PARTICIPATION AGREEMENT BETWEEN
AMERICAN UNITED LIFE INSURANCE COMPANY AND
MFS FUND DISTRIBUTORS, INC.
THIS AGREEMENT, made and entered into this 29th day of May, 2002, by and
between MFS FUND DISTRIBUTORS, INC., a Delaware corporation ("MFS") and AMERICAN
UNITED LIFE INSURANCE COMPANY, an Indiana life insurance company (the
"Company"), on its own behalf and on behalf of certain segregated asset accounts
of the Company (the "Account" or the "Accounts");
WHEREAS, each Massachusetts business trust listed on Schedule A attached
hereto (the "Trusts"), is registered with the Securities and Exchange Commission
("SEC") as an open-end investment company under the Investment Company Act of
1940, as amended (the "1940 Act"), and each Trust is composed of multiple series
of shares which are or will be registered under the Securities Act of 1933, as
amended (the "1933 Act") (each, a "Fund" and collectively, the "Funds");
WHEREAS each Fund is comprised of multiple classes of shares which are or
will be registered under the 1933 Act;
WHEREAS MFS is registered as a broker-dealer with the SEC under the
Securities Exchange Act of 1934, as amended (the "1934 Act"), and is a member in
good standing of the National Association of Securities Dealers, Inc. (the
"NASD");
WHEREAS, MFS serves as distributor for the Trusts pursuant to the terms of
a Distribution Agreement between each Trust and MFS;
WHEREAS, the Company will issue certain group fixed and variable annuity
contracts (individually, the "Policy" or collectively, the "Policies") which, if
required, will be registered under the 1933 Act;
WHEREAS, the Accounts are duly organized, validly existing segregated asset
accounts, established by resolution of the Board of Directors of the Company, to
set aside and invest assets attributable to the aforesaid Policies that are
allocated to the Accounts (the Policies and the Accounts covered by this
Agreement, and each corresponding Fund covered by this Agreement in which the
Accounts invest, is specified in Schedule A attached hereto as may be modified
from time to time);
WHEREAS, to the extent permitted by applicable insurance laws and
regulations, the Company intends to purchase Class A shares in one or more of
the Funds specified in Schedule A attached hereto (the "Shares") on behalf of
the Accounts to fund the Policies, and MFS intends to sell such Shares to the
Accounts;
NOW, THEREFORE, in consideration of their mutual promises, MFS and the
Company agree as follows:
ARTICLE I. SALE OF TRUST SHARES
1.1. MFS agrees to sell to the Company those Shares which the Accounts order
(based on orders placed by Policy holders on that Business Day, as defined
below) and which are available for purchase by such Accounts, executing
such orders on a daily basis at the net asset value next computed after
receipt by the Trust or its designee of the order for the Shares. For
purposes of this Section 1.1., the Company shall be the designee of the
Trust for receipt of such orders from Policy owners and receipt by such
designee shall constitute receipt by the Trust; provided that the Trust or
MFS receives notice of such orders by 9:00 a.m. Eastern Time on the next
following Business Day. "Business Day" shall mean any day on which the New
York Stock Exchange, Inc. (the "NYSE") is open for trading and on which the
Funds calculate their respective net asset values pursuant to the rules of
the SEC.
1.2. MFS agrees to make the Shares available indefinitely for purchase at the
applicable net asset value per share by the Company and the Accounts on
those days on which the Funds calculate their respective net asset value
pursuant to rules of the SEC and each Fund shall calculate such net asset
value on each day which the NYSE is open for trading. Notwithstanding the
foregoing, MFS may refuse to sell any Shares to the Company and the
Accounts, or suspend or terminate the offering of the Shares if such action
is required by law or by regulatory authorities having jurisdiction or,
pursuant to a determination made by the Board of Trustees of the Trust, on
behalf of the respective Fund, acting in good faith and in light of its
fiduciary duties under federal and any applicable state laws, if such
action is necessary in the best interest of the Shareholders of such Fund.
