Nationwide Life Insurance Company, et al., 28967-29005 [E9-14288]

Download as PDF Federal Register / Vol. 74, No. 116 / Thursday, June 18, 2009 / Notices 28967 Day Event 25 .......................................................... If NRC staff finds no ‘‘need’’ for SUNSI or likelihood of standing, the deadline for petitioner/requester to file a motion seeking a ruling to reverse the NRC staff’s denial of access; NRC staff files copy of access determination with the presiding officer (or Chief Administrative Judge or other designated officer, as appropriate). If NRC staff finds ‘‘need’’ for SUNSI, the deadline for any party to the proceeding whose interest independent of the proceeding would be harmed by the release of the information to file a motion seeking a ruling to reverse the NRC staff’s grant of access. Deadline for NRC staff reply to motions to reverse NRC staff determination(s). (Receipt +30) If NRC staff finds standing and need for SUNSI, deadline for NRC staff to complete information processing and file motion for Protective Order and draft Non-Disclosure Affidavit. Deadline for applicant/licensee to file Non-Disclosure Agreement for SUNSI. If access granted: Issuance of presiding officer or other designated officer decision on motion for protective order for access to sensitive information (including schedule for providing access and submission of contentions) or decision reversing a final adverse determination by the NRC staff. Deadline for filing executed Non-Disclosure Affidavits. Access provided to SUNSI consistent with decision issuing the protective order. Deadline for submission of contentions whose development depends upon access to SUNSI. However, if more than 25 days remain between the petitioner’s receipt of (or access to) the information and the deadline for filing all other contentions (as established in the notice of hearing or opportunity for hearing), the petitioner may file its SUNSI contentions by that later deadline. Answers to contentions whose development depends upon access to SUNSI. Petitioner/Intervenor reply to answers. Decision on contention admission. 30 .......................................................... 40 .......................................................... A ........................................................... A+3 ....................................................... A+28 ..................................................... A+53 (Contention receipt +25) ............. A+60 (Answer receipt +7) .................... B ........................................................... [FR Doc. E9–14305 Filed 6–17–09; 8:45 am] BILLING CODE 7590–01–P NUCLEAR REGULATORY COMMISSION Advisory Committee on Reactor Safeguards (ACRS); Meeting of the Materials, Metallurgy, and Reactor Fuels Subcommittee; Notice of Meeting Electronic recordings will be permitted. Detailed procedures for the conduct of and participation in ACRS meetings were published in the Federal Register on October 6, 2008 (73 FR 58268– 58269). Further information regarding this meeting can be obtained by contacting the Designated Federal Official between 6:45 a.m. and 3:30 p.m. (ET). Persons planning to attend this meeting are urged to contact the above named individual at least two working days prior to the meeting to be advised of any potential changes to the agenda. The ACRS Subcommittee on the Materials, Metallurgy and Reactor Fuels will hold a meeting on July 7, 2009, 11545 Rockville Pike, Room T2–B3, Rockville, Maryland. The entire meeting will be open to public attendance. The agenda for the subject meeting shall be as follows: Dated: June 12, 2009. Cayetano Santos, Chief, Reactor Safety Branch A, Advisory Committee on Reactor Safeguards. [FR Doc. E9–14304 Filed 6–17–09; 8:45 am] Tuesday, July 7, 2009—1:30 p.m.–5 p.m. BILLING CODE 7590–01–P The Subcommittee will discuss the technical approach and programmatic justification for the Materials and Metallurgy research projects, sponsored by the Office of Nuclear Regulatory Research. The Subcommittee will hear presentations by and hold discussions with representatives of the NRC staff and other interested persons regarding this matter. The Subcommittee will gather information, analyze relevant issues and facts, and formulate proposed positions and actions, as appropriate, for deliberation by the full Committee. Members of the public desiring to provide oral statements and/or written comments should notify the Designated Federal Official, Christopher Brown (Telephone: 301–415–7111) five days prior to the meeting, if possible, so that appropriate arrangements can be made. VerDate Nov<24>2008 21:58 Jun 17, 2009 Jkt 217001 SECURITIES AND EXCHANGE COMMISSION [Release No. IC–28767; File No. 812– 13495] Nationwide Life Insurance Company, et al. June 12, 2009. AGENCY: Securities and Exchange Commission. ACTION: Notice of application for an order pursuant to Section 26(c) of the Investment Company Act of 1940 (the ‘‘1940 Act’’) and an order of exemption pursuant to Section 17(b) of the 1940 Act from Section 17(a) of the 1940 Act. Applicants: Nationwide Life Insurance Company (‘‘NWL’’), PO 00000 Frm 00089 Fmt 4703 Sfmt 4703 Nationwide Variable Account—II (‘‘Account II’’), Nationwide Variable Account—7 (‘‘Account 7’’), Nationwide Variable Account—9 (‘‘Account 9’’), Nationwide Variable Account—14 (‘‘Account 14’’), Nationwide Multi-Flex Variable Account (‘‘Flex Account’’), Nationwide VLI Separate Account—2 (‘‘Account 2’’), Nationwide VLI Separate Account—4 (‘‘Account 4’’), Nationwide VLI Separate Account—7 (‘‘VLI Account 7’’), Nationwide Life and Annuity Insurance Company (‘‘NLAIC’’), Nationwide VL Separate Account—G (‘‘Account G’’), Nationwide Life Insurance Company of America (‘‘NLICA’’), Nationwide Provident VLI Separate Account 1 (‘‘Account 1’’), Nationwide Life and Annuity Company of America (‘‘NLACA’’ and together with NWL, NLAIC and NLICA, ‘‘Insurance Company Applicants’’), Nationwide Provident VA Separate Account A (‘‘Account A’’), and Nationwide Provident VLI Separate Account A (‘‘VLI Account A’’ and together with Account II, Account 7, Account 9, Account 14, Flex Account, Account 2, VLI Account 7, Account G, Account 1, and Account A, ‘‘Separate Accounts’’ and, together with Insurance Company Applicants, ‘‘Section 26 Applicants’’), and Nationwide Variable Insurance Trust (‘‘NVIT’’ and together with Section 26 Applicants, ‘‘Section 17 Applicants’’). SUMMARY: Summary of Application: Section 26 Applicants seek an order pursuant to Section 26(c) of the 1940 Act, approving the substitutions of certain securities (the ‘‘Substitutions’’) issued by certain management investment companies and held by Separate Accounts to support certain E:\FR\FM\18JNN1.SGM 18JNN1 28968 Federal Register / Vol. 74, No. 116 / Thursday, June 18, 2009 / Notices variable annuity contracts and variable life insurance contracts (the ‘‘Contracts’’) issued by Insurance Company Applicants. Section 17 Applicants seek an order pursuant to Section 17(b) of the 1940 Act exempting them from Section 17(a) of the 1940 Act to the extent necessary to permit them to effectuate the proposed Substitutions by redeeming a portion of the securities of one or more of the Existing Funds (as defined herein) in-kind and using those securities received to purchase shares of the Replacement Funds (as defined herein) (the ‘‘In-Kind Transactions’’). DATES: Filing Date: The application was originally filed on February 11, 2008 and amended on June 25, 2008, March 9, 2009 and June 12, 2009. Hearing or Notification of Hearing: An order granting the application will be issued unless the Commission orders a hearing. Interested persons may request a hearing by writing to the Secretary of the Commission and serving Insurance Company Applicants and NVIT with a copy of the request, personally or by mail. Hearing requests must be received by the Commission by 5:30 p.m. on July 7, 2009, and should be accompanied by proof of service on Insurance Company Applicants and NVIT in the form of an affidavit or, for lawyers, a certificate of service. Hearing requests should state the nature of the requester’s interest, the reason for the request, and the issues contested. Persons who wish to be notified of a hearing may request notification by writing to the Secretary of the Commission. ADDRESSES: Secretary, Securities and Exchange Commission, 100 F Street, NE., Washington, DC 20549–1090. Insurance Company Applicants and NVIT, c/o Jamie Ruff Casto, Managing Counsel, Nationwide Insurance, One Nationwide Plaza 1–34–201, Columbus, Ohio 43215. FOR FURTHER INFORMATION CONTACT: Craig Ruckman, Attorney-Adviser, at (202) 551–6753 or Harry Eisenstein, Branch Chief, Office of Insurance Products, Division of Investment Management, at (202) 551–6795. SUPPLEMENTARY INFORMATION: The following is a summary of the application. The complete application may be obtained via the Commission’s Web site by searching for the file number, or an applicant using the Company name box, at http:// www.sec.gov/search/search.htm or by calling (202) 551–8090. Applicants’ Representations 1. NWL is a stock life insurance company organized under the laws of the State of Ohio. NLAIC is a stock life insurance company organized under the laws of the State of Ohio. NLICA is a stock life insurance company organized under the laws of the State of Pennsylvania. NLACA is a stock life insurance company organized under the laws of the State of Pennsylvania. 2. Each of the following separate accounts are registered as unit investment trusts under the 1940 Act and are used to fund certain variable contracts issued by NWL: Account II (File No. 811–3330); Account 7 (File No. 811–8666); Account 9 (File No. 811– 08241); Account 14 (File No. 811– 21205); Flex Account (File No. 811– 3338); Account 2 (File No. 811–5311); Account 4 (File No. 811–8301); and, VLI Account 7 (File No. 811–21610). Each of the following separate accounts are registered as unit investment trusts under the 1940 Act and are used to fund certain variable contracts issued by NLACA: Account A (File No. 811–6484); and, VLI Account A (File No. 811–8722). Account G is registered as a unit investment trust under the 1940 Act (File No. 811–21697) and is used to fund certain variable contracts issued by NLAIC. Account 1 is registered as a unit investment trust under the 1940 Act (File No. 811–4460) and is used to fund certain variable contracts issued by NLICA. 3. For purposes of the 1940 Act, NWL is the depositor and sponsor of Account II, Account 7, Account 9, Account 14, Flex Account, Account 2, Account 4, and VLI Account 7; NLAIC is the depositor and sponsor of Account G; NLICA is the depositor and sponsor of Account 1; and NLACA is the depositor and sponsor of Account A and VLI Account A as those terms have been interpreted by the Commission with respect to variable annuity and variable life insurance separate accounts. 4. The Contracts can be issued as individual or group contracts, with participants of group contracts acquiring certain ownership rights as described in the group contract or the plan documents. Contract owners and participants in group contracts (each a ‘‘Contract Owner’’) may allocate some or all of their Contract value to one or more sub-accounts available as investment Ref. No. Existing funds 1 ................ AIM Variable Insurance Funds—AIM V.I. Basic Value Fund: Series I Shares. VerDate Nov<24>2008 21:58 Jun 17, 2009 Jkt 217001 PO 00000 Frm 00090 options under the Contract (each an ‘‘Investment Option’’). Each such Investment Option corresponds to an underlying mutual fund in which the Separate Account invests. Additionally, the Contract Owner may, if provided for under the Contract, allocate some or all Contract value to a fixed account and/ or guaranteed term option, both of which are supported by the assets of the depositor’s general account. Each Contract permits the Contract Owner to transfer Contract value from one Investment Option to another Investment Option available under the Contract at any time, subject to certain restrictions and charges described in the prospectuses for the Contracts. To the extent that the Contracts contain restrictions or limitations on a Contract Owner’s right to transfer, such restrictions or limitations will not apply in connection with the proposed Substitutions. 5. Each Contract’s prospectus contains provisions reserving Insurance Company Applicants’ right to substitute shares of one Investment Option for shares of another Investment Option already purchased or to be purchased in the future if either of the following occurs: (i) Shares of a current Investment Option are no longer available for investment by the Separate Account; or (ii) in the judgment of Insurance Company Applicants’ management, further investment in such Investment Option is inappropriate in view of the purposes of the Contract. Each Insurance Company Applicant’s management has determined that further investment in the Existing Funds is no longer appropriate in view of the purposes of the Contracts. 6. Each Insurance Company Applicant, on its own behalf and on behalf of its Separate Accounts, proposes to exercise its contractual right to substitute a different Investment Option for one of the current Investment Options available under the Contracts. In particular, Section 26 Applicants request an order from the Commission pursuant to Section 26(c) of the 1940 Act approving the proposed Substitutions of shares of the following Funds (as defined herein) of NVIT (the ‘‘Replacement Funds’’) for shares of the corresponding underlying mutual funds (the ‘‘Existing Funds’’), as shown in the following Substitution table (‘‘Substitution Table’’): Replacement funds Fmt 4703 NVIT—NVIT Multi-Manager Large Cap Value Fund: Class I. Sfmt 4703 E:\FR\FM\18JNN1.SGM 18JNN1 Federal Register / Vol. 74, No. 116 / Thursday, June 18, 2009 / Notices Ref. No. Existing funds 2 ................ AIM Variable Insurance Funds—AIM V.I. Basic Value Fund: Series II Shares. AIM Variable Insurance Funds—AIM V.I. Large Cap Growth Fund: Series I Shares. American Century Variable Portfolios, Inc.—American Century VP Capital Appreciation Fund: Class I. American Century Variable Portfolios, Inc.—American Century VP International Fund: Class I. American Century Variable Portfolios, Inc.—American Century VP International Fund: Class II. American Century Variable Portfolios, Inc.—American Century VP International Fund: Class III. American Century Variable Portfolios, Inc.—American Century VP International Fund: Class IV. American Century Variable Portfolios, Inc.—American Century VP Ultra Fund: Class I. American Century Variable Portfolios, Inc.—American Century VP Ultra Fund: Class II. American Century Variable Portfolios, Inc.—American Century VP Vista Fund: Class I. American Century Variable Portfolios, Inc.—American Century VP Vista Fund: Class II. American Century Variable Portfolios, Inc.—American Century VP Vista Fund: Class II. Credit Suisse Trust—International Equity Flex I Portfolio (formerly, International Focus Portfolio). Credit Suisse Trust—International Equity Flex I Portfolio (formerly, International Focus Portfolio). Federated Insurance Series—Federated Quality Bond Fund II: Primary Shares. Federated Insurance Series—Federated Quality Bond Fund II: Service Shares. Franklin Templeton Variable Insurance Products Trust— Templeton Developing Markets Securities Fund: Class 3. Franklin Templeton Variable Insurance Products Trust— Templeton Developing Markets Securities Fund: Class 3. Janus Aspen Series—INTECH Risk-Managed Core Portfolio: Service Shares. Janus Aspen Series—INTECH Risk-Managed Core Portfolio: Service Shares. Neuberger Berman Advisers Management Trust—AMT Growth Portfolio: I Class. Neuberger Berman Advisers Management Trust—AMT Guardian Portfolio: I Class. Neuberger Berman Advisers Management Trust—AMT International Portfolio: S Class. Neuberger Berman Advisers Management Trust—AMT International Portfolio: S Class. Neuberger Berman Advisers Management Trust—AMT Mid-Cap Growth Portfolio: I Class. Neuberger Berman Advisers Management Trust—AMT Mid-Cap Growth Portfolio: S Class. Neuberger Berman Advisers Management Trust—AMT Mid-Cap Growth Portfolio: S Class. Neuberger Berman Advisers Management Trust—AMT Partners Portfolio: I Class. Neuberger Berman Advisers Management Trust—AMT Regency Portfolio: S Class. T. Rowe Price Equity Series, Inc.—T. Rowe Price Limited Term Bond Portfolio: Class II. The Universal Institutional Funds, Inc.—Mid Cap Growth Portfolio: Class I. The Universal Institutional Funds, Inc.—U.S. Real Estate Portfolio: Class I. The Universal Institutional Funds, Inc.—U.S. Real Estate Portfolio: Class II. Van Eck Worldwide Insurance Trust—Worldwide Emerging Markets Fund: Initial Class. Van Eck Worldwide Insurance Trust—Worldwide Emerging Markets Fund: Initial Class. Van Eck Worldwide Insurance Trust—Worldwide Emerging Markets Fund: Class R1. Wells Fargo Advantage Variable Trust—Wells Fargo Advantage VT Discovery Fund. 3 ................ 4 ................ 5 ................ 6 ................ 7 ................ 8 ................ 9 ................ 10 .............. 11 .............. 12 .............. 13 .............. 14 .............. 15 .............. 16 .............. 17 .............. 18 .............. 19 .............. 20 .............. 21 .............. 22 .............. 23 .............. 24 .............. 25 .............. 26 .............. 27 .............. 28 .............. 29 .............. 30 .............. 31 .............. 32 .............. 33 .............. 34 .............. 35 .............. 36 .............. 37 .............. 38 .............. VerDate Nov<24>2008 21:58 Jun 17, 2009 Jkt 217001 PO 00000 Frm 00091 28969 Replacement funds Fmt 4703 NVIT—NVIT Multi-Manager Large Cap Value Fund: Class II. NVIT—NVIT Multi-Manager Large Cap Growth Fund: Class I. NVIT—NVIT Multi-Manager Mid Cap Growth Fund: Class I. NVIT—NVIT III. NVIT—NVIT VI. NVIT—NVIT III. NVIT—NVIT VI. NVIT—NVIT Multi-Manager International Growth Fund: Class Multi-Manager International Growth Fund: Class Multi-Manager International Growth Fund: Class Multi-Manager International Growth Fund: Class Multi-Manager Large Cap Growth Fund: Class I. NVIT—NVIT Multi-Manager Large Cap Growth Fund: Class II. NVIT—NVIT Multi-Manager Mid Cap Growth Fund: Class I. NVIT—NVIT Multi-Manager Mid Cap Growth Fund: Class I. NVIT—NVIT Multi-Manager Mid Cap Growth Fund: Class II. NVIT—Gartmore NVIT International Equity Fund: Class I. NVIT—Gartmore NVIT International Equity Fund: Class III. NVIT—NVIT Core Bond Fund: Class I. NVIT—NVIT Core Bond Fund: Class II. NVIT—Gartmore NVIT Emerging Markets Fund: Class III. NVIT—Gartmore NVIT Emerging Markets Fund: Class VI. NVIT—NVIT Nationwide Fund: Class I. NVIT—NVIT Nationwide Fund: Class II. NVIT—NVIT Multi-Manager Mid Cap Growth Fund: Class I. NVIT—Neuberger Berman NVIT Multi Cap Opportunities Fund: Class I. NVIT—Gartmore NVIT International Equity Fund: Class III. NVIT—Gartmore NVIT International Equity Fund: Class VI. NVIT—NVIT Multi-Manager Mid Cap Growth Fund: Class I. NVIT—NVIT Multi-Manager Mid Cap Growth Fund: Class I. NVIT—NVIT Multi-Manager Mid Cap Growth Fund: Class II. NVIT—Neuberger Berman NVIT Multi Cap Opportunities Fund: Class I. NVIT—NVIT Multi-Manager Mid Cap Value Fund: Class II. NVIT—NVIT Short Term Bond Fund: Class II. NVIT—NVIT Multi-Manager Mid Cap Growth Fund: Class I. NVIT—Van Kampen NVIT Real Estate Fund: Class I. NVIT—Van Kampen NVIT Real Estate Fund: Class II. NVIT—Gartmore NVIT Emerging Markets Fund: Class I. NVIT—Gartmore NVIT Emerging Markets Fund: Class III. NVIT—Gartmore NVIT Emerging Markets Fund: Class III. NVIT—NVIT Multi-Manager Mid Cap Growth Fund: Class I. Sfmt 4703 E:\FR\FM\18JNN1.SGM 18JNN1 28970 Federal Register / Vol. 74, No. 116 / Thursday, June 18, 2009 / Notices Ref. No. Existing funds 39 .............. Wells Fargo Advantage Variable Trust—Wells Fargo Advantage VT Discovery Fund. Wells Fargo Advantage Variable Trust—Wells Fargo Advantage VT Opportunity Fund: Investor Class. 40 .............. Replacement funds NVIT—NVIT Multi-Manager Mid Cap Growth Fund: Class II. NVIT—NVIT Multi-Manager Mid Cap Value Fund: Class II. 7. All of the Replacement Funds that correspond to the Existing Funds are available as Investment Options in the Contracts. 8. Each Replacement Fund is a series of NVIT, a Delaware statutory trust. NVIT is registered as an open-end management investment company under the 1940 Act and its shares are registered under the Securities Act of 1933, as amended, on Form N–1A (1933 Act File No. 02–73024). NVIT is a series investment company and currently offers 58 separate series (each a ‘‘Fund’’ and collectively, the ‘‘Funds’’). Shares of NVIT are sold exclusively to insurance company separate accounts to fund benefits under variable annuity contracts and variable life insurance policies, and to employer pension and profit-sharing plans. 9. Nationwide Fund Advisors (‘‘NFA’’) is a registered investment adviser (Reg. No. 801–56370) and is an affiliate of Section 26 Applicants. NFA currently serves as investment adviser (‘‘Adviser’’) to each of the Funds, including the Replacement Funds, pursuant to investment management agreements between NVIT, on behalf of each Fund, and NFA (the ‘‘Management Agreements’’). NFA employs a subadvised strategy whereby NFA serves as a ‘‘manager of managers’’ and delegates the fund management responsibilities for each Fund to one or more third party investment advisors (each a ‘‘SubAdviser’’) via investment advisory agreements (‘‘Sub-Advisory Agreements’’). Pursuant to the Management Agreements, NFA’s responsibilities include general management of each Fund, including full discretion to (i) select a new sub-adviser or an additional Sub-Adviser for each Fund; (ii) terminate a Sub-Adviser for each Fund; (iii) enter into, modify, and terminate Sub-Advisory Agreements; and (iv) allocate and reallocate a Fund’s assets among the Adviser and one or more Sub-Advisers. In addition, the Adviser monitors and reports to NVIT’s Board of Trustees on the performance of each Sub-Adviser relative to such SubAdviser’s responsibilities of complying with the investment objectives, policies, and restrictions of any Fund under the management of such Sub-Adviser. 10. NVIT received an exemptive order from the Commission on April 28, 1998 (Investment Company Act Release No. 23133) (the ‘‘Manager of Managers Order’’) that permits the Adviser, subject to certain conditions, including approval of the NVIT Board of Trustees, and without the approval of shareholders, to: (i) Select a new SubAdviser or additional Sub-Adviser for each Fund; (ii) terminate any existing Sub-Adviser and/or replace the SubAdviser; (iii) enter into new SubAdvisory Agreements 1 and/or materially modify the terms of, or terminate, any existing Sub-Advisory Agreement; and (iv) allocate and reallocate a Fund’s assets among the Adviser and one or more Sub-Advisers. If a new Sub-Adviser is retained for a Fund, Contract Owners would receive all information about the new Sub- 1 Relating to NVIT, the Adviser will not enter into any Sub-Advisory Agreement with any Sub-Adviser that is an ‘‘affiliated person,’’ as defined in Section 2(a)(3) of the 1940 Act, of NVIT or the Adviser, other than by reason of serving as a Sub-Adviser to a Fund, without such Sub-Advisory Agreement, including the compensation to be paid thereunder, being approved by the unit holders of any separate VerDate Nov<24>2008 21:58 Jun 17, 2009 Jkt 217001 PO 00000 Frm 00092 Fmt 4703 Sfmt 4703 Adviser that would be included in a proxy statement, including any change in disclosure caused by the addition of a new Sub-Adviser. 11. Section 26 Applicants represent that, after the Substitution date, the Replacement Funds will not change sub-advisers, retain any new subadviser, or otherwise rely on the Manager of Managers Order without first obtaining shareholder approval of: the new sub-adviser, the fund’s ability add or to replace a sub-adviser in reliance on the Manager of Managers Order, or otherwise rely on the Manager of Managers Order. 12. The Appendix includes a comparison of the management fees, the total operating expenses (before and after any waivers and reimbursements) expressed as an annual percentage of average daily net assets, and the asset levels of each Existing Fund and its corresponding Replacement Fund. The 12b–1 fees listed in the fee tables provided in the Appendix for each Existing Fund and Replacement Fund represents the maximum 12b–1 fee that could be assessed by the particular fund, except with regard to the Franklin Templeton Variable Insurance Products Trust—Templeton Developing Markets Securities Fund: Class 3, which is disclosed in a footnote. 13. Set forth below is a description of the investment objectives, the advisers, the principal investment strategies and principal risk factors of each Existing Fund and its corresponding Replacement Fund. BILLING CODE 8010–01–P account for which that Fund serves as a funding medium. E:\FR\FM\18JNN1.SGM 18JNN1 VerDate Nov<24>2008 21:58 Jun 17, 2009 Jkt 217001 PO 00000 Frm 00093 Fmt 4703 Sfmt 4725 E:\FR\FM\18JNN1.SGM 18JNN1 28971 EN18JN09.001</GPH> Federal Register / Vol. 74, No. 116 / Thursday, June 18, 2009 / Notices VerDate Nov<24>2008 Federal Register / Vol. 74, No. 116 / Thursday, June 18, 2009 / Notices 21:58 Jun 17, 2009 Jkt 217001 PO 00000 Frm 00094 Fmt 4703 Sfmt 4725 E:\FR\FM\18JNN1.SGM 18JNN1 EN18JN09.002</GPH> 28972 VerDate Nov<24>2008 21:58 Jun 17, 2009 Jkt 217001 PO 00000 Frm 00095 Fmt 4703 Sfmt 4725 E:\FR\FM\18JNN1.SGM 18JNN1 28973 EN18JN09.003</GPH> Federal Register / Vol. 74, No. 116 / Thursday, June 18, 2009 / Notices VerDate Nov<24>2008 Federal Register / Vol. 74, No. 116 / Thursday, June 18, 2009 / Notices 21:58 Jun 17, 2009 Jkt 217001 PO 00000 Frm 00096 Fmt 4703 Sfmt 4725 E:\FR\FM\18JNN1.SGM 18JNN1 EN18JN09.004</GPH> 28974 VerDate Nov<24>2008 21:58 Jun 17, 2009 Jkt 217001 PO 00000 Frm 00097 Fmt 4703 Sfmt 4725 E:\FR\FM\18JNN1.SGM 18JNN1 28975 EN18JN09.005</GPH> Federal Register / Vol. 74, No. 116 / Thursday, June 18, 2009 / Notices VerDate Nov<24>2008 Federal Register / Vol. 74, No. 116 / Thursday, June 18, 2009 / Notices 21:58 Jun 17, 2009 Jkt 217001 PO 00000 Frm 00098 Fmt 4703 Sfmt 4725 E:\FR\FM\18JNN1.SGM 18JNN1 EN18JN09.006</GPH> 28976 VerDate Nov<24>2008 21:58 Jun 17, 2009 Jkt 217001 PO 00000 Frm 00099 Fmt 4703 Sfmt 4725 E:\FR\FM\18JNN1.SGM 18JNN1 28977 EN18JN09.007</GPH> Federal Register / Vol. 74, No. 116 / Thursday, June 18, 2009 / Notices VerDate Nov<24>2008 Federal Register / Vol. 74, No. 116 / Thursday, June 18, 2009 / Notices 21:58 Jun 17, 2009 Jkt 217001 PO 00000 Frm 00100 Fmt 4703 Sfmt 4725 E:\FR\FM\18JNN1.SGM 18JNN1 EN18JN09.008</GPH> 28978 VerDate Nov<24>2008 21:58 Jun 17, 2009 Jkt 217001 PO 00000 Frm 00101 Fmt 4703 Sfmt 4725 E:\FR\FM\18JNN1.SGM 18JNN1 28979 EN18JN09.009</GPH> Federal Register / Vol. 74, No. 116 / Thursday, June 18, 2009 / Notices VerDate Nov<24>2008 Federal Register / Vol. 74, No. 116 / Thursday, June 18, 2009 / Notices 21:58 Jun 17, 2009 Jkt 217001 PO 00000 Frm 00102 Fmt 4703 Sfmt 4725 E:\FR\FM\18JNN1.SGM 18JNN1 EN18JN09.010</GPH> 28980 VerDate Nov<24>2008 21:58 Jun 17, 2009 Jkt 217001 PO 00000 Frm 00103 Fmt 4703 Sfmt 4725 E:\FR\FM\18JNN1.SGM 18JNN1 28981 EN18JN09.011</GPH> Federal Register / Vol. 74, No. 116 / Thursday, June 18, 2009 / Notices VerDate Nov<24>2008 Federal Register / Vol. 74, No. 116 / Thursday, June 18, 2009 / Notices 21:58 Jun 17, 2009 Jkt 217001 PO 00000 Frm 00104 Fmt 4703 Sfmt 4725 E:\FR\FM\18JNN1.SGM 18JNN1 EN18JN09.012</GPH> 28982 VerDate Nov<24>2008 21:58 Jun 17, 2009 Jkt 217001 PO 00000 Frm 00105 Fmt 4703 Sfmt 4725 E:\FR\FM\18JNN1.SGM 18JNN1 28983 EN18JN09.013</GPH> Federal Register / Vol. 74, No. 116 / Thursday, June 18, 2009 / Notices VerDate Nov<24>2008 Federal Register / Vol. 74, No. 116 / Thursday, June 18, 2009 / Notices 21:58 Jun 17, 2009 Jkt 217001 PO 00000 Frm 00106 Fmt 4703 Sfmt 4725 E:\FR\FM\18JNN1.SGM 18JNN1 EN18JN09.014</GPH> 28984 VerDate Nov<24>2008 21:58 Jun 17, 2009 Jkt 217001 PO 00000 Frm 00107 Fmt 4703 Sfmt 4725 E:\FR\FM\18JNN1.SGM 18JNN1 28985 EN18JN09.015</GPH> Federal Register / Vol. 74, No. 116 / Thursday, June 18, 2009 / Notices VerDate Nov<24>2008 Federal Register / Vol. 74, No. 116 / Thursday, June 18, 2009 / Notices 21:58 Jun 17, 2009 Jkt 217001 PO 00000 Frm 00108 Fmt 4703 Sfmt 4725 E:\FR\FM\18JNN1.SGM 18JNN1 EN18JN09.016</GPH> 28986 Federal Register / Vol. 74, No. 116 / Thursday, June 18, 2009 / Notices 14. As a result of the Substitutions, the number of Investment Options under each Contract will either not be decreased, or, in those cases where the number of Investment Options is being reduced, continue to offer a significant number of alternative Investment Options. Specifically, the number of Investment Options is currently expected to range in number from 21 to 129 after the Substitutions versus 23 to 149 before the Substitutions. 15. Prospectus supplements for the Contracts will be delivered to Contract Owners at least thirty (30) days before the Substitution date. The supplements will: (i) Notify all Contract Owners of the Insurance Company Applicants’ intent to implement the Substitutions, and that an application has been filed in order to obtain the necessary orders to do so; (ii) advise Contract Owners that from the date of the supplement until the Substitution date, Contract Owners are permitted to transfer Contract value out of any Existing Fund sub-account to any other sub-account(s) offered under the Contract without the transfer being treated as a transfer for purposes of transfer limitations and short-term trading fees that would otherwise be applicable under the terms of the Contract; (iii) instruct Contract Owners how to submit transfer requests in light of the proposed Substitutions; (iv) advise Contract Owners that any Contract value remaining in an Existing Fund sub-account on the Substitution date will be transferred to the corresponding Replacement Fund subaccount, and that the Substitutions will take place at relative net asset value; (v) inform Contract Owners that for at least thirty (30) days following the Substitution date, the Insurance Company Applicants will permit VerDate Nov<24>2008 21:58 Jun 17, 2009 Jkt 217001 Contract Owners to make transfers of Contract value out of each Replacement Fund sub-account to any other subaccount(s) offered under the Contract without the transfer being treated as a transfer for purposes of transfer limitations and short-term trading fees that would otherwise be applicable under the terms of the Contract; and (vi) inform Contract Owners that the respective Insurance Company Applicant will not exercise any rights reserved by it under the Contracts to impose additional restrictions on transfers out of a Replacement Fund for at least thirty (30) days after the Substitution date.2 16. The Insurance Company Applicants will cause the appropriate prospectus supplements containing this disclosure and the prospectus and/or supplement for the Replacement Funds to be sent to all existing Contract Owners. New purchasers of the Contracts will be provided the prospectus supplement, the Contract prospectus, and the prospectus and/or supplement for the Replacement Funds in accordance with all applicable legal requirements. Prospective purchasers of the Contracts will be provided the prospectus supplement and the Contract prospectus. 17. In addition to the Contract prospectus supplements distributed to Contract Owners, within five (5) business days after the Substitution date, Contract Owners will be sent a confirmation of the Substitutions in accordance with Rule 10b–10 under the Securities Exchange Act of 1934, as 2 One exception to this is that the Insurance Companies may impose restrictions on transfers to the extent necessary to prevent or limit disruptive trading activity, as described in the prospectuses for the Contracts and the underlying mutual funds. PO 00000 Frm 00109 Fmt 4703 Sfmt 4703 amended. The confirmation statement will reiterate that the Insurance Company Applicant will not exercise any right reserved by it under the Contracts to impose any restrictions or fees on transfers from the Replacement Funds until at least thirty (30) days after the Substitution date. 18. The proposed Substitutions will take place at relative net asset value determined on the Substitution date pursuant to Section 22 of the 1940 Act and Rule 22c–1 thereunder with no change in the amount of any Contract Owner’s Contract value, cash value, death benefit, or dollar value of his or her investment in the Separate Accounts. Each Substitution will be effected by redeeming shares of the Existing Fund in cash and/or in-kind on the Substitution date at their net asset value and using the proceeds of those redemptions to purchase shares of the Replacement Fund at their net asset value on the same date.3 19. Contract Owners will not incur any fees or charges as a result of the proposed Substitutions, nor will their rights or insurance benefits or the Insurance Company Applicants’ obligations under the Contracts be altered in any way. All expenses incurred in connection with the proposed Substitutions, including any brokerage, legal, accounting, and other fees and expenses, will be paid by the Insurance Company Applicants. In addition, the proposed Substitutions will not impose any tax liability on Contract Owners. The proposed 3 For administrative convenience, the In-Kind Transactions may be effected through a direct transfer of securities and cash between the custodian(s) for the Existing Fund and its corresponding Replacement Fund, followed by the distribution of shares of the Replacement Fund to the applicable Separate Account(s). E:\FR\FM\18JNN1.SGM 18JNN1 EN18JN09.021</GPH> BILLING CODE 8010–01–C 28987 28988 Federal Register / Vol. 74, No. 116 / Thursday, June 18, 2009 / Notices Substitutions will not cause the Contract fees and charges currently being paid by Contract Owners to be greater after the proposed Substitution than before the proposed Substitution. No fees will be charged on transfers made on the Substitution date because each Substitution redemption and purchase will not be treated as a transfer for purposes of assessing transfer charges or computing the number of permissible transfers under the Contracts. 