PARTICIPATION AGREEMENT
Among
NEW ENGLAND ZENITH FUND,
NEW ENGLAND INVESTMENT MANAGEMENT, INC.,
NEW ENGLAND SECURITIES CORPORATION
and
METROPOLITAN LIFE INSURANCE COMPANY
AGREEMENT, made and entered into as of the 1st day of May, 2000 by and
among NEW ENGLAND ZENITH FUND, a business trust organized under the laws of the
Commonwealth of Massachusetts (the "Fund"), Metropolitan Life Insurance Company
(the "Company") on its own behalf and on behalf of Metropolitan Life Separate
Account UL, Metropolitan Life Separate Account E, Metropolitan Life Separate
Account F, New England Variable Account and any other current or future separate
account which invests in the Fund (each an "Account"), each a separate account
of the Company, NEW ENGLAND INVESTMENT MANAGEMENT, INC. (the "Adviser") and NEW
ENGLAND SECURITIES CORPORATION (the "Underwriter").
WHEREAS, the Fund is registered as an open-end management investment
company under the Investment Company Act of 1940, as amended (the "1940 Act")
and its shares are registered under the Securities Act of 1933, as amended
(hereinafter the "1933 Act"); and
WHEREAS, the Fund serves as an investment vehicle underlying variable life
insurance policies and variable annuity contracts (collectively, "Variable
Insurance Products") offered by insurance companies ("Participating Insurance
Companies"); and
WHEREAS, the beneficial interest in the Fund is divided into several series
of shares, each representing the interest in a particular managed portfolio of
securities and other assets; and
WHEREAS, the Fund has obtained an order from the Securities and Exchange
Commission ("SEC") granting Participating Insurance Companies and variable
annuity and variable life insurance separate accounts exemptions from certain
provisions of the 1940 Act and certain rules and regulations thereunder, to the
extent necessary to permit shares of the Fund to be sold to and held by both
variable annuity and variable life insurance separate accounts of both
affiliated and unaffiliated life insurance companies (hereinafter the "Shared
Funding Exemptive Order"); and
WHEREAS, the Adviser acts as the investment adviser and/or administrator or
subadministrator to each series of the Fund and is registered as an investment
adviser under the Investment Advisers Act of 1940, as amended; and
WHEREAS, the Company has registered or will register certain variable life
and/or variable annuity contracts under the 1933 Act, if required;
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WHEREAS, the Company has registered or will register each Account as a unit
investment trust under the 1940 Act, if required;
WHEREAS, the Underwriter 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"); and
WHEREAS, to the extent permitted by applicable insurance laws and
regulations, the Company intends to purchase shares of certain series of the
Fund (the "Series") on behalf of each Account to fund certain variable life and
variable annuity contracts (each, a "Contract") and the Underwriter is
authorized to sell such shares to each Account at net asset value;
NOW, THEREFORE, in consideration of their mutual promises, the Company, the
Fund and the Underwriter agree as follows:
1. Sale of Fund Shares.
1.1 Subject to the terms of the Distribution Agreement in effect from time
to time between the Fund and the Underwriter, the Underwriter agrees to
sell to the Company those shares of each Series which each Account
orders, executing such orders on a daily basis at the net asset value
next computed after receipt by the Fund or its designee of the order
for the shares of the Fund. For purposes of this Section 1.1, the
Company is the Fund's designee. "Business Day" shall mean any day on
which the New York Stock Exchange is open for trading and on which the
Fund calculates the net asset value of shares of the Series. The
Company shall use commercially reasonable efforts to communicate notice
of orders for the purchase of Shares of each Series to the Fund's
custodian by 10:00 a.m. Eastern time on the following business day (the
"Next Business Day"), and the Company and the Fund shall each use
commercially reasonable efforts to wire (or cause to be wired) funds to
the other, for the purpose of settling net purchase orders or orders of
redemption, by 3:00 p.m. of the Next Business Day.
1.2 The Fund agrees to make its shares available for purchase at the
applicable net asset value per share by the Company and its Accounts on
those days on which the Fund calculates its net asset value. The Fund
agrees to use reasonable efforts to calculate such net asset value on
each day which the New York Stock Exchange is open for trading.
