EX-77.(e)(1)
INTERIM SUB-ADVISORY AGREEMENT
ING VARIABLE PORTFOLIOS, INC.
INTERIM AGREEMENT made this 30th day of September 2006 (the "Agreement")
between ING Investments, LLC, an Arizona limited liability company (the
"Manager"), and BlackRock Advisors, LLC, a Delaware limited liability company
(the "Sub-Adviser").
WHEREAS, the ING Variable Portfolios, Inc. (the "Fund") is registered
under the Investment Company Act of 1940, as amended (the "1940 Act"), as an
open-end, management investment company; and
WHEREAS, the Fund is authorized to issue separate series, each series
having its own investment objective or objectives, policies, and limitations;
and
WHEREAS, the Fund may offer shares of additional series in the future; and
WHEREAS, pursuant to an Investment Management Agreement, dated March 1,
2002, as amended April 1, 2004 (the "Management Agreement"), a copy of which has
been provided to the Sub-Adviser, the Fund has retained the Manager to render
advisory and management services with respect to certain of the Fund's series;
WHEREAS, pursuant to authority granted to the Manager in the Management
Agreement, the Manager wishes to retain the Sub-Adviser to furnish investment
advisory services to one or more of the series of the Fund, and the Sub-Adviser
is willing to furnish such services to the Fund and the Manager; and
WHEREAS, in order to provide continuous and uninterrupted investment
advisory services to the Trust, pursuant to Rule 15a-4 under the 1940 Act, the
Sub-Adviser and the Manager sought, and approval was obtained from a majority of
the Board of Directors (the "Board") of the Fund who have no interest in this
Agreement and are not interested persons (as such term is defined in the ▇▇▇▇
▇▇▇) of any party to this Agreement, to enter into this Agreement to be
effective upon the date first written above.
NOW, THEREFORE, in consideration of the premises and the promises and
mutual covenants herein contained, it is agreed between the Manager and the
Sub-Adviser as follows:
1. Appointment. The Manager hereby appoints the Sub-Adviser to act as the
investment adviser and manager to the series of the Fund set forth on Schedule A
hereto (the "Series") for the periods and on the terms set forth in this
Agreement. The Sub-Adviser accepts such appointment and agrees to furnish the
services herein set forth for the compensation herein provided.
In the event the Fund designates one or more series (other than the
Series) with respect to which the Manager wishes to retain the Sub-Adviser to
render investment advisory services hereunder, it shall notify the Sub-Adviser
in writing. If the Sub-Adviser is willing to render such
services, it shall notify the Manager in writing, whereupon such series shall
become a Series hereunder, and be subject to this Agreement.
2. Sub-Adviser Duties. Subject to the supervision of the Fund's Board of
Directors (the "Board") and the Manager, the Sub-Adviser will provide a
continuous investment program for each Series' portfolio and determine in its
discretion the composition of the assets of each Series' portfolio, including
determination of the purchase, retention, or sale of the securities, cash, and
other investments contained in the portfolio. The Sub-Adviser will provide
investment research and conduct a continuous program of evaluation, investment,
sales, and reinvestment of each Series' assets by determining the securities and
other investments that shall be purchased, entered into, sold, closed, or
exchanged for the Series, when these transactions should be executed, and what
portion of the assets of the Series should be held in the various securities and
other investments in which it may invest. To the extent permitted by the
investment policies of each Series, the Sub-Adviser shall make decisions for the
Series as to foreign currency matters and make determinations as to and execute
and perform foreign currency exchange contracts on behalf of the Series. The
Sub-Adviser will provide the services under this Agreement in accordance with
each Series' investment objective or objectives, policies, and restrictions as
stated in the Fund's Registration Statement filed with the Securities and
Exchange Commission ("SEC"), as amended, copies of which shall be sent to the
Sub-Adviser by the Manager prior to the commencement of this Agreement and
promptly following any such amendment. The Sub-Adviser further agrees as
follows:
(a) The Sub-Adviser will conform with the 1940 Act and all rules and
regulations thereunder, all other applicable federal and state laws and
regulations, with any applicable procedures adopted by the Fund's Board of which
the Sub-Adviser has been sent a copy, and the provisions of the Registration
Statement of the Fund filed under the Securities Act of 1933 (the "1933 Act")
and the 1940 Act, as supplemented or amended, of which the Sub-Adviser has
received a copy, and with the Manager's portfolio manager operating policies and
procedures as in effect on the date hereof, as such policies and procedures may
be revised or amended by the Manager. In carrying out its duties under this
Sub-Advisory Agreement, the Sub-Adviser will comply with the following policies
and procedures:
(i) The Sub-Adviser will (1) manage each Series so that it
meets the income and asset diversification requirements of Section 851 of
the Internal Revenue Code of 1986, as amended (the "Code"), and (2) manage
each Series so that no action or omission on the part of the Sub-Adviser
shall cause a Series to fail to comply with the diversification
requirements of Section 817(h) of the Code, and the regulations issued
thereunder.