1.3. MFS agrees to accept for redemption, on the Company's request, any full or
fractional Shares held by the Accounts (based on orders placed by Policy
holders on that Business Day), executing such requests on a daily basis at
the net asset value next computed after receipt by the Trust or its
designee of the request for redemption. For purposes of this Section 1.3.,
the Company shall be the designee of the Trust for receipt of requests for
redemption from Policy owners and receipt by such designee shall constitute
receipt by the Trust; provided that the Trust or MFS receives notice of
such request for redemption by 9:00 a.m. Eastern Time on the next following
Business Day.
1.4. Each purchase, redemption and exchange order placed by the Company shall be
placed separately for each Fund and shall not be netted with respect to any
Fund. However, with respect to payment of the purchase price by the Company
and of redemption proceeds by MFS, the Company and MFS shall net purchase
and redemption orders with respect to each Fund and shall transmit one net
payment for all of the Funds in accordance with Section 1.5. hereof.
1.5. In the event of net purchases, the Company shall pay for the Shares by
12:00 p.m. Eastern Time on the next Business Day after an order to purchase
the Shares is made in accordance with the provisions of Section 1.1.
hereof. In the event of net redemptions, MFS shall pay the redemption
proceeds by 12:00 p.m. Eastern Time on the next Business Day after an order
to redeem the shares is made in accordance with the provisions of Section
1.3. hereof. All such payments shall be in federal funds transmitted by
wire.
1.6. Issuance and transfer of the Shares will be by book entry only. Share
certificates will not be issued to the Company or the Accounts. The Shares
ordered from MFS will be recorded in an appropriate title for the Accounts
or the appropriate subaccounts of the Accounts.
1.7. MFS shall furnish same day notice (by wire or telephone followed by written
confirmation) to the Company of any dividends or capital gains
distributions payable on the Shares. The Company hereby elects to receive
all such dividends and distributions as are payable on a Fund's Shares in
additional Shares of that Fund. The Company reserves the right to revoke
this election in writing and to receive all such dividends and
distributions in cash. MFS shall notify the Company of the number of Shares
so issued as payment of such dividends and distributions.
1.8. MFS or its designee shall make the net asset value per share for each Fund
available to the Company on each Business Day as soon as reasonably
practical after the net asset value per share is calculated and shall use
its best efforts to make such net asset value per share available by 7:00
p.m. Eastern Time. In the event that MFS is unable to meet the 7:00 p.m.
time stated herein, MFS shall provide additional time for the Company to
place orders for the purchase and redemption of Shares. Such additional
time shall be equal to the additional time which MFS takes to make the net
asset value available to the Company. If MFS provides materially incorrect
share net asset value information, MFS shall cause the Trust to make an
adjustment to the number of shares purchased or redeemed for the Accounts
to reflect the correct net asset value per share. Any
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material error in the calculation or reporting of net asset value per
share, dividend or capital gains information shall be reported promptly
upon discovery to the Company.
ARTICLE II. CERTAIN REPRESENTATIONS, WARRANTIES AND COVENANTS
2.1. The Company represents and warrants that the Policies are group annuities
for investors who do not need to meet the diversification requirements of
Section 817(h) of the Internal Revenue Code of 1986, as amended (the
"Code") and such annuities are either registered under the 1933 Act or
exempt from or not subject to registration under the 1933 Act, and that the
Policies will be issued, sold, and distributed in compliance in all
material respects with all applicable state and federal laws or exemptions
therefrom, including without limitation the 1933 Act, the 1934 Act, and the
1940 Act, as may be applicable, and the Conduct Rules of the NASD. The
Company further represents and warrants that it is an insurance company
duly organized and in good standing under applicable law and that it has
legally and validly established the Account as a segregated asset account
under applicable law.
2.2. MFS represents and warrants on behalf of each Fund that each Fund has
elected to be a Regulated Investment Company, and has so qualified, and
will continue to elect to be a Regulated Investment Company under
Subchapter M of the Code and that every effort will be made to so qualify
(under Subchapter M or any successor or similar provision) and that MFS or
its designee will notify the Company promptly upon having a reasonable
basis for believing that any Fund has ceased to so qualify or that any Fund
might not so qualify in the future.
