
Sub-Adviser's Form ADV, Part II, and will promptly provide to the
Manager any updates or revisions to the Sub-Adviser's Form ADV.
(c) The Manager agrees and represents that:
(i) the Manager and representatives of the Fund prepared
the Registration Materials and the Registration Materials
(including the prospectus for each Series) comply in all
material respects with all applicable laws, rules and
regulations in each relevant jurisdiction;
(ii) the Registration Materials (including the prospectus
for each Series) do not contain any untrue statement of a
material fact or omit to state any material fact required by
any applicable law to be stated therein or necessary to make
the statements therein, in light of the circumstances under
which they were made, not misleading under applicable law;
and
(iii) the Manager and the Fund and all of their respective
officers, directors, partners, employees and agents will
comply, in all material respects, with all applicable laws
and rules related to the Manager, the Fund, the offering and
sale of shares of the Series and the business of the Fund
and the Sub-Adviser shall not be liable to the Manager, the
Fund or any of the Fund's shareholders as a result of any
act, conduct or omission of the Manager or its officers,
employees, affiliates or agents.
5. Expenses. During the term of this Agreement, the Sub-Adviser will
pay all expenses incurred by it and its staff and for their activities in
connection with its portfolio management duties under this Agreement. The
Manager or the Fund shall be responsible for all the expenses of the Fund's
operations. In addition, if the Fund is required, under applicable law, to
supplement the Registration Materials because of a change requested by the
Sub-Adviser, the Sub-Adviser will reimburse the Fund and/or the Manager for the
cost preparing and distributing such supplement, unless the Sub-Adviser is
requesting the change in order to comply with an applicable law, rule or
regulation.
6. 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; provided, however, that if the Fund fails to pay
the Manager all or a portion of the management fee under said Management
Agreement when due, and the amount that was paid is insufficient to cover the
Sub-Adviser's fee under this Agreement for the period in question, then
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the Sub-Adviser may enforce against the Fund any rights it may have as a
third-party beneficiary under the Management Agreement and the Manager will take
all steps appropriate under the circumstances to collect the amount due from the
Fund.
7. Marketing Materials.
(a) 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.
(b) 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.
(c) Neither the Manager nor the Fund, nor any affiliate of
either, will use the registered trademarks, service marks, logos, names
or other proprietary designations of NWQ, its subsidiaries and/or
affiliates without NWQ's prior written approval. The Manager and the
Fund will submit to NWQ for its prior written approval any advertising
or promotional material using NWQ's name or any name associated with an
affiliate of NWQ, or any trademarks, service marks, logos or
proprietary designations related to any of the foregoing.
8. Compliance.
(a) The Sub-Adviser shall use reasonable compliance techniques
as the Manager or the Board of Trustees may adopt, including any
written compliance procedures.
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(b) The Sub-Adviser agrees that it shall promptly notify the
Manager and the Fund (i) in the event that the SEC has censured the
Sub-Adviser; placed limitations upon its activities, functions or
operations; suspended or revoked its registration as an investment
adviser; or has commenced proceedings or an investigation that may
result in any of these actions, or (ii) 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 for the Fund
(which describes the Series), or any amendment or supplement thereto,
or if any statement contained therein that becomes untrue in any
material respect.
(c) The Manager agrees that it shall promptly notify the
Sub-Adviser (i) in the event that the SEC has censured the Manager or
the Fund; placed limitations upon either of their activities,
functions, or operations; suspended or revoked the Manager's
registration as an investment adviser or the Fund's registration under
the 1940 Act; or has commenced proceedings or an investigation against
either the Manager or the Fund that may result in any of these actions,
or (ii) 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.
9. Books and Records. The Sub-Adviser hereby agrees that all records
which it maintains for the Series are the property of the Fund and further
agrees to surrender promptly to the Fund any of such records upon the Fund's or
the Manager's request in compliance with the requirements of Rule 31a-3 under
the 1940 Act, although the Sub-Adviser may, at its own expense, make and retain
a copy of such records. 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.