Notwithstanding the foregoing, the Board of Trustees of the Fund
(hereinafter the "Board" or the "Trustees") may refuse to sell shares
of any Series to any person, or suspend or terminate the offering of
shares of any Series, if such action is required by law or by
regulatory authorities having jurisdiction or is, in the sole
discretion of the Trustees acting in good faith and in light of their
fiduciary duties under federal and any applicable state laws, in the
best interests of the shareholders of such Series.
1.3 The Fund and the Underwriter agree that shares of the Fund will be sold
only to Participating Insurance Companies and their separate accounts,
or to other purchasers of
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the kind specified in Treas. Reg. Section 1.817-5 (f)(3) (or any
successor regulation) as from time to time in effect.
1.4 The Fund agrees to redeem, on the Company's request, any full or
fractional shares of the Fund held by the Company, executing such
requests on a daily basis at the net asset value next computed after
receipt by the Fund or its designee of the request for redemption.
1.5 The Company agrees that all purchases and redemptions by it of the
shares of each Series will be in accordance with the provisions of the
then current prospectus and statement of additional information of the
Fund for the respective Series and in accordance with any procedures
that the Fund, the Underwriter or the Fund's transfer agent may have
established governing purchases and redemptions of shares of the Series
generally.
1.6 The Company shall pay for Fund shares on the next Business Day after an
order to purchase Fund shares is made in accordance with the provisions
of Section 1.1. hereof. Payment shall be in federal funds transmitted
by wire to the Fund's custodian.
1.7 Issuance and transfer of the Funds' shares will be by book entry only.
Share certificates will not be issued. Shares ordered from the Fund
will be recorded on the transfer records of the Fund in an appropriate
title for each Account or the appropriate subaccount of each Account.
1.8 The Fund shall furnish same day notice (by e-mail, fax or telephone,
followed by written confirmation) to the Company of any income,
dividends or capital gain distributions payable on the shares of any
Series. The Company hereby elects to receive all such income dividends
and capital gain distributions as are payable on the Series shares in
additional shares of that Series. The Company reserves the right to
revoke this election and to receive all such income dividends and
capital gain distributions in cash. The Fund shall notify the Company
of the number of shares so issued as payment of such dividends and
distributions.
1.9 The Fund shall make the net asset value per share for each Series
available to the Company on a daily basis 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. The Fund shall furnish the Company's daily
share balance to the Company as soon as reasonably practicable.
2. REPRESENTATIONS AND WARRANTIES.
2.1 The Company represents and warrants that each Contract shall be either
(i) registered, or prior to the purchase of shares of any Series in
connection with the funding of such Contract, will be registered under
the 1933 Act or (ii) exempt from such registration; that the Contracts
will be issued and sold in compliance in all material respects with all
applicable federal and state laws, including all applicable customer
suitability requirements. The Company further represents and warrants
that it is an insurance
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company duly organized and in good standing under applicable law and
that it has legally and validly established each Account as a separate
account pursuant to relevant state insurance law prior to any issuance
or sale of any Contract by such Account and that each Account shall be
either (i) registered or, prior to any issuance or sale of the
Contracts, will register each Account as a unit investment trust in
accordance with the provisions of the 1940 Act; or (ii) exempt from
such registration.
2.2 The Fund represents and warrants that Fund 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 Fund is and shall remain registered under the 1940 Act. The
Fund agrees that it will amend the registration statement for its
shares under the 1933 Act and the 1940 Act from time to time as
required in order to permit the continuous public offering of its
shares in accordance with the 1933 Act. The Fund shall register and
qualify the shares for sale in accordance with the laws of the various
states only if and to the extent deemed advisable by the Fund or the
Underwriter.
2.3 The Fund represents that each Series is currently qualified as a
"regulated investment company" under subchapter M of the Internal
Revenue Code of 1986, as amended, (the "Code") and agrees that it will
make every effort to maintain such qualification (under Subchapter M or
any successor or similar provision) and that it will notify the Company
promptly upon having a reasonable basis for believing that it has
ceased to so qualify or that it might not so qualify in the future.
2.4 Subject to Section 6.1, the Company represents that the Contracts are
currently treated as endowment, annuity or life insurance contracts
under applicable provisions of the Code and agrees that it will make
every effort to maintain such treatment and that it will notify the
Fund and the Underwriter immediately upon having a reasonable basis for
believing that the Contracts have ceased to be so treated or that they
might not be so treated in the future.
2.5 The Fund makes no representation as to whether any aspect of its
operations (including, but not limited to, fees and expenses and
investment policies) complies with the insurance laws or regulations of
the various states.