20. For all Substitutions other than Janus Aspen Series—INTECH RiskManaged Core Portfolio: Service Shares to be replaced by NVIT—NVIT Nationwide Fund: Class II (Ref. No. 21) (the ‘‘Aspen Substitution’’), for a period of two (2) years following the Substitution date and for those Contracts with assets allocated to the Existing Fund on the date of the Substitution, the issuing Insurance Company, as applicable, will reimburse, on the last business day of each fiscal quarter, the sub-accounts investing in the applicable Replacement Fund to the extent that the Replacement Fund’s net annual expenses for such period exceeds, on an annualized basis, the net annual expenses of the Existing Fund for fiscal year 2008. In addition, the Insurance Company Applicants will not increase the Contract fees and charges that would otherwise be assessed under the terms of the Contracts for a period of at least two (2) years following the Substitution date. 21. For the Aspen Substitution, where the sum of the management fee and 12b–1 fee of the Replacement Fund is greater than (or could be greater than) that of the Existing Fund, for those Contracts with assets allocated to the Existing Fund on the date of the Substitution, the issuing Insurance Company Applicant, as applicable, will reimburse, on the last business day of each fiscal quarter, the sub-accounts investing in the applicable Replacement Fund to the extent that the Replacement Fund’s net annual expenses for such period exceeds, on an annualized basis, the net annual expenses of the Existing Fund for fiscal year 2008. In addition, for those same Contracts, the Insurance Company Applicants will not increase the Contract fees and charges that would otherwise be assessed under the terms of the Contracts for the duration of the Contracts. Section 26 Applicants’ Legal Analysis 1. Section 26 Applicants request that the Commission issue an order pursuant to Section 26(c) of the 1940 Act approving the proposed Substitutions. VerDate Nov<24>2008 21:58 Jun 17, 2009 Jkt 217001 2. Section 26 Applicants assert that Section 26(c) of the 1940 Act makes it unlawful for the depositor of a registered unit investment trust that invests in the securities of a single issuer to substitute another security for such security without Commission approval. Section 26(c) further states that the Commission shall issue an order approving such a substitution ‘‘if the evidence establishes that it is consistent with the protection of investors and the purposes fairly intended by the policy and provisions of this title.’’ 3. Section 26 Applicants represent that the Contracts have reserved the right to substitute shares of another underlying mutual fund for one of the current underlying mutual funds offered as an investment option under the Contracts. The Contract prospectuses disclose this right. 4. Section 26 Applicants represent that each Replacement Fund and its corresponding Existing Fund have similar, and in some cases substantially similar or identical, investment objectives and strategies. In addition, Section 26 Applicants maintain that each proposed Substitution retains for Contract Owners the investment flexibility and expertise in asset management, which are core investment features of the Contracts and any impact on the investment programs of affected Contract Owners should be negligible. Furthermore, Section 26 Applicants assert that the ultimate effect of the Substitutions would be to continue to provide Contract Owners with a wide array of investment options and managers, while at the same time increasing administrative efficiencies of the Contracts. Additionally, Section 26 Applicants claim that information pertaining to the underlying mutual funds available under the Contracts will be more consistent and thus easier for Contract Owners to navigate and understand. 5. Section 26 Applicants represent that after the Substitution date, Contract Owners with Contract value invested in a Replacement Fund will have the same or lower net operating expense ratio(s) as before the Substitution. As indicated previously, certain expense limits have been put in place to ensure that Contract Owners do not incur higher expenses as a result of a Substitution for a period of either two (2) years after the Substitution, or for the lifetime of the Contract. 6. Section 26 Applicants submit that the proposed Substitutions are not of the type that Section 26 was designed to prevent, i.e., overreaching on the part of the depositor by permanently impacting PO 00000 Frm 00110 Fmt 4703 Sfmt 4703 the investment allocations of the entire trust. In the current situation, the Contracts provide Contract Owners with investment discretion to allocate and reallocate their Contract value among the available underlying mutual funds. Section 26 Applicants claim this flexibility provides Contract Owners with the ability to reallocate their assets at any time—either before the Substitution date, or after the Substitution date—if they do not wish to invest in the Replacement Fund. Thus, Section 26 Applicants assert that the likelihood of being invested in an undesired underlying mutual fund is minimized, with the discretion remaining with the Contract Owners, and the Substitutions, therefore, will not result in the type of costly forced redemption that Section 26(c) was designed to prevent. 7. Section 26 Applicants submit that the proposed Substitutions are also unlike the type of substitution that Section 26(c) was designed to prevent in that the Substitutions have no impact on other aspects of the Contracts. Specifically, Section 26 Applicants maintain that the type of insurance coverage offered by the Insurance Company Applicants under the applicable Contract, as well as numerous other rights and privileges associated with the Contract, are not impacted by the proposed Substitution. Section 26 Applicants note that Contract Owners also may have considered the Insurance Company Applicant’s size, financial condition, and its reputation for service in selecting their Contract. Section 26 Applicants assert that these factors will not change as a result of the proposed Substitutions, nor will the annuity, life, or tax benefits afforded under the Contracts held by any of the affected Contract Owners. 8. Section 26 Applicants submit that, for all the reasons stated above, the proposed Substitutions are consistent with the protection of investors and the purposes fairly intended by the policy and provisions of the 1940 Act. Section 17 Applicants’ Legal Analysis 1. Section 17 Applicants request that the Commission issue an order pursuant to Section 17(b) of the 1940 Act exempting them from the provisions of Section 17(a) of the 1940 Act to the extent necessary to permit them to carry out the In-Kind Transactions. 2. Section 17(a)(1) of the 1940 Act, in relevant part, generally prohibits any affiliated person of a registered investment company (or any affiliated person of such a person), acting as principal, from knowingly selling any security or other property to that E:\FR\FM\18JNN1.SGM 18JNN1 Federal Register / Vol. 74, No. 116 / Thursday, June 18, 2009 / Notices company. Section 17(a)(2) of the 1940 Act generally prohibits the same persons, acting as principals, from knowingly purchasing any security or other property from the registered investment company. Section 2(a)(3) of the 1940 Act defines the term ‘‘affiliated person’’ of another person, in relevant part, as: (A) any person directly or indirectly owning, controlling, or holding with power to vote, 5 per centum or more of the outstanding voting securities of such other person; (B) any person 5 per centum or more of whose outstanding voting securities are directly or indirectly owned, controlled, or held with power to vote, by such other person; [or] (C) any person directly or indirectly controlling, controlled by, or under common control with, such other person* * * 3. Section 2(a)(9) of the 1940 Act states that any person who owns beneficially, either directly or through one or more controlled companies, more than 25% of the voting securities of a company shall be presumed to control such company. Shares held by an insurance company separate account are legally owned by the insurance company. Thus, the Insurance Company Applicants collectively own substantially all of the shares of NVIT. Accordingly, NVIT and its respective funds are arguably under the control of the Insurance Company Applicants, as per Section 2(a)(9) of the 1940 Act (notwithstanding the fact that the Contract Owners are the beneficial owners of those Separate Account shares). If NVIT is under the common control of the Insurance Company Applicants, then each of the Insurance Company Applicants is an affiliated person of NVIT and its respective Funds. If NVIT and its respective Funds are under the control of the Insurance Company Applicants, then NVIT and its respective affiliates are affiliated persons of the Insurance Company Applicants. Regardless of whether or not the Insurance Company Applicants can be considered to actually control NVIT and its Funds, because the Insurance Company Applicants and their affiliates own of record more than 5% of the shares of each Fund and are under common control with NFA, the Insurance Company Applicants are affiliated persons of NVIT and its Funds. Likewise, NVIT and its respective Funds are each an affiliated person of the Insurance Company Applicants. 4. Section 17 Applicants represent that the proposed In-Kind Transactions could be seen as the indirect purchase of shares of certain Replacement Funds with portfolio securities of certain VerDate Nov<24>2008 21:58 Jun 17, 2009 Jkt 217001 Existing Funds and the indirect sale of portfolio securities of certain Existing Funds for shares of certain Replacement Funds. Pursuant to this analysis, the proposed In-Kind Transactions also could be categorized as a purchase of shares of certain Replacement Funds by certain Existing Funds, acting as principal, and a sale of portfolio securities by certain Existing Funds, acting as principal, to certain Replacement Funds. In addition, the proposed In-Kind Transactions could be viewed as a purchase of securities from certain Existing Funds, and a sale of securities to certain Replacement Funds, by the Insurance Company Applicants (or their Separate Accounts), acting as principal. If categorized in this manner, the proposed In-Kind Transactions may be deemed to contravene Section 17(a) due to the affiliated status of these participants. 5. Section 17(b) of the 1940 Act provides that any person may apply to the Commission for an exemption from the provisions of Section 17(a), and the Commission shall issue such exemptive order, if evidence establishes that: (1) The terms of the proposed transaction, including the consideration to be paid or received, are reasonable and fair and do not involve overreaching on the part of any person concerned; (2) The proposed transaction is consistent with the policy of each registered investment company concerned, as recited in its registration statement and reports filed under [the 1940 Act]; and (3) The proposed transaction is consistent with the general purposes of [the 1940 Act]. 6. The Section 17 Applicants submit that the In-Kind Transactions meet the conditions set forth in Section 17(b) of the 1940 Act. 7. The Section 17 Applicants submit that the terms of the In-Kind Transactions, including the consideration to be paid and received, are reasonable, fair, and do not involve overreaching because: (1) The Contract Owners’ Contract values will not be adversely impacted or diluted; (2) with respect to those securities for which market quotations are readily available, the In-Kind Transactions will comply with the conditions set forth in Rule 17a–7, other than the requirement relating to cash consideration; and (3) with respect to those securities for which market quotations are not readily available, the In-Kind Transactions will be effected in accordance with the relevant Existing Funds’ and the relevant corresponding Replacement Funds’ normal valuation procedures, as described in the relevant fund’s registration statement. PO 00000 Frm 00111 Fmt 4703 Sfmt 4703 28989 8. Section 17 Applicants represent that Contract Owners’ Contract values will not be adversely impacted or diluted because the In-Kind Transactions will be effected at the respective net asset values of the Existing Funds and the Replacement Funds, as described in each fund’s registration statement and as required by Rule 22c–1 under the 1940 Act. The In-Kind Transactions will not change the dollar value of any Contract, the accumulation unit value or annuity unit value of any Contract, or the death benefit payable under any Contract. After the In-Kind Transactions, the value of a Separate Account’s investment in a Replacement Fund will equal the value of its investments in the corresponding Existing Fund (in addition to any pre-existing investment in the Replacement Fund) before the InKind Transactions. 9. The adopting release of Rule 17a– 7 states that the purpose of the rule is to set forth ‘‘conditions as to the availability of the exemption to those situations where the Commission, upon the basis of its experience, considers that there is no likelihood of overreaching of the investment companies participating in the transaction.’’ 4 Because the proposed InKind Transactions would comply in substance with the conditions of the rule and since the In-Kind Transactions will be effected at the respective net asset values of the relevant funds, as per the registration statement for each fund and as required by Rule 22c–1 under the 1940 Act, the Section 17 Applicants submit that the terms of the In-Kind Transactions do not present a situation where the investment companies participating in the transaction could overreach and potentially harm investors. Section 17 Applicants claim that the purposes intended by implementation of the rule are therefore met by the terms of the In-Kind Transactions. 10. Section 17 Applicants represent that the proposed In-Kind Transactions will be effected based upon the independent current market price of the portfolio securities as specified in Rule 17a–7(b). Section 17 Applicants claim that the proposed In-Kind Transactions will be consistent with the policy of each registered investment company and separate series thereof participating in the In-Kind Transactions, as recited in the relevant registered investment company’s registration statement and reports in accordance with Rule 17a– 4 1940 Act Rel. Nos. 4604 (May 20, 1966) (proposing release) and 4697 (Sept. 8, 1966) (adopting release). E:\FR\FM\18JNN1.SGM 18JNN1 28990 Federal Register / Vol. 74, No. 116 / Thursday, June 18, 2009 / Notices 7(c). No brokerage commission, fee (except for any customary transfer fees), or other remuneration will be paid in connection with the proposed In-Kind Transactions as specified in Rule 17a– 7(d). NVIT’s board of directors has adopted and implemented the fund governance and oversight procedures as required by Rule 17a–7(e) and (f). Finally, a written record of the procedures for the proposed In-Kind Transactions will be maintained and preserved in accordance with Rule 17a– 7(g). 11. Although the proposed In-Kind Transactions will not comply with the cash consideration requirement of Rule 17a–7(a), Section 17 Applicants assert that the terms of the proposed In-Kind Transactions will offer to each of the relevant Existing Funds and each of the relevant Replacement Funds the same degree of protection from overreaching that Rule 17a–7 generally provides in connection with the purchase and sale of securities under that Rule in the ordinary course of business. Specifically, Insurance Company Applicants and their affiliates cannot effect the proposed In-Kind Transactions at a price that is disadvantageous to any Replacement Fund and the proposed In-Kind Transactions will not occur absent an exemptive order from the Commission. 12. Section 17 Applicants represent that for those Existing Funds that will redeem their shares in-kind as part of the In-Kind Transactions, such transactions will be consistent with the investment policies of the Existing Fund because: (1) The redemption in-kind policy is stated in the relevant Existing Fund’s current registration statement; and (2) the shares will be redeemed at their net asset value in conformity with Rule 22c–1 under the 1940 Act. Likewise, for the Replacement Funds that will sell shares in exchange for portfolio securities as part of the InKind Transactions, such transactions will be consistent with the investment policies of the Replacement Fund because: (1) NVIT’s policy of selling shares in exchange for investment securities is stated in NVIT’s current registration statement; (2) the shares will be sold at their net asset value; and (2) the investment securities will be of the type and quality that a Replacement Fund could have acquired with the proceeds from the sale of its shares had the shares been sold for cash. For each of the proposed In-Kind Transactions, the Adviser and relevant Sub-Adviser(s) will analyze the portfolio securities being offered to each relevant Replacement Fund and will retain only those securities that it would have VerDate Nov<24>2008 21:58 Jun 17, 2009 Jkt 217001 acquired for each such Fund in a cash transaction. 13. Section 17 Applicants represent that all in-kind redemptions from an Existing Fund of which any Section 17 Applicants is an affiliated person will be effected in accordance with the conditions set forth in the Commission’s no-action letter issued to Signature Financial Group, Inc. (available December 28, 1999). 14. Section 17 Applicants assert that the proposed In-Kind Transactions, as described herein, are consistent with the general purposes of the 1940 Act set forth in Section 1 of the 1940 Act. In particular, the proposed In-Kind Transactions do not present any conditions or abuses that the 1940 Act was designed to prevent. 15. Section 17 Applicants request that the Commission issue an order pursuant to Section 17(b) of the 1940 Act to permit them, to the extent necessary, to carry out the proposed In-Kind Transactions. Section 17 Applicants submit that, for all the reasons stated above: (1) The terms of the proposed InKind Transactions, including the consideration to be paid and received, are reasonable and fair to each of the relevant Replacement Funds, each of the relevant Existing Funds, and Contract Owners, and that the proposed In-Kind Transactions do not involve overreaching on the part of any person concerned; (2) the proposed In-Kind Transactions are, or will be, consistent with the policies of the relevant Replacement Funds and the relevant Existing Funds as stated in the relevant investment company’s registration statement and reports filed under the 1940 Act; and (3) the proposed In-Kind Transactions are, or will be, consistent with the general purposes of the 1940 Act. Conclusion Section 26 Applicants submit that for the reasons summarized above the proposed Substitutions meet the standards of Section 26(c) of the 1940 Act and request that the Commission issue an order of approval pursuant to Section 26(c) of the 1940 Act. Section 17 Applicants submit that the proposed InKind Transactions meet the standards of Section 17(b) of the 1940 Act and request that the Commission issue an order of exemption pursuant to Section 17(b) of the 1940 Act. PO 00000 Frm 00112 Fmt 4703 Sfmt 4703 For the Commission, by the Division of Investment Management pursuant to delegated authority. Florence E. Harmon, Deputy Secretary. Appendix 1. AIM Variable Insurance Funds— AIM V.I. Basic Value Fund Replaced by the NVIT—NVIT Multi-Manager Large Cap Value Fund (Substitution Table Reference Nos. 1 & 2) AIM Variable Insurance Funds—AIM V.I. Basic Value Fund: Series I Shares will be replaced by the NVIT—NVIT Multi-Manager Large Cap Value Fund: Class I shares. AIM Variable Insurance Funds—AIM V.I. Basic Value Fund: Series II Shares will be replaced by the NVIT—NVIT Multi-Manager Large Cap Value Fund: Class II shares. The following chart compares the management fees, the total operating expenses (before and after any waivers and reimbursements) expressed as an annual percentage of average daily net assets, and the asset levels of the AIM Variable Insurance Funds—AIM V.I. Basic Value Fund: Series I Shares, AIM Variable Insurance Funds—AIM V.I. Basic Value Fund: Series II Shares, NVIT—NVIT Multi-Manager Large Cap Value Fund: Class I, and NVIT—NVIT Multi-Manager Large Cap Value Fund: Class II. 5 Through April 30, 2010, the fund’s advisor has contractually agreed to waive a portion of its advisory fees to the extent necessary so that the advisory fees payable by the fund do not exceed a specified maximum annual advisory fee rate, wherein the fee rate is based upon average net asset levels as follows: 0.695% of the first $250 million, 0.67% of the next $250 million, 0.645% of the next $500 million, 0.62% of the next $1.5 billion, 0.595% of the next $2.5 billion, 0.57% of the next $2.5 billion, 0.545% of the next $2.5 billion, 0.52% of the excess over $10 billion. 6 ‘‘Other Expenses’’ include administrative services fees which currently are 0.15%, but which are permitted to be as high as 0.25%. The full 0.25% in administrative services fees is not reflected in ‘‘Other Expenses’’ at this time because, until at least May 1, 2010, the Fund does not intend to pay insurance companies a higher amount. If the full amount of administrative services fees were charged, total operating expenses (after fee waivers/ expense reimbursements) would be 1.02% and 1.27%, respectively. 7 NVIT and NFA have entered into a written contract limiting operating expenses to 0.77% until May 1, 2010. This limit excludes certain Fund expenses, including interest, taxes, brokerage commissions, Rule 12b–1 fees, fees paid pursuant to an Administrative Services Plan, short sale dividend expenses, other expenditures which are capitalized in accordance with generally accepted accounting principles and other non-routine expenses not incurred in the ordinary course of the Fund’s business. NVIT is authorized to reimburse the NFA for management fees previously waived or reduced and/or for expenses previously paid by E:\FR\FM\18JNN1.SGM 18JNN1 28991 Federal Register / Vol. 74, No. 116 / Thursday, June 18, 2009 / Notices Existing fund Replacement fund AIM variable insurance funds— AIM V.I. basic value fund shares NVIT–NVIT multi-manager large cap value fund Series I 5 0.68% 5 0.68% 0.00% 0.35% 1.03% 0.00% 1.03% 9 $170.3 Management Fees ........................................................................................... 12b–1 Fees ...................................................................................................... Other Expenses ............................................................................................... Total Gross Expenses ..................................................................................... Waivers/Reimbursements ................................................................................ Total Net Expenses ......................................................................................... Fund/Class 8 Asset Level ($MMs) (5/20/09) .................................................... 2. AIM Variable Insurance Funds— AIM V.I. Large Cap Growth Fund: Series I Shares Replaced by the NVIT— NVIT Multi-Manager Large Cap Growth Fund: Class I (Substitution Table Reference No. 3) Class I Series II 0.25% 0.35% 1.28% 0.00% 1.28% 10 $143.4 The following chart compares the management fees, the total operating expenses (before and after any waivers and reimbursements) expressed as an annual percentage of average daily net assets, and the asset levels of the AIM Class II 0.65% 0.00% 6 0.37% 1.02% 7 0.10% 0.92% $0.2 0.65% 0.25% 6 0.37% 1.27% 7 0.10% 1.17% $5.9 Variable Insurance Funds—AIM V.I. Large Cap Growth Fund: Series I Shares and the NVIT—NVIT Multi-Manager Large Cap Growth Fund: Class I. Existing fund Replacement fund AIM Variable Insurance Funds—AIM V.I. Large Cap Growth Fund: Series I Shares NVIT—NVIT Multi-Manager Large Cap Growth Fund: Class I 11 0.70% Management Fees ........................................................................... 12b–1 Fees ...................................................................................... Other Expenses ............................................................................... NFA, provided, however, that any reimbursements must be paid at a date not more than three years after the fiscal year in which NFA waived the fees or reimbursed the expenses and the reimbursements do not cause the Fund to exceed the expense limitation in the agreement. 8 Represents assets held by the fund or listed share class, as applicable. 9 Based on asset levels as of 3/31/09, approximately 2% of AIM V.I. Basic Value Fund Shares: Series I assets will be transferred to NVIT Multi-Manager Large Cap Value Fund: Class I pursuant to the Substitution. This transfer represents approximately 1% of the Existing Fund’s total assets. 10 Based on asset levels as of 3/31/09, approximately 19% of AIM V.I. Basic Value Fund Shares: Series II assets will be transferred to NVIT Multi-Manager Large Cap Value Fund: Class II pursuant to the Substitution. This transfer represents approximately 9% of the Existing Fund’s total assets. 11 Through April 30, 2010, the fund’s advisor has contractually agreed to waive a portion of its advisory fees to the extent necessary so that the advisory fees payable by the fund do not exceed a specified maximum annual advisory fee rate, wherein the fee rate is based upon average levels as follows: 0.695% of the first $250 million, 0.67% of the next $250 million, 0.645% of the next $500 million, 0.62% of the next $1.5 billion, 0.595% of the next $2.5 billion, 0.57% of the next $2.5 billion, 0.545% of the next $2.5 billion, 0.52% of the excess over $10 billion. 12 ‘‘Other Expenses’’ include administrative services fees which currently are 0.15%, but which are permitted to be as high as 0.25%. The full 0.25% in administrative services fees is not reflected in ‘‘Other Expenses’’ at this time because, until at least May 1, 2010, the Fund does not intend to pay insurance companies a higher amount. If the full amount of administrative services fees were VerDate Nov<24>2008 21:58 Jun 17, 2009 Jkt 217001 0.00% 0.40% charged, total operating expenses (after fee waivers/ expense reimbursements) would be 1.00%. 13 The fund’s advisor has contractually agreed to waive advisory fees and/or reimburse expenses to the extent necessary to limit Total Annual Fund Operating Expenses (excluding certain items discussed below) to 1.01% of average daily net assets. In determining the advisor’s obligation to waive advisory fees and/or reimburse expenses, the following expenses are not taken into account, and could cause the Total Annual Fund Operating Expenses to exceed the number reflected above: (i) Interest; (ii) taxes; (iii) dividend expense on short sales; (iv) extraordinary items; (v) expenses related to a merger or reorganization, as approved by the fund’s Board of Trustees; and (vi) expenses that the fund has incurred but did not actually pay because of an expense offset arrangement. Currently, the expense offset arrangements from which the fund may benefit are in the form of credits that the fund receives from banks where the fund or its transfer agent has deposit accounts in which it holds uninvested cash. These credits are used to pay certain expenses incurred by the fund. This expense limitation agreement is in effect through at least April 30, 2010. 14 NVIT and NFA have entered into a written contract limiting operating expenses to 0.75% until at least May 1, 2010. This limit excludes certain Fund expenses, including any taxes, interest, brokerage fees, Rule 12b–1 fees, short-sale dividend expenses, administrative services fees, other expenses which are capitalized in accordance with generally accepted accounting principles and may exclude other non-routine expenses not incurred in the ordinary course of the Fund’s business. NVIT is authorized to reimburse NFA for management fees previously waived and/or for expenses previously paid by NFA, provided however, that any reimbursements must be paid at a date not more than three years after the fiscal year in which NFA waived the fees or reimbursed the expenses and the reimbursements do not cause the Fund to exceed the expense limitation in the agreement. 15 Represents assets held by the fund or listed share class, as applicable. PO 00000 Frm 00113 Fmt 4703 Sfmt 4703 0.65% 0.00% 12 0.36% 16 Based on asset levels as of 3/31/09, approximately 0.1% of the Existing Fund’s Series I assets will be transferred to the Replacement Fund pursuant to the Substitution. This transfer represents approximately 0.3% of the Existing Fund’s total assets. 17 The fund pays the advisor a single, unified management fee for arranging all services necessary for the fund to operate. The fee shown is based on assets during the fund’s most recent fiscal year. The fund has a stepped fee schedule, which is reflected in the following table: 1.00% of first $500 million, 0.95% of the next $500 million, and 0.90% over $1 billion. 18 ‘‘Other Expenses’’ include administrative services fees which currently are 0.07%, but which are permitted to be as high as 0.25%. The full 0.25% in administrative services fees is not reflected in ‘‘Other Expenses’’ at this time because, until at least May 1, 2010, the Fund does not intend to pay insurance companies a higher amount. If the full amount of administrative services fees were charged, total operating expenses (after fee waivers/ expense reimbursements) would be 1.07%. 19 NVIT and NFA have entered into a written contract limiting operating expenses to 0.82% until at least May 1, 2010. This limit excludes certain Fund expenses, including any interest, taxes, brokerage commissions, Rule 12b-1 fees, fees paid pursuant to an Administrative Services Plan, shortsale dividend expenses, other expenditures which are capitalized in accordance with generally accepted accounting principles and other nonroutine expenses not incurred in the ordinary course of the Fund’s business. NVIT is authorized to reimburse NFA for management fees previously waived or reduced and/or for expenses previously paid by NFA, provided however, that any reimbursements must be paid at a date not more than three years after the fiscal year in which NFA waived the fees or reimbursed the expenses and the reimbursements do not cause the Fund to exceed the expense limitation in the agreement. E:\FR\FM\18JNN1.SGM 18JNN1 28992 Federal Register / Vol. 74, No. 116 / Thursday, June 18, 2009 / Notices Existing fund Replacement fund AIM Variable Insurance Funds—AIM V.I. Large Cap Growth Fund: Series I Shares NVIT—NVIT Multi-Manager Large Cap Growth Fund: Class I Total Gross Expenses ..................................................................... Waivers/Reimbursements ................................................................ Total Net Expenses ......................................................................... Fund/Class 15 Asset Level ($MMs) (5/20/09) ................................... 3. American Century Variable Portfolios, Inc.—American Century VP Capital Appreciation Fund: Class I Replaced by the NVIT—NVIT MultiManager Mid Cap Growth Fund: Class I (Substitution Table Reference No. 4) 1.10% 1.01% 13 0.09% 14 0.11% 1.01% 0.90% $0.6 16 $63.5 The following chart compares the management fees, the total operating expenses (before and after any waivers and reimbursements) expressed as an annual percentage of average daily net assets, and the asset levels of the American Century Variable Portfolios, Inc.—American Century VP Capital Appreciation Fund: Class I and the NVIT—NVIT Multi-Manager Mid Cap Growth Fund: Class I. Existing fund Replacement fund American Century Variable Portfolios, Inc.—American Century VP Capital Appreciation Fund: Class I NVIT—NVIT Multi-Manager Mid Cap Growth Fund: Class I 17 1.00% Management Fees ........................................................................... 12b–1 Fees ...................................................................................... Other Expenses ............................................................................... Total Gross Expenses ..................................................................... Waivers/Reimbursements ................................................................ Total Net Expenses ......................................................................... Fund/Class 20 Asset Level ($MMs) (9/30/08) .................................. 4. American Century Variable Portfolios, Inc.—American Century VP International Fund Replaced by the NVIT—NVIT Multi-Manager International Growth Fund (Substitution Table Reference Nos. 5, 6, 7, & 8) American Century Variable Portfolios, Inc.—American Century VP International Fund: Class I will be replaced by NVIT—NVIT MultiManager International Growth Fund: Class III. American Century Variable Portfolios, Inc.