(ii) The Sub-Adviser will have no duty to vote any proxy
solicited by or with respect to the issuers of securities in which assets
of the Series are invested unless the Manager gives the Sub-Adviser
written instructions to the contrary. The Sub-Adviser will immediately
forward any proxy solicited by or with respect to the issuers of
securities in which assets of the Series are invested to the Manager or to
any agent of the Manager designated by the Manager in writing.
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The Sub-Adviser will make appropriate personnel available for
consultation for the purpose of reviewing with representatives of the
Manager and/or the Board any proxy solicited by or with respect to the
issuers of securities in which assets of the Series are invested. Upon
request, the Sub-Adviser will submit a written voting recommendation to
the Manager for such proxies. In making such recommendations, the
Sub-Adviser shall use its good faith judgment to act in the best interests
of the Series. The Sub-Adviser shall disclose to the best of its knowledge
any conflict of interest with the issuers of securities that are the
subject of such recommendation including whether such issuers are clients
or are being solicited as clients of the Sub-Adviser or of its affiliates.
(iii) In connection with the purchase and sale of securities
for each Series, the Sub-Adviser will arrange for the transmission to the
custodian and portfolio accounting agent for the Series on a daily basis,
such confirmation, trade tickets, and other documents and information,
including, but not limited to, Cusip, Sedol, or other numbers that
identify securities to be purchased or sold on behalf of the Series, as
may be reasonably necessary to enable the custodian and portfolio
accounting agent to perform its administrative and recordkeeping
responsibilities with respect to the Series. With respect to portfolio
securities to be settled through the Fund's transfer agent, currently the
Depository Trust Company, the Sub-Adviser will arrange for the prompt
transmission of the confirmation of such trades to the Fund's custodian
and portfolio accounting agent.
(iv) The Sub-Adviser will assist the custodian and portfolio
accounting agent for the Fund in determining or confirming, consistent
with the procedures and policies stated in the Registration Statement for
the Fund or adopted by the Board , the value of any portfolio securities
or other assets of the Series for which the custodian and portfolio
accounting agent seeks assistance from or identifies for review by the
Sub-Adviser. The parties acknowledge that the Sub-Adviser is not a
custodian of the Series' assets and will not take possession or custody of
such assets.
(v) The Sub-Adviser will provide the Manager, no later than
the 10th business day following the end of each Series' semi-annual period
and fiscal year, a letter to shareholders (to be subject to review and
editing by the Manager) containing a discussion of those factors referred
to in Item 5(a) of 1940 Act Form N-1A in respect of both the prior quarter
and the fiscal year to date.
(vi) The Sub-Adviser will complete and deliver to the Manager
a written compliance checklist in a form provided by the Manager for each
month by the 10th business day of the following month.
(b) The Sub-Adviser will complete and deliver to the Manager by the
10th business day of each month a written report on each Series of the Fund that
contains the following information as of the immediately previous month's end:
(i) A performance comparison to the Series' benchmark listed
in the prospectus as well as a comparison to other mutual funds as listed
in the rankings prepared by Lipper Analytical Services, Inc., Morningstar,
Inc., or similar independent
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services that monitor the performance of mutual funds or with other
appropriate indexes of investment securities;
(ii) Composition of the assets of each Series' portfolio and
the impact of key portfolio holdings and sector concentrations on the
Series; and
(iii) Confirmation of the Fund's current investment objective
and Sub-Adviser's projected plan to realize the Fund's investment
objectives.
(c) The Sub-Adviser will contact Morningstar to clarify any style
box conflicts with the Fund's style and the anticipated timeframe in which
Morningstar will remedy such conflicts, if any.
