SUBADVISORY AGREEMENT
EX-28.d.3.i
THIS AGREEMENT, is made and entered into as of the 2nd day of April, 2009, by and among
NATIONWIDE MUTUAL FUNDS (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 FEDERATED INVESTMENT MANAGEMENT COMPANY, a Delaware statutory
trust (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 (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 is willing and possesses legal authority under its governing documents to
render such services subject to the terms and conditions set forth in this Agreement;
WHEREAS, 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 do not and
cannot object to such activities.
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 in
writing thereof, as supplemented or amended from time to time (collectively referred to
hereinafter as the “Prospectus”) and subject to the directions 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. Consistent with the foregoing,
the Sub-Adviser shall have the authority to purchase, hold and sell investments for the
Subadviser Assets without prior consultation with the Adviser or the Trusts’ Board of
Trustees. 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) 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 Internal
Revenue Code of 1986, as amended (the “Code”), and all other applicable federal and state
laws and regulations. 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 Code, and all other applicable federal and state laws and
regulations. 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, if applicable, Section 817(h) of the Code. In
connection with such compliance tests, the Adviser shall provide written notice to the
Subadviser at least 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, if applicable, 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 in accordance
with Adviser’s notice within the time permitted under the Code thereunder. Subadviser’s
actions taken pursuant to Adviser’s notice shall not constitute any admission of wrongdoing
by Subadviser and Subadviser shall be protected for acting in accordance with Adviser’s
notice.
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, subject to the terms and conditions of this Agreement and to
the same extent as if Subadviser had performed such services), 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 for which Subadviser timely receives a proxy, 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. Subadviser (or its designee) shall vote any proxies received
in a timely manner in accordance with Subadviser’s proxy voting policies and procedures as
in effect from time to time. 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 has established a written procedure for proxy voting in compliance with
current applicable rules and regulations, including, but not limited to, Rule 30b1-4 (Report
of Proxy Voting Record) under the 0000 Xxx. The Subadviser will provide the Adviser or its
designee, a copy of such procedure and establish a mutually acceptable 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.
(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 upon Adviser’s reasonable request.
(e) Brokerage. The Subadviser is authorized, subject to the supervision of the
Adviser and the general 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 or dealers (including, to the extent permitted by
applicable law, “affiliated persons” of Subadviser (as such term is defined under the 1940
Act)) (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 the best
execution available for each Fund in accordance with Subadviser’s best execution policies
and applicable law, 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 seek to obtain for the Fund the best 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 and its affiliates with respect to the accounts as to which
it and its affiliates exercise investment discretion.
It is recognized that the services provided by such Brokers may be useful to the
Subadviser in connection with the Subadviser’s and its affiliates’ services to other
clients. On occasions when the Subadviser deems the purchase or sale of a security to be in
the best interests of the Fund with respect to the Subadviser Assets as well as other
clients of the Subadviser and its affiliates, 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 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 in good faith, 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 reasonable information/certifications or perform such reasonable additional acts with
respect to the Subadviser Assets as are necessary 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 of or 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 (and in such form as mutually agreed by the
parties) 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 (subject in all cases to the terms and conditions of this Agreement)
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.
(j) Valuation Assistance. The Subadviser shall not be responsible for the
provision of administrative, bookkeeping or accounting services to the Trust. The Adviser
hereby acknowledges that the Subadviser is not responsible for pricing portfolio securities.
Notwithstanding the foregoing, the Subadviser agrees that, upon request of the Adviser, it
shall reasonably assist the Adviser in obtaining prices for portfolio securities and, to the
extent it may lawfully do so, provide the Adviser with reasonable information, data or
analyses in its possession. The Adviser and the Trust acknowledge that any such
information, data or analyses may be proprietary to the Subadviser or otherwise consist of
nonpublic information, agree that nothing in this Agreement shall require Subadviser to
provide any information, data or analysis in contravention of applicable legal or
contractual requirements, and agree to use any such information only for the purpose of
pricing portfolio securities and to maintain their confidentiality.