—American Century VP International Fund: Class II will be replaced by NVIT—NVIT Multi- 0.75% 0.00% 18 0.22% 0.97% 19 0.08% 0.89% $87.7 0.00% 0.01% 1.01% 0.00% 1.01% 21 $288.0 Manager International Growth Fund: Class VI. American Century Variable Portfolios, Inc.—American Century VP International Fund: Class III will be replaced by NVIT—NVIT MultiManager International Growth Fund: Class III. American Century Variable Portfolios, Inc.—American Century VP International Fund: Class IV will be replaced by NVIT—NVIT MultiManager International Growth Fund: Class VI. The following chart compares the management fees, the total operating expenses (before and after any waivers and reimbursements) expressed as an annual percentage of average daily net assets, and the asset levels of the American Century Variable Portfolios, Inc.—American Century VP International Fund: Class I, American Century Variable Portfolios, Inc.— American Century VP International Fund: Class II, American Century Variable Portfolios, Inc.—American Century VP International Fund: Class III, American Century Variable Portfolios, Inc.—American Century VP International Fund: Class IV, NVIT— NVIT Multi-Manager International Growth Fund: Class III and NVIT—NVIT Multi-Manager International Growth Fund: Class VI. Existing fund Replacement fund American Century Variable Portfolios, Inc.—American Century VP International Fund NVIT—NVIT Multi-Manager International Growth Fund Class I Management Fees ................................... 12b–1 Fees .............................................. Other Expenses ....................................... Total Gross Expenses ............................. Waivers/Reimbursements ........................ Total Net Expenses ................................. Fund/Class 26 Asset Level ($MMs) (4/30/ 09) ........................................................ VerDate Nov<24>2008 21:58 Jun 17, 2009 Jkt 217001 Class II Class III Class IV Class III Class VI 22 1.36% 23 1.26% 22 1.36% 23 1.26% 0.00% 0.01% 1.37% 0.00% 1.37% 0.25% 0.01% 1.52% 0.00% 1.52% 0.00% 0.01% 1.37% 0.00% 1.37% 0.25% 0.01% 1.52% 0.00% 1.52% 0.85% 0.00% 24 0.30% 1.15% 25 0.04% 1.11% 0.85% 0.25% 24 0.30% 1.40% 25 0.04% 1.36% 27 $258.2 28 $105.1 29 $52.0 30 $9.8 $9.8 $90.6 PO 00000 Frm 00114 Fmt 4703 Sfmt 4703 E:\FR\FM\18JNN1.SGM 18JNN1 28993 Federal Register / Vol. 74, No. 116 / Thursday, June 18, 2009 / Notices 5. American Century Variable Portfolios, Inc.—American Century VP Ultra Fund Replaced by NVIT—NVIT Multi-Manager Large Cap Growth Fund (Substitution Table Reference Nos. 9 & 10) AmericanCentury Variable Portfolios, Inc.—American Century VP Ultra Fund: Class I will be replaced by NVIT—NVIT Multi-Manager Large Cap Growth Fund: Class I and American Century Variable Portfolios, Inc.—American Century VP Ultra Fund: Class II will be replaced by NVIT—NVIT Multi-Manager Large Cap Growth Fund: Class II. The following chart compares the management fees, the total operating expenses (before and after any waivers and reimbursements) expressed as an annual percentage of average daily net assets, and the asset levels of the American Century Variable Portfolios, Inc.—American Century VP Ultra Fund: Class I, American Century Variable Portfolios, Inc.—American Century VP Ultra Fund: Class II, NVIT— NVIT Multi-Manager Large Cap Growth Fund: Class I and NVIT—NVIT MultiManager Large Cap Growth Fund: Class II. Existing fund Replacement fund American Century Variable Portfolios, Inc.—American Century VP Ultra Fund NVIT—NVIT Multi-Manager Large Cap Growth Fund Class I Management Fees ........................................................................................... 12b–1 Fees ...................................................................................................... Other Expenses ............................................................................................... Total Gross Expenses ..................................................................................... Waivers/Reimbursements ................................................................................ Total Net Expenses ......................................................................................... Fund/Class 36 Asset Level ($MMs) (4/30/09) .................................................. Class II 31 1.00% 32 0.90% 0.00% 0.01% 1.01% 0.00% 1.01% 37 $37.2 0.25% 0.01% 1.16% 0.00% 1.16% 38 $177.6 Class I 0.65% 0.00% 33 0.36% 1.01% 35 0.11% 0.90% $0.6 Class II 0.65% 0.25% 34 0.36% 1.26% 35 0.11% 1.15% $1.4 6. American Century Variable Portfolios, Inc.—American Century VP Vista Fund Replaced by NVIT—NVIT Multi-Manager Mid Cap Growth Fund (Substitution Table Reference Nos. 11, 12, & 13) American Century Variable Portfolios, Inc.—American Century VP Vista Fund: 20 Represents assets held by the fund or listed share class, as applicable. 21 Based on asset levels as of 3/31/09, approximately 27% of the Existing Fund’s Class I assets will be transferred to the Replacement Fund pursuant to the Substitution. This transfer represents approximately 27% of the Existing Fund’s total assets. 22 The fund pays the advisor a single, unified management fee for arranging all services necessary for the fund to operate. The fund has a stepped fee schedule, which is as follows: 1.50% of first $250 million, 1.20% of the next $250 million, 1.10% of the next $500 million, and 1.00% over $1 billion. The fee shown has been restated based on strategy assets for the period from the most recent fiscal year end through March 31, 2009. As a result, the Total Annual Fund Operating Expenses in this table differ from those shown in the fund’s prospectus or statement of additional information. The fee for the fiscal year ended December 31, 2008 was 1.23%. 23 The fund pays the advisor a single, unified management fee for arranging all services necessary for the fund to operate. The fund has a stepped fee schedule, which is as follows: 1.40% of first $250 million, 1.10% of the next $250 million, 1.00% of the next $500 million, and 0.90% over $1 billion. The fee shown has been restated based on strategy assets for the period from the most recent fiscal year end through March 31, 2009. As a result, the Total Annual Fund Operating Expenses in this table differ from those shown in the fund’s prospectus and statement of additional information. The fee for the fiscal year ended December 31, 2008 was 1.13%. 24 ‘‘Other Expenses’’ include administrative services fees which currently are 0.15%, but which are permitted to be as high as 0.25%. The full 0.25% in administrative services fees is not reflected in ‘‘Other Expenses’’ at this time because, until at least May 1, 2010, the Fund does not intend to pay insurance companies a higher amount. If the full amount of administrative services fees were charged, total operating expenses (after fee waivers/ expense reimbursements) would be 1.21% and 1.46%, respectively. 25 NVIT and NFA have entered into a written contract limiting operating expenses to 0.96% until at least May 1, 2010. This limit excludes certain Fund expenses, including any taxes, interest, brokerage fees, Rule 12b–1 fees, short-sale dividend expenses, administrative services fees, other expenses which are capitalized in accordance with generally accepted accounting principles and may exclude other non-routine expenses not incurred in the ordinary course of the Fund’s business. NVIT is authorized to reimburse NFA for management fees previously waived and/or for expenses previously paid by NFA, provided however, that any reimbursements must be paid at a date not more than three years after the fiscal year in which NFA waived the fees or reimbursed the expenses and the reimbursements do not cause the Fund to exceed the expense limitation in the agreement. 26 Represents assets held by the fund or listed share class, as applicable. 27 Based on asset levels as of 3/31/09, approximately 23% of the Existing Fund’s Class I assets will be transferred to the Replacement Fund’s Class III pursuant to the Substitution. This transfer represents approximately 16% of the Existing Fund’s total assets. 28 Based on asset levels as of 3/31/09, approximately 2% of the Existing Fund’s Class II assets will be transferred to the Replacement Fund’s Class VI pursuant to the Substitution. This transfer represents approximately 0.3% of the Existing Fund’s total assets. 29 Based on asset levels as of 3/31/09, approximately 87% of the Existing Fund’s Class III assets will be transferred to the Replacement Fund’s Class III pursuant to the Substitution. This transfer represents approximately 12% of the Existing Fund’s total assets. 30 Based on asset levels as of 3/31/09, approximately 90% of the Existing Fund’s Class IV assets will be transferred to the Replacement Fund pursuant to the Substitution. This transfer represents approximately 2% of the Existing Fund’s total assets. 31 The fund pays the advisor a single, unified management fee for arranging all services necessary for the fund to operate. The fee shown is based on assets during the fund’s most recent fiscal year. The fund has s stepped fee schedule. As a result, the fund’s unified management fee rate generally decreases as strategy assets increase and increases as strategy assets decrease. 32 The fund pays the advisor a single, unified management fee for arranging all services necessary for the fund to operate. The fee shown is based on assets during the fund’s most recent fiscal year. The fund has s stepped fee schedule, which is as follows: 0.90% of first $500 million, 0.85% of next $500 million, and 0.80% over $1 billion. 33 ‘‘Other Expenses’’ include administrative services fees which currently are 0.15%, but which are permitted to be as high as 0.25%. The full 0.25% in administrative services fees is not reflected in ‘‘Other Expenses’’ at this time because, until at least May 1, 2010, the Fund does not intend to pay insurance companies a higher amount. If the full amount of administrative services fees were charged, total operating expenses (after fee waivers/ expense reimbursements) would be 1.00%. 34 ‘‘Other Expenses’’ include administrative services fees which currently are 0.15%, but which Continued VerDate Nov<24>2008 21:58 Jun 17, 2009 Jkt 217001 PO 00000 Frm 00115 Fmt 4703 Sfmt 4703 E:\FR\FM\18JNN1.SGM 18JNN1 28994 Federal Register / Vol. 74, No. 116 / Thursday, June 18, 2009 / Notices Class I will be replaced by NVIT—NVIT Multi-Manager Mid Cap Growth Fund: Class I. American Century Variable Portfolios, Inc.—American Century VP Vista Fund: Class II will be replaced by NVIT—NVIT Multi-Manager Mid Cap Growth Fund: Class I or Class II, depending on the contract involved in the Substitution. The following chart compares the management fees, the total operating expenses (before and after any waivers and reimbursements) expressed as an annual percentage of average daily net assets, and the asset levels of American Century Variable Portfolios, Inc.—American Century VP Vista Fund: Class I, American Century Variable Portfolios, Inc.—American Century VP Vista Fund: Class II, NVIT—NVIT MultiManager Mid Cap Growth Fund: Class I and NVIT—NVIT Multi-Manager Mid Cap Growth Fund: Class II. Existing fund Replacement fund American Century Variable Portfolios, Inc.—American Century VP Vista Fund NVIT—NVIT Multi-Manager Mid Cap Growth Fund Class I Management Fees ........................................................................................... 12b–1 Fees ...................................................................................................... Other Expenses ............................................................................................... Total Gross Expenses ..................................................................................... Waivers/Reimbursements ................................................................................ Total Net Expenses ......................................................................................... Fund/Class 41 Asset Level ($MMs) (4/30/09) .................................................. 7. Credit Suisse Trust—International Equity Flex I Portfolio (Formerly, International Focus Portfolio) Replaced by NVIT—Gartmore NVIT are permitted to be as high as 0.25%. The full 0.25% in administrative services fees is not reflected in ‘‘Other Expenses’’ at this time because, until at least May 1, 2010, the Fund does not intend to pay insurance companies a higher amount. If the full amount of administrative services fees were charged, total operating expenses (after fee waivers/ expense reimbursements) would be 1.25%. 35 NVIT and NFA have entered into a written contract limiting operating expenses to 0.75% until at least May 1, 2010. This limit excludes certain Fund expenses, including any taxes, interest, brokerage fees, Rule 12b–1 fees, short-sale dividend expenses, administrative services fees, other expenses which are capitalized in accordance with generally accepted accounting principles and may exclude other non-routine expenses not incurred in the ordinary course of the Fund’s business. NVIT is authorized to reimburse NFA for management fees previously waived and/or for expenses previously paid by NFA, provided however, that any reimbursements must be paid at a date not more than three years after the fiscal year in which NFA waived the fees or reimbursed the expenses and the reimbursements do not cause the Fund to exceed the expense limitation in the agreement. 36 Represents assets held by the fund or listed share class, as applicable. 37 Based on asset levels as of 3/31/09, approximately 22% of the Existing Fund’s Class I assets will be transferred to the Replacement Fund’s Class I pursuant to the Substitution. This transfer represents approximately 4% of the Existing Fund’s total assets. 38 Based on asset levels as of 3/31/09, approximately 4% of the Existing Fund’s Class II assets will be transferred to the Replacement Fund’s Class II pursuant to the Substitution. This transfer represents approximately 4% of the Existing Fund’s total assets. 39 ‘‘Other Expenses’’ include administrative services fees which currently are 0.07%, but which are permitted to be as high as 0.25%. The full 0.25% in administrative services fees is not reflected in ‘‘Other Expenses’’ at this time because, until at least May 1, 2010, the Fund does not intend to pay insurance companies a higher amount. If the VerDate Nov<24>2008 21:58 Jun 17, 2009 Jkt 217001 1.00% 0.00% 0.01% 1.01% 0.00% 1.01% 42 $37.7 International Equity Fund (Substitution Table Reference Nos. 14 & 15) Credit Suisse Trust—International Equity Flex I Portfolio (formerly, full amount of administrative services fees were charged, total operating expenses (after fee waivers/ expense reimbursements) would be 1.07% and 1.32%, respectively. 40 NVIT and NFA have entered into a written contract limiting operating expenses to 0.82% for all share classes until at least May 1, 2010. This limit excludes certain Fund expenses, including any interest, taxes, brokerage commissions, Rule 12b–1 fees, fees paid pursuant to an Administrative Services Plan, short-sale dividend expenses, other expenditures which are capitalized in accordance with generally accepted accounting principles and other non-routine expenses not incurred in the ordinary course of the Fund’s business. NVIT is authorized to reimburse NFA for management fees previously waived or reduced and/or for expenses previously paid by NFA, provided however, that any reimbursements must be paid at a date not more than three years after the fiscal year in which NFA waived the fees or reimbursed the expenses and the reimbursements do not cause the Fund to exceed the expense limitation in the agreement. 41 Represents assets held by the fund or listed share class, as applicable. 42 Based on asset levels as of 3/31/09, approximately 29% of the Existing Fund’s Class I assets will be transferred to the Replacement Fund’s Class I pursuant to the Substitution. This transfer represents approximately 22% of the Existing Fund’s total assets. 43 Based on asset levels as of 3/31/09, approximately 2% of the Existing Fund’s Class II assets will be transferred to the Replacement Fund’s Class I pursuant to the Substitution. This transfer represents approximately 0.5% of the Existing Fund’s total assets. Based on asset levels as of 3/ 31/09, approximately 94% of the Existing Fund’s Class II assets will be transferred to the Replacement Fund’s Class II pursuant to the Substitution. This transfer represents approximately 22% of the Existing Fund’s total assets. 44 Management fees have been restated to reflect the elimination of a performance-based management fee and implementation of an assetbased management fee equal to the lowest possible management fee under the previous performance- PO 00000 Frm 00116 Fmt 4703 Sfmt 4703 Class II 0.90% 0.25% 0.01% 1.16% 0.00% 1.16% 43 $11.7 Class I 0.75% 0.00% 39 0.22% 0.97% 40 0.08% 0.89% $87.7 Class II 0.75% 0.25% 39 0.22% 1.22% 40 0.08% 1.14% $134.2 International Focus Portfolio) will be replaced by NVIT—Gartmore NVIT International Equity Fund: Class I or based fee structure, as approved by the Board of Trustees on January 16, 2009. Under no circumstances, during a six-month transition period will the management fee under the new fee structure exceed what the Adviser would have received under the old structure assuming maximum penalty for underperformance. 45 ‘‘Other Expenses’’ include administrative services fees which currently are 0.15%, but which are permitted to be as high as 0.25%. The full 0.25% in administrative services fees is not reflected in ‘‘Other Expenses’’ at this time because, until at least May 1, 2010, the Fund does not intend to pay insurance companies a higher amount. If the full amount of administrative services fees were charged, total operating expenses would be 1.21%. 46 NVIT and NFA have entered into a written contract limiting operating expenses to 1.05% for all share classes until at least May 1, 2010. This limit excludes certain Fund expenses, including interest, taxes, brokerage commissions, Rule 12b–1 fees, fees paid pursuant to an Administrative Services Plan, short-sale dividend expenses, other expenditures which are capitalized in accordance with generally accepted accounting principles and other non-routine expenses not incurred in the ordinary course of the Fund’s business. NVIT is authorized to reimburse NFA for management fees previously waived or reduced and/or for expenses previously paid by NFA provided, however, that any reimbursements must be paid at a date not more than three years after the fiscal year in which NFA waived the fees or reimbursed the expenses and the reimbursements do not cause the Fund to exceed the expense limitation in the agreement. Currently, all share classes are operating below the expense limit. 47 Represents assets held by the fund or listed share class, as applicable. 48 Based on asset levels as of 3/31/09, approximately 0.5% of the Existing Fund’s assets will be transferred to the Replacement Fund’s Class I pursuant to the Substitution. This transfer represents approximately 0.5% of the Existing Fund’s total assets. Based on asset levels as of 3/ 31/09, approximately 47% of the Existing Fund’s E:\FR\FM\18JNN1.SGM 18JNN1 28995 Federal Register / Vol. 74, No. 116 / Thursday, June 18, 2009 / Notices Class III, depending on the contract involved in the Substitution. The following chart compares the management fees, the total operating expenses (before and after any waivers and reimbursements) expressed as an annual percentage of average daily net assets, and the asset levels of Credit Suisse Trust—International Equity Flex I Portfolio, NVIT—Gartmore NVIT International Equity Fund: Class I and NVIT—Gartmore NVIT International Equity Fund: Class III. Existing fund Replacement fund Credit Suisse Trust— International Equity Flex I Portfolio NVIT—Gartmore NVIT International Equity Fund Management Fees ............................................................................................. 12b–1 Fees ........................................................................................................ Other Expenses ................................................................................................. Total Gross Expenses ....................................................................................... Waivers/Reimbursements .................................................................................. Total Net Expenses ........................................................................................... Fund/Class 47 Asset Level ($MMs) (5/20/09) .................................................... 8. Federated Insurance Series— Federated Quality Bond Fund II Replaced by NVIT—NVIT Core Bond Fund (Substitution Table Reference Nos. 16 & 17) 1.00% 0.00% 1.14% 2.14% 0.00% 2.14% 48 $44.5 NVIT—NVIT Core Bond Fund: Class I. Federated Insurance Series—Federated Quality Bond Fund II: Service Shares will be replaced by NVIT—NVIT Core Bond Fund: Class II. The following chart compares the management fees, the total operating expenses (before and after any waivers and reimbursements) expressed as an annual percentage of average daily Federated Insurance Series— Federated Quality Bond Fund II: Primary Shares will be replaced by Class I 44 0.80% 0.00% 45 0.31% 1.11% 46 0.00% 1.11% $8.1 Class III 44 0.80% 0.00% 45 0.31% 1.11% 46 0.00% 1.11% $35.4 net assets, and the asset levels of Federate Insurance Series—Federated Quality Bond Fund II: Primary Shares, Federate Insurance Series—Federated Quality Bond Fund II: Service Shares, NVIT—NVIT Core Bond Fund: Class I and NVIT—NVIT Core Bond Fund: Class II. Existing fund Replacement fund Federated Insurance Series— Federated Quality Bond Fund II NVIT—NVIT Core Bond Fund Primary Management Fees ........................................................................................... 12b–1 Fees ...................................................................................................... Other Expenses ............................................................................................... Total Gross Expenses ..................................................................................... Waivers/Reimbursements ................................................................................ Total Net Expenses ......................................................................................... Fund/Class 55 Asset Level ($MMs) (5/19/09) .................................................. Service 49 0.60% 49 0.60% 50 0.25% 0.25% 51 0.39% 1.24% 0.00% 1.24% 57 $62.7 51 0.39% 1.24% 53 0.00% 1.24% 56 $218.5 9. Franklin Templeton Variable Insurance Products Trust—Templeton Developing Markets Securities Fund Replaced by NVIT—Gartmore NVIT Emerging Markets Fund (Substitution Table Reference Nos. 18 & 19) Franklin Templeton Variable Insurance Products Trust—Templeton shareholder services. The shareholder services provider did not charge, and therefore the Fund’s Primary Shares did not accrue, its fee. This reduction can be terminated at any time. Total other expenses paid by the Fund’s Primary Shares (after the reduction) were 0.14% for the fiscal year ended December 31, 2008. 52 ‘‘Other Expenses’’ include administrative services fees which currently are 0.15%, but which are permitted to be as high as 0.25%. The full 0.25% in administrative services fees is not reflected in ‘‘Other Expenses’’ at this time because, until at least May 1, 2010, the Fund does not intend to pay insurance companies a higher amount. If the full amount of administrative services fees were charged, total operating expenses (after fee waivers/ expense reimbursements) would be 0.80% and 1.05% respectively. 0.40% 0.00% 52 0.37% 0.77% 54 0.07% 0.70% $4.8 Class II 0.40% 0.25% 52 0.37% 1.02% 54 0.07% 0.95% $7.1 Developing Markets Securities Fund: assets will be transferred to the Replacement Fund’s Class III pursuant to the Substitution. This transfer represents approximately 47% of the Existing Fund’s total assets. 49 The Adviser voluntarily waived a portion of the management fee. The Adviser can terminate this voluntary waiver at any time. The management fee paid by the Fund (after the voluntary waiver) was 0.56% for the fiscal year ended December 31, 2008. 50 The Fund’s Primary Shares did not pay or accrue the distribution (12b–1) fee during the fiscal year ended December 31, 2008. The Fund’s Primary Shares have no present intention of paying or accruing the distribution (12b–1) fee during the fiscal year ending December 31, 2009. 51 Includes an administrative services fee which is used to compensate insurance companies for Class I 53 Although not contractually obligated to do so, the Adviser waived and the distributor and shareholder services provider elected not to charge 0.56% in expenses, resulting in Total Net Expenses (after waiver reductions) of 0.70%. 54 NVIT and NFA have entered into a written contract limiting operating expenses to 0.55% for all share classes until May 1, 2010. This limit excludes certain Fund expenses, including interest, taxes, brokerage commissions, Rule 12b–1 fees, fees paid pursuant to an Administrative Services Plan, short sale dividend expenses, other expenditures which are capitalized in accordance with generally accepted accounting principles and other nonroutine expenses not incurred in the ordinary course of the Fund’s business. NVIT is authorized to reimburse NFA for management fees previously Continued VerDate Nov<24>2008 21:58 Jun 17, 2009 Jkt 217001 PO 00000 Frm 00117 Fmt 4703 Sfmt 4703 E:\FR\FM\18JNN1.SGM 18JNN1 28996 Federal Register / Vol. 74, No. 116 / Thursday, June 18, 2009 / Notices Class 3 will be replaced by NVIT— Gartmore NVIT Emerging Markets Fund: Class III or NVIT—Gartmore NVIT Emerging Markets Fund: Class VI, depending on the contract involved in the Substitution. The following chart compares the management fees, the total operating expenses (before and after any waivers and reimbursements) expressed as an annual percentage of average daily net assets, and the asset levels of Franklin Templeton Variable Insurance Products Trust—Templeton Developing Markets Securities Fund: Class 3, NVIT—Gartmore NVIT Emerging Markets Fund: Class III and NVIT— Gartmore NVIT Emerging Markets Fund: Class VI. Existing fund Replacement fund Franklin Templeton Variable Insurance Products Trust— Templeton Developing Markets Securities Fund NVIT—Gartmore NVIT Emerging Markets Fund Class III Class VI Class 3 1.25% 58 0.95% 59 0.25% Management Fees ............................................................................................. 12b–1 Fees ........................................................................................................ Other Expenses ................................................................................................. Total Gross Expenses ....................................................................................... Waivers/Reimbursements .................................................................................. Total Net Expenses ........................................................................................... Fund/Class63 Asset Level ($MMs) (5/20/09) ..................................................... 0.00% 60 0.29% 1.24% 62 0.00% 1.24% $101.6 0.29% 1.79% 61 0.01% 1.78% 64 $42.3 58 0.95% 0.25% 60 0.28% 1.48% 62 0.00% 1.48% $44.8 10. Janus Aspen Series—INTECH RiskManaged Core Portfolio Replaced by NVIT—NVIT Nationwide Fund (Substitution Table Reference Nos. 20 & 21) Janus Aspen Series—INTECH RiskManaged Core Portfolio: Service Shares will be replaced by NVIT—NVIT Nationwide Fund: Class I or Class II, depending on the contract involved in the Substitution. The following chart compares the management fees, the total operating expenses (before and after any waivers and reimbursements) expressed as an annual percentage of average daily net assets, and the asset levels of Janus Aspen Series—INTECH Risk-Managed Core Portfolio: Service Shares, NVIT— NVIT Nationwide Fund: Class I and NVIT—NVIT Nationwide Fund: Class II. waived or reduced and/or for expenses previously paid by NFA, provided, however, that any reimbursements must be paid at a date not more than three years after the fiscal year in which NFA waived the fees or reimbursed the expenses and the reimbursements do not cause the Fund to exceed the expense limitation in the agreement. 55 Represents assets held by the fund or listed share class, as applicable. 56 Based on asset levels as of 3/31/09, approximately 84% of the Existing Fund’s Primary Share assets will be transferred to the Replacement Fund’s Class I pursuant to the Substitution. This transfer represents approximately 65% of the Existing Fund’s total assets. 57 Based on asset levels as of 3/31/09, approximately 97% of the Existing Fund’s Service Share assets will be transferred to the Replacement Fund’s Class II pursuant to the Substitution. This transfer represents approximately 21.5% of the Existing Fund’s total assets. 58 Management fees have been restated to reflect the elimination of a performance-based management fee and implementation of an assetbased management fee equal to the lowest possible management fee under the previous performancebased fee structure, as approved by the Board of Trustees on September 18, 2008. Under no circumstances, during a six-month transition period will the management fee under the new fee structure exceed what the Adviser would have received under the old structure assuming maximum penalty for underperformance. 59 While the maximum amount payable under the Fund’s Class 3 rule 12b–1 plan is 0.35% per year of the Fund’s average daily net assets, the Fund’s board of trustees has set the current rate at 0.25% per year through April 30, 2010. 60 ‘‘Other Expenses’’ include administrative services fees which currently are 0.16% and 0.15%, respectively, but which are permitted to be as high as 0.25%. The full 0.25% in administrative services fees is not reflected in ‘‘Other Expenses’’ at this time because, until at least May 1, 2010, the Fund does not intend to pay insurance companies a higher amount. If the full amount of administrative services fees were charged, total operating expenses would be 1.33% and 1.58%, respectively. 61 The investment manager has agreed in advance to reduce its fee from assets invested by the Fund in a Franklin Templeton money market fund (the Sweep Money Fund which is the ‘‘acquired fund’’ in this case) to the extent of the Fund’s fees and expenses of the acquired fund. This reduction is required by the Trust’s board of trustees and an exemptive order by the Securities and Exchange Commission; this arrangement will continue as long as the exemptive order is relied upon. 62 NVIT and NFA have entered into a written contract limiting operating expenses to 1.20% for all share classes until at least May 1, 2010. This limit excludes certain Fund expenses, including interest, taxes, brokerage commissions, Rule 12b–1 fees, fees paid pursuant to an Administrative Services Plan, short sale dividend expenses, other expenditures which are capitalized in accordance with generally accepted accounting principles and other non-routine expenses not incurred in the ordinary course of the Fund’s business. NVIT is authorized to reimburse NFA for management fees previously waived or reduced and/or for expenses previously paid by NFA provided, however, that any reimbursements must be paid at a date not more than three years after the fiscal year in which NFA waived the fees or reimbursed the expenses and the reimbursements do not cause the Fund to exceed the expense limitation in the agreement. Currently, all share classes are operating below the expense limit. 63 Represents assets held by the fund or listed share class, as applicable. 64 Based on asset levels as of 3/31/09, approximately 30% of the Existing Fund’s Class 3 assets will be transferred to the NVIT—Gartmore NVIT Emerging Markets Fund: Class III and approximately 36% of the Existing Fund’s Class 3 assets will be transferred to NVIT—Gartmore NVIT Emerging Markets Fund: Class VI pursuant to the Substitution. These transfers represent approximately 5% of the Existing Fund’s total assets. 65 The ‘‘Management Fee’’ is the investment advisory fee rate paid by each Portfolio to Janus Capital as of the end of the fiscal year. This fee may go up or down monthly based on the Portfolio’s performance relative to its benchmark index over the performance measurement period. This fee rate, prior to any performance adjustment, is 0.50% and may go up or down by a variable of up to 0.15% (assuming constant assets) on a monthly basis. Any such adjustment to this fee rate commenced January 2007, and may increase or decrease the Management Fee. The Portfolio has entered into an agreement with Janus Capital to limit certain expenses. Because a fee waiver will have a positive effect upon the Portfolio’s performance, a fee waiver that is in place during the period when the performance adjustment applies may affect the performance adjustment in a way that is favorable to Janus Capital. It is possible that the cumulative dollar amount of additional compensation ultimately payable to Janus Capital may, under some circumstances, exceed the cumulative dollar amount of management fees waived by Janus Capital. 66 ‘‘Other Expenses’’ include administrative services fees which currently are 0.15%, but which are permitted to be as high as 0.25%. The full amounts of administrative services fees are not reflected in ‘‘Other Expenses’’ at this time because, until at least May 1, 2010, the Fund does not intend to pay insurance companies a higher amount. If the full amounts of administrative services fees were charged, total operating expenses would be 0.94% and 1.19%, respectively. 