2.6 The Underwriter represents and warrants that it is a member in good
standing of the NASD and is registered as a broker-dealer with the SEC.
2.7 The Underwriter further represents that it will sell and distribute the
Fund shares in accordance with all applicable state and federal
securities laws, including without limitation the 1933 Act, the 1934
Act and the 0000 Xxx.
2.8 The Fund represents that it is lawfully organized and validly existing
under the laws of the Commonwealth of Massachusetts and that it does
and will comply in all material respects with the 1940 Act.
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2.9 Each of the Fund, the Adviser and the Underwriter represent and warrant
that all of their directors, officers and employees dealing with the
money and/or securities of the Fund are and shall continue to be at all
times covered by a blanket fidelity bond or similar coverage in an
amount, in the case of the Adviser and the Underwriter, of not less
than $5,000,000 and, in the case of the Fund, not less than the minimal
coverage as required by Rule 17g-1 under the 1940 Act or any successor
regulations as may be promulgated from time to time. Each aforesaid
bond shall include coverage for larceny and embezzlement of Fund assets
and shall be issued by a reputable bonding company.
2.10 The Company represents and warrants that all of its directors,
officers, employees and other individuals/entities dealing with the
money and/or securities representing amounts intended for the purchase
of shares of the Fund or proceeds of the redemption of shares of the
Fund are and shall continue to be at all times covered by a blanket
fidelity bond or similar coverage in an amount not less than
$5,000,000. The aforesaid Bond shall include coverage for larceny and
embezzlement of Fund assets and shall be issued by a reputable bonding
company.
2.11 The Company represents and warrants that it will not, without the prior
written consent of the Fund and the Adviser, purchase Fund shares with
Account assets derived from the sale of Contracts to individuals or
entities which would cause the investment policies of any Series to be
subject to any limitations not in the Fund's then current prospectus or
statement of additional information with respect to any Series.
3. PROSPECTUSES AND PROXY STATEMENTS; VOTING.
3.1 The Underwriter (or the Fund) shall provide the Company with as many
copies of the Fund's current prospectus as the Company may reasonably
request (at the Company's expense with respect to other than existing
Contract owners). If requested by the Company in lieu thereof, the
Underwriter (or the Fund) shall provide such documentation (including a
final copy of the new prospectus as set in type at the Fund's expense)
and other assistance as is reasonably necessary in order for the
Company once each year (or more frequently if the prospectus for the
Fund is amended) to have the prospectus for the Contracts and the
Fund's prospectus printed together in one document (such printing to be
at the Company's expense with respect to other than existing Contract
owners).
3.2 The Underwriter (or the Fund), at its expense, shall print and provide
the Fund's then current statement of additional information free of
charge to the Company and to any owner of a Contract or prospective
owner who requests such statement.
3.3 The Fund, at its expense, shall provide the Company with copies of its
proxy material, reports to shareholders and other communications to
shareholders in such quantity as the Company shall reasonably require
for distribution (at the Fund's expense) to Contract owners.
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3.4 So long as and to the extent that the SEC or its staff continues to
interpret the 1940 Act to require pass-through voting privileges for
variable contract owners, or if and to the extent required by law, the
Company shall: (i) solicit voting instructions from Contract owners;
(ii) vote the Fund shares in accordance with instructions received from
Contract owners; and (iii) vote Fund shares for which no instructions
have been received in the same proportion as Fund shares of such Series
for which instructions have been received. The Company reserves the
right to vote Fund shares held in any Account in its own right, to the
extent permitted by law. The Company shall be responsible for assuring
that each Account participating in the Fund calculates voting
privileges in a manner consistent with the standards set forth on
Schedule A hereto, which standards will also be provided to the other
Participating Insurance Companies.
4. SALES MATERIAL AND INFORMATION.
4.1 The Company shall be solely responsible for sales literature or other
promotional material, in which the Fund, a Series, the Adviser, any
subadviser to any Series, or the Underwriter (in its capacity as
distributor of the Fund) is named, the substance of which is contained
in the then current prospectus or statement of additional information
of the Fund. Other sales literature or other promotional material may
also be used by the Company if such sales literature or other
promotional material (or the substance thereof) has been previously
approved by the Fund or its designee. All other sales literature or
other promotional material shall not be used by the Company until it
has been approved by the Fund or its designee. The Company shall
deliver such draft sales literature or other promotional material to
the Fund or its designee at least thirty Business days prior to its
use. The Fund or such designee shall use commercially reasonable
efforts to review sales literature so delivered within ten days.