(d) The Sub-Adviser will make available to the Fund and the Manager,
promptly upon request, any of the Series' investment records and ledgers
maintained by the Sub-Adviser (which shall not include the records and ledgers
maintained by the custodian or portfolio accounting agent for the Fund) as are
necessary to assist the Fund and the Manager to comply with requirements of the
1940 Act and the Investment Advisers Act of 1940, as amended (the "Advisers
Act"), as well as other applicable laws. The Sub-Adviser will furnish to
regulatory authorities having the requisite authority any information or reports
in connection with such services in respect to the Series which may be requested
in order to ascertain whether the operations of the Fund are being conducted in
a manner consistent with applicable laws and regulations.
(e) The Sub-Adviser will provide reports to the Fund's Board for
consideration at meetings of the Board on the investment program for each Series
and the issuers and securities represented in each Series' portfolio, and will
furnish the Fund's Board with respect to each Series such periodic and special
reports as the Directors and the Manager may reasonably request.
3. Broker-Dealer Selection. The Sub-Adviser is authorized to make
decisions to buy and sell securities and other investments for each Series'
portfolio, broker-dealer selection and negotiation of brokerage commission rates
in effecting a security transaction. The Sub-Adviser's primary consideration in
effecting a security transaction will be to obtain the best execution for the
Series, taking into account the factors specified in the prospectus and/or
statement of additional information for the Fund, and determined in consultation
with the Manager, which include price (including the applicable brokerage
commission or dollar spread), the size of the order, the nature of the market
for the security, the timing of the transaction, the reputation, the experience
and financial stability of the broker-dealer involved, the quality of the
service, the difficulty of execution, and the execution capabilities and
operational facilities of the firm involved, and the firm's risk in positioning
a block of securities. Accordingly, the price to a Series in any transaction may
be less favorable than that available from another broker-dealer if the
difference is reasonably justified, in the judgment of the Sub-Adviser in the
exercise of its fiduciary obligations to the Fund, by other aspects of the
portfolio execution services offered. Subject to such policies as the Fund's
Board or Manager may determine and consistent with Section 28(e) of the
Securities Exchange Act of 1934, the Sub-Adviser shall not be deemed to have
acted unlawfully or to have breached any duty created by this Agreement or
otherwise
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solely by reason of its having caused a Series to pay a broker-dealer for
effecting a portfolio investment transaction in excess of the amount of
commission another broker-dealer would have charged for effecting that
transaction, if the Sub-Adviser determines in good faith that such amount of
commission was reasonable in relation to the value of the brokerage and research
services provided by such broker-dealer, viewed in terms of either that
particular transaction or the Sub-Adviser's or the Manager's overall
responsibilities with respect to the Series and to their respective other
clients as to which they exercise investment discretion. The Sub-Adviser will
consult with the Manager to ensure that portfolio transactions on behalf of a
Series are directed to broker-dealers on the basis of criteria reasonably
considered appropriate by the Manager. To the extent consistent with these
standards, the Sub-Adviser is further authorized to allocate the orders placed
by it on behalf of a Series to the Sub-Adviser if it is registered as a
broker-dealer with the SEC, to an affiliated broker-dealer, or to such brokers
and dealers who also provide research or statistical material, or other services
to the Series, the Sub-Adviser, or an affiliate of the Sub-Adviser. Such
allocation shall be in such amounts and proportions as the Sub-Adviser shall
determine consistent with the above standards, and the Sub-Adviser will report
on said allocation regularly to the Fund's Board indicating the broker-dealers
to which such allocations have been made and the basis therefor.
4. Disclosure about Sub-Adviser. The Sub-Adviser has reviewed the most
recent Post-Effective Amendment to the Registration Statement for the Fund filed
with the SEC that contains disclosure about the Sub-Adviser, and represents and
warrants that, with respect to the disclosure about the Sub-Adviser or
information relating, directly or indirectly, to the Sub-Adviser, such
Registration Statement contains, as of the date hereof, no untrue statement of
any material fact and does not omit any statement of a material fact which was
required to be stated therein or necessary to make the statements contained
therein, in light of the circumstances under which they were made, not
misleading. The Sub-Adviser further represents and warrants that it is a duly
registered investment adviser under the Advisers Act and will maintain such
registration so long as this Agreement remains in effect. The Manager hereby
acknowledges that it has received a copy of the Sub-Adviser's Form ADV, Part II,
at least forty-eight (48) hours prior to entering into this Agreement.