67 Janus Capital has contractually agreed to waive certain Portfolios’ total operating expenses (excluding the distribution and shareholder servicing fee, the administrative services fee applicable to certain Portfolios, brokerage commissions, interest, dividends, taxes, and extraordinary expenses including, but not limited to, acquired fund fees and expenses) to until at least May 1, 2010. 68 Represents assets held by the fund or listed share class, as applicable. VerDate Nov<24>2008 21:58 Jun 17, 2009 Jkt 217001 PO 00000 Frm 00118 Fmt 4703 Sfmt 4703 E:\FR\FM\18JNN1.SGM 18JNN1 28997 Federal Register / Vol. 74, No. 116 / Thursday, June 18, 2009 / Notices Existing fund Replacement fund Janus Aspen Series—INTECH RiskManaged Core Portfolio NVIT—NVIT Nationwide Fund Class I Service Shares 0.40%65 0.25% 1.06% 1.71% 67 0.26% 1.45% 69 $20.5 Management Fees ................................................................................... 12b–1 Fees .............................................................................................. Other Expenses ....................................................................................... Total Gross Expenses ............................................................................. Waivers/Reimbursements ........................................................................ Total Net Expenses ................................................................................. Fund/Class 68 Asset Level ($MMs) (5/30/09) .......................................... 11. Neuberger Berman Advisers Management Trust—AMT Growth Portfolio Replaced by NVIT—NVIT Multi-Manager Mid Cap Growth Fund (Substitution Table Reference No. 22) Neuberger Berman Advisers Management Trust—AMT Growth Portfolio: I Class will be replaced by NVIT—NVIT Multi-Manager Mid Cap Growth Fund: Class I. The following chart compares the management fees, the total operating expenses (before and after any waivers and reimbursements) expressed as an annual percentage of 0.58% 0.00% 66 0.26% 0.84% 0.00% 0.84% $629.2 Class II 0.58% 0.25% 66 0.26% 1.09% 0.00% 1.09% $316.6 average daily net assets, and the asset levels of Neuberger Berman Advisers Management Trust—AMT Growth Portfolio: I Class and NVIT—NVIT Multi-Manager Mid Cap Growth Fund: Class I. Existing fund Replacement fund Neuberger Berman Advisers Management Trust—AMT Growth Portfolio: I Class NVIT—NVIT Multi-Manager Mid Cap Growth Fund: Class I 0.85% 0.00% 0.19% 1.04% 71 0.00% 1.04% 74 $78.5 0.75% 0.00% 70 0.22% 0.97% 72 0.08% 0.89% $87.7 Management Fees ................................................................................................................... 12b–1 Fees .............................................................................................................................. Other Expenses ....................................................................................................................... Total Gross Expenses ............................................................................................................. Waivers/Reimbursements ........................................................................................................ Total Net Expenses ................................................................................................................. Fund/Class 73 Asset Level ($MMs) (5/20/09) .......................................................................... 12. Neuberger Berman Advisers Management Trust—AMT Guardian Portfolio Replaced by NVIT— Neuberger Berman NVIT Multi Cap Opportunities Fund (Substitution Table Reference No. 23) Neuberger Berman Advisers Management Trust—AMT Guardian Portfolio: I Class will be replaced by NVIT—Neuberger Berman NVIT Multi Cap Opportunities Fund: Class I. The following chart compares the management fees, the total operating expenses (before and after any waivers and reimbursements) expressed as an annual percentage of average daily net assets, and the asset levels of Neuberger Berman Advisers Management Trust— AMT Guardian Portfolio: I Class and NVIT—Neuberger Berman NVIT Multi Cap Opportunities Fund: Class I. 69 Based on asset levels as of 3/31/09, approximately 2% of the Existing Fund’s Service Shares assets will be transferred to the NVIT—NVIT Nationwide Fund: Class I and approximately 22% of the Existing Fund’s Service Shares assets will be transferred to the NVIT—NVIT Nationwide Fund: Class II pursuant to the Substitution. These transfers represent approximately 24% of the Existing Fund’s total assets. 70 ‘‘Other Expenses’’ include administrative services fees which currently are 0.07%, but which are permitted to be as high as 0.25%. The full 0.25% in administrative services fees is not reflected in ‘‘Other Expenses’’ at this time because, until at least May 1, 2010, the Fund does not intend to pay insurance companies a higher amount. If the full amount of administrative services fees were charged, total operating expenses (after fee waivers/ expense reimbursements) would be 1.07%. 71 Neuberger Berman Management LLC (‘‘NBM’’) has contractually undertaken to limit the Fund’s expenses through December 31, 2012 by reimbursing the Fund for its total operating expenses (excluding the compensation of NBM, taxes, interest, extraordinary expenses, brokerage commissions and transaction costs) that exceed, in the aggregate, 1.00% per annum of the Fund’s average daily net asset value. Because of the exclusion, the Fund’s net expenses may exceed the contractual expense limitation. The Fund has contractually undertaken to reimburse NBM for the excess expenses paid by NBM, provided the reimbursements do not cause total operating expenses (exclusive of the compensation of NBM, taxes, interest, brokerage commissions, transaction costs and extraordinary expenses) to exceed an annual rate of 1.00%, and the reimbursements are made within three years after the year in which NBM incurred the expense. The figures in the table are based on last year’s expenses. 72 NVIT and NFA have entered into a written contract limiting operating expenses to 0.82% for all share classes until at least May 1, 2010. This limit excludes certain Fund expenses, including any interest, taxes, brokerage commissions, Rule 12b–1 fees, fees paid pursuant to an Administrative Services Plan, short-sale dividend expenses, other expenditures which are capitalized in accordance with generally accepted accounting principles and other non-routine expenses not incurred in the ordinary course of the Fund’s business. NVIT is authorized to reimburse NFA for management fees previously waived or reduced and/or for expenses previously paid by NFA, provided however, that any reimbursements must be paid at a date not more than three years after the fiscal year in which NFA waived the fees or reimbursed the expenses and the reimbursements do not cause the Fund to exceed the expense limitation in the agreement. 73 Represents assets held by the fund or listed share class, as applicable. 74 Based on asset levels as of 3/31/09, approximately 88% of the Existing Fund’s I Class assets will be transferred to the Replacement Fund’s Class I pursuant to the Substitution. This transfer represents approximately 88% of the Existing Fund’s total assets. 75 ‘‘Other Expenses’’ include administrative services fees which currently are 0.15%, but which are permitted to be as high as 0.25%. The full 0.25% in administrative services fees is not reflected in ‘‘Other Expenses’’ at this time because, until at least May 1, 2010, the Fund does not intend to pay insurance companies a higher amount. If the full amount of administrative services fees were charged, total operating expenses (after fee waivers/ expense reimbursements) would be 1.00%. 76 Neuberger Berman Management LLC (‘‘NBM’’) has contractually undertaken to limit the expenses of I Class shares through December 31, 2012 by Continued VerDate Nov<24>2008 21:58 Jun 17, 2009 Jkt 217001 PO 00000 Frm 00119 Fmt 4703 Sfmt 4703 E:\FR\FM\18JNN1.SGM 18JNN1 28998 Federal Register / Vol. 74, No. 116 / Thursday, June 18, 2009 / Notices Existing fund Replacement fund Neuberger Berman Advisers Management Trust—AMT Guardian Portfolio: I Class NVIT—Neuberger Berman NVIT Multi Cap Opportunities Fund: Class I 0.85% 0.00% 0.16% 1.01% 0.00% 76 1.01% $62.4 79 0.60% 0.00% 1.50%75 2.10% 1.20% 77 0.90% $2.9 Management Fees ................................................................................................................... 12b–1 Fees .............................................................................................................................. Other Expenses ....................................................................................................................... Total Gross Expenses ............................................................................................................. Waivers/Reimbursements ........................................................................................................ Total Net Expenses ................................................................................................................. Fund/Class 78 Asset Level ($MMs) (5/20/09) .......................................................................... 13. Neuberger Berman Advisers Management Trust—AMT International Portfolio Replaced by NVIT—Gartmore NVIT International Equity Fund (Substitution Table Reference Nos. 24 & 25) Neuberger Berman Advisers Management Trust—AMT International Portfolio: S Class will be replaced by NVIT—Gartmore NVIT International Equity Fund: Class III or Class VI, depending on the contract involved in the Substitution. The following chart compares the management fees, the total operating expenses (before and after any waivers and reimbursements) expressed as an annual percentage of average daily net assets, and the asset levels of Neuberger Berman Advisers Management Trust—AMT International Portfolio: S Class, NVIT—Gartmore NVIT International Equity Fund: Class III and NVIT—Gartmore NVIT International Equity Fund: Class VI. Existing fund Replacement fund Neuberger Berman Advisers Management Trust—AMT International Portfolio NVIT—Gartmore NVIT International Equity Fund S Class Management Fees ................................................................................... 12b–1 Fees .............................................................................................. Other Expenses ....................................................................................... Total Gross Expenses ............................................................................. Waivers/Reimbursements ........................................................................ Total Net Expenses ................................................................................. Fund/Class 84 Asset Level ($MMs) (5/20/09) .......................................... 14. Neuberger Berman Advisers Management Trust—AMT Mid-Cap Growth Portfolio Replaced by NVIT— NVIT Multi-Manager Mid Cap Growth Fund (Substitution Table Reference Nos. 26, 27, & 28) Class III 1.15% 0.25% 0.21% 1.61% 82 0.00% 1.61% 85 $284.0 80 0.80% 0.00% 81 0.31% 1.11% 83 0.00% 1.11% $35.5 Class VI 80 0.80% 0.25% 81 0.31% 1.36% 83 0.00% 1.36% $5.0 Neuberger Berman Advisers Management Trust—AMT Mid-Cap Growth Portfolio: I Class will be replaced by NVIT—NVIT Multi- Manager Mid Cap Growth Fund: Class I. Neuberger Berman Advisers Management Trust—AMT Mid-Cap Growth Portfolio: S Class will be replaced by NVIT—NVIT MultiManager Mid Cap Growth Fund: Class I or Class II, depending on the contract involved in the Substitution. The following chart compares the management fees, the total operating expenses (before and after any waivers and reimbursements) expressed as an annual percentage of average daily net assets, and the asset levels of Neuberger Berman Advisers Management Trust— AMT Mid-Cap Growth Portfolio: I Class, Neuberger Berman Advisers Management Trust—AMT Mid-Cap Growth Portfolio: S Class, NVIT—NVIT Multi-Manager Mid Cap Growth Fund: Class I and NVIT—NVIT Multi-Manager Mid Cap Growth Fund: Class II. reimbursing the Fund for its total operating expenses, excluding compensation to NBM, taxes, interest, extraordinary expenses, transaction costs and brokerage commissions, that exceed, in the aggregate, 1.00% per annum of the Class’s average daily net asset value. Because of the exclusion, the Fund’s net expenses may exceed the contractual expense limitation. The Fund has in turn contractually undertaken to repay NBM from I Class assets for the excess operating expenses borne by NBM, so long as the Class’s annual operating expenses during that period (exclusive of compensation to NBM, taxes, interest, extraordinary expenses and brokerage commissions) does not exceed 1.00% per year of the Class’s average daily net assets, and further provided that the reimbursements are made within three years after the year in which NBM incurred the expense. The figures in the table are based on last year’s expenses. 77 NVIT and NFA have entered into a written contract limiting operating expenses to 0.75% for all share classes until May 1, 2010. This limit excludes certain Fund expenses, including interest, taxes, brokerage commissions, Rule 12b–1 fees, fees paid pursuant to an Administrative Services Plan, short sale dividend expenses, other expenditures which are capitalized in accordance with generally accepted accounting principles and other nonroutine expenses not incurred in the ordinary course of the Fund’s business. NVIT is authorized to reimburse NFA for management fees previously waived or reduced and/or for expenses previously paid by NFA, provided, however, that any reimbursements must be paid at a date not more than three years after the fiscal year in which NFA waived the fees or reimbursed the expenses and the reimbursements do not cause the Fund to exceed the expense limitation in the agreement. 78 Represents assets held by the fund or listed share class, as applicable. 79 Based on asset levels as of 3/31/09, approximately 70% of the Existing Fund’s I Class assets will be transferred to the Replacement Fund’s Class I pursuant to the Substitution. This transfer represents approximately 35% of the Existing Fund’s total assets. 80 Management fees have been restated to reflect the elimination of a performance-based management fee and implementation of an assetbased management fee equal to the lowest possible management fee under the previous performancebased fee structure, as approved by the Board of Trustees on January 16, 2009. Under no circumstances, during a six-month transition period will the management fee under the new fee structure exceed what the Adviser would have received under the old structure assuming maximum penalty for underperformance. 81 ‘‘Other Expenses’’ include administrative services fees which currently are 0.15%, but which are permitted to be as high as 0.25%. The full VerDate Nov<24>2008 21:58 Jun 17, 2009 Jkt 217001 PO 00000 Frm 00120 Fmt 4703 Sfmt 4703 E:\FR\FM\18JNN1.SGM 18JNN1 28999 Federal Register / Vol. 74, No. 116 / Thursday, June 18, 2009 / Notices Existing fund Replacement fund Neuberger Berman Advisers Management Trust—AMT MidCap Growth Portfolio NVIT—NVIT Multi-Manager Mid Cap Growth Fund I Class Management Fees ........................................................................................... 12b–1 Fees ...................................................................................................... Other Expenses ............................................................................................... Total Gross Expenses ..................................................................................... Waivers/Reimbursements ................................................................................ Total Net Expenses ......................................................................................... Fund/Class 90 Asset Level ($MMs) (5/20/09) .................................................. 15. Neuberger Berman Advisers Management Trust—AMT Partners Portfolio Replaced by NVIT— Neuberger Berman NVIT Multi Cap Opportunities Fund (Substitution Table Reference No. 29) 0.83% 0.00% 0.09% 0.92% 87 0.00% 0.92% 91 $331.0 S Class 0.83% 0.25% 0.10% 1.18% 88 0.00% 1.18% 92 $37.3 Class I 0.75% 0.00% 86 0.22% 0.97% 89 0.08% 0.89% $87.7 Class II 0.75% 0.25% 86 0.22% 1.22% 89 0.08% 1.14% $134.2 assets, and the asset levels of Neuberger Berman Advisers Management Trust— AMT Partners Portfolio: I Class and NVIT—Neuberger Berman NVIT Multi Cap Opportunities Fund: Class I. Neuberger Berman Advisers Management Trust—AMT Partners Portfolio: I Class will be replaced by NVIT—Neuberger Berman NVIT Multi Cap Opportunities Fund: Class I. The following chart compares the management fees, the total operating expenses (before and after any waivers and reimbursements) expressed as an annual percentage of average daily net 0.25% in administrative services fees is not reflected in ‘‘Other Expenses’’ at this time because, until at least May 1, 2010, the Fund does not intend to pay insurance companies a higher amount. If the full amount of administrative services fees were charged, total operating expenses would be 1.21% and 1.46%, respectively. 82 Neuberger Berman Management Inc. (NBMI) has undertaken through December 31, 2012 to reimburse certain operating expenses, including the compensation of NBMI and excluding taxes, interest, extraordinary expenses, brokerage commissions and transaction costs, that exceed, in the aggregate, 2.00% of the average daily net asset value of the Fund. The expense limitation agreement is contractual and any excess expenses can be repaid to NBMI within three years of the year incurred, provided such recoupment would not cause the fund to exceed its contractual expense limitation. Moreover, NBMI has voluntarily committed to reimburse certain expenses, as stated above, for an additional 0.50% of the average daily net asset value of fund to maintain the Fund’s net operating expense ratio at 1.50%. NBMI may, at its sole discretion, terminate this voluntary additional reimbursement commitment without notice. The figures in the table are based on last year’s expenses. 83 NVIT and NFA have entered into a written contract limiting operating expenses to 1.05% f until at least May 1, 2010. This limit excludes certain Fund expenses, including interest, taxes, brokerage commissions, Rule 12b–1 fees, fees paid pursuant to an Administrative Services Plan, short sale dividend expenses, other expenditures which are capitalized in accordance with generally accepted accounting principles and other nonroutine expenses not incurred in the ordinary course of the Fund’s business. NVIT is authorized to reimburse NFA for management fees previously waived or reduced and/or for expenses previously paid by NFA provided, however, that any reimbursements must be paid at a date not more than three years after the fiscal year in which NFA waived the fees or reimbursed the expenses and the reimbursements do not cause the Fund to exceed the expense limitation in the agreement. Currently, all share classes are operating below the expense limit. 84 Represents assets held by the fund or listed share class, as applicable. 85 Based on asset levels as of 3/31/09, approximately 1% of the Existing Fund’s S Class assets will be transferred to the NVIT—Gartmore NVIT International Equity Fund: Class III and approximately 3% of the Existing Fund’s S Class assets will be transferred to the NVIT—Gartmore NVIT International Equity Fund: Class VI pursuant to the Substitution. These transfers represent approximately 4% of the Existing Fund’s total assets. 86 ‘‘Other Expenses’’ include administrative services fees which currently are 0.07%, but which are permitted to be as high as 0.25%. The full 0.25% in administrative services fees is not reflected in ‘‘Other Expenses’’ at this time because, until at least May 1, 2010, the Fund does not intend to pay insurance companies a higher amount. If the full amount of administrative services fees were charged, total operating expenses (after fee waivers/ expense reimbursements) would be 1.07% and 1.32%, respectively. 87 Neuberger Berman Management LLC (‘‘NBM’’) has contractually undertaken to limit the expenses of I Class shares through December 31, 2012 by reimbursing the Fund for its total operating expenses, excluding compensation to NBM, taxes, interest, extraordinary expenses, transaction costs and brokerage commissions, that exceed, in the aggregate, 1.00% per annum of the Class’s average daily net asset value. Because of the exclusion, the Fund’s net expenses may exceed the contractual expense limitation. The Fund has in turn contractually undertaken to repay NBM from I Class assets for the excess operating expenses borne by NBM, so long as the Class’s annual operating expenses during that period (exclusive of the compensation to NBM, taxes, interest, extraordinary expenses and brokerage commissions) does not exceed 1.00% per year of the Class’s average daily net assets, and further provided that the reimbursements are made within three years after the year in which NBM incurred the expense. The figures in the table are based on last year’s expenses. 88 Neuberger Berman Management Inc. (NBMI) has contractually undertaken to limit the expenses of S Class shares through December 31, 2012 by reimbursing the Fund for its total operating expenses, including compensation to NBMI, but excluding taxes, interest, extraordinary expenses, transaction costs and brokerage commissions, that exceed, in the aggregate, 1.25% per annum of the Class’s average daily net asset value. The Fund has in turn contractually undertaken to repay NBMI from S Class assets for the excess operating expenses borne by NBMI, so long as the Class’s annual operating expenses during that period (exclusive of taxes, interest, extraordinary expenses and brokerage commissions) does not exceed 1.25% per year of the Class’s average daily net assets, and further provided that the reimbursements are made within three years after the year in which NBMI incurred the expense. The figures in the table are based on last year’s expenses. 89 NVIT and NFA have entered into a written contract limiting operating expenses to 0.82% until at least May 1, 2010. This limit excludes certain Fund expenses, including any interest, taxes, brokerage commissions, Rule 12b–1 fees, fees paid pursuant to an Administrative Services Plan, shortsale dividend expenses, other expenditures which are capitalized in accordance with generally accepted accounting principles and other nonroutine expenses not incurred in the ordinary course of the Fund’s business. NVIT is authorized to reimburse NFA for management fees previously waived or reduced and/or for expenses previously paid by NFA, provided however, that any reimbursements must be paid at a date not more than three years after the fiscal year in which NFA waived the fees or reimbursed the expenses and the reimbursements do not cause the Fund to exceed the expense limitation in the agreement. 90 Represents assets held by the fund or listed share class, as applicable. 91 Based on asset levels as of 3/31/09, approximately 22% of the Existing Fund’s I Class assets will be transferred to NVIT—NVIT MultiManager Mid Cap Growth Fund: Class I pursuant to the Substitution. This transfer represents approximately 20% of the Existing Fund’s total assets. 92 Based on asset levels as of 3/31/09, approximately 0.8% of the Existing Fund’s S Class assets will be transferred to NVIT—NVIT MultiManager Mid Cap Growth Fund: Class I, representing approximately 0.1% of the Existing Fund’s total assets, and approximately 11% of the Existing Fund’s S Class assets will be transferred to NVIT—NVIT Multi-Manager Mid Cap Growth Fund: Class II pursuant to the Substitution, representing approximately 1% of the Existing Fund’s total assets. 93 ‘‘Other Expenses’’ include administrative services fees which currently are 0.15%, but which are permitted to be as high as 0.25%. The full 0.25% in administrative services fees is not reflected in ‘‘Other Expenses’’ at this time because, until at least May 1, 2010, the Fund does not intend to pay insurance companies a higher amount. If the Continued VerDate Nov<24>2008 21:58 Jun 17, 2009 Jkt 217001 PO 00000 Frm 00121 Fmt 4703 Sfmt 4703 E:\FR\FM\18JNN1.SGM 18JNN1 29000 Federal Register / Vol. 74, No. 116 / Thursday, June 18, 2009 / Notices Existing fund Replacement fund Neuberger Berman Advisers Management Trust—AMT Partners Portfolio: I Class NVIT—Neuberger Berman NVIT Multi Cap Opportunities Fund: Class I 0.84% 0.00% 0.11% 0.95% 94 0.00% 0.95% 97 $236.1 0.60% 0.00% 93 1.50% 2.10% 95 1.20% 0.90% $2.9 Management Fees ................................................................................................................... 12b–1 Fees .............................................................................................................................. Other Expenses ....................................................................................................................... Total Gross Expenses ............................................................................................................. Waivers/Reimbursements ........................................................................................................ Total Net Expenses ................................................................................................................. Fund/Class 96 Asset Level ($MMs) (5/20/09) .......................................................................... Neuberger Berman Advisers Management Trust—AMT Regency Portfolio: S Class will be replaced by NVIT—NVIT Multi-Manager Mid Cap Value Fund: Class II. The following chart compares the management fees, the total operating expenses (before and after any waivers and reimbursements) 16. Neuberger Berman Advisers Management Trust—AMT Regency Portfolio Replaced by NVIT—NVIT Multi-Manager Mid Cap Value Fund (Substitution Table Reference No. 30) expressed as an annual percentage of average daily net assets, and the asset levels of Neuberger Berman Advisers Management Trust—AMT Regency Portfolio: S Class and NVIT—NVIT Multi-Manager Mid Cap Value Fund: Class II. Existing fund Replacement fund Neuberger Berman Advisers Management Trust—AMT Regency Portfolio: S Class NVIT—NVIT Multi-Manager Mid Cap Value Fund: Class II 0.85% 0.25% 0.13% 1.23% 99 0.00% 1.23% 102 $149.7 0.75% 0.25% 98 0.13% 1.13% 100 0.06% 1.07% $124.9 Management Fees ................................................................................................................... 12b–1 Fees .............................................................................................................................. Other Expenses ....................................................................................................................... Total Gross Expenses ............................................................................................................. Waivers/Reimbursements ........................................................................................................ Total Net Expenses ................................................................................................................. Fund/Class 101 Asset Level ($MMs) (5/20/09) ......................................................................... full amount of administrative services fees were charged, total operating expenses (after fee waivers/ expense reimbursements) would be 1.00%. 94 Neuberger Berman Management LLC (‘‘NBM’’) has contractually undertaken to limit the Fund’s expenses through December 31, 2012 by reimbursing the Fund for its total operating expenses (excluding the compensation of NBM, taxes, interest, extraordinary expenses, brokerage commissions and transaction costs) that exceed, in the aggregate, 1.00% per annum of the Fund’s average daily net asset value. Because of the exclusion, the Fund’s net expenses may exceed the contractual expense limitation. The Fund has contractually undertaken to reimburse NBM for the excess expenses paid by NBM, provided the reimbursements do not cause total operating expenses (exclusive of the compensation of NBM, taxes, interest, brokerage commissions, transaction costs and extraordinary expenses) to exceed an annual rate of 1.00%, and the reimbursements are made within three years after the year in which NBM incurred the expense. The figures in the table are based on last year’s expenses. 95 NVIT and NFA have entered into a written contract limiting operating expenses to 0.75% until May 1, 2010. This limit excludes certain Fund expenses, including interest, taxes, brokerage commissions, Rule 12b–1 fees, fees paid pursuant to an Administrative Services Plan, short sale dividend expenses, other expenditures which are capitalized in accordance with generally accepted accounting principles and other non-routine expenses not incurred in the ordinary course of the Fund’s business. NVIT is authorized to reimburse VerDate Nov<24>2008 21:58 Jun 17, 2009 Jkt 217001 NFA for management fees previously waived or reduced and/or for expenses previously paid by NFA, provided, however, that any reimbursements must be paid at a date not more than three years after the fiscal year in which NFA waived the fees or reimbursed the expenses and the reimbursements do not cause the Fund to exceed the expense limitation in the agreement. 96 Represents assets held by the fund or listed share class, as applicable. 97 Based on asset levels as of 3/31/09, approximately 50% of the Existing Fund’s assets will be transferred to the Replacement Fund pursuant to the Substitution. 98 ‘‘Other Expenses’’ include administrative services fees which currently are 0.01%, but which are permitted to be as high as 0.25%. The full 0.25% in administrative services fees is not reflected in ‘‘Other Expenses’’ at this time because, until at least May 1, 2010, the Fund does not intend to pay insurance companies a higher amount. If the full amount of administrative services fees were charged, total operating expenses (after fee waivers/ expense reimbursements) would be 1.31%. 99 Neuberger Berman Management LLC (‘‘NBM’’) has contractually agreed to reimburse certain expenses of the Fund through 12/31/2019, so that the total annual operating expenses are limited to 1.25% of the Fund’s average daily net asset value. This arrangement does not cover interest, taxes, brokerage commissions, and extraordinary expenses; consequently, net expenses may exceed the contractual expense limitation. The Fund has agreed to repay NBM for expenses reimbursed to PO 00000 Frm 00122 Fmt 4703 Sfmt 4703 the Fund provided that repayment does not cause the Fund’s annual operating expenses to exceed its expense limitation. Any such repayment must be made within three years after the year in which NBM incurred the expense. The figures in the table are based on last year’s expenses. 100 NVIT and NFA have entered into a written contract limiting operating expenses to 0.81% until at least May 1, 2010. This limit excludes certain Fund expenses, including interest, taxes, brokerage commissions, Rule 12b–1 fees, short-sale dividend expenses, fees paid pursuant to an Administrative Services Plan, other expenditures which are capitalized in accordance with generally accepted accounting principles and other non-routine expenses not incurred in the ordinary course of the Fund’s business. NVIT is authorized to reimburse NFA for management fees previously waived or reduced and/or for expenses previously paid by NFA, provided, however, that any reimbursements must be paid at a date not more than three years after the fiscal year in which NFA waived the fees or reimbursed the expenses and the reimbursements do not cause the Fund to exceed the expense limitation in the agreement. 101 Represents assets held by the fund or listed share class, as applicable. 102 Based on asset levels as of 3/31/09, approximately 7% of the Existing Fund’s S Class assets will be transferred to the Replacement Fund pursuant to the Substitution. This transfer represents approximately 7% of the Existing Fund’s total assets. E:\FR\FM\18JNN1.SGM 18JNN1 Federal Register / Vol. 74, No. 116 / Thursday, June 18, 2009 / Notices 17. T. Rowe Price Equity Series, Inc.— T. Rowe Price Limited Term Bond Portfolio Replaced by NVIT—NVIT Short Term Bond Fund (Substitution Table Reference No. 31) T. Rowe Price Equity Series, Inc.—T. Rowe Price Limited Term Bond Portfolio: Class II will be replaced by NVIT—NVIT Short Term Bond Fund: Class II. The following chart compares the management fees, the total operating expenses (before and after any waivers 29001 and reimbursements) expressed as an annual percentage of average daily net assets, and the asset levels of T. Rowe Price Equity Series, Inc.—T. Rowe Price Limited Term Bond Portfolio: Class II and NVIT—NVIT Short Term Bond Fund: Class II. Existing fund Replacement fund T. Rowe Price Equity Series, Inc.—T. Rowe Price Limited Term Bond Portfolio: Class II NVIT—NVIT Short Term Bond Fund: Class II 0.70% 0.25% 0.00% 0.95% 0.00% 0.95% 106 $73.5 0.35% 0.25% 103 0.32% 0.92% 104 0.02% 0.90% $34.6 Management Fees ................................................................................................................... 