4.2 The Company shall not give any information or make any representations
or statements on behalf of the Fund or concerning the Fund in
connection with the sale of the Contracts other than the information or
representations contained in the registration statement, prospectus or
statement of additional information for the Fund shares, as such
registration statement and prospectus or statement of additional
information may be amended or supplemented from time to time, or in
reports or proxy statements for the Fund, or in sales literature or
other promotional material approved by the Fund or its designee or by
the Underwriter, except with the approval of the Fund or the
Underwriter or the designee of either.
4.3 The obligations set forth in Section 4.1 herein shall apply mutatis
mutandis to the Fund and the Underwriter with respect to each piece of
sales literature or other promotional material in which the Company
and/or any Account is named.
4.4 The Fund and the Underwriter shall not give any information or make any
representations on behalf of the Company or concerning the Company, any
Account or the Contracts other than the information or representations
contained in a registration statement or prospectus for the Contracts,
as such registration statement and prospectus may be
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amended or supplemented from time to time, or in published reports for
each Account which are in the public domain or approved by the Company
for distribution to Contract owners, or in sales literature or other
promotional material approved by the Company or its designee, except
with the permission of the Company.
4.5 The Fund will provide to the Company at least one complete copy of all
registration statements, prospectuses, statements of additional
information, shareholder annual, semi-annual or other reports, proxy
statements, applications for exemptions, requests for no-action letters
and any amendments to any of the above, that relate to any Series,
promptly after the filing of each such document with the SEC or any
other regulatory authority.
4.6 The Company will provide to the Fund at least one complete copy of all
registration statements, prospectuses, statements of additional
information, shareholder annual, semi-annual or other reports,
solicitations for voting instructions, applications for exemptions,
requests for no-action letters and any amendments to any of the above,
that relate to the Contracts or any Account, promptly after the filing
of such document with the SEC or any other regulatory authority. Each
party hereto will provide to each other party, to the extent it is
relevant to the Contracts or the Fund, a copy of any comment letter
received from the staff of the SEC or the NASD, and the Company's
response thereto, following any examination or inspection by the staff
of the SEC or the NASD.
4.7 As used herein, 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), sales literature (i.e., any written communication distributed
or made generally available to customers or the public, including
brochures, circulars, research reports, market letters, form letters,
seminar texts, reprints or excerpts of any other advertisement, sales
literature or published article), educational or training materials or
other communications distributed or made generally available to some or
all agents or employees.
5. FEES AND EXPENSES.
5.1 The Fund, the Adviser and the Underwriter shall pay no fee or other
compensation to the Company under this agreement, except that if the
Fund or any Series adopts and implements a plan pursuant to Rule 12b-1
to finance distribution expenses, then the Fund may make payments to
the Underwriter or to the Company. Each party acknowledges that the
Adviser may pay service or administrative fees to the Company and other
Participating Insurance Companies pursuant to separate agreements.
6. DIVERSIFICATION.
6.1 The Fund will at all times invest money from the Contracts in such a
manner as to ensure that the Contracts will be treated as variable
contracts under the Code and the regulations
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issued thereunder. Without limiting the scope of the foregoing, the
Fund will at all times comply with Section 817(h) of the Code and any
Treasury Regulations thereunder relating to the diversification
requirements for variable annuity, endowment or life insurance
contracts, as from time to time in effect.
7. POTENTIAL CONFLICTS.
7.1 To the extent required by the Shared Funding Exemptive Order or by
applicable law, the Board of Trustees of the Fund (the "Board") will
monitor the Fund for the existence of any material irreconcilable
conflict between the interests of the contract owners of all separate
accounts investing in the Fund. An irreconcilable material conflict may
arise for a variety of reasons, including: (a) an action by any state
insurance regulatory authority; (b) a change in applicable federal or
state insurance, tax, or securities laws or regulations, or a public
ruling, private letter ruling, no-action or interpretative letter, or
any similar action by insurance, tax, or securities regulatory
authorities; (c) an administrative or judicial decision in any relevant
proceeding; (d) the manner in which the investments of any Series are
being managed; (e) a difference in voting instructions given by
variable annuity contract and variable life insurance contract owners;
or (f) a decision by an insurer to disregard the voting instructions of
contract owners. The Fund shall promptly inform the Company if it
determines that an irreconcilable material conflict exists and the
implications thereof.
