SUB-ADVISORY AGREEMENT
(for Sub-Advised Funds)
This Sub-Advisory Agreement executed as of , 2005, is between
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[LINCOLN ENTITY'S NAME], a corporation (the "Adviser"), and
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[SUB-ADVISOR'S NAME], a corporation (the "Sub-Adviser").
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WHEREAS, Lincoln Variable Insurance Products Trust (the "Trust"), on behalf
of the Fund (the "Fund") has entered into an Investment
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Management Agreement, dated , 2005, with the Adviser, pursuant to
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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
subadviser 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 control of the Board of Trustees (the "Trustees") of the
Trust, the Sub-Adviser, at its expense, 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.
(b) The Sub-Adviser, at its expense, will furnish (i) all necessary
investment and management facilities, including salaries of personnel, required
for it to execute its duties faithfully and (ii) administrative facilities,
including bookkeeping, clerical personnel and equipment necessary for the
efficient conduct of the investment affairs of the Fund (excluding determination
of net asset value per share, portfolio accounting and shareholder accounting
services).
(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, and shall review its proxy voting activities on a
periodic basis with the Trustees. Upon sixty (60) days' written notice to the
Sub-Adviser, the Trustees may withdraw the authority granted to the Sub-Adviser
pursuant to this Section.
(d) 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 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. 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.
(e) The Sub-Adviser will provide 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 to the Adviser
from time to time at such reasonable times as the parties may agree to review
investment policies of the Fund and to consult with the Adviser 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
stated investment objectives, policies and restrictions of the Fund; (iii) the
Investment Company Act of 1940 (the "1940 Act") and the Investment Advisers Act
of 1940 (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.
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2. OTHER AGREEMENTS.
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 so long as its ability to render
the services provided for in this Agreement shall not be impaired thereby.
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. 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 upon its execution, 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.
Termination of this Agreement pursuant to this Section 5 shall be without the
payment of any penalty.
(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 in conformance with the 1940 Act; provided, however, that this
Agreement may be terminated at any time:
(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
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(iii) by the Sub-Adviser on 60 days' written notice to the Adviser.
(c) No amendment to this Agreement shall be effective unless (i) there is
written consent of the parties to this Agreement and (ii) the amendment is
approved in a manner consistent with the 1940 Act as interpreted or permitted by
the SEC and/or its staff.
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) the President of the Sub-Adviser or any portfolio manager of
the Fund shall have changed.
7. NONLIABILITY OF SUB-ADVISER.
(a) 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, the Sub-Adviser shall not 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 the investment program for
the Fund meets the diversification requirements of Section 817(h) of the Code,
as required by Section 1 of this Agreement, shall constitute gross negligence
per se under sub-paragraph 7(a) above.
8. INDEMNIFICATION.
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 legal and other expenses) to which the
Adviser or the Funds may become subject as a result of any failure by the
Sub-Adviser, whether unintentional or in good faith or otherwise, to adequately
diversify the investment program of the Fund pursuant to the requirements of
Section 817(h) of the Code, and the regulations issued thereunder, provided that
the Sub-Adviser shall have been given written notice concerning any matter for
which indemnification is afforded under this Section.
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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 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. 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 Securities and Exchange Commission, 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. 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.
11. GOVERNING LAW.
This Agreement shall be governed by the laws of the State of Delaware,
without regard to conflict of law principles; provided, however, that nothing
herein shall be construed as being inconsistent with the 1940 Act.
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12. 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.
13. 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 Securities and Exchange Commission.
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.
[ADVISER'S NAME]
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Name:
Title:
[SUB-ADVISER'S NAME]
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Name:
Title:
Accepted and agreed to
as of the day and year
first above written:
[FUND NAME]
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Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: President
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SCHEDULE A
Fee Schedule
The Adviser shall pay to the Sub-Adviser compensation at an annual rate as
follows:
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