5. Expenses. During the term of this Agreement, the Sub-Adviser will pay
all expenses incurred by it and its staff and for their activities in connection
with its portfolio management duties under this Agreement. The Manager or the
Fund shall be responsible for all the expenses of the Fund's operations.
6. Compensation. For the services provided, the Manager will pay the
Sub-Adviser a fee, payable as described in Schedule A. The compensation earned
under this Agreement will be held in an interest-bearing escrow account with the
Series custodian or a bank. If a majority of the Series outstanding voting
securities approve an agreement with the Sub-Adviser by the Termination Date (as
defined in Section 16), the amount in the escrow account (including interest
earned) will be paid to the Sub-Adviser. If a majority of the Series outstanding
voting securities do not approve an agreement with the Sub-Adviser, the
Sub-Adviser will be paid, out of the escrow account, the lesser of: (i) any
costs incurred in performing this Agreement (plus interest earned on that amount
while in escrow); or (ii) the total amount in the escrow account (plus interest
earned).
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7. Marketing Materials.
(a) During the term of this Agreement, the Sub-Adviser agrees to
furnish the Manager at its principal office for prior review and approval by the
Manager all written and/or printed materials, including but not limited to,
PowerPoint(R) or slide presentations, news releases, advertisements, brochures,
fact sheets and other promotional, informational or marketing materials (the
"Marketing Materials") for internal use or public dissemination, that are
produced or are for use or reference by the Sub-Adviser, its affiliates or other
designees, broker-dealers or the public in connection with the Series, and
Sub-Adviser shall not use any such materials if the Manager reasonably objects
in writing within five business days (or such other period as may be mutually
agreed) after receipt thereof. Marketing Materials may be furnished to the
Manager by first class or overnight mail, facsimile transmission equipment,
electronic delivery or hand delivery.
(b) During the term of this Agreement, the Manager agrees to furnish
the Sub-Adviser at its principal office all prospectuses, proxy statements,
reports to shareholders, or Marketing Materials prepared for distribution to
shareholders of each Series, or the public that refer to the Sub-Adviser in any
way, prior to the use thereof, and the Manager shall not use any such materials
if the Sub-Adviser reasonably objects in writing within five business days (or
such other period as may be mutually agreed) after receipt thereof. The
Sub-Adviser's right to object to such materials is limited to the portions of
such materials that expressly relate to the Sub-Adviser, its services and its
clients. The Manager agrees to use its reasonable best efforts to ensure that
materials prepared by its employees or agents or its affiliates that refer to
the Sub-Adviser or its clients in any way are consistent with those materials
previously approved by the Sub-Adviser as referenced in the first sentence of
this paragraph. Marketing Materials may be furnished to the Sub-Adviser by first
class or overnight mail, facsimile transmission equipment, electronic delivery
or hand delivery.
8. Compliance.
(a) The Sub-Adviser agrees to use reasonable compliance techniques
as the Manager or the Board may adopt, including any written compliance
procedures.
(b) The Sub-Adviser agrees that it shall promptly notify, if legally
permitted, the Manager and the Fund (1) in the event that the SEC has censured
the Sub-Adviser; placed limitations upon its activities, functions or
operations; suspended or revoked its registration as an investment adviser; or
has commenced proceedings or an investigation that may result in any of these
actions, or (2) upon having a reasonable basis for believing that the Series has
ceased to qualify or might not qualify as a regulated investment company under
Subchapter M of the Internal Revenue Code. The Sub-Adviser further agrees to
notify the Manager and the Fund promptly of any material fact known to the
Sub-Adviser respecting or relating to the Sub-Adviser that is not contained in
the Registration Statement or prospectus for the Fund (which describes the
Series), or any amendment or supplement thereto, or if any statement contained
therein that becomes untrue in any material respect.
(c) The Manager agrees that it shall promptly notify, if legally
permitted, the Sub-Adviser (1) in the event that the SEC has censured the
Manager or the Fund; placed
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limitations upon either of their activities, functions, or operations; suspended
or revoked the Manager's registration as an investment adviser; or has commenced
proceedings or an investigation that may result in any of these actions, or (2)
upon having a reasonable basis for believing that the Series has ceased to
qualify or might not qualify as a regulated investment company under Subchapter
M of the Internal Revenue Code.