12b–1 Fees .............................................................................................................................. Other Expenses ....................................................................................................................... Total Gross Expenses ............................................................................................................. Waivers/Reimbursements ........................................................................................................ Total Net Expenses ................................................................................................................. Fund/Class 105 Asset Level ($MMs) (4/30/09) ......................................................................... 18. The Universal Institutional Funds, Inc.—Mid Cap Growth Portfolio Replaced by NVIT—NVIT MultiManager Mid Cap Growth Fund (Substitution Table Reference No. 32) The Universal Institutional Funds, Inc.—Mid Cap Growth Portfolio: Class I will be replaced by NVIT—NVIT MultiManager Mid Cap Growth Fund: Class I. The following chart compares the management fees, the total operating expenses (before and after any waivers and reimbursements) expressed as an annual percentage of average daily net assets, and the asset levels of The Universal Institutional Funds, Inc.— Mid Cap Growth Portfolio: Class I and NVIT—NVIT Multi-Manager Mid Cap Growth Fund: Class I. Existing fund Replacement fund The Universal Institutional Funds, Inc.—Mid Cap Growth Portfolio: Class I NVIT—NVIT Multi-Manager Mid Cap Growth Fund: Class I 107 0.75% Management Fees ................................................................................................................... 12b–1 Fees .............................................................................................................................. 103 ‘‘Other Expenses’’ include administrative services fees which currently are 0.15%, but which are permitted to be as high as 0.25%. The full 0.25% in administrative services fees is not reflected in ‘‘Other Expenses’’ at this time because, until at least May 1, 2010, the Fund does not intend to pay insurance companies a higher amount. If the full amount of administrative services fees were charged, total operating expenses (after fee waivers/ expense reimbursements) would be 1.00%. 104 NVIT and NFA have entered into a written contract limiting operating expenses to 0.50% for all share classes until May 1, 2010. This limit excludes certain Fund expenses, including interest, taxes, brokerage commissions, Rule 12b–1 fees, fees paid pursuant to an Administrative Services Plan, short sale dividend expenses, other expenditures which are capitalized in accordance with generally accepted accounting principles and other nonroutine expenses not incurred in the ordinary course of the Fund’s business. NVIT is authorized to reimburse NFA for management fees previously waived or reduced and/or for expenses previously paid by NFA, provided, however, that any reimbursements must be paid at a date not more than three years after the fiscal year in which NFA waived the fees or reimbursed the expenses and the reimbursements do not cause the Fund to exceed the expense limitation in the agreement. 105 Represents assets held by the fund or listed share class, as applicable. 106 Based on asset levels as of 3/31/09, approximately 96% of the Existing Fund’s Class II assets will be transferred to the Replacement Fund pursuant to the Substitution. This comprised VerDate Nov<24>2008 21:58 Jun 17, 2009 Jkt 217001 approximately 31% of the Existing Fund’s total assets. 107 The Adviser is entitled to receive an advisory fee at an annual percentage of the Portfolio’s average daily net assets as set forth in the table below: First $500 million—0.75% From $500 million to $1 billion—0.70% More than $1 billion—0.65% 108 ‘‘Other Expenses’’ include administrative services fees which currently are 0.07%, but which are permitted to be as high as 0.25%. The full 0.25% in administrative services fees is not reflected in ‘‘Other Expenses’’ at this time because, until at least May 1, 2010, the Fund does not intend to pay insurance companies a higher amount. If the full amount of administrative services fees were charged, total operating expenses (after fee waivers/ expense reimbursements) would be 1.07%. 109 The Adviser has voluntarily agreed to reduce its advisory fee and/or reimburse the Portfolio so that Total Annual Portfolio Operating Expenses, excluding certain investment related expenses described below, will not exceed 1.05%. In determining the actual amount of voluntary advisory fee waivers and/or expense reimbursements for the Portfolio, if any, certain investment related expenses, such as foreign country tax expense and interest expense on amounts borrowed, are excluded from Total Annual Portfolio Operating Expenses. If these expenses were included, the Total Annual Portfolio Operating Expenses after voluntary fee waivers and/ or expense reimbursements could exceed the expense ratio shown. For the fiscal year ended PO 00000 Frm 00123 Fmt 4703 Sfmt 4703 0.00% 0.75% 0.00% December 31, 2008, after giving effect to the Adviser’s voluntary advisory fee waivers and/or expense reimbursements, the Total Annual Portfolio Operating Expenses incurred by investors were 1.05%. Fee waivers and/or expense reimbursements are voluntary and the Adviser reserves the right to terminate any waivers and/or reimbursements at any time and without notice. 110 NVIT and NFA have entered into a written contract limiting operating expenses to 0.82% until at least May 1, 2010. This limit excludes certain Fund expenses, including any interest, taxes, brokerage commissions, Rule 12b–1 fees, fees paid pursuant to an Administrative Services Plan, shortsale dividend expenses, other expenditures which are capitalized in accordance with generally accepted accounting principles and other nonroutine expenses not incurred in the ordinary course of the Fund’s business. NVIT is authorized to reimburse NFA for management fees previously waived or reduced and/or for expenses previously paid by the NFA, provided however, that any reimbursements must be paid at a date not more than three years after the fiscal year in which NFA waived the fees or reimbursed the expenses and the reimbursements do not cause the Fund to exceed the expense limitation in the agreement. 111 Represents assets held by the fund or listed share class, as applicable. 112 Based on asset levels as of 3/31/09, approximately 22% of the Existing Fund’s Class I assets will be transferred to the Replacement Fund pursuant to the Substitution. This comprises approximately 7% of the Existing Fund’s total assets. E:\FR\FM\18JNN1.SGM 18JNN1 29002 Federal Register / Vol. 74, No. 116 / Thursday, June 18, 2009 / Notices Existing fund Replacement fund The Universal Institutional Funds, Inc.—Mid Cap Growth Portfolio: Class I NVIT—NVIT Multi-Manager Mid Cap Growth Fund: Class I Other Expenses ....................................................................................................................... Total Gross Expenses ............................................................................................................. Waivers/Reimbursements ........................................................................................................ Total Net Expenses ................................................................................................................. Fund/Class 111 Asset Level ($MMs) (5/20/09) ......................................................................... 19. The Universal Institutional Funds, Inc.—U.S. Real Estate Portfolio Replaced by NVIT—Van Kampen NVIT Real Estate Fund (Substitution Table Reference Nos. 33 & 34) The Universal Institutional Funds, Inc.—U.S. Real Estate Portfolio: Class I will be replaced by NVIT—Van Kampen NVIT Real Estate Fund: Class I. The Universal Institutional Funds, Inc.— U.S. Real Estate Portfolio: Class II will be replaced by NVIT—Van Kampen NVIT Real Estate Fund: Class II. The following chart compares the management fees, the total operating expenses (before and after any waivers and reimbursements) expressed as an 108 0.22% 0.31% 1.06% 109 0.00% 1.06% 112 $56.4 0.97% 110 0.08% 0.89% $87.7 annual percentage of average daily net assets, and the asset levels of The Universal Institutional Funds, Inc.— U.S. Real Estate Portfolio: Class I, The Universal Institutional Funds, Inc.— U.S. Real Estate Portfolio: Class II, NVIT—Van Kampen NVIT Real Estate Fund: Class I and NVIT—Van Kampen NVIT Real Estate Fund: Class II. Existing fund Replacement fund The Universal Institutional Funds, Inc.—U.S. Real Estate Portfolio NVIT—Van Kampen NVIT Real Estate Fund Class I Management Fees ........................................................................................... 12b–1 Fees ...................................................................................................... Other Expenses ............................................................................................... Total Gross Expenses ..................................................................................... Waivers/Reimbursements ................................................................................ Total Net Expenses ......................................................................................... Fund/Class 116 Asset Level ($MMs) (5/20/09) ................................................. Class II 113 0.77% 113 0.77% 0.00% 0.30% 1.07% 0.00% 1.07% 117 $340.9 0.35% 0.30% 1.42% 0.00% 1.42% 118 $219.3 Class I 0.70% 0.00% 114 0.74% 1.44% 115 0.44% 1.00% $3.8 Class II 0.70% 0.25% 114 0.74% 1.69% 115 0.44% 1.25% $2.8 20. Van Eck Worldwide Insurance Trust—Worldwide Emerging Markets Fund Replaced by NVIT—Gartmore NVIT Emerging Markets Fund (Substitution Table Reference Nos. 35, 36, & 37) Van Eck Worldwide Insurance Trust—Worldwide Emerging Markets Fund: Initial Class will be replaced by NVIT—Gartmore NVIT Emerging Markets Fund: Class I or Class III, depending on the contract involved in the Substitution. Van Eck Worldwide Insurance Trust—Worldwide Emerging Markets Fund: Class R1 will be replaced by NVIT—Gartmore NVIT Emerging Markets Fund: Class III. The following chart compares the management fees, the total operating expenses (before and after any waivers and reimbursements) expressed as an annual percentage of average daily net assets, and the asset levels of Van Eck Worldwide Insurance Trust—Worldwide Emerging Markets Fund: Initial Class, Van Eck Worldwide Insurance Trust—Worldwide Emerging Markets Fund: Class R1, NVIT— Gartmore NVIT Emerging Markets Fund: Class I and NVIT—Gartmore NVIT Emerging Markets Fund: Class III. 113 The Adviser is entitled to receive an advisory fee at an annual percentage of the Portfolio’s average daily net assets as set forth as follows: First $500 million 0.80%; from $500 million to $1 billion 0.75%; more than $1 billion 0.70%. 114 ‘‘Other Expenses’’ include administrative services fees which currently are 0.15%, but which are permitted to be as high as 0.25%. The full 0.25% in administrative services fees is not reflected in ‘‘Other Expenses’’ at this time because, until at least May 1, 2010, the Fund does not intend to pay insurance companies a higher amount. If the full amount of administrative services fees were charged, total operating expenses would be 1.10% and 1.35%, respectively. 115 NVIT and NFA have entered into a written contract limiting operating expenses to 0.85% until May 1, 2010. This limit excludes certain Fund expenses, including interest, taxes, brokerage commissions, Rule 12b–1 fees, fees paid pursuant to an Administrative Services Plan, short sale dividend expenses, other expenditures which are capitalized in accordance with generally accepted accounting principles and other non-routine expenses not incurred in the ordinary course of the Fund’s business. NVIT is authorized to reimburse NFA for management fees previously waived or reduced and/or for expenses previously paid by NFA, provided, however, that any reimbursements must be paid at a date not more than three years after the fiscal year in which NFA waived the fees or reimbursed the expenses and the reimbursements do not cause the Fund to exceed the expense limitation in the agreement. 116 Represents assets held by the fund or listed share class. 117 Based on asset levels as of 3/31/09, approximately 35% of the Existing Fund’s Class I assets will be transferred to NVIT—Van Kampen NVIT Real Estate Fund: Class I pursuant to the Substitution. This comprises approximately 21% of the Existing Fund’s total assets. 118 Based on asset levels as of 3/31/09, approximately 13% of the Existing Fund’s Class II assets will be transferred to NVIT—Van Kampen NVIT Real Estate Fund: Class II pursuant to the Substitution. This comprises approximately 5% of the Existing Fund’s total assets. VerDate Nov<24>2008 21:58 Jun 17, 2009 Jkt 217001 PO 00000 Frm 00124 Fmt 4703 Sfmt 4703 E:\FR\FM\18JNN1.SGM 18JNN1 29003 Federal Register / Vol. 74, No. 116 / Thursday, June 18, 2009 / Notices Existing fund Replacement fund Van Eck Worldwide Insurance Trust—Worldwide Emerging Markets Fund NVIT—Gartmore NVIT Emerging Markets Fund Initial Class Management Fees ........................................................................................... 12b–1 Fees ...................................................................................................... Other Expenses ............................................................................................... Total Gross Expenses ..................................................................................... Waivers/Reimbursements ................................................................................ Total Net Expenses ......................................................................................... Fund/Class124 Asset Level ($MMs) (5/20/09) ................................................. 1.00% 0.00% 0.29% 1.29% 122 0.00% 1.29% 125 $118.3 Class R1 1.00% 0.00% 0.29% 1.29% 122 0.00% 1.29% 126 $37.1 Class I 119 0.95% 0.00% 120 0.28% 1.23% 123 0.00% 1.23% $36.0 Class III 119 0.95% 0.00% 121 0.29% 1.24% 123 0.00% 1.24% $101.6 21. Wells Fargo Advantage Variable Trust—Wells Fargo Advantage VT Discovery Fund Replaced by NVIT— NVIT Multi-Manager Mid Cap Growth Fund (Substitution Table Reference Nos. 38 & 39) Wells Fargo Advantage Variable Trust—Wells Fargo Advantage VT Discovery Fund will be replaced by NVIT—NVIT Multi-Manager Mid Cap Growth Fund: Class I or Class II, depending on the contract involved in the Substitution. The following chart compares the management fees, the total operating expenses (before and after any waivers and reimbursements) expressed as an annual percentage of average daily net assets, and the asset levels of Wells Fargo Advantage Variable Trust—Wells Fargo Advantage VT Discovery Fund, NVIT—NVIT Multi-Manager Mid Cap Growth Fund: Class I and NVIT—NVIT Multi-Manager Mid Cap Growth Fund: Class II. 119 Management fees have been restated to reflect the elimination of a performance-based management fee and implementation of an assetbased management fee equal to the lowest possible management fee under the previous performancebased fee structure, as approved by the Board of Trustees on September 18, 2008. Under no circumstances, during a six-month transition period will the management fee under the new fee structure exceed what the Adviser would have received under the old structure assuming maximum penalty for underperformance. 120 ‘‘Other Expenses’’ include administrative services fees which currently are 0.15%, but which are permitted to be as high as 0.25%. The full 0.25% in administrative services fees is not reflected in ‘‘Other Expenses’’ at this time because, until at least May 1, 2010, the Fund does not intend to pay insurance companies a higher amount. If the full amount of administrative services fees were charged, total operating expenses would be 1.33%. 121 ‘‘Other Expenses’’ include administrative services fees which currently are 0.16%, but which are permitted to be as high as 0.25%. The full 0.25% in administrative services fees is not reflected in ‘‘Other Expenses’’ at this time because, until at least May 1, 2010, the Fund does not intend to pay insurance companies a higher amount. If the full amount of administrative services fees were charged, total operating expenses would be 1.33%. 122 For the period May 1, 2009 through April 30, 2010, the Adviser contractually agreed to waive fees and reimburse certain operating expenses (excluding interest, dividends paid on securities sold short, trading expenses, taxes and extraordinary expenses) to the extent Total Annual Fund Operating Expenses exceed 1.50% of average daily net assets. 123 NVIT and NFA have entered into a written contract limiting operating expenses to 1.20% for all share classes until at least May 1, 2010. This limit excludes certain Fund expenses, including interest, taxes, brokerage commissions, Rule 12b–1 fees, fees paid pursuant to an Administrative Services Plan, short sale dividend expenses, other expenditures which are capitalized in accordance with generally accepted accounting principles and other non-routine expenses not incurred in the ordinary course of the Fund’s business. NVIT is authorized to reimburse NFA for management fees previously waived or reduced and/or for expenses previously paid by NFA provided, however, that any reimbursements must be paid at a date not more than three years after the fiscal year in which NFA waived the fees or reimbursed the expenses and the reimbursements do not cause the Fund to exceed the expense limitation in the agreement. Currently, all share classes are operating below the expense limit. 124 Represents assets held by the fund or listed share class, as applicable. 125 Based on asset levels as of 3/31/09, approximately 0.3% of the Existing Fund’s Initial Class assets will be transferred to NVIT—Gartmore NVIT Emerging Markets Fund: Class I, representing approximately 0.3% of the Existing Fund’s total assets, and approximately 25% of the Existing Fund’s assets will be transferred to NVIT— Gartmore NVIT Emerging Markets Fund: Class III, representing approximately 25% of the Existing Fund’s total assets, pursuant to the Substitution. 126 Based on asset levels as of 3/31/09, approximately 42% of the Existing Fund’s Class R1 assets will be transferred to NVIT—Gartmore NVIT Emerging Markets Fund: Class III pursuant to the Substitution. This comprises approximately 10% of the Existing Fund’s total assets. 127 The following advisory fee schedule is charged to the Fund as a percentage of the Fund’s average daily net assets: 0.75% for the first $500 million; 0.70% for the next $500 million; 0.65% for the next $2 billion; 0.625% for the next $2 billion; and 0.60% for assets over $5 billion. 128 ‘‘Other Expenses’’ include administrative services fees which currently are 0.07%, but which are permitted to be as high as 0.25%. The full 0.25% in administrative services fees is not reflected in ‘‘Other Expenses’’ at this time because, until at least May 1, 2010, the Fund does not intend to pay insurance companies a higher amount. If the full amount of administrative services fees were charged, total operating expenses (after fee waivers/ expense reimbursements) would be 1.07% and 1.32%, respectively. 129 The adviser has committed through April 30, 2010 to waive fees and/or reimburse expenses to the extent necessary to maintain the Fund’s net operating expenses, excluding brokerage commissions, interest, taxes, extraordinary expenses and the expenses of any money market fund or other fund held by the Fund, do not exceed the net operating expense ratio of 1.15%.The committed net operating expense ratio may be increased only with approval of the Board of Trustees. 130 NVIT and NFA have entered into a written contract limiting operating expenses to 0.82% for all share classes until at least May 1, 2010. This limit excludes certain Fund expenses, including any interest, taxes, brokerage commissions, Rule 12b–1 fees, fees paid pursuant to an Administrative Services Plan, short-sale dividend expenses, other expenditures which are capitalized in accordance with generally accepted accounting principles and other non-routine expenses not incurred in the ordinary course of the Fund’s business. NVIT is authorized to reimburse NFA for management fees previously waived or reduced and/or for expenses previously paid by NFA, provided however, that any reimbursements must be paid at a date not more than three years after the fiscal year in which NFA waived the fees or reimbursed the expenses and the reimbursements do not cause the Fund to exceed the expense limitation in the agreement. 131 Represents assets held by the fund or listed share class, as applicable. 132 Based on asset levels as of 3/31/09, approximately 29% of the Existing Fund’s assets will be transferred to NVIT—NVIT Multi-Manager Mid Cap Growth Fund: Class I and approximately 0.02% of the Existing Fund’s assets will be transferred to NVIT—NVIT Multi-Manager Mid Cap Growth Fund: Class II pursuant to the Substitution. VerDate Nov<24>2008 21:58 Jun 17, 2009 Jkt 217001 PO 00000 Frm 00125 Fmt 4703 Sfmt 4703 E:\FR\FM\18JNN1.SGM 18JNN1 29004 Federal Register / Vol. 74, No. 116 / Thursday, June 18, 2009 / Notices Existing fund Replacement fund Wells Fargo Advantage Variable Trust—Wells Fargo Advantage VT Discovery Fund NVIT—NVIT Multi-Manager Mid Cap Growth Fund 127 0.76% Management Fees ................................................................................... 12b–1 Fees .............................................................................................. Other Expenses ....................................................................................... Total Gross Expenses ............................................................................. Waivers/Reimbursements ........................................................................ Total Net Expenses ................................................................................. Fund/Class131 Asset Level ($MMs) (5/20/09) ......................................... 22. Wells Fargo Advantage Variable Trust—Wells Fargo Advantage VT Opportunity Fund Replaced by NVIT— NVIT Multi-Manager Mid Cap Value Fund (Substitution Table Reference No. 40) Class I 0.25% 0.27% 1.28% 129 0.12% 1.16% 132 $112.7 Wells Fargo Advantage Variable Trust—Wells Fargo Advantage VT Opportunity Fund: Investor Class will be replaced by NVIT—NVIT MultiManager Mid Cap Value Fund: Class II. The following chart compares the management fees, the total operating expenses (before and after any waivers 0.75% 0.00% 128 0.22% 0.97% 130 0.08% 0.89% $87.7 Class II 0.75% 0.25% 128 0.22% 1.22% 130 0.08% 1.14% $134.2 and reimbursements) expressed as an annual percentage of average daily net assets, and the asset levels of Wells Fargo Advantage Variable Trust—Wells Fargo Advantage VT Opportunity Fund: Investor Class and NVIT—NVIT MultiManager Mid Cap Value Fund: Class II. Existing fund Replacement fund Wells Fargo Advantage Variable Trust—Wells Fargo Advantage VT Opportunity Fund: Investor Class NVIT—NVIT Multi-Manager Mid Cap Value Fund: Class II 133 0.76% Management Fees ................................................................................................................... 12b–1 Fees .............................................................................................................................. Other Expenses ....................................................................................................................... Total Gross Expenses ............................................................................................................. Waivers/Reimbursements ........................................................................................................ Total Net Expenses ................................................................................................................. Fund/Class 137 Asset Level ($MMs) (5/20/09) ......................................................................... 133 The following advisory fee schedule is charged to the Fund as a percentage of the Fund’s average daily net assets: 0.75% for the first $500 million; 0.70% for the next $500 million; 0.65% for the next $2 billion; 0.625% for the next $2 billion; and 0.60% for assets over $5 billion. 134 ‘‘Other Expenses’’ include administrative services fees which currently are 0.01%, but which are permitted to be as high as 0.25%. The full 0.25% in administrative services fees is not reflected in ‘‘Other Expenses’’ at this time because, until at least May 1, 2010, the Fund does not intend to pay insurance companies a higher amount. If the full amount of administrative services fees were charged, total operating expenses (after fee waivers/ expense reimbursements) would be 1.31%. VerDate Nov<24>2008 21:58 Jun 17, 2009 Jkt 217001 135 The adviser has committed through April 30, 2010, to waive fees and/or reimburse expenses to the extent necessary to ensure that the Fund’s net operating expenses, excluding brokerage commissions, interest, taxes, extraordinary expenses and the expenses of any money market fund or other fund held by the Fund, do not exceed the net operating expense ratio of 1.07%.The committed net operating expense ratio may be increased only with approval of the Board of Trustees. 136 NVIT and NFA have entered into a written contract limiting operating expenses to 0.81% for all share classes until at least May 1, 2010. This limit excludes certain Fund expenses, including interest, taxes, brokerage commissions, Rule 12b-1 fees, short-sale dividend expenses, fees paid pursuant to an Administrative Services Plan, other expenditures which are capitalized in accordance PO 00000 Frm 00126 Fmt 4703 Sfmt 4703 0.25% 0.22% 1.23% 135 0.14% 1.09% 138 $404.3 0.75% 0.25% 134 0.13% 1.13% 136 0.06% 1.07% $124.9 with generally accepted accounting principles and other non-routine expenses not incurred in the ordinary course of the Fund’s business. NVIT is authorized to reimburse NFA for management fees previously waived or reduced and/or for expenses previously paid by NFA, provided, however, that any reimbursements must be paid at a date not more than three years after the fiscal year in which NFA waived the fees or reimbursed the expenses and the reimbursements do not cause the Fund to exceed the expense limitation in the agreement. 137 Represents assets held by the fund or listed share class, as applicable. 138 Based on asset levels as of 3/31/09, approximately 53% of the Existing Fund’s assets will be transferred to the Replacement Fund pursuant to the Substitution. E:\FR\FM\18JNN1.SGM 18JNN1 Federal Register / Vol. 74, No. 116 / Thursday, June 18, 2009 / Notices [FR Doc. E9–14288 Filed 6–17–09; 8:45 am] BILLING CODE 8010–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–60108; File No. PCAOB– 2008–05] Public Company Accounting Oversight Board; Notice of Filing of Proposed Rules on Succeeding to the Registration Status of a Predecessor Firm June 12, 2009. Pursuant to Section 107(b) of the Sarbanes-Oxley Act of 2002 (the ‘‘Act’’), notice is hereby given that on August 4, 2008, the Public Company Accounting Oversight Board (the ‘‘Board’’ or the ‘‘PCAOB’’) filed with the Securities and Exchange Commission (the ‘‘Commission’’ or ‘‘SEC’’) the proposed rules described in Items I and II below, which items have been prepared by the Board. The Commission is publishing this notice to solicit comments on the proposed rules from interested persons. I. Board’s Statement of the Terms of Substance of the Proposed Rules On July 29, 2008, the Board adopted rules and a form related to succeeding to the registration status of a predecessor firm. New PCAOB Rules 2108–2109 and the instructions to a new form, Form 4, are set out below. Section 2. Registration and Reporting Part 1—Registration of Public Accounting Firms * * * * * 2108. Succeeding to the Registration Status of a Predecessor (a) In the event that a registered public accounting firm changes its form of organization or changes the jurisdiction under the law of which it is organized, in circumstances that do not involve an acquisition or combination as described in paragraph (b) of this Rule, the entity in its new form shall succeed to the registration status of the predecessor if the new entity is a public accounting firm and files a Form 4 in accordance with Rule 2109. (b) In the event that a registered public accounting firm is acquired by an entity that is not a registered public accounting firm, or combines with any other entity or entities to form a new legal entity— (1) If the acquiring entity or the new entity is a public accounting firm that files a Form 4 in accordance with Rule 2109, and the answer provided to each subpart of Item 3.2.e of that Form 4 is VerDate Nov<24>2008 21:58 Jun 17, 2009 Jkt 217001 ‘‘no,’’ that entity shall succeed to the registration status of the registered firm; (2) If the acquiring entity or the new entity is a public accounting firm that files a Form 4 in accordance with Rule 2109, and the answer provided to any subpart of Item 3.2.e of that Form 4 is other than ‘‘no,’’ that entity shall not succeed to the registration status of the registered firm; provided, however, that if that entity represents on Form 4 that it has filed, or that it intends to file within 45 days of the effective date of the acquisition or combination, an application for registration on Form 1, then— (i) Subject to the qualifications in subparagraphs (ii), (iii), and (iv), that entity shall temporarily succeed to the registration status of the registered firm for a transitional period, but that registration will cease to be effective on the earlier of the date that the entity’s application on Form 1 is approved or the date that is 91 days after the effective date of the acquisition or combination as reported on Form 4; (ii) Subject to the qualifications in subparagraphs (iii) and (iv), if the acquisition or combination took effect before the effective date of this rule, that entity shall temporarily succeed to the registration status of the registered firm for a transitional period, but that registration will cease to be effective on the earlier of the date that the entity’s application on Form 1 is approved or the date that is 91 days after the effective date of this rule; (iii) if the Board requests additional information from the entity pursuant to Rule 2106(c) with less than 60 days remaining in the original transitional period, the entity’s temporary succession to registration status shall continue to the date that is 60 days after the date of the Board’s request; and (iv) If, after the original transition period has been extended pursuant to subparagraph (iii), the Board makes any further requests for additional information from the entity pursuant to Rule 2106(c), the Board may in its discretion extend the temporary succession to registration status for such finite period as the Board shall specify. (c) Subject to paragraph (d) of this rule, a public accounting firm that results from events described in paragraphs (a) or (b) of this rule shall not, in the absence of compliance with the provisions of Rule 2109, succeed to the registration status of a predecessor registered public accounting firm. (d) Notwithstanding paragraph (c) of this rule, if a public accounting firm’s failure to comply with the provisions of Rule 2109 is solely a failure concerning the timeliness of the submission, the PO 00000 Frm 00127 Fmt 4703 Sfmt 4703 29005 firm may request leave to file Form 4 out of time by indicating and supporting that request in accordance with the instructions to the form. The Board will evaluate any such request in light of the relevant facts and circumstances and the public interest and may, in its discretion, grant or deny the request. If the Board grants leave to file the form out of time, the Form 4 shall be deemed filed and the provisions of paragraphs (a) and (b) shall apply as if the Form 4 had been timely filed. A Form 4 that has been submitted out of time may be withdrawn by the firm at any time before the Board has approved or disapproved the request for leave to file out of time. 2109. Procedure for Succeeding to the Registration Status of a Predecessor (a) A public accounting firm seeking to succeed to the registration status of a predecessor registered public accounting firm pursuant to the provisions of Rule 2108 must do so by filing a Form 4— (1) No later than the 14th day after the change or business combination takes effect, if the change or business combination takes effect on or after [insert effective date of this rule]; or (2) No later than [insert date 14 days after effective date of this rule], if the change or business combination took effect before [insert effective date of this rule]. (b) A public accounting firm filing a Form 4 must do so by filing the Form 4 in accordance with the instructions to that form. Unless directed otherwise by the Board, a public accounting firm filing a Form 4 must file the Form 4 and exhibits thereto electronically with the Board through the Board’s Web-based system. (c) A Form 4 shall be deemed to be filed on the date that the public accounting firm submits a Form 4 in accordance with Rule 2109(b) that includes the signed certification required in Part V of Form 4, provided, however, that any report so submitted after the applicable deadline as prescribed in paragraph (a) of this rule, shall not be deemed filed unless and until the Board, pursuant to Rule 2108(d), grants leave to file the Form 4 out of time. (d) The provisions of Rule 2204 concerning signatures, shall apply to each signature required by Form 4 as if it were a signature to a report on Form 3. Rule 2205 concerning amendments, and Rule 2207 concerning assertions of conflicts with non-U.S. laws, shall apply to any submission on Form 4 as if the submission were a report on Form. E:\FR\FM\18JNN1.SGM 18JNN1