2.3. MFS represents and warrants that the Shares sold pursuant to this Agreement
shall be registered under the 1933 Act, duly authorized for issuance and
sold in compliance with the laws of The Commonwealth of Massachusetts and
all applicable federal and state securities laws and that the Trust is and
shall remain registered under the 1940 Act. MFS shall amend, or cause to be
amended, the Trust's registration statement under the 1933 Act and the 1940
Act from time to time as required in order to effect the continuous
offering of Fund Shares. MFS shall cause the Trust to register and qualify
its Shares for sale in accordance with the laws of the various states only
if and to the extent deemed necessary by MFS.
2.4. MFS represents and warrants that it is a member in good standing of the
NASD and is registered as a broker-dealer with the SEC. MFS represents and
warrants that it will sell and distribute the Shares in accordance in all
material respects with all applicable state and federal laws, including
without limitation the 1933 Act, the 1934 Act, and the 0000 Xxx.
2.5. MFS represents and warrants that the Trust is lawfully organized and
validly existing under the laws of The Commonwealth of Massachusetts and
that the Trust does and will comply in all material respects with the 1940
Act and any applicable regulations thereunder.
2.6. MFS represents and warrants that the investment adviser to the Funds (the
"Adviser") is and shall remain duly registered under all applicable federal
securities laws and that it shall perform its obligations for the Funds in
compliance in all material respects with any applicable federal securities
laws.
ARTICLE III. PROSPECTUS AND PROXY STATEMENTS; VOTING
3.1. At least annually, MFS or its designee shall provide the Company, free of
charge, with as many copies of the current prospectus (describing only the
Funds listed in Schedule A hereto) for the Shares as the Company may
reasonably request for distribution to existing Policy owners whose
Policies are funded by such Shares. MFS or its designee shall also provide
the Company, at MFS' expense, with copies of the
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current prospectus for the Shares for distribution to prospective
purchasers of the Policies in amounts mutually agreeable to MFS and the
Company.
3.2. The prospectus for the Shares shall state that the statement of additional
information for the Shares is available from MFS or its designee. MFS or
its designee, at its expense, shall print and provide such statement of
additional information to the Company (or a master of such statement
suitable for duplication by the Company) for distribution to any
prospective or existing Policy owner.
3.3. MFS or its designee shall provide the Company free of charge copies, if and
to the extent applicable to the Shares, of the Funds' proxy materials,
reports to Shareholders and other communications to Shareholders in such
quantity as the Company shall reasonably require for distribution to
existing Policy owners. MFS or its designee shall also provide the Company,
at MFS' expense, with copies of such materials, reports and communications
for distribution to prospective purchasers of Policies in amounts mutually
agreeable to MFS and the Company.
3.4. If and to the extent required by law, the Company shall:
(a) solicit voting instructions from Policy owners;
(b) vote the Shares in accordance with instructions received from Policy
owners; and
(c) vote the Shares for which no instructions have been received in the
same proportion as the Shares of such Fund for which instructions have
been received from Policy owners;
so long as and to the extent that the SEC continues to interpret the 1940
Act to require pass through voting privileges for variable contract owners.
The Company will in no way recommend action in connection with or oppose or
interfere with the solicitation of proxies for the Shares held for such
Policy owners. The Company reserves the right to vote shares held in any
segregated asset account in its own right, to the extent permitted by law.
ARTICLE IV. SALES MATERIAL AND INFORMATION
4.1. The Company shall furnish, or shall cause to be furnished, to MFS or its
designee, each piece of sales literature or other promotional material in
which the Funds, MFS, the Adviser, or any affiliate of MFS are named, at
least five (5) Business Days prior to its use. No such material shall be
used if MFS or its designee reasonably objects to such use within five (5)
Business Days after receipt of such material.