(k) 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.
(l) 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, 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.
3. 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.
4. 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 has filed a notice of exemption pursuant to Rule 4.14 under the
Commodity Exchange Act, as amended (the “CEA”), with the Commodity Futures Trading
Commission (the “CFTC”) and the National Futures Association or is not required to file such
exemption;
(c) The Subadviser is a Delaware statutory 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 Subadviser of this Agreement are
within the Subadviser’s powers and have been duly authorized by all necessary actions of its
trustees 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 material 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 provided to the Adviser and the Trust in connection
with the execution of this Agreement 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, 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
therein, in light of the circumstances under which they were made, not misleading.
5. 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 provided to the Subadviser and the Trust in connection
with the execution of this Agreement 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, 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 therein, 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 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.
6. 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 prior
to the execution of this Agreement.
7. Survival of Representations and Warranties; Duty to Update Information. All
representations and warranties made by the Subadviser, the Adviser and the Trust pursuant to
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 aware that any of the foregoing
representations and warranties are no longer true or accurate in all material effects.
8. Liability and Indemnification.
(a) Liability. The Subadviser shall exercise its best judgment in rendering
its services in accordance with the terms of this Agreement. In the absence of willful
misfeasance, bad faith or gross negligence on the part of the Subadviser or a reckless
disregard by Subadviser of its duties hereunder, the Subadviser, each of its affiliates,
affiliated persons 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, or any Affiliate or Controlling Persons of any of
them, 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 or for any act or omission in the case of, or connected with, rendering
services hereunder. The Adviser shall exercise its best judgment in rendering its
obligations in accordance with the terms of this Agreement. 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 by Adviser 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, its Affiliates or its Controlling
Persons 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 or for any act or omission in the case of, or connected with, rendering
services hereunder. Notwithstanding the foregoing, nothing herein shall relieve the Adviser
and the Subadviser from any of their non-waivable obligations under applicable law,
including, without limitation, any such obligations under the federal and state securities
laws and the CEA.
(b) Indemnification. Subject to Section 10(a) above, 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. Subject to Section 10(a) above, 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
Subadviser, its Affiliates or its Controlling Persons may sustain 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 Subadviser, its Affiliates or its Controlling Persons may sustain 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.
The Subadviser shall not be liable under or in connection with this Agreement for
(i) any acts of the Adviser, any other subadviser to the Fund, the Trust or the Fund, or any
of the Fund’s shareholders, or any Affiliate or Controlling Persons of any of them, 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, any other subadviser to the Fund, the
Trust or the Fund, or any of the Fund’s shareholders, or any Affiliate or Controlling
Persons of any of them, 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 required to be separately
maintained by Subadviser. 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.
9. 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:
| a) | 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), in each case, upon not more than 60 days’ written notice to the Subadviser; | ||
| b) | By any party hereto immediately upon written notice to the other parties in the event of a breach of any provision of this Agreement by either of the other parties; or | ||
| c) | By the Subadviser upon not less than 60 days’ written notice to the Adviser and the Trust, or by the Adviser upon not less than 60 days’ written notice to the Subadviser and the Trust. |
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.
10. 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.
11. 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 to
the Subadviser, 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. Notwithstanding the foregoing, neither the
Subadviser nor its Affiliates shall identify the Adviser, the Fund or the Trust in any
responses to requests for information/proposals without the prior written consent of the
Adviser.
(c) Nothing in this Section 13 shall be construed as preventing, or requiring consent
for, the use of the name of the other party or its Affiliates, or clients, in any
disclosures required by applicable law.