Agencies

[Federal Register Volume 74, Number 116 (Thursday, June 18, 2009)]
[Notices]
[Pages 28967-29005]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E9-14288]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. IC-28767; File No. 812-13495]


Nationwide Life Insurance Company, et al.

June 12, 2009.
AGENCY: Securities and Exchange Commission.

ACTION: Notice of application for an order pursuant to Section 26(c) of 
the Investment Company Act of 1940 (the ``1940 Act'') and an order of 
exemption pursuant to Section 17(b) of the 1940 Act from Section 17(a) 
of the 1940 Act.

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    Applicants: Nationwide Life Insurance Company (``NWL''), Nationwide 
Variable Account--II (``Account II''), Nationwide Variable Account--7 
(``Account 7''), Nationwide Variable Account--9 (``Account 9''), 
Nationwide Variable Account--14 (``Account 14''), Nationwide Multi-Flex 
Variable Account (``Flex Account''), Nationwide VLI Separate Account--2 
(``Account 2''), Nationwide VLI Separate Account--4 (``Account 4''), 
Nationwide VLI Separate Account--7 (``VLI Account 7''), Nationwide Life 
and Annuity Insurance Company (``NLAIC''), Nationwide VL Separate 
Account--G (``Account G''), Nationwide Life Insurance Company of 
America (``NLICA''), Nationwide Provident VLI Separate Account 1 
(``Account 1''), Nationwide Life and Annuity Company of America 
(``NLACA'' and together with NWL, NLAIC and NLICA, ``Insurance Company 
Applicants''), Nationwide Provident VA Separate Account A (``Account 
A''), and Nationwide Provident VLI Separate Account A (``VLI Account 
A'' and together with Account II, Account 7, Account 9, Account 14, 
Flex Account, Account 2, VLI Account 7, Account G, Account 1, and 
Account A, ``Separate Accounts'' and, together with Insurance Company 
Applicants, ``Section 26 Applicants''), and Nationwide Variable 
Insurance Trust (``NVIT'' and together with Section 26 Applicants, 
``Section 17 Applicants'').
SUMMARY: Summary of Application: Section 26 Applicants seek an order 
pursuant to Section 26(c) of the 1940 Act, approving the substitutions 
of certain securities (the ``Substitutions'') issued by certain 
management investment companies and held by Separate Accounts to 
support certain

[[Page 28968]]

variable annuity contracts and variable life insurance contracts (the 
``Contracts'') issued by Insurance Company Applicants. Section 17 
Applicants seek an order pursuant to Section 17(b) of the 1940 Act 
exempting them from Section 17(a) of the 1940 Act to the extent 
necessary to permit them to effectuate the proposed Substitutions by 
redeeming a portion of the securities of one or more of the Existing 
Funds (as defined herein) in-kind and using those securities received 
to purchase shares of the Replacement Funds (as defined herein) (the 
``In-Kind Transactions'').

DATES: Filing Date: The application was originally filed on February 
11, 2008 and amended on June 25, 2008, March 9, 2009 and June 12, 2009.
    Hearing or Notification of Hearing: An order granting the 
application will be issued unless the Commission orders a hearing. 
Interested persons may request a hearing by writing to the Secretary of 
the Commission and serving Insurance Company Applicants and NVIT with a 
copy of the request, personally or by mail. Hearing requests must be 
received by the Commission by 5:30 p.m. on July 7, 2009, and should be 
accompanied by proof of service on Insurance Company Applicants and 
NVIT in the form of an affidavit or, for lawyers, a certificate of 
service. Hearing requests should state the nature of the requester's 
interest, the reason for the request, and the issues contested. Persons 
who wish to be notified of a hearing may request notification by 
writing to the Secretary of the Commission.

ADDRESSES: Secretary, Securities and Exchange Commission, 100 F Street, 
NE., Washington, DC 20549-1090. Insurance Company Applicants and NVIT, 
c/o Jamie Ruff Casto, Managing Counsel, Nationwide Insurance, One 
Nationwide Plaza 1-34-201, Columbus, Ohio 43215.