7.2 The Company will report to the Board any potential or existing
conflicts between the interests of contract owners of different
separate accounts of which the Company is or becomes aware. The Company
will assist the Board in carrying out its responsibilities under the
Shared Funding Exemptive Order and under applicable law, by providing
the Board with all information reasonably necessary for the Board to
consider any issues raised. This includes, but is not limited to, an
obligation of the Company to inform the Board whenever contract owner
voting instructions are disregarded.
7.3 If it is determined by a majority of the Board, or a majority of its
disinterested trustees, that a material irreconcilable conflict exists,
the Company and other Participating Insurance Companies shall, at their
expense take whatever steps are necessary to remedy or eliminate the
irreconcilable material conflict, which steps could include: (1)
withdrawing the assets allocable to some or all of the separate
accounts from the Fund or any Series and reinvesting such assets in a
different investment medium, including (but not limited to) another
series of the Fund, or submitting the question of whether such
segregation should be implemented to a vote of all affected Contract
owners and, as appropriate, segregating the assets of any appropriate
group (i.e., annuity contract owners, life insurance contract owners,
or variable contract owners of one or more Participating Insurance
Companies) that votes in favor of such segregation, or offering to the
affected
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contract owners the option of making such a change; and (2)
establishing a new registered management investment company or managed
separate account.
7.4 If a material irreconcilable conflict arises because of a decision by
the Company to disregard Contract owner voting instructions and that
decision represents a minority position or would preclude a majority
vote, the Company may be required, at the Fund's election, to withdraw
the relevant Account's investment in the Fund and terminate this
Agreement; provided, however, that such withdrawal and termination
shall be limited to the extent required by such material irreconcilable
conflict as determined by a majority of the disinterested members of
the Board. Any such withdrawal and termination will take place within
six (6) months after the Fund gives written notice that this provision
is being implemented.
7.5 If a material irreconcilable conflict arises because a particular state
insurance regulator's decision applicable to the Company conflicts with
the majority of other state regulators, then the Company will withdraw
the affected Account's investment in the Fund and terminate this
Agreement within six months after the Board informs the Company in
writing that it has determined that such decision has created an
irreconcilable material conflict; provided, however, that such
withdrawal and termination shall be limited to the extent required by
such material irreconcilable conflict as determined by a majority of
the disinterested members of the Board.
7.6 For purposes of Sections 7.3 through 7.6 of this Agreement, a majority
of the disinterested members of the Board shall determine whether any
proposed action adequately remedies any irreconcilable material
conflict, but in no event will the Fund be required to establish a new
funding medium for the Contracts. The Company shall not be required by
Section 7.3 to establish a new funding medium for the Contracts if an
offer to do so has been declined by vote of a majority of Contract
owners materially adversely affected by the irreconcilable material
conflict. In the event that the Board determines that any proposed
action does not adequately remedy any irreconcilable material conflict,
then the Company will withdraw the Account's investment in the Fund and
terminate this Agreement within six (6) months after the Board informs
the Company in writing of the foregoing determination, provided,
however, that such withdrawal and termination shall be limited to the
extent required by any such material irreconcilable conflict as
determined by a majority of the disinterested members of the Board.
7.7 If and to the extent that Rule 6e-2 and Rule 6e-3(T) under the 1940 Act
are amended, or Rule 6e-3 is adopted, to provide exemptive relief from
any provision of the Act or the rules promulgated thereunder with
respect to mixed or shared funding (as defined in the Shared Funding
Exemptive Order) on terms and conditions materially different from
those contained in the Shared Funding Exemptive Order, then (a) the
Fund and/or Participating Insurance Companies, as appropriate, shall
take such steps as may be necessary to comply with Rules 6e-2 and
6e-3(T), as amended, and Rule 6e-3, as adopted, to the extent such
rules are applicable; and (b) Sections 3.4, 7.1, 7.2, 7.3, 7.4, and 7.5
of this Agreement shall continue in effect only to the extent that
terms and conditions
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substantially identical to such Sections are contained in such Rule(s)
as so amended or adopted.