(d) The Subadviser shall give the Trust, for the term of this Agreement, a royalty
free, nonexclusive, nontransferable right to use the name “Federated” (hereinafter referred
to as a “Xxxx”) in the United States as part of the name of the series of the Trust
identified on Exhibit A, provided the use of such names is approved by the Subadviser in
advance in writing. Such right does not include the right to allow third parties to use the
Xxxx except as specifically provided in this Agreement. Neither the Trust (or its series)
nor the Adviser shall retain any right to use of the Xxxx after the termination of this
Agreement. Upon termination of this Agreement, the Adviser will (and will cause the Trust
(and its series) to) immediately terminate all use of the Xxxx and destroy any remaining
unused sales documentation, promotional, marketing, advertising or other written printed or
electronic material or performance information that contains the Xxxx. The Adviser agrees
to use its best efforts to ensure that the nature and quality of the services rendered in
connection with the Xxxx shall conform to the terms of this Agreement and any amendments
thereto. The Adviser further agrees (and to cause the Trust (and its series)) to comply
with any reasonable requirements for the use of the Xxxx provided from time to time by the
Subadviser to the Adviser or the Trust in writing.
12. 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.
13. 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 of
confidential information of the Adviser or the Trust, or Subadviser has authorized such
disclosure of confidential information of Subadviser;
(b) Court or Regulatory Authority; Applicable Law; Necessary Disclosure for
Performance. Disclosure of such information is expressly permitted, required or
requested by a court or other tribunal of competent jurisdiction or applicable federal or
state regulatory authorities or under applicable law, or disclosure of such information is
necessary to perform the services to be performed under this Agreement;
(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 which is known to the disclosing party;
(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) without restriction on its disclosure and without
breach of this Agreement or of a similar confidential disclosure agreement regarding such
information which is known to the disclosing party; or
(f) Independently Developed. The party independently developed such
information.
14. 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: | ||
| Federated Investment Management Company |
| Federated Investors Tower 0000 Xxxxxxx Xxxxxx Xxxxxxxxxx, XX 00000-0000 Attention: Xxxxx Xxxxxxxx Facsimile: (000) 000-0000 |
|||
| (b) | If to the Adviser: | ||
| Nationwide Fund Advisors 0000 Xxxxx Xxxx Xxxxxxxxxxxx, XX 00000 Attention: Legal Department Facsimile: (000) 000-0000 |
|||
| (c) | If to the Trust: | ||
| Nationwide Mutual Funds 0000 Xxxxx Xxxx Xxxxxxxxxxxx, XX 00000 Attention: Legal Department Facsimile: (000) 000-0000 |
15. 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.
16. 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.
17. 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.
18. Captions. The captions herein are included for convenience of reference only and
shall be ignored in the construction or interpretation hereof.
19. 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.
20. 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
21. Nationwide Mutual Funds and its Trustees. The terms “Nationwide Mutual Funds” and
the “Trustees of Nationwide Mutual Funds” 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.
22. 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
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. Federated Investment Management Company. The Trust and the Adviser are hereby
expressly put on notice of the limitation of liability as set forth in the Declaration of Trust of
the Subadviser and agree that the obligations assumed by the Subadviser pursuant to this
Subadvisory Agreement will be limited in any case to the Subadviser and its assets and the Adviser
and the Trust shall not seek satisfaction of any such obligations from the shareholders of the
Subadviser, the trustees of the Subadviser, officers, employees or agents of the Subadviser, or any
of them.
[The remainder of this page is intentionally left blank.]
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the day and year first
written above.
| TRUST | ||||
| NATIONWIDE MUTUAL FUNDS | ||||
| By: | /s/ Xxxxxxx Xxxxxxxx | |||
| Name: | Xxxxxxx Xxxxxxxx | |||
| Title: | President and CEO, Nationwide Funds Group | |||
| ADVISER | ||||
| NATIONWIDE FUND ADVISORS | ||||
| By: | /s/ Xxxxxxx Xxxxxxxx | |||
| Name: | Xxxxxxx Xxxxxxxx | |||
| Title: | President, Nationwide Fund Advisors | |||
| SUBADVISER | ||||
| FEDERATED INVESTMENT MANAGEMENT COMPANY | ||||
| By: | /s/ Xxxx X. Xxxxxx | |||
| Name: | Xxxx X. Xxxxxx | |||
| Title: | President and CEO Federated Advisory Companies | |||
