SUB-ADVISORY AGREEMENT LVIP VALUE OPPORTUNITIES FUND
LVIP
VALUE OPPORTUNITIES FUND
This Sub-Advisory Agreement
(“Agreement”) executed as of October 15, 2007, is between LINCOLN INVESTMENT
ADVISORS CORPORATION, a New Hampshire corporation (the “Adviser”), and COLUMBIA
MANAGEMENT ADVISORS, LLC, a Delaware limited liability company (the
“Sub-Adviser”).
WHEREAS,
Lincoln Variable Insurance Products Trust (the “Trust”), on behalf of the LVIP
Value Opportunities Fund (the “Fund”), has entered into an Investment Management
Agreement, dated April 30, 2007, with the Adviser, pursuant to which the Adviser
has agreed to provide certain investment management services to the Fund;
and
WHEREAS,
the Adviser desires to appoint Sub-Adviser as investment sub-adviser to provide
the investment advisory services to the Fund specified herein, and Sub-Adviser
is willing to serve the Fund in such capacity.
NOW,
THEREFORE, in consideration of the mutual covenants herein contained, and each
of the parties hereto intending to be legally bound, it is agreed as
follows:
1. SERVICES
TO BE RENDERED BY SUB-ADVISER TO THE FUND.
(a) Subject
to the direction and control of the Board of Trustees (the “Trustees”) of the
Trust, the Sub-Adviser will furnish continuously an investment program for the
Fund which shall at all times meet the diversification requirements of Section
817(h) of the Internal Revenue Code of 1986 (the “Code”). The
Sub-Adviser will make investment decisions on behalf of the Fund and place all
orders for the purchase and sale of portfolio securities. The
Sub-Adviser will be an independent contractor and will not have authority to act
for or represent the Trust or Adviser in any way or otherwise be deemed an agent
of the Trust or Adviser except as expressly authorized in this Agreement or as
agreed to in writing by the Trust, Adviser and the Sub-Adviser.
Pursuant
to this agreement Sub-Adviser shall possess full power and authority on behalf
of the Fund and at risk of, and in the name of, Fund (a) to buy, sell, exchange,
convert and otherwise trade in any and all securities and other assets as
Sub-Adviser may select; (b) to instruct any custodian of any security
or other asset of the Fund to deliver securities or assets sold, exchanged, or
otherwise disposed of from the Fund’s account; (c) to pay cash for securities or
assets delivered to any trustee or custodian upon acquisition for the Fund; (d)
to consent to any class action, plan or reorganization, merger, combination,
consolidation, liquidation or similar plan with reference to such securities or
other assets; (e) to exercise or dispose of subscription rights, warrants and
fractional shares as it deems to be in Fund’s best interests; (f)
to deal through accounts with one or more securities or commodities
brokerage firms, dealers or banks; and (g) generally to perform any other act
necessary to enable Sub-Adviser to carry out its obligations under this
Agreement. This discretionary authority shall remain in full force
and effect until Sub-Adviser receives written notice from the Adviser of its
termination. It is understood and agreed that Sub-Adviser shall have
no obligation whatsoever to initiate, pursue and/or prosecute any claim,
proceeding or action on behalf of the Fund or Adviser.
(b) The
Sub-Adviser, at its expense, will furnish (i) all necessary investment and
management facilities, including salaries of Sub-Adviser’s personnel, required
for it to execute its duties faithfully and (ii) administrative facilities,
including bookkeeping, clerical personnel and equipment as Sub-Adviser
determines is necessary for Sub-Adviser to execute its obligations under this
Agreement. The Sub-Adviser shall be responsible for commercially
reasonable expenses relating to the printing and mailing of required supplements
to the Fund’s registration statement, provided that such supplements relate
solely to a change in control of the Sub-Adviser or any change in the portfolio
manager or managers assigned by the Sub-Adviser to manage the Fund.
(c) The
Sub-Adviser shall vote proxies relating to the Fund’s investment securities in
the manner in which the Sub-Adviser believes to be in the best interests of the
Fund, including voting in accordance with the Sub-Adviser’s Proxy Voting
Policies and Procedures, and shall review its proxy voting activities on a
periodic basis with the Trustees. The Trust or Adviser may withdraw
the authority granted to the Sub-Adviser pursuant to this Section at any time
upon written notice. Sub-Adviser’s responsibilities with respect to
proxy voting shall be limited to submission of votes, which have been forwarded
to Sub-Adviser in a timely manner by the Adviser’s voting
agent. Sub-Adviser shall not have any supervisory responsibility with
respect to the Adviser’s voting agent.