9. Books and Records. The Sub-Adviser hereby agrees that all records which
it maintains for the Series are the property of the Fund and further agrees to
surrender promptly to the Fund any of such records upon the Fund's or the
Manager's request in compliance with the requirements of Rule 31a-3 under the
1940 Act, although the Sub-Adviser may, at its own expense, make and retain a
copy of such records. The Sub-Adviser further agrees to preserve for the periods
prescribed by Rule 31a-2 under the 1940 Act the records required to be
maintained by Rule 31a-l under the 1940 Act.
10. Cooperation; Confidentiality. Each party to this Agreement agrees to
cooperate with the other party and with all appropriate governmental authorities
having the requisite jurisdiction (including, but not limited to, the SEC) in
connection with any investigation or inquiry relating to this Agreement or the
Fund. Subject to the foregoing, the Sub-Adviser shall treat as confidential all
information pertaining to the Fund and actions of the Fund, the Manager and the
Sub-Adviser, and the Manager shall treat as confidential and use only in
connection with the Series all information furnished to the Fund or the Manager
by the Sub-Adviser, in connection with its duties under this Agreement except
that the aforesaid information need not be treated as confidential if required
to be disclosed under applicable law, if generally available to the public
through means other than by disclosure by the Sub-Adviser or the Manager, or if
available from a source other than the Manager, Sub-Adviser or the Fund.
11. Non-Exclusivity. The services of the Sub-Adviser to the Series and the
Fund are not to be deemed to be exclusive, and the Sub-Adviser shall be free to
render investment advisory or other services to others (including other
investment companies) and to engage in other activities.
12. Prohibited Conduct. The Sub-Adviser may not consult with any other
sub-adviser of the Fund concerning transactions in securities or other assets
for any investment portfolio of the Fund, including the Series, except that such
consultations are permitted between the current and successor sub-advisers of
the Series in order to effect an orderly transition of sub-advisory duties so
long as such consultations are not concerning transactions prohibited by Section
17(a) of the 1940 Act.
13. Representations Respecting Sub-Adviser. The Manager agrees that
neither the Manager, nor affiliated persons of the Manager, shall give any
information or make any representations or statements in connection with the
sale of shares of the Series concerning the Sub-Adviser or the Series other than
the information or representations contained in the Registration Statement,
prospectus, or statement of additional information for the Fund's shares, as
they may be amended or supplemented from time to time, or in reports or proxy
statements for the Fund, or in sales literature or other promotional material
approved in advance by the Sub-Adviser, except with the prior permission of the
Sub-Adviser.
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14. Control. Notwithstanding any other provision of the Agreement, it is
understood and agreed that the Fund shall at all times retain the ultimate
responsibility for and control of all functions performed pursuant to this
Agreement and has reserved the right to reasonably direct any action hereunder
taken on its behalf by the Sub-Adviser.
15. Liability. Except as may otherwise be required by the 1940 Act or the
rules thereunder or other applicable law, the Manager agrees that the
Sub-Adviser, any affiliated person of the Sub-Adviser, and each person, if any,
who, within the meaning of Section 15 of the 1933 Act controls the Sub-Adviser
(1) shall bear no responsibility and shall not be subject to any liability for
any act or omission respecting any series of the Fund that is not a Series
hereunder, and (2) shall not be liable for, or subject to any damages, expenses,
or losses in connection with, any act or omission connected with or arising out
of any services rendered under this Agreement, except by reason of willful
misfeasance, bad faith, or negligence in the performance of the Sub-Adviser's
duties, or by reason of reckless disregard of the Sub-Adviser's obligations and
duties under this Agreement.