8. INDEMNIFICATION.
8.1 Indemnification by the Company
(a) The Company agrees to indemnify and hold harmless the Fund and each
of its Trustees and officers and each person, if any, who controls the
Fund within the meaning of Section 15 of the 1933 Act (collectively,
the "Indemnified Parties" for purposes of this Section 8.1) against any
and all losses, claims, damages, liabilities (including amounts paid in
settlement with the written consent of the Company) or litigation
(including legal and other expenses), to which the Indemnified Parties
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 Fund's shares or the Contracts and: (i)
arise out of or are based upon any untrue statements or alleged untrue
statements of any material fact contained in the registration statement
or prospectus or statement of additional information (if applicable)
for the Contracts or contained in the Contracts or sales literature or
other promotional material for the Contracts (or any amendment or
supplement to any of the foregoing), or arise out of or are based upon
the omission or the alleged 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 or
such alleged statement or omission was made in reliance upon and in
conformity with information furnished to the Company by or on behalf of
the Fund for use in the registration statement or prospectus or
statement of additional information (if applicable) for the Contracts
or in the Contracts or sales literature or other promotional material
(or any amendment or supplement) or otherwise for use in connection
with the sale of the Contracts or Fund shares; or (ii) arise out of or
as a result of statements or representations (other than statements or
representations contained in the registration statement, prospectus or
statement of additional information (if applicable) or sales literature
or other promotional material of the Fund not supplied by the Company,
or persons under its control) or wrongful conduct of the Company or
persons under its control, with respect to the sale or distribution of
the Contracts or Fund Shares; or (iii) arise out of any untrue
statement or alleged untrue statement of a material fact contained in
any registration statement, prospectus or statement of additional
information (if applicable) or sales literature or other promotional
material of the Fund or any amendment thereof or supplement thereto or
the omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements
therein not misleading if such a statement or omission was made in
reliance upon information furnished to the Fund by or on behalf of the
Company; or (iv) arise as a result of any failure by the Company to
provide the services and furnish the materials under the terms of this
Agreement; or (v) 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
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the Company, as limited by and in accordance with the provisions of
Section 8.1(b) and 8.1(c) hereof.
(b) The Company shall not be liable under this Section 8.1 with respect
to any losses, claims, damages, liabilities or litigation to which an
Indemnified Party would otherwise be subject if such loss, claim,
damage, liability or litigation is caused by or arises out of such
Indemnified Party's willful misfeasance, bad faith or gross negligence
or by reason of such Indemnified Party's reckless disregard of
obligations or duties under this Agreement or to the Fund, whichever is
applicable.
(c) Each Indemnified Party shall notify the Company of any claim made
against an Indemnified Party in writing within a reasonable time after
the summons or other first legal process giving information of the
nature of the claim shall have been served upon such Indemnified Party
(or after such Indemnified Party shall have received notice of such
service on any designated agent), but failure to notify the Company of
any such claim shall not relieve the Company from any liability which
it may have to the Indemnified Party against whom such action is
brought under this indemnification provision unless the Company's
ability to defend against the claim shall have been materially
prejudiced by the Indemnified Party's failure to give such notice and
shall not in any way relieve the Company from any liability which it
may have to the Indemnified Party against whom the action is brought
otherwise than on account of this indemnification provision. In case
any such action is brought against one or more Indemnified Parties, the
Company shall be entitled to participate, at its own expense, in the
defense of such action. The Company also shall be entitled to assume
the defense thereof, with counsel satisfactory to each Indemnified
Party named in the action. After notice from the Company to such party
of the Company's election to assume the defense thereof, the
Indemnified Party shall bear the fees and expenses of any additional
counsel retained by it, and the Company will not be liable to such
party under this Agreement for any legal or other expenses subsequently
incurred by such party independently in connection with the defense
thereof other than reasonable costs of investigation. An Indemnified
Party shall not settle any claim involving a remedy other than monetary
damages without the prior written consent of the Company.
(d) The Indemnified Parties will promptly notify the Company of the
commencement of any litigation or proceedings against them in
connection with the issuance or sale of the Fund Shares or the
Contracts or the operation of the Fund.