4.2. The Company shall not give any information or make any representations or
statement on behalf of the Trust, the Funds, MFS, the Adviser, or any
affiliate of MFS or concerning MFS or any other such entity in connection
with the sale of the Policies other than the information or representations
contained in the registration statement, prospectus or statement of
additional information for the Shares, as such registration statement,
prospectus and statement of additional information may be amended or
supplemented from time to time, or in reports or proxy statements for MFS,
or in sales literature or other promotional material approved by MFS or its
designees, except with the permission of MFS or its designees. MFS or its
designees each agrees to respond to any request for approval on a prompt
and timely basis. The Company may not alter any material so provided by MFS
or its designee (including, without limitation, presenting or delivering
such material in a different medium, e.g., electronic or internet) without
the prior written consent of MFS. The Company shall adopt and implement
procedures reasonably designed to ensure that information concerning the
Trust, the Funds, MFS or any of their affiliates which is intended for use
only by brokers or agents selling the Policies (i.e., information that is
not intended for distribution to Policy holders or prospective Policy
holders) or any other appropriate institutions is so used, and neither the
Trust, the Funds, the Adviser, MFS
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nor any of their affiliates shall be liable for any losses, damages or
expenses relating to the improper use of such materials.
4.3. MFS or its designee shall furnish, or shall cause to be furnished, to the
Company or its designee, each piece of sales literature or other
promotional material in which the Company and/or the Accounts is named, at
least five (5) Business Days prior to its use. No such material shall be
used if the Company or its designee reasonably objects to such use within
five (5) Business Days after receipt of such material.
4.4. MFS shall not give any information or make any representations on behalf of
the Company or concerning the Company, the Accounts, or the Policies in
connection with the sale of the Policies other than the information or
representations contained in a registration statement, prospectus, or
statement of additional information for the Policies, as such registration
statement, prospectus and statement of additional information may be
amended or supplemented from time to time, or in reports for the Accounts,
or in sales literature or other promotional material approved by the
Company or its designee, except with the permission of the Company. The
Company or its designee agrees to respond to any request for approval on a
prompt and timely basis. MFS may not alter any material so provided by the
Company or its designee (including, without limitation, presenting or
delivering such material in a different medium, e.g., electronic or
internet) without the prior written consent of the Company. The parties
hereto agree that this Section 4.4. is neither intended to designate nor
otherwise imply that MFS is an underwriter or distributor of the Policies.
4.5. MFS will provide the Company with as much notice as is reasonably
practicable of any proxy solicitation for any Fund, and of any material
change in a Fund's registration statement, particularly any change
resulting in change to the registration statement or prospectus or
statement of additional information for any Account. MFS will cooperate
with the Company so as to enable the Company to solicit proxies from Policy
owners or to make changes to its sales literature or other promotional
material in an orderly manner.
4.6. For purpose of this Article IV and Article VI, the phrase "sales literature
or other promotional material" includes but is not limited to
advertisements (such as material published, or designed for use in, a
newspaper, magazine, or other periodical, radio, television, telephone or
tape recording, videotape display, signs or billboards, motion pictures, or
other public media), and sales literature (such as brochures, circulars,
reprints or excerpts or any other advertisement, sales literature, or
published articles), distributed or made generally available to customers
or the public, educational or training materials or communications
distributed or made generally available to some or all agents or employees.
ARTICLE V. FEES AND EXPENSES
5.1. MFS will reimburse the Company certain of the administrative costs and
expenses incurred by the Company as a result of the operations necessitated
by the beneficial ownership by Policy owners of Shares of the Funds each
quarter in an amount equal to the applicable per annum rate specified in
Schedule A attached hereto of the average daily net assets attributable to
Policies sold by the Company or its affiliates that are invested in each
Fund, multiplied by a fraction the numerator of which is the number of days
in the quarter and the denominator of which is 365. Each party, shall, in
accordance with the allocation of expenses specified in Articles III and V
hereof, reimburse other parties for expenses initially paid by one party
but allocated to another party. In addition, nothing herein shall prevent
the parties hereto from otherwise agreeing to perform, and arranging for
appropriate compensation for, other services relating to the Funds and/or
to the Accounts.