16. Indemnification.
(a) The Manager agrees to indemnify and hold harmless the
Sub-Adviser, any affiliated person of the Sub-Adviser, and each person, if any,
who, within the meaning of Section 15 of the 1933 Act controls ("controlling
person") the Sub-Adviser (all of such persons being referred to as "Sub-Adviser
Indemnified Persons") against any and all losses, claims, damages, liabilities,
or litigation (including legal and other expenses) to which a Sub-Adviser
Indemnified Person may become subject under the 1933 Act, the 1940 Act, the
Advisers Act, under any other statute, at common law or otherwise, arising out
of the Manager's responsibilities to the Fund which (1) may be based upon the
Manager's negligence, willful misfeasance, or bad faith in the performance of
its duties (which could include a negligent action or a negligent omission to
act), or by reason of the Manager's reckless disregard of its obligations and
duties under this Agreement, or (2) may be based upon any untrue statement or
alleged untrue statement of a material fact contained in the Registration
Statement or prospectus covering shares of the Fund or any Series, or any
amendment thereof or any supplement thereto, or the omission or alleged omission
to state therein a material fact required to be stated therein or necessary to
make the statements therein not misleading, unless such statement or omission
was made in reliance upon information furnished to the Manager or the Fund or to
any affiliated person of the Manager by a Sub-Adviser Indemnified Person;
provided however, that in no case shall the indemnity in favor of the
Sub-Adviser Indemnified Person be deemed to protect such person against any
liability to which any such person would otherwise be subject by reason of
willful misfeasance, bad faith, or negligence in the performance of its duties,
or by reason of its reckless disregard of obligations and duties under this
Agreement.
(b) Notwithstanding Section 15 of this Agreement, the Sub-Adviser
agrees to indemnify and hold harmless the Manager, any affiliated person of the
Manager, and any controlling person of the Manager (all of such persons being
referred to as "Manager Indemnified Persons") against any and all losses,
claims, damages, liabilities, or litigation (including legal and other expenses)
to which a Manager Indemnified Person may become subject under the 1933 Act,
1940 Act, the Advisers Act, under any other statute, at common law or otherwise,
arising out of the Sub-Adviser's responsibilities as Sub-Adviser of the Series
which (1) may be based
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upon the Sub-Adviser's negligence, willful misfeasance, or bad faith in the
performance of its duties (which could include a negligent action or a negligent
omission to act), or by reason of the Sub-Adviser's reckless disregard of its
obligations and duties under this Agreement, or (2) may be based upon any untrue
statement or alleged untrue statement of a material fact contained in the
Registration Statement or prospectus covering the shares of the Fund or any
Series, or any amendment or supplement thereto, or the omission or alleged
omission to state therein a material fact known or which should have been known
to the Sub-Adviser and was required to be stated therein or necessary to make
the statements therein not misleading, if such a statement or omission was made
in reliance upon information furnished to the Manager, the Fund, or any
affiliated person of the Manager or Fund by the Sub-Adviser or any affiliated
person of the Sub-Adviser; provided, however, that in no case shall the
indemnity in favor of a Manager Indemnified Person be deemed to protect such
person against any liability to which any such person would otherwise be subject
by reason of willful misfeasance, bad faith, negligence in the performance of
its duties, or by reason of its reckless disregard of its obligations and duties
under this Agreement.
(c) The Manager shall not be liable under Paragraph (a) of this
Section 16 with respect to any claim made against a Sub-Adviser Indemnified
Person unless such Sub-Adviser Indemnified Person shall have notified the
Manager in writing within a reasonable time after the summons or other first
legal process giving information of the nature of the claim shall have been
served upon such Sub-Adviser Indemnified Person (or after such Sub-Adviser
Indemnified Person shall have received notice of such service on any designated
agent), but failure to notify the Manager of any such claim shall not relieve
the Manager from any liability which it may have to the Sub-Adviser Indemnified
Person against whom such action is brought except to the extent the Manager is
prejudiced by the failure or delay in giving such notice. In case any such
action is brought against the Sub-Adviser Indemnified Person, the Manager will
be entitled to participate, at its own expense, in the defense thereof or, after
notice to the Sub-Adviser Indemnified Person, to assume the defense thereof,
with counsel satisfactory to the Sub-Adviser Indemnified Person. If the Manager
assumes the defense of any such action and the selection of counsel by the
Manager to represent the Manager and the Sub-Adviser Indemnified Person would
result in a conflict of interests and therefore, would not, in the reasonable
judgment of the Sub-Adviser Indemnified Person, adequately represent the
interests of the Sub-Adviser Indemnified Person, the Manager will, at its own
expense, assume the defense with counsel to the Manager and, also at its own
expense, with separate counsel to the Sub-Adviser Indemnified Person, which
counsel shall be satisfactory to the Manager and to the Sub-Adviser Indemnified
Person. The Sub-Adviser Indemnified Person shall bear the fees and expenses of
any additional counsel retained by it, and the Manager shall not be liable to
the Sub-Adviser Indemnified Person under this Agreement for any legal or other
expenses subsequently incurred by the Sub-Adviser Indemnified Person
independently in connection with the defense thereof other than reasonable costs
of investigation. The Manager shall not have the right to compromise on or
settle the litigation without the prior written consent of the Sub-Adviser
Indemnified Person if the compromise or settlement results, or may result, in a
finding of wrongdoing on the part of the Sub-Adviser Indemnified Person.