FOR FURTHER INFORMATION CONTACT: Craig Ruckman, Attorney-Adviser, at 
(202) 551-6753 or Harry Eisenstein, Branch Chief, Office of Insurance 
Products, Division of Investment Management, at (202) 551-6795.

SUPPLEMENTARY INFORMATION: The following is a summary of the 
application. The complete application may be obtained via the 
Commission's Web site by searching for the file number, or an applicant 
using the Company name box, at http://www.sec.gov/search/search.htm or 
by calling (202) 551-8090.

Applicants' Representations

    1. NWL is a stock life insurance company organized under the laws 
of the State of Ohio. NLAIC is a stock life insurance company organized 
under the laws of the State of Ohio. NLICA is a stock life insurance 
company organized under the laws of the State of Pennsylvania. NLACA is 
a stock life insurance company organized under the laws of the State of 
Pennsylvania.
    2. Each of the following separate accounts are registered as unit 
investment trusts under the 1940 Act and are used to fund certain 
variable contracts issued by NWL: Account II (File No. 811-3330); 
Account 7 (File No. 811-8666); Account 9 (File No. 811-08241); Account 
14 (File No. 811-21205); Flex Account (File No. 811-3338); Account 2 
(File No. 811-5311); Account 4 (File No. 811-8301); and, VLI Account 7 
(File No. 811-21610).
    Each of the following separate accounts are registered as unit 
investment trusts under the 1940 Act and are used to fund certain 
variable contracts issued by NLACA: Account A (File No. 811-6484); and, 
VLI Account A (File No. 811-8722).
    Account G is registered as a unit investment trust under the 1940 
Act (File No. 811-21697) and is used to fund certain variable contracts 
issued by NLAIC.
    Account 1 is registered as a unit investment trust under the 1940 
Act (File No. 811-4460) and is used to fund certain variable contracts 
issued by NLICA.
    3. For purposes of the 1940 Act, NWL is the depositor and sponsor 
of Account II, Account 7, Account 9, Account 14, Flex Account, Account 
2, Account 4, and VLI Account 7; NLAIC is the depositor and sponsor of 
Account G; NLICA is the depositor and sponsor of Account 1; and NLACA 
is the depositor and sponsor of Account A and VLI Account A as those 
terms have been interpreted by the Commission with respect to variable 
annuity and variable life insurance separate accounts.
    4. The Contracts can be issued as individual or group contracts, 
with participants of group contracts acquiring certain ownership rights 
as described in the group contract or the plan documents. Contract 
owners and participants in group contracts (each a ``Contract Owner'') 
may allocate some or all of their Contract value to one or more sub-
accounts available as investment options under the Contract (each an 
``Investment Option''). Each such Investment Option corresponds to an 
underlying mutual fund in which the Separate Account invests. 
Additionally, the Contract Owner may, if provided for under the 
Contract, allocate some or all Contract value to a fixed account and/or 
guaranteed term option, both of which are supported by the assets of 
the depositor's general account.
    Each Contract permits the Contract Owner to transfer Contract value 
from one Investment Option to another Investment Option available under 
the Contract at any time, subject to certain restrictions and charges 
described in the prospectuses for the Contracts. To the extent that the 
Contracts contain restrictions or limitations on a Contract Owner's 
right to transfer, such restrictions or limitations will not apply in 
connection with the proposed Substitutions.
    5. Each Contract's prospectus contains provisions reserving 
Insurance Company Applicants' right to substitute shares of one 
Investment Option for shares of another Investment Option already 
purchased or to be purchased in the future if either of the following 
occurs: (i) Shares of a current Investment Option are no longer 
available for investment by the Separate Account; or (ii) in the 
judgment of Insurance Company Applicants' management, further 
investment in such Investment Option is inappropriate in view of the 
purposes of the Contract. Each Insurance Company Applicant's management 
has determined that further investment in the Existing Funds is no 
longer appropriate in view of the purposes of the Contracts.
    6. Each Insurance Company Applicant, on its own behalf and on 
behalf of its Separate Accounts, proposes to exercise its contractual 
right to substitute a different Investment Option for one of the 
current Investment Options available under the Contracts. In 
particular, Section 26 Applicants request an order from the Commission 
pursuant to Section 26(c) of the 1940 Act approving the proposed 
Substitutions of shares of the following Funds (as defined herein) of 
NVIT (the ``Replacement Funds'') for shares of the corresponding 
underlying mutual funds (the ``Existing Funds''), as shown in the 
following Substitution table (``Substitution Table''):

------------------------------------------------------------------------
     Ref. No.             Existing funds           Replacement funds
------------------------------------------------------------------------
1.................  AIM Variable Insurance     NVIT--NVIT Multi-Manager
                     Funds--AIM V.I. Basic      Large Cap Value Fund:
                     Value Fund: Series I       Class I.
                     Shares.

[[Page 28969]]

 
2.................  AIM Variable Insurance     NVIT--NVIT Multi-Manager
                     Funds--AIM V.I. Basic      Large Cap Value Fund:
                     Value Fund: Series II      Class II.
                     Shares.
3.................  AIM Variable Insurance     NVIT--NVIT Multi-Manager
                     Funds--AIM V.I. Large      Large Cap Growth Fund:
                     Cap Growth Fund: Series    Class I.
                     I Shares.
4.................  American Century Variable  NVIT--NVIT Multi-Manager
                     Portfolios, Inc.--         Mid Cap Growth Fund:
                     American Century VP        Class I.
                     Capital Appreciation
                     Fund: Class I.
5.................  American Century Variable  NVIT--NVIT Multi-Manager
                     Portfolios, Inc.--         International Growth
                     American Century VP        Fund: Class III.
                     International Fund:
                     Class I.
6.................  American Century Variable  NVIT--NVIT Multi-Manager
                     Portfolios, Inc.--         International Growth
                     American Century VP        Fund: Class VI.
                     International Fund:
                     Class II.
7.................  American Century Variable  NVIT--NVIT Multi-Manager
                     Portfolios, Inc.--         International Growth
                     American Century VP        Fund: Class III.
                     International Fund:
                     Class III.
8.................  American Century Variable  NVIT--NVIT Multi-Manager
                     Portfolios, Inc.--         International Growth
                     American Century VP        Fund: Class VI.
                     International Fund:
                     Class IV.
9.................  American Century Variable  NVIT--NVIT Multi-Manager
                     Portfolios, Inc.--         Large Cap Growth Fund:
                     American Century VP        Class I.
                     Ultra Fund: Class I.
10................  American Century Variable  NVIT--NVIT Multi-Manager
                     Portfolios, Inc.--         Large Cap Growth Fund:
                     American Century VP        Class II.
                     Ultra Fund: Class II.
11................  American Century Variable  NVIT--NVIT Multi-Manager
                     Portfolios, Inc.--         Mid Cap Growth Fund:
                     American Century VP        Class I.
                     Vista Fund: Class I.
12................  American Century Variable  NVIT--NVIT Multi-Manager
                     Portfolios, Inc.--         Mid Cap Growth Fund:
                     American Century VP        Class I.
                     Vista Fund: Class II.
13................  American Century Variable  NVIT--NVIT Multi-Manager
                     Portfolios, Inc.--         Mid Cap Growth Fund:
                     American Century VP        Class II.
                     Vista Fund: Class II.
14................  Credit Suisse Trust--      NVIT--Gartmore NVIT
                     International Equity       International Equity
                     Flex I Portfolio           Fund: Class I.
                     (formerly, International
                     Focus Portfolio).
15................  Credit Suisse Trust--      NVIT--Gartmore NVIT
                     International Equity       International Equity
                     Flex I Portfolio           Fund: Class III.
                     (formerly, International
                     Focus Portfolio).
16................  Federated Insurance        NVIT--NVIT Core Bond
                     Series--Federated          Fund: Class I.
                     Quality Bond Fund II:
                     Primary Shares.
17................  Federated Insurance        NVIT--NVIT Core Bond
                     Series--Federated          Fund: Class II.
                     Quality Bond Fund II:
                     Service Shares.
18................  Franklin Templeton         NVIT--Gartmore NVIT
                     Variable Insurance         Emerging Markets Fund:
                     Products Trust--           Class III.
                     Templeton Developing
                     Markets Securities Fund:
                     Class 3.
19................  Franklin Templeton         NVIT--Gartmore NVIT
                     Variable Insurance         Emerging Markets Fund:
                     Products Trust--           Class VI.
                     Templeton Developing
                     Markets Securities Fund:
                     Class 3.
20................  Janus Aspen Series--       NVIT--NVIT Nationwide
                     INTECH Risk-Managed Core   Fund: Class I.
                     Portfolio: Service
                     Shares.
21................  Janus Aspen Series--       NVIT--NVIT Nationwide
                     INTECH Risk-Managed Core   Fund: Class II.
                     Portfolio: Service
                     Shares.
22................  Neuberger Berman Advisers  NVIT--NVIT Multi-Manager
                     Management Trust--AMT      Mid Cap Growth Fund:
                     Growth Portfolio: I        Class I.
                     Class.
23................  Neuberger Berman Advisers  NVIT--Neuberger Berman
                     Management Trust--AMT      NVIT Multi Cap
                     Guardian Portfolio: I      Opportunities Fund:
                     Class.                     Class I.
24................  Neuberger Berman Advisers  NVIT--Gartmore NVIT
                     Management Trust--AMT      International Equity
                     International Portfolio:   Fund: Class III.
                     S Class.
25................  Neuberger Berman Advisers  NVIT--Gartmore NVIT
                     Management Trust--AMT      International Equity
                     International Portfolio:   Fund: Class VI.
                     S Class.
26................  Neuberger Berman Advisers  NVIT--NVIT Multi-Manager
                     Management Trust--AMT      Mid Cap Growth Fund:
                     Mid-Cap Growth             Class I.
                     Portfolio: I Class.
27................  Neuberger Berman Advisers  NVIT--NVIT Multi-Manager
                     Management Trust--AMT      Mid Cap Growth Fund:
                     Mid-Cap Growth             Class I.
                     Portfolio: S Class.
28................  Neuberger Berman Advisers  NVIT--NVIT Multi-Manager
                     Management Trust--AMT      Mid Cap Growth Fund:
                     Mid-Cap Growth             Class II.
                     Portfolio: S Class.
29................  Neuberger Berman Advisers  NVIT--Neuberger Berman
                     Management Trust--AMT      NVIT Multi Cap
                     Partners Portfolio: I      Opportunities Fund:
                     Class.                     Class I.
30................  Neuberger Berman Advisers  NVIT--NVIT Multi-Manager
                     Management Trust--AMT      Mid Cap Value Fund:
                     Regency Portfolio: S       Class II.
                     Class.
31................  T. Rowe Price Equity       NVIT--NVIT Short Term
                     Series, Inc.--T. Rowe      Bond Fund: Class II.
                     Price Limited Term Bond
                     Portfolio: Class II.
32................  The Universal              NVIT--NVIT Multi-Manager
                     Institutional Funds,       Mid Cap Growth Fund:
                     Inc.--Mid Cap Growth       Class I.
                     Portfolio: Class I.
33................  The Universal              NVIT--Van Kampen NVIT
                     Institutional Funds,       Real Estate Fund: Class
                     Inc.--U.S. Real Estate     I.
                     Portfolio: Class I.
34................  The Universal              NVIT--Van Kampen NVIT
                     Institutional Funds,       Real Estate Fund: Class
                     Inc.--U.S. Real Estate     II.
                     Portfolio: Class II.
35................  Van Eck Worldwide          NVIT--Gartmore NVIT
                     Insurance Trust--          Emerging Markets Fund:
                     Worldwide Emerging         Class I.
                     Markets Fund: Initial
                     Class.
36................  Van Eck Worldwide          NVIT--Gartmore NVIT
                     Insurance Trust--          Emerging Markets Fund:
                     Worldwide Emerging         Class III.
                     Markets Fund: Initial
                     Class.
37................  Van Eck Worldwide          NVIT--Gartmore NVIT
                     Insurance Trust--          Emerging Markets Fund:
                     Worldwide Emerging         Class III.
                     Markets Fund: Class R1.
38................  Wells Fargo Advantage      NVIT--NVIT Multi-Manager
                     Variable Trust--Wells      Mid Cap Growth Fund:
                     Fargo Advantage VT         Class I.
                     Discovery Fund.

[[Page 28970]]

 
39................  Wells Fargo Advantage      NVIT--NVIT Multi-Manager
                     Variable Trust--Wells      Mid Cap Growth Fund:
                     Fargo Advantage VT         Class II.
                     Discovery Fund.
40................  Wells Fargo Advantage      NVIT--NVIT Multi-Manager
                     Variable Trust--Wells      Mid Cap Value Fund:
                     Fargo Advantage VT         Class II.
                     Opportunity Fund:
                     Investor Class.
------------------------------------------------------------------------

    7. All of the Replacement Funds that correspond to the Existing 
Funds are available as Investment Options in the Contracts.
    8. Each Replacement Fund is a series of NVIT, a Delaware statutory 
trust. NVIT is registered as an open-end management investment company 
under the 1940 Act and its shares are registered under the Securities 
Act of 1933, as amended, on Form N-1A (1933 Act File No. 02-73024). 
NVIT is a series investment company and currently offers 58 separate 
series (each a ``Fund'' and collectively, the ``Funds''). Shares of 
NVIT are sold exclusively to insurance company separate accounts to 
fund benefits under variable annuity contracts and variable life 
insurance policies, and to employer pension and profit-sharing plans.
    9. Nationwide Fund Advisors (``NFA'') is a registered investment 
adviser (Reg. No. 801-56370) and is an affiliate of Section 26 
Applicants. NFA currently serves as investment adviser (``Adviser'') to 
each of the Funds, including the Replacement Funds, pursuant to 
investment management agreements between NVIT, on behalf of each Fund, 
and NFA (the ``Management Agreements''). NFA employs a sub-advised 
strategy whereby NFA serves as a ``manager of managers'' and delegates 
the fund management responsibilities for each Fund to one or more third 
party investment advisors (each a ``Sub-Adviser'') via investment 
advisory agreements (``Sub-Advisory Agreements'').
    Pursuant to the Management Agreements, NFA's responsibilities 
include general management of each Fund, including full discretion to 
(i) select a new sub-adviser or an additional Sub-Adviser for each 
Fund; (ii) terminate a Sub-Adviser for each Fund; (iii) enter into, 
modify, and terminate Sub-Advisory Agreements; and (iv) allocate and 
reallocate a Fund's assets among the Adviser and one or more Sub-
Advisers. In addition, the Adviser monitors and reports to NVIT's Board 
of Trustees on the performance of each Sub-Adviser relative to such 
Sub-Adviser's responsibilities of complying with the investment 
objectives, policies, and restrictions of any Fund under the management 
of such Sub-Adviser.
    10. NVIT received an exemptive order from the Commission on April 
28, 1998 (Investment Company Act Release No. 23133) (the ``Manager of 
Managers Order'') that permits the Adviser, subject to certain 
conditions, including approval of the NVIT Board of Trustees, and 
without the approval of shareholders, to: (i) Select a new Sub-Adviser 
or additional Sub-Adviser for each Fund; (ii) terminate any existing 
Sub-Adviser and/or replace the Sub-Adviser; (iii) enter into new Sub-
Advisory Agreements \1\ and/or materially modify the terms of, or 
terminate, any existing Sub-Advisory Agreement; and (iv) allocate and 
reallocate a Fund's assets among the Adviser and one or more Sub-
Advisers.
---------------------------------------------------------------------------

    \1\ Relating to NVIT, the Adviser will not enter into any Sub-
Advisory Agreement with any Sub-Adviser that is an ``affiliated 
person,'' as defined in Section 2(a)(3) of the 1940 Act, of NVIT or 
the Adviser, other than by reason of serving as a Sub-Adviser to a 
Fund, without such Sub-Advisory Agreement, including the 
compensation to be paid thereunder, being approved by the unit 
holders of any separate account for which that Fund serves as a 
funding medium.
---------------------------------------------------------------------------

    If a new Sub-Adviser is retained for a Fund, Contract Owners would 
receive all information about the new Sub-Adviser that would be 
included in a proxy statement, including any change in disclosure 
caused by the addition of a new Sub-Adviser.
    11. Section 26 Applicants represent that, after the Substitution 
date, the Replacement Funds will not change sub-advisers, retain any 
new sub-adviser, or otherwise rely on the Manager of Managers Order 
without first obtaining shareholder approval of: the new sub-adviser, 
the fund's ability add or to replace a sub-adviser in reliance on the 
Manager of Managers Order, or otherwise rely on the Manager of Managers 
Order.
    12. The Appendix includes a comparison of the management fees, the 
total operating expenses (before and after any waivers and 
reimbursements) expressed as an annual percentage of average daily net 
assets, and the asset levels of each Existing Fund and its 
corresponding Replacement Fund. The 12b-1 fees listed in the fee tables 
provided in the Appendix for each Existing Fund and Replacement Fund 
represents the maximum 12b-1 fee that could be assessed by the 
particular fund, except with regard to the Franklin Templeton Variable 
Insurance Products Trust--Templeton Developing Markets Securities Fund: 
Class 3, which is disclosed in a footnote.
    13. Set forth below is a description of the investment objectives, 
the advisers, the principal investment strategies and principal risk 
factors of each Existing Fund and its corresponding Replacement Fund.
BILLING CODE 8010-01-P

[[Page 28971]]

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[[Page 28973]]


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[[Page 28974]]


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[[Page 28975]]


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[[Page 28976]]


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[[Page 28977]]


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[[Page 28978]]


[GRAPHIC] [TIFF OMITTED] TN18JN09.008


[[Page 28979]]


[GRAPHIC] [TIFF OMITTED] TN18JN09.009


[[Page 28980]]


[GRAPHIC] [TIFF OMITTED] TN18JN09.010


[[Page 28981]]


[GRAPHIC] [TIFF OMITTED] TN18JN09.011


[[Page 28982]]


[GRAPHIC] [TIFF OMITTED] TN18JN09.012


[[Page 28983]]


[GRAPHIC] [TIFF OMITTED] TN18JN09.013


[[Page 28984]]


[GRAPHIC] [TIFF OMITTED] TN18JN09.014


[[Page 28985]]


[GRAPHIC] [TIFF OMITTED] TN18JN09.015


[[Page 28986]]


[GRAPHIC] [TIFF OMITTED] TN18JN09.016


[[Page 28987]]


[GRAPHIC] [TIFF OMITTED] TN18JN09.021

BILLING CODE 8010-01-C
    14. As a result of the Substitutions, the number of Investment 
Options under each Contract will either not be decreased, or, in those 
cases where the number of Investment Options is being reduced, continue 
to offer a significant number of alternative Investment Options. 
Specifically, the number of Investment Options is currently expected to 
range in number from 21 to 129 after the Substitutions versus 23 to 149 
before the Substitutions.
    15. Prospectus supplements for the Contracts will be delivered to 
Contract Owners at least thirty (30) days before the Substitution date. 
The supplements will: (i) Notify all Contract Owners of the Insurance 
Company Applicants' intent to implement the Substitutions, and that an 
application has been filed in order to obtain the necessary orders to 
do so; (ii) advise Contract Owners that from the date of the supplement 
until the Substitution date, Contract Owners are permitted to transfer 
Contract value out of any Existing Fund sub-account to any other sub-
account(s) offered under the Contract without the transfer being 
treated as a transfer for purposes of transfer limitations and short-
term trading fees that would otherwise be applicable under the terms of 
the Contract; (iii) instruct Contract Owners how to submit transfer 
requests in light of the proposed Substitutions; (iv) advise Contract 
Owners that any Contract value remaining in an Existing Fund sub-
account on the Substitution date will be transferred to the 
corresponding Replacement Fund sub-account, and that the Substitutions 
will take place at relative net asset value; (v) inform Contract Owners 
that for at least thirty (30) days following the Substitution date, the 
Insurance Company Applicants will permit Contract Owners to make 
transfers of Contract value out of each Replacement Fund sub-account to 
any other sub-account(s) offered under the Contract without the 
transfer being treated as a transfer for purposes of transfer 
limitations and short-term trading fees that would otherwise be 
applicable under the terms of the Contract; and (vi) inform Contract 
Owners that the respective Insurance Company Applicant will not 
exercise any rights reserved by it under the Contracts to impose 
additional restrictions on transfers out of a Replacement Fund for at 
least thirty (30) days after the Substitution date.\2\
---------------------------------------------------------------------------

    \2\ One exception to this is that the Insurance Companies may 
impose restrictions on transfers to the extent necessary to prevent 
or limit disruptive trading activity, as described in the 
prospectuses for the Contracts and the underlying mutual funds.
---------------------------------------------------------------------------

    16. The Insurance Company Applicants will cause the appropriate 
prospectus supplements containing this disclosure and the prospectus 
and/or supplement for the Replacement Funds to be sent to all existing 
Contract Owners. New purchasers of the Contracts will be provided the 
prospectus supplement, the Contract prospectus, and the prospectus and/
or supplement for the Replacement Funds in accordance with all 
applicable legal requirements. Prospective purchasers of the Contracts 
will be provided the prospectus supplement and the Contract prospectus.
    17. In addition to the Contract prospectus supplements distributed 
to Contract Owners, within five (5) business days after the 
Substitution date, Contract Owners will be sent a confirmation of the 
Substitutions in accordance with Rule 10b-10 under the Securities 
Exchange Act of 1934, as amended. The confirmation statement will 
reiterate that the Insurance Company Applicant will not exercise any 
right reserved by it under the Contracts to impose any restrictions or 
fees on transfers from the Replacement Funds until at least thirty (30) 
days after the Substitution date.
    18. The proposed Substitutions will take place at relative net 
asset value determined on the Substitution date pursuant to Section 22 
of the 1940 Act and Rule 22c-1 thereunder with no change in the amount 
of any Contract Owner's Contract value, cash value, death benefit, or 
dollar value of his or her investment in the Separate Accounts. Each 
Substitution will be effected by redeeming shares of the Existing Fund 
in cash and/or in-kind on the Substitution date at their net asset 
value and using the proceeds of those redemptions to purchase shares of 
the Replacement Fund at their net asset value on the same date.\3\
---------------------------------------------------------------------------

    \3\ For administrative convenience, the In-Kind Transactions may 
be effected through a direct transfer of securities and cash between 
the custodian(s) for the Existing Fund and its corresponding 
Replacement Fund, followed by the distribution of shares of the 
Replacement Fund to the applicable Separate Account(s).
---------------------------------------------------------------------------

    19. Contract Owners will not incur any fees or charges as a result 
of the proposed Substitutions, nor will their rights or insurance 
benefits or the Insurance Company Applicants' obligations under the 
Contracts be altered in any way. All expenses incurred in connection 
with the proposed Substitutions, including any brokerage, legal, 
accounting, and other fees and expenses, will be paid by the Insurance 
Company Applicants. In addition, the proposed Substitutions will not 
impose any tax liability on Contract Owners. The proposed

[[Page 28988]]

Substitutions will not cause the Contract fees and charges currently 
being paid by Contract Owners to be greater after the proposed 
Substitution than before the proposed Substitution. No fees will be 
charged on transfers made on the Substitution date because each 
Substitution redemption and purchase will not be treated as a transfer 
for purposes of assessing transfer charges or computing the number of 
permissible transfers under the Contracts.
    20. For all Substitutions other than Janus Aspen Series--INTECH 
Risk-Managed Core Portfolio: Service Shares to be replaced by NVIT--
NVIT Nationwide Fund: Class II (Ref. No. 21) (the ``Aspen 
Substitution''), for a period of two (2) years following the 
Substitution date and for those Contracts with assets allocated to the 
Existing Fund on the date of the Substitution, the issuing Insurance 
Company, as applicable, will reimburse, on the last business day of 
each fiscal quarter, the sub-accounts investing in the applicable 
Replacement Fund to the extent that the Replacement Fund's net annual 
expenses for such period exceeds, on an annualized basis, the net 
annual expenses of the Existing Fund for fiscal year 2008. In addition, 
the Insurance Company Applicants will not increase the Contract fees 
and charges that would otherwise be assessed under the terms of the 
Contracts for a period of at least two (2) years following the 
Substitution date.
    21. For the Aspen Substitution, where the sum of the management fee 
and 12b-1 fee of the Replacement Fund is greater than (or could be 
greater than) that of the Existing Fund, for those Contracts with 
assets allocated to the Existing Fund on the date of the Substitution, 
the issuing Insurance Company Applicant, as applicable, will reimburse, 
on the last business day of each fiscal quarter, the sub-accounts 
investing in the applicable Replacement Fund to the extent that the 
Replacement Fund's net annual expenses for such period exceeds, on an 
annualized basis, the net annual expenses of the Existing Fund for 
fiscal year 2008. In addition, for those same Contracts, the Insurance 
Company Applicants will not increase the Contract fees and charges that 
would otherwise be assessed under the terms of the Contracts for the 
duration of the Contracts.