5.2. MFS or its designee shall bear the expenses for the cost of registration
and qualification of the Shares under all applicable federal and state
laws, including preparation and filing of the Funds' registration
statements, and payment of filing fees and registration fees; preparation
and filing of the Funds' proxy materials and reports to Shareholders;
setting in type and printing Fund prospectuses and statements of
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additional information; setting in type and printing the proxy materials
and reports to Shareholders; the preparation of all statements and notices
required of the Funds by any federal or state law with respect to their
Shares; all taxes on the issuance or transfer of the Shares; and the costs
of distributing the Funds' prospectuses, Shareholder reports and proxy
materials and any expenses permitted to be paid or assumed by the Funds
pursuant to a plan, if any, under Rule 12b-1 under the 1940 Act. MFS shall
not bear any expenses of marketing the Policies.
5.3. The Company shall bear the expenses of distributing the Funds' prospectuses
in connection with new sales of the Policies and of distributing the Funds'
Shareholder reports to Policy owners. The Company shall bear all expenses
associated with the qualification and filing of the Policies under
applicable state insurance laws, and the cost of preparing, printing and
distributing annual individual account statements for Policy owners as
required by state insurance laws.
ARTICLE VI. INDEMNIFICATION
6.1. INDEMNIFICATION BY THE COMPANY
The Company agrees to indemnify and hold harmless MFS, any affiliates
of MFS, and its directors/trustees, officers and each person, if any, who
controls MFS within the meaning of Section 15 of the 1933 Act, and any
agents or employees of the foregoing (each an "Indemnified Party," or
collectively, the "Indemnified Parties" for purposes of this Article VI)
against any and all losses, claims, damages, liabilities (including amounts
paid in settlement with the written consent of the Company) or expenses
(including reasonable counsel fees) to which an Indemnified Party may
become subject under any statute, regulation, at common law or otherwise,
insofar as such losses, claims, damages, liabilities or expenses (or
actions in respect thereof) or settlements are related to the sale or
acquisition of the Shares or the Policies and:
(a) arise out of or are based upon any untrue statement of any
material fact contained in the Policies or sales literature or
other promotional material for the Policies (or any amendment or
supplement to any of the foregoing), or arise out of or are based
upon the omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not
misleading provided that this agreement to indemnify shall not
apply as to any Indemnified Party if such statement or omission
was made in reasonable reliance upon and in conformity with
information furnished to the Company or its designee by or on
behalf of MFS, the Trust or the Funds for use in the Policies or
sales literature or other promotional material (or any amendment
or supplement) or otherwise for use in connection with the sale
of the Policies or Shares; or
(b) arise out of or as a result of statements or representations
(other than statements or representations contained in the
registration statement, prospectus, statement of additional
information or sales literature or other promotional material of
the Funds not supplied by the Company or its designee, or persons
under its control and on which the Company has reasonably relied)
or wrongful conduct of the Company or persons under its control,
with respect to the sale or distribution of the Policies or
Shares; or
(c) arise out of any untrue statement of a material fact contained in
the registration statement, prospectus, statement of additional
information, or sales literature or other promotional literature
of the Funds, or any amendment thereof or supplement thereto, or
the omission to state therein a material fact required to be
stated therein or necessary to make the statement or statements
therein not misleading, if such statement or omission was made in
reliance upon information furnished to the Funds by or on behalf
of the Company; or
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(d) arise out of or result from any material breach of any
representation and/or warranty made by the Company in this
Agreement or arise out of or result from any other material
breach of this Agreement by the Company; or
(e) arise as a result of any failure by the Company to provide the
services and furnish the materials under the terms of this
Agreement; as limited by and in accordance with the provisions of
this Article VI.