(d) The Sub-Adviser shall not be liable under Paragraph (b) of this
Section 16 with respect to any claim made against a Manager Indemnified Person
unless such Manager
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Indemnified Person shall have notified the Sub-Adviser in writing within a
reasonable time after the summons or other first legal process giving
information of the nature of the claim shall have been served upon such Manager
Indemnified Person (or after such Manager Indemnified Person shall have received
notice of such service on any designated agent), but failure to notify the
Sub-Adviser of any such claim shall not relieve the Sub-Adviser from any
liability which it may have to the Manager Indemnified Person against whom such
action is brought except to the extent the Sub-Adviser is prejudiced by the
failure or delay in giving such notice. In case any such action is brought
against the Manager Indemnified Person, the Sub-Adviser will be entitled to
participate, at its own expense, in the defense thereof or, after notice to the
Manager Indemnified Person, to assume the defense thereof, with counsel
satisfactory to the Manager Indemnified Person. If the Sub-Adviser assumes the
defense of any such action and the selection of counsel by the Sub-Adviser to
represent both the Sub-Adviser and the Manager Indemnified Person would result
in a conflict of interests and therefore, would not, in the reasonable judgment
of the Manager Indemnified Person, adequately represent the interests of the
Manager Indemnified Person, the Sub-Adviser will, at its own expense, assume the
defense with counsel to the Sub-Adviser and, also at its own expense, with
separate counsel to the Manager Indemnified Person, which counsel shall be
satisfactory to the Sub-Adviser and to the Manager Indemnified Person. The
Manager Indemnified Person shall bear the fees and expenses of any additional
counsel retained by it, and the Sub-Adviser shall not be liable to the Manager
Indemnified Person under this Agreement for any legal or other expenses
subsequently incurred by the Manager Indemnified Person independently in
connection with the defense thereof other than reasonable costs of
investigation. The Sub-Adviser shall not have the right to compromise on or
settle the litigation without the prior written consent of the Manager
Indemnified Person if the compromise or settlement results, or may result, in a
finding of wrongdoing on the part of the Manager Indemnified Person.
17. Duration and Termination.
(a) This Agreement shall become effective on the date first
indicated above, subject to the condition that the Fund's Board, including a
majority of those Directors who are not interested persons (as such term is
defined in the ▇▇▇▇ ▇▇▇) of the Manager or the Sub-Adviser, and the shareholders
of each Series, shall have approved this Agreement. Unless terminated as
provided herein, this Agreement shall remain in full force and effect through
February 27, 2007, 150 days from its effective date (the "Termination Date").
Notwithstanding the foregoing, this Agreement may be terminated with respect to
any Series covered by this Agreement: (a) by the parties' entry into a new
Sub-Advisory Agreement that replaces this Agreement, following approval of the
shareholders of each of the Series covered by this Agreement, (b) by the Manager
at any time, upon ten (10) calendar days' written notice to the Sub-Adviser and
the Fund, (c) at any time without payment of any penalty by the Fund, by the
Fund's Board or a majority of the outstanding voting securities of each Series,
upon ten (10) calendar days' written notice to the Manager and the Sub-Adviser,
or (d) by the Sub-Adviser upon three (3) months' written notice unless the Fund
or the Manager requests additional time to find a replacement for the
Sub-Adviser, in which case the Sub-Adviser shall allow the additional time
requested by the Fund or Manager not to exceed three (3) additional months
beyond the initial three-month notice period, provided however, in no event
shall the effective date of the termination of this Agreement exceed the
Termination Date; also provided, that the Sub-Adviser may terminate this
Agreement at any time without penalty, effective upon written notice to the
10
Manager and the Fund, in the event either the Sub-Adviser (acting in good faith)
or the Manager ceases to be registered as an investment adviser under the
Advisers Act or otherwise becomes legally incapable of providing investment
management services pursuant to its respective contract with the Fund or with
respect to the Series, or in the event the Manager becomes bankrupt or otherwise
incapable of carrying out its obligations under this Agreement, or in the event
that the Sub-Adviser does not receive compensation for its services from the
Manager or the Fund as required by the terms of this Agreement.