Section 26 Applicants' Legal Analysis

    1. Section 26 Applicants request that the Commission issue an order 
pursuant to Section 26(c) of the 1940 Act approving the proposed 
Substitutions.
    2. Section 26 Applicants assert that Section 26(c) of the 1940 Act 
makes it unlawful for the depositor of a registered unit investment 
trust that invests in the securities of a single issuer to substitute 
another security for such security without Commission approval. Section 
26(c) further states that the Commission shall issue an order approving 
such a substitution ``if the evidence establishes that it is consistent 
with the protection of investors and the purposes fairly intended by 
the policy and provisions of this title.''
    3. Section 26 Applicants represent that the Contracts have reserved 
the right to substitute shares of another underlying mutual fund for 
one of the current underlying mutual funds offered as an investment 
option under the Contracts. The Contract prospectuses disclose this 
right.
    4. Section 26 Applicants represent that each Replacement Fund and 
its corresponding Existing Fund have similar, and in some cases 
substantially similar or identical, investment objectives and 
strategies. In addition, Section 26 Applicants maintain that each 
proposed Substitution retains for Contract Owners the investment 
flexibility and expertise in asset management, which are core 
investment features of the Contracts and any impact on the investment 
programs of affected Contract Owners should be negligible.
    Furthermore, Section 26 Applicants assert that the ultimate effect 
of the Substitutions would be to continue to provide Contract Owners 
with a wide array of investment options and managers, while at the same 
time increasing administrative efficiencies of the Contracts. 
Additionally, Section 26 Applicants claim that information pertaining 
to the underlying mutual funds available under the Contracts will be 
more consistent and thus easier for Contract Owners to navigate and 
understand.
    5. Section 26 Applicants represent that after the Substitution 
date, Contract Owners with Contract value invested in a Replacement 
Fund will have the same or lower net operating expense ratio(s) as 
before the Substitution. As indicated previously, certain expense 
limits have been put in place to ensure that Contract Owners do not 
incur higher expenses as a result of a Substitution for a period of 
either two (2) years after the Substitution, or for the lifetime of the 
Contract.
    6. Section 26 Applicants submit that the proposed Substitutions are 
not of the type that Section 26 was designed to prevent, i.e., 
overreaching on the part of the depositor by permanently impacting the 
investment allocations of the entire trust. In the current situation, 
the Contracts provide Contract Owners with investment discretion to 
allocate and reallocate their Contract value among the available 
underlying mutual funds. Section 26 Applicants claim this flexibility 
provides Contract Owners with the ability to reallocate their assets at 
any time--either before the Substitution date, or after the 
Substitution date--if they do not wish to invest in the Replacement 
Fund. Thus, Section 26 Applicants assert that the likelihood of being 
invested in an undesired underlying mutual fund is minimized, with the 
discretion remaining with the Contract Owners, and the Substitutions, 
therefore, will not result in the type of costly forced redemption that 
Section 26(c) was designed to prevent.
    7. Section 26 Applicants submit that the proposed Substitutions are 
also unlike the type of substitution that Section 26(c) was designed to 
prevent in that the Substitutions have no impact on other aspects of 
the Contracts. Specifically, Section 26 Applicants maintain that the 
type of insurance coverage offered by the Insurance Company Applicants 
under the applicable Contract, as well as numerous other rights and 
privileges associated with the Contract, are not impacted by the 
proposed Substitution. Section 26 Applicants note that Contract Owners 
also may have considered the Insurance Company Applicant's size, 
financial condition, and its reputation for service in selecting their 
Contract. Section 26 Applicants assert that these factors will not 
change as a result of the proposed Substitutions, nor will the annuity, 
life, or tax benefits afforded under the Contracts held by any of the 
affected Contract Owners.
    8. Section 26 Applicants submit that, for all the reasons stated 
above, the proposed Substitutions are consistent with the protection of 
investors and the purposes fairly intended by the policy and provisions 
of the 1940 Act.

Section 17 Applicants' Legal Analysis

    1. Section 17 Applicants request that the Commission issue an order 
pursuant to Section 17(b) of the 1940 Act exempting them from the 
provisions of Section 17(a) of the 1940 Act to the extent necessary to 
permit them to carry out the In-Kind Transactions.
    2. Section 17(a)(1) of the 1940 Act, in relevant part, generally 
prohibits any affiliated person of a registered investment company (or 
any affiliated person of such a person), acting as principal, from 
knowingly selling any security or other property to that

[[Page 28989]]

company. Section 17(a)(2) of the 1940 Act generally prohibits the same 
persons, acting as principals, from knowingly purchasing any security 
or other property from the registered investment company. Section 
2(a)(3) of the 1940 Act defines the term ``affiliated person'' of 
another person, in relevant part, as:

    (A) any person directly or indirectly owning, controlling, or 
holding with power to vote, 5 per centum or more of the outstanding 
voting securities of such other person; (B) any person 5 per centum 
or more of whose outstanding voting securities are directly or 
indirectly owned, controlled, or held with power to vote, by such 
other person; [or] (C) any person directly or indirectly 
controlling, controlled by, or under common control with, such other 
person* * *

    3. Section 2(a)(9) of the 1940 Act states that any person who owns 
beneficially, either directly or through one or more controlled 
companies, more than 25% of the voting securities of a company shall be 
presumed to control such company. Shares held by an insurance company 
separate account are legally owned by the insurance company. Thus, the 
Insurance Company Applicants collectively own substantially all of the 
shares of NVIT. Accordingly, NVIT and its respective funds are arguably 
under the control of the Insurance Company Applicants, as per Section 
2(a)(9) of the 1940 Act (notwithstanding the fact that the Contract 
Owners are the beneficial owners of those Separate Account shares). If 
NVIT is under the common control of the Insurance Company Applicants, 
then each of the Insurance Company Applicants is an affiliated person 
of NVIT and its respective Funds. If NVIT and its respective Funds are 
under the control of the Insurance Company Applicants, then NVIT and 
its respective affiliates are affiliated persons of the Insurance 
Company Applicants. Regardless of whether or not the Insurance Company 
Applicants can be considered to actually control NVIT and its Funds, 
because the Insurance Company Applicants and their affiliates own of 
record more than 5% of the shares of each Fund and are under common 
control with NFA, the Insurance Company Applicants are affiliated 
persons of NVIT and its Funds. Likewise, NVIT and its respective Funds 
are each an affiliated person of the Insurance Company Applicants.
    4. Section 17 Applicants represent that the proposed In-Kind 
Transactions could be seen as the indirect purchase of shares of 
certain Replacement Funds with portfolio securities of certain Existing 
Funds and the indirect sale of portfolio securities of certain Existing 
Funds for shares of certain Replacement Funds. Pursuant to this 
analysis, the proposed In-Kind Transactions also could be categorized 
as a purchase of shares of certain Replacement Funds by certain 
Existing Funds, acting as principal, and a sale of portfolio securities 
by certain Existing Funds, acting as principal, to certain Replacement 
Funds. In addition, the proposed In-Kind Transactions could be viewed 
as a purchase of securities from certain Existing Funds, and a sale of 
securities to certain Replacement Funds, by the Insurance Company 
Applicants (or their Separate Accounts), acting as principal. If 
categorized in this manner, the proposed In-Kind Transactions may be 
deemed to contravene Section 17(a) due to the affiliated status of 
these participants.
    5. Section 17(b) of the 1940 Act provides that any person may apply 
to the Commission for an exemption from the provisions of Section 
17(a), and the Commission shall issue such exemptive order, if evidence 
establishes that:

    (1) The terms of the proposed transaction, including the 
consideration to be paid or received, are reasonable and fair and do 
not involve overreaching on the part of any person concerned;
    (2) The proposed transaction is consistent with the policy of 
each registered investment company concerned, as recited in its 
registration statement and reports filed under [the 1940 Act]; and
    (3) The proposed transaction is consistent with the general 
purposes of [the 1940 Act].

    6. The Section 17 Applicants submit that the In-Kind Transactions 
meet the conditions set forth in Section 17(b) of the 1940 Act.
    7. The Section 17 Applicants submit that the terms of the In-Kind 
Transactions, including the consideration to be paid and received, are 
reasonable, fair, and do not involve overreaching because: (1) The 
Contract Owners' Contract values will not be adversely impacted or 
diluted; (2) with respect to those securities for which market 
quotations are readily available, the In-Kind Transactions will comply 
with the conditions set forth in Rule 17a-7, other than the requirement 
relating to cash consideration; and (3) with respect to those 
securities for which market quotations are not readily available, the 
In-Kind Transactions will be effected in accordance with the relevant 
Existing Funds' and the relevant corresponding Replacement Funds' 
normal valuation procedures, as described in the relevant fund's 
registration statement.
    8. Section 17 Applicants represent that Contract Owners' Contract 
values will not be adversely impacted or diluted because the In-Kind 
Transactions will be effected at the respective net asset values of the 
Existing Funds and the Replacement Funds, as described in each fund's 
registration statement and as required by Rule 22c-1 under the 1940 
Act. The In-Kind Transactions will not change the dollar value of any 
Contract, the accumulation unit value or annuity unit value of any 
Contract, or the death benefit payable under any Contract. After the 
In-Kind Transactions, the value of a Separate Account's investment in a 
Replacement Fund will equal the value of its investments in the 
corresponding Existing Fund (in addition to any pre-existing investment 
in the Replacement Fund) before the In-Kind Transactions.
    9. The adopting release of Rule 17a-7 states that the purpose of 
the rule is to set forth ``conditions as to the availability of the 
exemption to those situations where the Commission, upon the basis of 
its experience, considers that there is no likelihood of overreaching 
of the investment companies participating in the transaction.'' \4\ 
Because the proposed In-Kind Transactions would comply in substance 
with the conditions of the rule and since the In-Kind Transactions will 
be effected at the respective net asset values of the relevant funds, 
as per the registration statement for each fund and as required by Rule 
22c-1 under the 1940 Act, the Section 17 Applicants submit that the 
terms of the In-Kind Transactions do not present a situation where the 
investment companies participating in the transaction could overreach 
and potentially harm investors. Section 17 Applicants claim that the 
purposes intended by implementation of the rule are therefore met by 
the terms of the In-Kind Transactions.
---------------------------------------------------------------------------

    \4\ 1940 Act Rel. Nos. 4604 (May 20, 1966) (proposing release) 
and 4697 (Sept. 8, 1966) (adopting release).
---------------------------------------------------------------------------

    10. Section 17 Applicants represent that the proposed In-Kind 
Transactions will be effected based upon the independent current market 
price of the portfolio securities as specified in Rule 17a-7(b). 
Section 17 Applicants claim that the proposed In-Kind Transactions will 
be consistent with the policy of each registered investment company and 
separate series thereof participating in the In-Kind Transactions, as 
recited in the relevant registered investment company's registration 
statement and reports in accordance with Rule 17a-

[[Page 28990]]

7(c). No brokerage commission, fee (except for any customary transfer 
fees), or other remuneration will be paid in connection with the 
proposed In-Kind Transactions as specified in Rule 17a-7(d). NVIT's 
board of directors has adopted and implemented the fund governance and 
oversight procedures as required by Rule 17a-7(e) and (f). Finally, a 
written record of the procedures for the proposed In-Kind Transactions 
will be maintained and preserved in accordance with Rule 17a-7(g).
    11. Although the proposed In-Kind Transactions will not comply with 
the cash consideration requirement of Rule 17a-7(a), Section 17 
Applicants assert that the terms of the proposed In-Kind Transactions 
will offer to each of the relevant Existing Funds and each of the 
relevant Replacement Funds the same degree of protection from 
overreaching that Rule 17a-7 generally provides in connection with the 
purchase and sale of securities under that Rule in the ordinary course 
of business. Specifically, Insurance Company Applicants and their 
affiliates cannot effect the proposed In-Kind Transactions at a price 
that is disadvantageous to any Replacement Fund and the proposed In-
Kind Transactions will not occur absent an exemptive order from the 
Commission.
    12. Section 17 Applicants represent that for those Existing Funds 
that will redeem their shares in-kind as part of the In-Kind 
Transactions, such transactions will be consistent with the investment 
policies of the Existing Fund because: (1) The redemption in-kind 
policy is stated in the relevant Existing Fund's current registration 
statement; and (2) the shares will be redeemed at their net asset value 
in conformity with Rule 22c-1 under the 1940 Act. Likewise, for the 
Replacement Funds that will sell shares in exchange for portfolio 
securities as part of the In-Kind Transactions, such transactions will 
be consistent with the investment policies of the Replacement Fund 
because: (1) NVIT's policy of selling shares in exchange for investment 
securities is stated in NVIT's current registration statement; (2) the 
shares will be sold at their net asset value; and (2) the investment 
securities will be of the type and quality that a Replacement Fund 
could have acquired with the proceeds from the sale of its shares had 
the shares been sold for cash. For each of the proposed In-Kind 
Transactions, the Adviser and relevant Sub-Adviser(s) will analyze the 
portfolio securities being offered to each relevant Replacement Fund 
and will retain only those securities that it would have acquired for 
each such Fund in a cash transaction.
    13. Section 17 Applicants represent that all in-kind redemptions 
from an Existing Fund of which any Section 17 Applicants is an 
affiliated person will be effected in accordance with the conditions 
set forth in the Commission's no-action letter issued to Signature 
Financial Group, Inc. (available December 28, 1999).
    14. Section 17 Applicants assert that the proposed In-Kind 
Transactions, as described herein, are consistent with the general 
purposes of the 1940 Act set forth in Section 1 of the 1940 Act. In 
particular, the proposed In-Kind Transactions do not present any 
conditions or abuses that the 1940 Act was designed to prevent.
    15. Section 17 Applicants request that the Commission issue an 
order pursuant to Section 17(b) of the 1940 Act to permit them, to the 
extent necessary, to carry out the proposed In-Kind Transactions. 
Section 17 Applicants submit that, for all the reasons stated above: 
(1) The terms of the proposed In-Kind Transactions, including the 
consideration to be paid and received, are reasonable and fair to each 
of the relevant Replacement Funds, each of the relevant Existing Funds, 
and Contract Owners, and that the proposed In-Kind Transactions do not 
involve overreaching on the part of any person concerned; (2) the 
proposed In-Kind Transactions are, or will be, consistent with the 
policies of the relevant Replacement Funds and the relevant Existing 
Funds as stated in the relevant investment company's registration 
statement and reports filed under the 1940 Act; and (3) the proposed 
In-Kind Transactions are, or will be, consistent with the general 
purposes of the 1940 Act.

Conclusion

    Section 26 Applicants submit that for the reasons summarized above 
the proposed Substitutions meet the standards of Section 26(c) of the 
1940 Act and request that the Commission issue an order of approval 
pursuant to Section 26(c) of the 1940 Act. Section 17 Applicants submit 
that the proposed In-Kind Transactions meet the standards of Section 
17(b) of the 1940 Act and request that the Commission issue an order of 
exemption pursuant to Section 17(b) of the 1940 Act.

    For the Commission, by the Division of Investment Management 
pursuant to delegated authority.
Florence E. Harmon,
Deputy Secretary.

Appendix

1. AIM Variable Insurance Funds--AIM V.I. Basic Value Fund Replaced by 
the NVIT--NVIT Multi-Manager Large Cap Value Fund (Substitution Table 
Reference Nos. 1 & 2)

    AIM Variable Insurance Funds--AIM V.I. Basic Value Fund: Series I 
Shares will be replaced by the NVIT--NVIT Multi-Manager Large Cap Value 
Fund: Class I shares. AIM Variable Insurance Funds--AIM V.I. Basic 
Value Fund: Series II Shares will be replaced by the NVIT--NVIT Multi-
Manager Large Cap Value Fund: Class II shares.
    The following chart compares the management fees, the total 
operating expenses (before and after any waivers and reimbursements) 
expressed as an annual percentage of average daily net assets, and the 
asset levels of the AIM Variable Insurance Funds--AIM V.I. Basic Value 
Fund: Series I Shares, AIM Variable Insurance Funds--AIM V.I. Basic 
Value Fund: Series II Shares, NVIT--NVIT Multi-Manager Large Cap Value 
Fund: Class I, and NVIT--NVIT Multi-Manager Large Cap Value Fund: Class 
II.
---------------------------------------------------------------------------

    \5\ Through April 30, 2010, the fund's advisor has contractually 
agreed to waive a portion of its advisory fees to the extent 
necessary so that the advisory fees payable by the fund do not 
exceed a specified maximum annual advisory fee rate, wherein the fee 
rate is based upon average net asset levels as follows:
    0.695% of the first $250 million,
    0.67% of the next $250 million,
    0.645% of the next $500 million,
    0.62% of the next $1.5 billion,
    0.595% of the next $2.5 billion,
    0.57% of the next $2.5 billion,
    0.545% of the next $2.5 billion,
    0.52% of the excess over $10 billion.
    \6\ ``Other Expenses'' include administrative services fees 
which currently are 0.15%, but which are permitted to be as high as 
0.25%. The full 0.25% in administrative services fees is not 
reflected in ``Other Expenses'' at this time because, until at least 
May 1, 2010, the Fund does not intend to pay insurance companies a 
higher amount. If the full amount of administrative services fees 
were charged, total operating expenses (after fee waivers/expense 
reimbursements) would be 1.02% and 1.27%, respectively.
    \7\ NVIT and NFA have entered into a written contract limiting 
operating expenses to 0.77% until May 1, 2010. This limit excludes 
certain Fund expenses, including interest, taxes, brokerage 
commissions, Rule 12b-1 fees, fees paid pursuant to an 
Administrative Services Plan, short sale dividend expenses, other 
expenditures which are capitalized in accordance with generally 
accepted accounting principles and other non-routine expenses not 
incurred in the ordinary course of the Fund's business. NVIT is 
authorized to reimburse the NFA for management fees previously 
waived or reduced and/or for expenses previously paid by NFA, 
provided, however, that any reimbursements must be paid at a date 
not more than three years after the fiscal year in which NFA waived 
the fees or reimbursed the expenses and the reimbursements do not 
cause the Fund to exceed the expense limitation in the agreement.
    \8\ Represents assets held by the fund or listed share class, as 
applicable.
    \9\ Based on asset levels as of 3/31/09, approximately 2% of AIM 
V.I. Basic Value Fund Shares: Series I assets will be transferred to 
NVIT Multi-Manager Large Cap Value Fund: Class I pursuant to the 
Substitution. This transfer represents approximately 1% of the 
Existing Fund's total assets.
    \10\ Based on asset levels as of 3/31/09, approximately 19% of 
AIM V.I. Basic Value Fund Shares: Series II assets will be 
transferred to NVIT Multi-Manager Large Cap Value Fund: Class II 
pursuant to the Substitution. This transfer represents approximately 
9% of the Existing Fund's total assets.

[[Page 28991]]



----------------------------------------------------------------------------------------------------------------
                                                           Existing fund                 Replacement fund
                                                 ---------------------------------------------------------------
                                                  AIM variable insurance funds--   NVIT-NVIT multi-manager large
                                                     AIM V.I. basic value fund            cap value fund
                                                              shares             -------------------------------
                                                 --------------------------------
                                                     Series I        Series II        Class I        Class II
----------------------------------------------------------------------------------------------------------------
Management Fees.................................       \5\ 0.68%       \5\ 0.68%           0.65%           0.65%
12b-1 Fees......................................           0.00%           0.25%           0.00%           0.25%
Other Expenses..................................           0.35%           0.35%       \6\ 0.37%       \6\ 0.37%
Total Gross Expenses............................           1.03%           1.28%           1.02%           1.27%
Waivers/Reimbursements..........................           0.00%           0.00%       \7\ 0.10%       \7\ 0.10%
Total Net Expenses..............................           1.03%           1.28%           0.92%           1.17%
Fund/Class \8\ Asset Level ($MMs) (5/20/09).....      \9\ $170.3     \10\ $143.4            $0.2            $5.9
----------------------------------------------------------------------------------------------------------------

2. AIM Variable Insurance Funds--AIM V.I. Large Cap Growth Fund: Series 
I Shares Replaced by the NVIT--NVIT Multi-Manager Large Cap Growth 
Fund: Class I (Substitution Table Reference No. 3)
    The following chart compares the management fees, the total 
operating expenses (before and after any waivers and reimbursements) 
expressed as an annual percentage of average daily net assets, and the 
asset levels of the AIM Variable Insurance Funds--AIM V.I. Large Cap 
Growth Fund: Series I Shares and the NVIT--NVIT Multi-Manager Large Cap 
Growth Fund: Class I.
---------------------------------------------------------------------------

    \11\ Through April 30, 2010, the fund's advisor has 
contractually agreed to waive a portion of its advisory fees to the 
extent necessary so that the advisory fees payable by the fund do 
not exceed a specified maximum annual advisory fee rate, wherein the 
fee rate is based upon average levels as follows:
     0.695% of the first $250 million,
     0.67% of the next $250 million,
     0.645% of the next $500 million,
     0.62% of the next $1.5 billion,
     0.595% of the next $2.5 billion,
     0.57% of the next $2.5 billion,
     0.545% of the next $2.5 billion,
     0.52% of the excess over $10 billion.
    \12\ ``Other Expenses'' include administrative services fees 
which currently are 0.15%, but which are permitted to be as high as 
0.25%. The full 0.25% in administrative services fees is not 
reflected in ``Other Expenses'' at this time because, until at least 
May 1, 2010, the Fund does not intend to pay insurance companies a 
higher amount. If the full amount of administrative services fees 
were charged, total operating expenses (after fee waivers/expense 
reimbursements) would be 1.00%.
    \13\ The fund's advisor has contractually agreed to waive 
advisory fees and/or reimburse expenses to the extent necessary to 
limit Total Annual Fund Operating Expenses (excluding certain items 
discussed below) to 1.01% of average daily net assets. In 
determining the advisor's obligation to waive advisory fees and/or 
reimburse expenses, the following expenses are not taken into 
account, and could cause the Total Annual Fund Operating Expenses to 
exceed the number reflected above: (i) Interest; (ii) taxes; (iii) 
dividend expense on short sales; (iv) extraordinary items; (v) 
expenses related to a merger or reorganization, as approved by the 
fund's Board of Trustees; and (vi) expenses that the fund has 
incurred but did not actually pay because of an expense offset 
arrangement. Currently, the expense offset arrangements from which 
the fund may benefit are in the form of credits that the fund 
receives from banks where the fund or its transfer agent has deposit 
accounts in which it holds uninvested cash. These credits are used 
to pay certain expenses incurred by the fund. This expense 
limitation agreement is in effect through at least April 30, 2010.
    \14\ NVIT and NFA have entered into a written contract limiting 
operating expenses to 0.75% until at least May 1, 2010. This limit 
excludes certain Fund expenses, including any taxes, interest, 
brokerage fees, Rule 12b-1 fees, short-sale dividend expenses, 
administrative services fees, other expenses which are capitalized 
in accordance with generally accepted accounting principles and may 
exclude other non-routine expenses not incurred in the ordinary 
course of the Fund's business. NVIT is authorized to reimburse NFA 
for management fees previously waived and/or for expenses previously 
paid by NFA, provided however, that any reimbursements must be paid 
at a date not more than three years after the fiscal year in which 
NFA waived the fees or reimbursed the expenses and the 
reimbursements do not cause the Fund to exceed the expense 
limitation in the agreement.
    \15\ Represents assets held by the fund or listed share class, 
as applicable.
    \16\ Based on asset levels as of 3/31/09, approximately 0.1% of 
the Existing Fund's Series I assets will be transferred to the 
Replacement Fund pursuant to the Substitution. This transfer 
represents approximately 0.3% of the Existing Fund's total assets.
    \17\ The fund pays the advisor a single, unified management fee 
for arranging all services necessary for the fund to operate. The 
fee shown is based on assets during the fund's most recent fiscal 
year. The fund has a stepped fee schedule, which is reflected in the 
following table:
    1.00% of first $500 million,
    0.95% of the next $500 million, and
    0.90% over $1 billion.
    \18\ ``Other Expenses'' include administrative services fees 
which currently are 0.07%, but which are permitted to be as high as 
0.25%. The full 0.25% in administrative services fees is not 
reflected in ``Other Expenses'' at this time because, until at least 
May 1, 2010, the Fund does not intend to pay insurance companies a 
higher amount. If the full amount of administrative services fees 
were charged, total operating expenses (after fee waivers/expense 
reimbursements) would be 1.07%.
    \19\ NVIT and NFA have entered into a written contract limiting 
operating expenses to 0.82% until at least May 1, 2010. This limit 
excludes certain Fund expenses, including any interest, taxes, 
brokerage commissions, Rule 12b-1 fees, fees paid pursuant to an 
Administrative Services Plan, short-sale dividend expenses, other 
expenditures which are capitalized in accordance with generally 
accepted accounting principles and other non-routine expenses not 
incurred in the ordinary course of the Fund's business. NVIT is 
authorized to reimburse NFA for management fees previously waived or 
reduced and/or for expenses previously paid by NFA, provided 
however, that any reimbursements must be paid at a date not more 
than three years after the fiscal year in which NFA waived the fees 
or reimbursed the expenses and the reimbursements do not cause the 
Fund to exceed the expense limitation in the agreement.

----------------------------------------------------------------------------------------------------------------
                                                     Existing fund                     Replacement fund
                                         -----------------------------------------------------------------------
                                           AIM Variable Insurance Funds--AIM
                                          V.I. Large Cap Growth Fund: Series  NVIT--NVIT Multi-Manager Large Cap
                                                       I Shares                      Growth Fund: Class I
----------------------------------------------------------------------------------------------------------------
Management Fees.........................                          \11\ 0.70%                               0.65%
12b-1 Fees..............................                               0.00%                               0.00%
Other Expenses..........................                               0.40%                          \12\ 0.36%

[[Page 28992]]

 
Total Gross Expenses....................                               1.10%                               1.01%
Waivers/Reimbursements..................                          \13\ 0.09%                          \14\ 0.11%
Total Net Expenses......................                               1.01%                               0.90%
Fund/Class \15\ Asset Level ($MMs) (5/20/                         \16\ $63.5                                $0.6
 09)....................................
----------------------------------------------------------------------------------------------------------------

3. American Century Variable Portfolios, Inc.--American Century VP 
Capital Appreciation Fund: Class I Replaced by the NVIT--NVIT Multi-
Manager Mid Cap Growth Fund: Class I (Substitution Table Reference No. 
4)
    The following chart compares the management fees, the total 
operating expenses (before and after any waivers and reimbursements) 
expressed as an annual percentage of average