8.2 Indemnification by the Adviser and the Underwriter
(a) The Adviser and the Underwriter agree to indemnify and hold
harmless the Company and each of its directors and officers and each
person, if any, who controls the Company within the meaning of Section
15 of the 1933 Act (collectively, the "Indemnified Parties" for
purposes of this Section 8.2) against any and all losses, claims,
damages, liabilities (including amounts paid in settlement with the
written consent of the Adviser and the Underwriter) or litigation
(including legal and other expenses) to which the Indemnified
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Parties 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 Fund's shares or the Contracts and:
(i) arise out of or are based upon any untrue statement or alleged
untrue statement of any material fact contained in the registration
statement, prospectus or statement of additional information, or sales
literature or other promotional material of the Fund (or any amendment
or supplement to any of the foregoing), or arise out of or are based
upon the omission or the alleged 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 or such alleged statement or omission was made in reliance
upon and in conformity with information furnished to the Adviser, the
Underwriter, or Fund by or on behalf of the Company for use in the
registration statement, prospectus or statement of additional
information for the Fund or in sales literature or other promotional
material (or any amendment or supplement) or otherwise for use in
connection with the sale of the Contracts or Fund shares; or (ii)
arise out of or as a result of statements or representations (other
than statements or representations contained in the registration
statement, prospectus or statement of additional information or sales
literature or other promotional material for the Contracts not
supplied by the Adviser, the Underwriter or the Fund or persons under
their control) or wrongful conduct of the Adviser, the Underwriter or
the Fund or persons under their control, with respect to the sale or
distribution of the Contracts or Fund Shares; or (iii) arise out of
any untrue statement or alleged untrue statement of a material fact
contained in any registration statement, prospectus or statement of
additional information or sales literature or other promotional
material covering the Contracts, or any amendment thereof or
supplement thereto, or the omission or alleged omission to state
therein a material fact required to be stated therein or necessary to
make the statements therein not misleading, if such statement or
omission was made in reliance upon information furnished to the
Company by or on behalf of the Adviser, the Underwriter, or the Fund;
or (iv) arise as a result of any failure by the Adviser, the
Underwriter or the Fund to provide the services and furnish the
materials under the terms of this Agreement (including a failure,
whether unintentional or in good faith or otherwise, to comply with
the diversification requirements specified in Article VI of this
Agreement); or (v) arise out of or result from any material breach of
any representation and/or warranty made by the Adviser, the
Underwriter, or the Fund in this Agreement or arise out of or result
from any other material breach of this Agreement by the Adviser, the
Underwriter, or the Fund; as limited by and in accordance with the
provisions of Sections 8.2(b) and 8.2(c) hereof.
(b) Neither the Adviser nor the Underwriter shall be liable under this
Section 8.2 with respect to any losses, claims, damages, liabilities or
litigation to which an Indemnified Party would otherwise be subject if
such loss, claim, damage, liability or litigation is caused by or
arises out of such Indemnified Party's willful misfeasance, bad faith
or gross negligence or by reason of such Indemnified Party's reckless
disregard of obligations and duties under this Agreement or to the
Company or each Account, whichever is applicable.
12
(c) Each Indemnified Party shall notify each of the Adviser, the
Underwriter, and the Fund of any claim made against the Indemnified
Party within a reasonable time after the summons or other first legal
process giving information of the nature of the claim shall have been
served upon such Indemnified Party (or after such Indemnified Party
shall have received notice of such service on any designated agent),
but failure to notify each of the Adviser, the Underwriter, and the
Fund of any such claim shall not relieve the Adviser or the Underwriter
from any liability which it may have to the Indemnified Party against
whom such action is brought under this indemnification provision unless
the Adviser or the Underwriter's ability to defend against the claim
shall have been materially prejudiced by the Indemnified Party's
failure to give such notice and shall not in any way relieve the
Adviser or the Underwriter from any liability which it may have to the
Indemnified Party against whom the action is brought otherwise than on
account of this indemnification provision. In case any such action is
brought against one or more Indemnified Parties, the Adviser and the
Underwriter will be entitled to participate, at their own expense, in
the defense thereof. The Adviser and/or the Underwriter shall be
entitled to assume the defense thereof, with counsel satisfactory to
the party named in the action. After notice from the Adviser and/or the
Underwriter to such party of the election of the Adviser and/or the
Underwriter to assume the defense thereof, the Indemnified Party shall
bear the fees and expenses of any additional counsel retained by it,
and the Adviser and/or the Underwriter will not be liable to such party
under this Agreement for any legal or other expenses subsequently
incurred by such party independently in connection with the defense
thereof other than reasonable costs of investigation. An Indemnified
Party shall not settle any claim involving any remedy other than
monetary damages without the prior written consent of the Adviser
and/or the Underwriter.