In the event of termination for any reason, all records of each
Series for which the Agreement is terminated shall promptly be returned to the
Manager or the Fund, free from any claim or retention of rights in such record
by the Sub-Adviser, although the Sub-Adviser may, at its own expense, make and
retain a copy of such records. This Agreement shall automatically terminate in
the event of its assignment (as such term is described in the 1940 Act). In the
event this Agreement is terminated or is not approved in the manner described
above, the Sections or Paragraphs numbered 9, 10, 13, 14, 15 and 16 of this
Agreement shall remain in effect, as well as any applicable provision of this
Section numbered 17 and, to the extent that only amounts are owed to the
Sub-Adviser as compensation for services rendered while the agreement was in
effect, Section 6.
(b) Notices. Any notice must be in writing and shall be sufficiently
given (1) when delivered in person, (2) when dispatched by telegram or
electronic facsimile transfer (confirmed in writing by postage prepaid first
class air mail simultaneously dispatched), (3) when sent by internationally
recognized overnight courier service (with receipt confirmed by such overnight
courier service), or (4) when sent by registered or certified mail, to the other
party at the address of such party set forth below or at such other address as
such party may from time to time specify in writing to the other party.
If to the Fund:
ING Variable Portfolios, Inc.
▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Chief Counsel
If to the Adviser:
ING Investments, LLC
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Chief Counsel
11
If to the Sub-Adviser:
BlackRock Advisors, LLC
c/o BlackRock, Inc.
▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, Managing Director and General Counsel
18. Amendments. No provision of this Agreement may be changed, waived,
discharged or terminated orally, but only by an instrument in writing signed by
the party against which enforcement of the change, waiver, discharge or
termination is sought, and no amendment of this Agreement shall be effective
until approved as required by applicable law.
19. Miscellaneous.
(a) This Agreement shall be governed by the laws of the State of
Arizona, provided that nothing herein shall be construed in a manner
inconsistent with the 1940 Act, the Advisers Act or rules or orders of the SEC
thereunder, and without regard for the conflicts of laws principle thereof. The
term "affiliate" or "affiliated person" as used in this Agreement shall mean
"affiliated person" as defined in Section 2(a)(3) of the ▇▇▇▇ ▇▇▇.
(b) The Manager and the Sub-Adviser acknowledge that the Fund enjoys
the rights of a third-party beneficiary under this Agreement, and the Manager
acknowledges that the Sub-Adviser enjoys the rights of a third party beneficiary
under the Management Agreement.
(c) The captions of this Agreement are included for convenience only
and in no way define or limit any of the provisions hereof or otherwise affect
their construction or effect.
(d) If any provision of this Agreement shall be held or made invalid
by a court decision, statute, rule or otherwise, the remainder of this Agreement
shall not be affected thereby, and to this extent, the provisions of this
Agreement shall be deemed to be severable.
(e) Nothing herein shall be construed as constituting the
Sub-Adviser as an agent or co-partner of the Manager, or constituting the
Manager as an agent or co-partner of the Sub-Adviser.
(f) This Agreement may be executed in counterparts.
12
IN WITNESS WHEREOF, the parties hereto have caused this instrument to be
executed as of the day and year first above written.
ING INVESTMENTS, LLC
By: ________________________________
▇▇▇▇ ▇▇▇▇▇
Senior Vice President
BLACKROCK ADVISORS, LLC
By: ________________________________
Name: ______________________________
Title: _____________________________
13
SCHEDULE A
with respect to the
INTERIM SUB-ADVISORY AGREEMENT
between
ING INVESTMENTS, LLC
and
BLACKROCK ADVISORS, LLC
Annual Sub-Adviser Fee*
-----------------------
Series (as a percentage of average daily net assets)
------
ING VP Global Science and Technology Portfolio 0.50% on first $200 million of assets
0.45% on next $300 million of assets
0.40% on assets in excess of $500 million
----------
* For purposes of calculating fees under this Agreement, the assets of the
Series shall be aggregated with the assets of ING Global Science and
Technology Fund, a series of ING Series Fund, Inc., a registered
investment company that is not a party to this Agreement. The aggregated
assets will be applied to the above schedule and the resulting fee shall
be prorated back to these two series and their respective Sub-Adviser
based on relative net assets.