(d) The
Sub-Adviser will select brokers and dealers to effect all portfolio transactions
subject to the conditions set forth herein (except to the extent such
transactions are effected in accordance with such policies or procedures as may
be established by the Board of Trustees.) In the selection of
brokers, dealers or futures commission merchants and the placing of orders for
the purchase and sale of portfolio investments for the Fund, the Sub-Adviser
shall use its best efforts to seek to obtain for the Fund the most favorable
price and execution available, except to the extent it may be permitted to pay
higher brokerage commissions for brokerage and research services as described
below. The Adviser reserves the right to direct the Sub-Adviser upon
written notice not to execute transactions through any particular broker(s) or
dealer(s), and the Sub-Adviser agrees to comply with such request within ten
business days of receiving written notice. In using its best efforts
to obtain for the Fund the most favorable price and execution available, the
Sub-Adviser, bearing in mind the Fund’s best interests at all times, shall
consider all factors it deems relevant, including by way of illustration: price;
the size of the transaction; the nature of the market for the security; the
amount of the commission; the timing of the transaction taking into account
market prices and trends; the reputation, experience and financial stability of
the broker, dealer, or futures commission merchant involved; and the quality of
service rendered by the broker, dealer or futures commission merchant in other
transactions. Subject to such policies as the Trustees may determine,
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 the Fund to pay a broker, dealer or futures commission merchant that
provides brokerage and research services to the Sub-Adviser an amount of
commission for effecting a portfolio investment transaction in excess of the
amount of commission another broker, dealer or futures commission merchant 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 or
futures commission merchant, viewed in terms of either that particular
transaction or the Sub-Adviser’s over-all responsibilities with respect to the
Fund and to other clients of the Sub-Adviser as to which the Sub-Adviser
exercises investment discretion. The Sub-Adviser shall maintain
records it has reasonably determined are adequate to demonstrate compliance with
this section.
On
occasions when the Sub-Adviser deems the purchase or sale of a security to be in
the best interest of the Fund as well as other clients of the Sub-Adviser, the
Sub-Adviser to the extent permitted by applicable laws and regulations, may, but
shall be under no obligation to, aggregate the securities to be purchased or
sold to attempt to obtain a more favorable price or lower brokerage commissions
and efficient execution. In such event, allocation of the securities
so purchased or sold, as well as the expenses incurred in the transaction, will
be made by the Sub-Adviser in compliance with Section 17(d) of the Investment
Company Act of 1940 and the rules established thereunder, Section 206 of the
Investment Advisers Act of 1940 and any rules established thereunder, and
pursuant to policies adopted by the Sub-Adviser and approved by the Board of
Trustees of the Fund.
(e) The
Sub-Adviser will provide reasonable advice and assistance to the Investment
Adviser as to the determination of the fair value of certain investments where
market quotations are not readily available for purposes of calculating net
asset value of the Fund in accordance with valuation procedures and methods
established by the Trustees.
(f) The
Sub-Adviser shall furnish the Adviser and the Board of Trustees with such
information and reports regarding the Fund’s investments as the Adviser deems
appropriate or as the Board of Trustees shall reasonably request. The
Sub-Adviser shall make its officers and employees available from time to time,
including attendance at Board of Trustees Meetings, at such reasonable times as
the parties may agree to review the Sub-Adviser’s investments on behalf of the
Fund and to consult with the Adviser or the Board of Trustees regarding the
investment affairs of the Fund.
(g) The
Sub-Adviser shall not consult with any other sub-adviser to the Fund or a
sub-adviser to a portfolio that is under common control with the Fund concerning
the assets of the Fund, except as permitted by the policies and procedures of
the Fund.
(h) In the performance of
its duties, the Sub-Adviser shall be subject to, and shall perform in accordance
with, the following: (i) provisions of the organizational documents
of the Trust that are applicable to the Fund; (ii) the investment objectives,
policies and restrictions of the Fund as stated in the Fund’s currently
effective Prospectus and Statement of Additional Information (“SAI”) as amended
from time to time; (iii) the Investment Company Act of 1940, as amended (the
“1940 Act”) and the Investment Advisers Act of 1940, as amended (the “Advisers
Act”); (iv) any written instructions and directions of the Trustees, the Adviser
or Fund management; and (v) its general fiduciary responsibility to the
Fund.