6.2. INDEMNIFICATION BY MFS
MFS agrees to indemnify and hold harmless the Company, the Accounts,
any affiliates of the Company or the Accounts, and each of the Company's
directors and officers and each person, if any, who controls the Company
within the meaning of Section 15 of the 1933 Act, and any agents or
employees of the foregoing (each an "Indemnified Party," or collectively,
the "Indemnified Parties" for purposes of this Article VI) against any and
all losses, claims, damages, liabilities (including amounts paid in
settlement with the written consent of MFS) or expenses (including
reasonable counsel fees) to which any Indemnified Party may become subject
under any statute, at common law or otherwise, insofar as such losses,
claims, damages, liabilities or expenses (or actions in respect thereof) or
settlements are related to the sale or acquisition of the Shares or the
Policies and:
(a) arise out of or are based upon any untrue statement of any
material fact contained in the registration statement,
prospectus, statement of additional information or sales
literature or other promotional material of the Funds (or any
amendment or supplement to any of the foregoing), or arise out of
or are based upon the omission to state therein a material fact
required to be stated therein or necessary to make the statement
therein not misleading, provided that this agreement to indemnify
shall not apply as to any Indemnified Party if such statement or
omission was made in reasonable reliance upon and in conformity
with information furnished to the Trust or MFS or their
respective designees by or on behalf of the Company for use in
the registration statement, prospectus or statement of additional
information for the Funds or in sales literature or other
promotional material for the Funds (or any amendment or
supplement) or otherwise for use in connection with the sale of
the Policies or Shares; or
(b) arise out of or as a result of statements or representations
(other than statements or representations contained in the sales
literature or other promotional material for the Policies not
supplied by MFS or any of its designees or persons under their
respective control and on which any such entity has reasonably
relied) or wrongful conduct of MFS or persons under its control,
with respect to the sale or distribution of the Policies or
Shares; or
(c) arise out of any untrue statement of a material fact contained in
the offering documents, sales literature or other promotional
literature of the Accounts or relating to the Policies, or any
amendment thereof or supplement thereto, or the omission to state
therein a material fact required to be stated therein or
necessary to make the statement or statements therein not
misleading, if such statement or omission was made in reliance
upon information furnished to the Company by or on behalf of the
Trust, the Funds or MFS; or
(d) arise out of or result from any material breach of any
representation and/or warranty made by MFS in this Agreement or
arise out of or result from any other material breach of this
Agreement by MFS; or
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(e) arise out of or result from the materially incorrect or untimely
calculation or reporting of the daily net asset value per Share
or dividend or capital gain distribution rate; or
(f) arise as a result of any failure by MFS to provide the services
and furnish the materials under the terms of the Agreement;
as limited by and in accordance with the provisions of this Article VI.
6.3. (a) In no event shall MFS be liable under the indemnification
provisions contained in this Agreement to any individual or entity,
including without limitation, the Company or any Policy holder, with
respect to any losses, claims, damages, liabilities or expenses that
arise out of or result from (i) a material breach of any
representation, warranty, and/or covenant made by the Company
hereunder; (ii) the failure by the Company to maintain its segregated
asset account (which invests in any Fund) as a legally and validly
established segregated asset account under applicable state law; or
(iii) the failure by the Company to maintain the Policies (with
respect to which any Fund serves as an underlying funding vehicle) as
endowment or annuity contracts under applicable provisions of the
Code.
(b) In no event shall the Company be liable under the indemnification
provisions contained in this Agreement to any individual or
entity, including without limitation, the Trust, the Funds or
MFS, with respect to any losses, claims, damages, liabilities or
expenses that arise out of or result from (i) a material breach
of any representation, warranty and/or covenant made by MFS; or
(ii) the failure by any Fund to be qualified as a Regulated
Investment Company under Subchapter M of the Code.
6.4. Neither the Company nor MFS shall be liable under the indemnification
provisions contained in this Agreement with respect to any losses,
claims, damages, liabilities or expenses to which an Indemnified Party
would otherwise be subject by reason of such Indemnified Party's
willful misfeasance, willful misconduct, or gross negligence in the
performance of such Indemnified Party's duties or by reason of such
Indemnified Party's reckless disregard of obligations and duties under
this Agreement.
6.5. Promptly after receipt by an Indemnified Party under this Article VI
of notice of commencement of action, such Indemnified Party will, if a
claim in respect thereof is to be made against the indemnifying party
under this Article VI, notify the indemnifying party of the
commencement thereof; but the omission so to notify the indemnifying
party will not relieve it from any liability which it may have to any
Indemnified Party otherwise than under this section. In case any such
action is brought against any Indemnified Party, and it notified the
indemnifying party of the commencement thereof, the indemnifying party
will be entitled to participate therein and, to the extent that it may
wish, assume the defense thereof, with counsel reasonably satisfactory
to such Indemnified Party. After notice from the indemnifying party of
its intention to assume the defense of an action, the Indemnified
Party shall bear the expenses of any additional counsel obtained by
it, and the indemnifying party shall not be liable to such Indemnified
Party under this section for any legal or other expenses subsequently
incurred by such Indemnified Party in connection with the defense
thereof other than reasonable costs of investigation.