10. Cooperation; Confidentiality. Each party to this Agreement agrees
to provide reasonable cooperation 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
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
pertaining to or furnished by the Sub-Adviser to the Fund or the Manager, 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, the Manager or the Fund, or if available
from a source other than the Manager, Sub-Adviser or the Fund.
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11. Exclusivity.
(a) Until the second 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 two year period, Sub-Adviser may enter into an
investment advisory agreement with an Excluded Fund that: (1) is
organized and/or offered by Nuveen Investments, Inc. and/or any
subsidiary or affiliate thereof ("Nuveen"); and (2) has a gross
management fee equal to or higher than the lesser of (x) the gross
management fee of the corresponding Series or (y) 1.00%. For purposes
of the foregoing clause (2), any breakpoint fees attributable to an
Excluded Fund organized and/or offered by Nuveen, whether fund-specific
or complex-wide, which would have the effect of reducing the otherwise
stated management fee level, shall not be taken into account.
(b) For purposes of clarification, it is understood and agreed
by the parties that this Section 11(a) shall have no force, effect on
or applicability to any fund, pool of assets, collective investment
scheme or any other client to which the Sub-Adviser provides advisory
services as of the Effective Date of this Agreement and that Section
11(a) shall never be applicable to any client of Sub-Adviser that is
not an Excluded Fund, except as provided in the case of Nuveen above.
Furthermore, for purpose of clarity, it is understood and agreed by the
parties hereto that Section 11(a) shall not apply to any institutional
fund or share class providing for minimum investments of $250,000 or
more nor shall it apply to the sale of any "R" class of shares
associated with any fund organized and/or offered by Nuveen. In
addition, this Section 11 will not apply in the case where the
Sub-Adviser manages a "sleeve" of a fund or to any "fund of funds,"
"manager of managers" or "multi-manager" arrangement or other
collective investment scheme(s). Lastly, it is understood and agreed by
the parties to this Agreement that this Section 11 shall immediately
have no further force, effect on or applicability to the parties to
this Agreement upon the second anniversary of the Effective Date of
this Agreement or, with respect to any Series identified at Schedule A
to this Agreement, if the Agreement is terminated with respect to that
Series prior to the second anniversary of such Effective Date.
12. Prohibited Conduct. The Sub-Adviser may not engage in prior
consultation 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. This Section 12 does
not apply to Sub-Adviser's disclosure of a Series' portfolio holdings in
accordance with the Fund's policies and procedures governing portfolio holdings
disclosure.
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13. 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.
14. Control. Notwithstanding any other provision of the Agreement, it
is understood and agreed that day-to-day management of the Series will be
delegated to the Sub-Adviser, subject to the oversight of the Manager and the
Fund's Board of Trustees, which shall at all times retain the ultimate
responsibility for and control of all functions performed pursuant to this
Agreement. The Fund has reserved the right to reasonably direct any action
hereunder taken on its behalf by the Sub-Adviser.
15. Liability. 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
(a) 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 (b) shall not be liable for, or subject to any damages, expenses,
or losses in connection with, any act or omission connected with or arising out
of any services rendered under this Agreement, except by reason of willful
misfeasance, bad faith, or gross negligence in the performance of the
Sub-Adviser's duties, or by reason of reckless disregard of the Sub-Adviser's
obligations and duties under this Agreement.
16. 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, bad faith or reckless
disregard in the performance of its duties to the Fund (which could
include a negligent action or a negligent omission to act), or by
reason of the Manager's breach of its obligations and duties under this
Agreement, or (2) may be based upon any 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 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
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information furnished to the Manager or the Fund or to any affiliated
person of the Manager by a Sub-Adviser Indemnified Person; 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.
(b) Notwithstanding Section 15 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 as a result of the Sub-Adviser's negligence, willful
misfeasance, bad faith or reckless disregard in the performance of its
duties to the Fund (which could include a negligent action or a
negligent omission to act), or by reason of the Sub-Adviser's breach of
its obligations and duties under this Agreement, or (2) may be based
upon any 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 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, if 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; 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 16 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
11
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, 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 16 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.