(i) The
Sub-Adviser shall provide reasonable assistance to the Fund in the preparation
of its registration statement, prospectus, shareholder reports, and other
regulatory filings, or any amendment or supplement thereto (collectively,
“Regulatory Filings”) and shall provide the Fund with disclosure for use in the
Fund’s Regulatory Filings, including, without limitation, any requested
disclosure related to the Sub-Adviser’s investment management personnel,
portfolio manager compensation, Codes of Ethics, firm description, investment
management strategies and techniques, and proxy voting policies.
(j) The
Sub-Adviser shall furnish the Adviser, the Board of Trustees and/or the Chief
Compliance Officer of the Trust and/or the Adviser with such information,
certifications and reports as such persons may reasonably deem appropriate or
may request from the Sub-Adviser regarding the Sub-Adviser’s compliance with
Rule 206(4)-7 of the Advisers Act, and compliance with Rule 38a-1 under the 1940
Act (including compliance with the Federal Securities Laws as defined under that
Rule). Such information, certifications and reports shall include,
without limitation, those regarding the Sub-Adviser’s compliance with the
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Ethics of the Sub-Adviser and the Trust and certifications as to the validity of
the information included in the Fund’s Regulatory Filings. The
Sub-Adviser shall make its officers and employees (including its Chief
Compliance Officer) available to the Adviser and/or the Chief Compliance Officer
of the Trust and/or the Adviser upon reasonable request to examine and review
the Sub-Adviser’s compliance program and its adherence thereto.
2. OTHER
AGREEMENTS.
(a) The
investment management services provided by the Sub-Adviser under this Agreement
are not to be deemed exclusive, and the Sub-Adviser shall be free to render
similar or different services to others. Sub-Adviser will not be
obligated to recommend for the Fund the purchase or sale of securities or other
investments that Sub-Adviser may purchase or sell for the accounts of
Sub-Adviser’s other clients.
(b) Adviser
and Fund hereby acknowledge that Sub-Adviser is affiliated with Bank of America
Corporation, a diversified financial services company that directly or through
affiliates provides a wide variety of banking, securities, insurance and other
investment services to a broad array of customers.
3. COMPENSATION
TO BE PAID BY THE ADVISER TO THE SUB-ADVISER.
(a) As
compensation for the services to be rendered by the Sub-Adviser under the
provisions of this Agreement, the Adviser will pay to the Sub-Adviser a fee each
month based on the average daily net assets of the Fund during the
month. Solely for the purpose of determining the promptness of
payments, payments shall be considered made upon mailing or wiring pursuant to
wiring instructions provided by the Sub-Adviser. Such fee shall be
calculated in accordance with the fee schedule applicable to the Fund as set
forth in Schedule
A attached hereto.
(b) The
fee shall be paid by the Adviser, and not by the Fund, and without regard to any
reduction in the fees paid by the Fund to the Adviser under its management
contract as a result of any statutory or regulatory limitation on investment
company expenses or voluntary fee reduction assumed by the
Adviser. Such fee to the Sub-Adviser shall be payable for each month
within 10 business days after the end of such month. If the
Sub-Adviser shall serve for less than the whole of a month, the foregoing
compensation shall be prorated.
4. AUTOMATIC
TERMINATION.
This
Agreement shall automatically terminate, without the payment of any penalty, in
the event of its assignment or in the event that the investment advisory
contract between the Adviser and the Fund shall have terminated for any
reason.
5. EFFECTIVE
PERIOD; TERMINATION AND AMENDMENT OF THIS AGREEMENT.
(a) This Agreement shall
become effective as of the date first written above, and shall remain in full
force and effect continuously thereafter (unless terminated automatically as set
forth in Section 4) until terminated as set forth below. This
Agreement shall automatically terminate in the event of its assignment or in the
event of termination of the Investment Management Agreement.
(b) This
Agreement shall continue in effect for a period of more than two years from the
date hereof only so long as continuance is specifically approved at least
annually by the Board of Trustees or by the vote of a majority of the
outstanding voting securities of the Fund as required by the 1940 Act; provided,
however, that this Agreement may be terminated at any time without the payment
of any penalty:
(i) by
the Board of Trustees of the Trust or by the vote of a majority of the
outstanding voting securities of the Fund;
(ii) by
the Adviser on 60 days’ written notice to the Sub-Adviser; or
(iii) by
the Sub-Adviser on 60 days’ written notice to the Adviser.