6.6. Each of the parties agrees promptly to notify the other parties of the
commencement of any litigation or proceeding against it or any of its
respective officers, directors, trustees, employees or 1933 Act
control persons in connection with the Agreement, the issuance or sale
of the Policies, the operation of the Accounts or the Funds, or the
sale or acquisition of Shares.
6.7. A successor by law of a party to this Agreement shall be entitled to
the benefits of the indemnification contained in this Article VI. The
indemnification provisions contained in this Article VI shall survive
any termination of this Agreement.
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ARTICLE VII. APPLICABLE LAW
7.1. This Agreement shall be construed and the provisions hereof
interpreted under and in accordance with the laws of The Commonwealth
of Massachusetts.
7.2. This Agreement shall be subject to the provisions of the 1933, 1934
and 1940 Acts, and the rules and regulations and rulings thereunder,
including such exemptions from those statutes, rules and regulations
as the SEC may grant and the terms hereof shall be interpreted and
construed in accordance therewith.
ARTICLE VIII. NOTICE OF FORMAL PROCEEDINGS
MFS and the Company agree that each such party shall promptly notify the
other party to this Agreement, in writing, of the institution of any formal
proceedings brought against such party or its designees by NASD Regulation, Inc.
(the "NASDR"), the SEC, or any insurance department or any other regulatory body
regarding such party's duties under this Agreement or related to the sale of the
Policies, the operation of the Accounts, the Trust, or the Funds, or the
purchase of the Shares.
ARTICLE IX. TERMINATION
9.1. This Agreement shall terminate with respect to the Accounts, or one,
some, or all Funds:
(a) at the option of any party upon ninety (90) days' advance written
notice to the other parties; or
(b) at the option of the Company to the extent that the Shares of the
Funds are not reasonably available to meet the requirements of
the Policies or are not "appropriate funding vehicles" for the
Policies, as reasonably determined by the Company. Prompt notice
of the election to terminate for such cause and an explanation of
such cause shall be furnished to MFS by the Company; or
(c) at the option of MFS upon institution of formal proceedings
against the Company by the NASDR, the SEC, or any insurance
department or any other regulatory body regarding the Company's
duties under this Agreement or related to the sale of the
Policies, the operation of the Accounts, or the purchase of the
Shares; or
(d) at the option of the Company upon institution of formal
proceedings against MFS or the Trust by the NASDR, the SEC, or
any state securities or insurance department or any other
regulatory body regarding MFS' or the Trust's duties under this
Agreement or related to the operation of the Trust, a Fund or the
sale of the Shares; or
(e) at the option of the Company or MFS upon receipt of any necessary
regulatory approvals and/or the vote of the Policy owners having
an interest in the Accounts (or any subaccounts) to substitute
the shares of another investment company for the corresponding
Fund Shares in accordance with the terms of the Policies for
which those Fund Shares had been selected to serve as the
underlying investment media. The Company will give thirty (30)
day's prior written notice to MFS of the date of any proposed
vote or other action taken to replace the Shares; or
(f) at the option of MFS by written notice to the Company, if MFS
shall determine, in its sole judgment exercised in good faith,
that the Company has suffered a material adverse change
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in its business, operations, financial condition, or prospects
since the date of this Agreement or is the subject of material
adverse publicity; or
(g) at the option of the Company by written notice to MFS, if the
Company shall determine, in its sole judgment exercised in good
faith, that MFS, the Trust or the Funds have suffered a material
adverse change in its business, operations, financial condition
or prospects since the date of this Agreement or is the subject
of material adverse publicity; or
(h) at the option of any party to this Agreement, upon another
party's material breach of any provision of this Agreement; or
(i) upon assignment of this Agreement, unless made with the written
consent of the parties hereto.