12
17. 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 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
continue on an annual basis thereafter with respect to each Series
covered by this Agreement; provided that such annual continuance is
specifically approved each year by (i) 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 (ii) 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 (i) that
this Agreement has not been approved by the holders of a majority of
the outstanding shares of any other Series or (ii) that this agreement
has not been approved by the vote of a majority of the outstanding
shares of the Fund, unless such approval shall be required by any other
applicable law or otherwise. Notwithstanding the foregoing, this
Agreement may be terminated with respect to any Series covered by this
Agreement: (i) by the Manager at any time, upon sixty (60) days'
written notice to the Sub-Adviser and the Fund, (ii) 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 (iii) by the Sub-Adviser upon ninety (90) days' written
notice 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 Manager not to
exceed thirty (30) additional days beyond the initial ninety-day notice
period; provided, however, that the Sub-Adviser may terminate this
Agreement at any time without penalty, with respect to any Series
immediately, effective upon written notice to the Manager and the Fund,
in the event (i) 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 under applicable law or pursuant to its
respective contract with the Fund; (ii) the Manager becomes bankrupt or
otherwise incapable of carrying out its obligations under this
Agreement or the Management Agreement; and/or (iii) 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, all records of
each Series for which the Agreement is terminated shall promptly be
returned to the Manager or the Fund, free from any claim or retention
of rights in such record by the Sub-Adviser, although the Sub-Adviser
may, at its own expense, make and retain a copy of such records. 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
13
in the manner described above, the Sections or Paragraphs numbered 9,
10, 13, 14, 15 and 16 of this Agreement shall remain in effect, as
well as any applicable provision of this Section numbered 17 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 6.
(b) Notices. Any notice must be in writing and shall be
sufficiently given (1) when delivered in person, (2) when dispatched by
telegram or electronic facsimile transfer (confirmed in writing by
postage prepaid first class air mail simultaneously dispatched), (3)
when sent by internationally recognized overnight courier service (with
receipt confirmed by such overnight courier service), or (4) when 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.
If to the Fund:
ING Equity Trust
0000 Xxxx Xxxxxxxxxx Xxxxx Xxxx
Xxxxxxxxxx, XX 00000
Attention: Xxxx X. Xxxxxxx, Xx.
If to the Manager:
ING Investments, LLC
0000 Xxxx Xxxxxxxxxx Xxxxx Xxxx
Xxxxxxxxxx, XX 00000
Attention: Xxxx X. Xxxxxxx, Xx.
If to the Sub-Adviser:
NWQ Investment Management Company, LLC
0000 Xxxxxxx Xxxx Xxxx
Xxx Xxxxxxx, XX 00000
Attention: General Counsel
18. 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 amendment of this Agreement shall be effective
until approved as required by applicable law.
19. 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 conflicts of laws
principle thereof. The term "affiliate" or "affiliated person" as used
14
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) To the extent permitted under Section 17 of this
Agreement, this Agreement may only be assigned by any party with the
prior written consent of the other parties.
(e) 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.
(f) Except as otherwise contemplated in this Agreement,
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.
(g) This agreement may be executed in counterparts.
15
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/ Xxxx Xxxxx
Xxxx Xxxxx
Senior Vice President
NWQ INVESTMENT MANAGEMENT COMPANY,
LLC
By: /s/ Xxxxxxx X. Goshtigan
Name: Xxxxxxx X. Goshtigan
Title: Senior Vice President
16
SCHEDULE A
with respect to the
SUB-ADVISORY AGREEMENT
between
ING INVESTMENTS, LLC
and
NWQ INVESTMENT MANAGEMENT COMPANY, LLC
Series Annual Sub-Adviser Fee
(as a percentage of average daily net assets)
ING MidCap Value Choice Fund 0.50% on the initial $250 million;
0.55% thereafter at any aggregate asset level
ING SmallCap Value Choice Fund 0.50% on the initial $150 million;
0.60% thereafter at any aggregate asset level
17