(c) Except
to the extent permitted by the 1940 Act or the rules or regulations thereunder
or pursuant to any exemptive relief granted by the Securities and Exchange
Commission (“SEC”), this Agreement may be amended by the parties only if such
amendment, if material, is specifically approved by the vote of a majority of
the outstanding voting securities of the Fund (unless such approval is not
required by Section 15 of the Investment Company Act of 1940 as interpreted by
the SEC or its staff) and by the vote of a majority of the Independent
Trustees.
6. CERTAIN
INFORMATION.
The
Sub-Adviser shall promptly notify the Adviser in writing of the occurrence of
any of the following events: (a) the Sub-Adviser shall fail to be registered as
an investment adviser under the Advisers Act and under the laws of any
jurisdiction in which the Sub-Adviser is required to be registered as an
investment adviser in order to perform its obligations under this Agreement, (b)
the Sub-Adviser has a reasonable basis for believing that the Fund has ceased to
qualify or might not qualify as a regulated investment company under Subchapter
M of the Code (c) the Sub-Adviser shall have been served or otherwise have
notice of any action, suit, proceeding, inquiry or investigation, at law or in
equity, before or by any court, public board or body, involving the affairs of
the Fund, and (d) any portfolio manager of the Fund shall have
changed.
7. NONLIABILITY
OF SUB-ADVISER.
(a) Except
as may otherwise be provided by the 1940 Act or the Advisers Act, in the absence
of willful misfeasance, bad faith or gross negligence on the part of the
Sub-Adviser, or reckless disregard of its obligations and duties hereunder,
neither the Sub-Adviser nor its officers, directors, employees or agents shall
be subject to any liability to the Fund or to any shareholder of the Fund, for
any act or omission in the course of, or connected with, rendering services
hereunder.
(b) Failure
by the Sub-Adviser to assure that any disclosure provided by the Sub-Adviser for
inclusion in the Fund’s Regulatory filings does not (i) contain any untrue
statement of a material fact or (ii) omit to state a material fact required to
be stated necessary to make such disclosure not misleading, shall constitute
gross negligence per se under sub-paragraph 7(a) above.
(c) Sub-Adviser
shall not be liable for any act or omission of Custodian or any broker which
effects transactions for the Fund. Without limiting the foregoing,
Sub-Adviser does not assume responsibility for the accuracy of information
furnished to it by the Fund, Adviser, Custodian, broker, or by any person on
whom it reasonably relies.
(d) Sub-Adviser
does not warrant that the portion of the assets of the Fund managed by
Sub-Adviser will achieve any particular rate of return or that its performance
will match that of any benchmark or index.
8.
INDEMNIFICATION.
Notwithstanding Section 7, the
Sub-Adviser agrees to indemnify the Adviser and the Funds for, and hold them
harmless against, any and all losses, claims, damages, liabilities (including
amounts paid in settlement with the written consent of the Sub-Adviser) or
litigation (including reasonable legal and other expenses) to which the Adviser
or the Funds may become subject as a result of any untrue statement of a
material fact contained in disclosure provided by the Sub-Adviser for inclusion
in the Fund’s Regulatory Filings or any omission of a material fact required to
be stated necessary to make such disclosure not misleading, provided that the
Sub-Adviser shall have been given written notice concerning any matter for which
indemnification is claimed under this Section.
9. RECORDS;
RIGHT TO AUDIT.
(a) The
Sub-Adviser agrees to maintain in the form and for the period required by Rule
31a-2 under the 1940 Act, all records relating to the Fund’s investments made by
the Sub-Adviser that are required to be maintained by the Fund pursuant to the
requirements of Rule 31a-1 under the 1940 Act. The Sub-Adviser agrees
that all records that it maintains on behalf of the Fund are the property of the
Fund, and the Sub-Adviser will surrender promptly to the Fund any such records
upon the Fund’s request; provided, however, that the Sub-Adviser may retain a
copy of such records. The Sub-Adviser will use records or information
obtained under this Agreement only for the purposes contemplated hereby, and
will not disclose such records or information in any manner other than expressly
authorized by the Fund, or if disclosure is expressly required by applicable
federal or state regulatory authorities or by this Agreement. In
addition, for the duration of this Agreement, the Sub-Adviser shall preserve for
the periods prescribed by Rule 31a-2 under the 1940 Act any such records as are
required to be maintained by it pursuant to this Agreement and shall transfer
all such records to any entity designated by the Adviser upon the termination of
this Agreement.