(j) termination by the Company upon termination of the investment
advisory agreement between any Fund and the Adviser. Notice of
such termination shall be promptly furnished to the Company.
9.2. The notice shall specify the Fund or Funds, Policies and, if
applicable, the Accounts as to which the Agreement is to be
terminated.
9.3. It is understood and agreed that the right of any party hereto to
terminate this Agreement pursuant to Section 9.1(a) may be exercised
for cause or for no cause.
ARTICLE X. NOTICES
Any notice shall be sufficiently given when sent by registered or certified
mail to the other party at the address of such party set forth below or at such
other address as such party may from time to time specify in writing to the
other party.
If to the Company:
American United Life Insurance Company
Xxx Xxxxxxxx Xxxxxx
Xxxxxxxxxxxx, Xxxxxxx 00000
Attn: Xxxxxxx X. Xxxxxx
If to MFS:
MFS Fund Distributors, Inc.
c/o Massachusetts Financial Services Company
000 Xxxxxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Attn: Xxxxxx X. Xxxxx, Senior Vice President and Associate
General Counsel
ARTICLE XI. MISCELLANEOUS
11.1.Subject to the requirement of legal process and regulatory authority,
each party hereto shall treat as confidential the names and addresses
of the owners of the Policies and all information reasonably
identified as
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confidential in writing by any other party hereto and, except as
permitted by this Agreement or as otherwise required by applicable law
or regulation, shall not disclose, disseminate or utilize such names
and addresses and other confidential information without the express
written consent of the affected party until such time as it may come
into the public domain.
11.2.The captions in this Agreement are included for convenience of
reference only and in no way define or delineate any of the provisions
hereof or otherwise affect their construction or effect.
11.3.This Agreement may be executed simultaneously in one or more
counterparts, each of which taken together shall constitute one and
the same instrument.
11.4.If any provision of this Agreement shall be held or made invalid by a
court decision, statute, rule or otherwise, the remainder of the
Agreement shall not be affected thereby.
11.5.The Schedule attached hereto, as modified from time to time, is
incorporated herein by reference and is part of this Agreement.
11.6.Each party hereto shall cooperate with each other party in connection
with inquiries by appropriate governmental authorities (including
without limitation the SEC, the NASDR, and state insurance regulators)
relating to this Agreement or the transactions contemplated hereby.
11.7.The rights, remedies and obligations contained in this Agreement are
cumulative and are in addition to any and all rights, remedies and
obligations, at law or in equity, which the parties hereto are
entitled to under state and federal laws.
IN WITNESS WHEREOF, each of the parties hereto has caused this Agreement to
be executed in its name and on its behalf by its duly authorized representative
and its seal to be hereunder affixed hereto as of the date specified above.
AMERICAN UNITED LIFE INSURANCE COMPANY
By its authorized officer,
By:/s/ Xxxxxxx X. Xxxxxx
___________________________________
Title: Associate General Counsel
MFS FUND DISTRIBUTORS, INC.
By its authorized officer,
By:/s/ Xxxxxx X. Xxxxxxxx
___________________________________
Xxxxxx X. Xxxxxxxx
President
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SCHEDULE A
POLICIES, ACCOUNTS, AND FUNDS SUBJECT
TO THE PARTICIPATION AGREEMENT
Name of Account: Name of Policies:
AUL American Unit Trust Registered 401, 403(b), 457, 408
(established 8/17/89) contracts, non-qualified contracts
Group Retirement Annuity
Separate Account I Qualified 401 contracts
(established 8/17/89)
Group Retirement Annuity
Separate Account II Qualified 401 contracts
(established 8/17/89)
Group Retirement Annuity
Separate Account III Qualified 401 contracts
(established 3/31/00)
Name of Trust: Name of Funds: Applicable Per Annum Rate:
MFS Series Trust I MFS Value Fund A 0.40%
MFS Series Trust IV MFS Mid-Cap Growth Fund - A 0.40%
MFS Series Trust V MFS International New Discovery 0.45%
Fund - A
MFS Series Trust X MFS Strategic Value Fund A 0.45%