(b) The
Sub-Adviser agrees that all accounts, books and other records maintained and
preserved by it as required hereby will be subject at any time, and from time to
time, to such reasonable periodic, special and other examinations by the SEC,
the Fund’s auditors, any representative of the Fund, the Adviser, or any
governmental agency or other instrumentality having regulatory authority over
the Fund.
10. CONFIDENTIAL
INFORMATION
(a) The Sub-Adviser will use
records or information obtained under this Agreement only for the purposes
contemplated hereby, and will not disclose such records or information in any
manner other than expressly authorized by the Fund, or if disclosure is
expressly required by applicable federal or state regulatory authorities or by
this Agreement.
(b) Notwithstanding the
foregoing, the Sub-Adviser shall not disclose to any third party the “non-public
portfolio holdings” of the Fund, unless (1) there is a legitimate business
purpose for such disclosure, and (2) such third party agrees in writing with
Sub-Adviser to keep such information confidential and to not engage in trading
based upon such information. “Non-public portfolio holdings” means
holdings which have not first been made public by making a filing with the
Securities and Exchange Commission which is required to include such portfolio
holdings information.
448999-1
11. MARKETING
MATERIALS.
(a) The
Fund shall furnish to the Sub-Adviser, prior to its use, each piece of
advertising, supplemental sales literature or other promotional material in
which the Sub-Adviser or any of its affiliates is named. No such
material shall be used except with prior written permission of the Sub-Adviser
or its delegate. The Sub-Adviser agrees to respond to any request for
approval on a prompt and timely basis. Failure by the Sub-Adviser to
respond within ten (10) calendar days to the Fund shall relieve the Fund of the
obligation to obtain the prior written permission of the
Sub-Adviser.
(b) The
Sub-Adviser shall furnish to the Fund, prior to its use, each piece of
advertising, supplemental sales literature or other promotional material in
which the Fund, the Adviser or any of the Adviser’s affiliates is
named. No such material shall be used except with prior written
permission of the Fund or its delegate. The Fund agrees to respond to
any request for approval on a prompt and timely basis. Failure by the
Fund to respond within ten (10) calendar days to the Sub-Adviser shall relieve
the Sub-Adviser of the obligation to obtain the prior written permission of the
Fund.
12. GOVERNING
LAW.
This
Agreement shall be construed and interpreted in accordance with the laws of the
State of Delaware without regard to conflict of law principles, and the
applicable provisions of the 1940 Act or other federal laws and regulations
which may be applicable. To the extent that the applicable law of the
State of Delaware or any of the provisions herein, conflict with the applicable
provisions of the 1940 Act or other federal laws and regulations which may be
applicable, the latter shall control.
13. SEVERABILITY/INTERPRETATION.
If any
provision of this Agreement is held invalid by a court decision, statute, rule
or otherwise, the remainder of this Agreement shall not be affected
thereby. This Agreement shall be binding upon and shall inure to the
benefit of the parties hereto and their respective successors. Where the effect
of a requirement of the 1940 Act reflected in any provision of this Agreement is
altered by a rule, regulation or order of the SEC, whether of special or general
application, such provision shall be deemed to incorporate the effect of such
rule, regulation or order.
14. NOTICES.
Any notice that is required to be given
by the parties to each other under the terms of this Agreement shall be given in
writing, delivered, or mailed to the other party, or transmitted by facsimile 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:
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(a)
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If
to the Sub-Adviser:
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Columbia
Management Advisors, LLC
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▇▇▇▇▇▇,
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Attn: ▇▇▇▇▇▇▇▇
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Facsimile
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(b)
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If
to the Adviser:
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Lincoln
Investment Advisors Corporation
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Attn:
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Facsimile
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15. CERTAIN
DEFINITIONS.
For the
purposes of this Agreement, the terms “vote of a majority of the outstanding
voting securities,” “interested persons,” and “assignment” shall have the
meaning defined in the 1940 Act, and subject to such orders or no-action letters
as may be granted by the SEC and/or its staff.
IN
WITNESS WHEREOF, the parties have caused this instrument to be signed by their
duly authorized representatives, all as of the day and year first above
written.
LINCOLN
INVESTMENT ADVISORS CORPORATION
_________________________________
Name:Title:
COLUMBIA
MANAGEMENT ADVISORS, LLC
_________________________________
Name:
Title:
448999-1
Accepted
and agreed to
as of the
day and year
first
above written:
on behalf
of the LVIP Value Opportunities Fund
_______________________________
Name:
Title:
448999-1