(d) The Company agrees promptly to notify the Adviser, the Underwriter
and the Fund of the commencement of any litigation or proceedings
against it or any of its officers or directors in connection with the
issuance or sale of the Contracts or the operation of each Account.
9. APPLICABLE LAW.
9.1 This Agreement shall be construed and the provisions hereof interpreted
under and in accordance with the laws of the Commonwealth of
Massachusetts.
9.2 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 (including, but not limited to, the Shared Funding
Exemptive Order) and the terms hereof shall be interpreted and
construed in accordance therewith.
10. TERMINATION.
10.1 This Agreement shall terminate:
13
(a) at the option of any party upon 180 days' advance written notice to
the other parties; provided, however, that such notice shall not be
given earlier than one year following the date of this Agreement; or
(b) at the option of the Company to the extent that shares of a Series
are not reasonably available to meet the requirements of the Contracts
as determined by the Company, provided however, that such termination
shall apply only to those Series the shares of which are not reasonably
available. Prompt notice of the election to terminate for such cause
shall be furnished by the Company; or
(c) at the option of the Fund in the event that formal administrative
proceedings are instituted against the Company by the NASD, the SEC,
any state insurance department or commissioner or similar insurance
regulator or any other regulatory body regarding the Company's duties
under this Agreement or related to the sale of the Contracts, with
respect to the operation of any Account or the purchase by any Account
of Fund shares, provided, however, that the Fund determines in its sole
judgment, exercised in good faith, that any such administrative
proceedings will have a material adverse effect upon the ability of the
Company to perform its obligations under this Agreement; or
(d) at the option of the Company in the event that formal
administrative proceedings are instituted against the Fund, the Adviser
or the Underwriter by the NASD, the SEC or any state securities or
insurance department or commissioner or any other regulatory body,
provided, however, that the Company determines in its sole judgment
exercised in good faith, that any such administrative proceedings will
have a material adverse effect upon the ability of the Fund, the
Adviser or the Underwriter to perform its obligations under this
Agreement; or
(e) with respect to any Account, upon requisite authority (by vote of
the Contract owners having an interest in such Account or any
subaccount thereof, or otherwise) to substitute the shares of another
investment company (or separate series thereof) for the shares of any
Series in accordance with the terms of the Contracts for which shares
of that Series had been selected to serve as the underlying investment
medium. The Company will give 90 days' prior written notice to the Fund
of the date of any proposed vote to replace the Fund's shares or of the
filing by the Company with the SEC of any application relating to any
such substitution; or
(f) at the option of the Company, in the event any shares of any Series
are not registered, issued or sold in accordance with applicable state
and/or federal law or such law precludes the use of such shares as the
underlying investment medium of the Contracts issued or to be issued by
the Company; or
(g) at the option of the Company, if any Series ceases to qualify as a
Regulated Investment Company under Subchapter M of the Code or under
any successor or similar provision, or if the Company reasonably
believes that any Series may fail to so qualify; or
14
(h) at the option of the Company, if the Fund fails to meet the
diversification requirements specified in Section 6 hereof; or
(i) at the option of the Fund, the Adviser or the Underwriter, if (1)
the Fund, the Adviser or the Underwriter, as the case may be, shall
determine, in its sole judgment reasonably exercised in good faith,
that the Company has suffered a material adverse change in its business
or financial condition or is the subject of material adverse publicity
and such material adverse change or material adverse publicity will
have a material adverse impact on the business and operations of the
Fund, the Adviser or the Underwriter, as the case may be, (2) the Fund,
the Adviser or the Underwriter shall notify the Company in writing of
such determination and its intent to terminate this Agreement, and (3)
after considering the actions taken by the Company and any other
changes in circumstances since the giving of such notice, such
determination of the Fund, the Adviser or the Underwriter shall
continue to apply on the sixtieth (60th) day following the giving of
such notice, which sixtieth day shall be the effective date of
termination; or
(j) at the option of the Company, if (1) the Company shall determine,
in its sole judgment reasonably exercised in good faith, that the Fund,
the Adviser or the Underwriter has suffered a material adverse change
in its business or financial condition or is the subject of material
adverse publicity and such material adverse change or material adverse
publicity will have a material adverse impact upon the business and
operations of the Company, (2) the Company shall notify the Fund, the
Adviser and the Underwriter in writing of such determination and its
intent to terminate the Agreement, and (3) after considering the
actions taken by the Fund, the Adviser and/or the Underwriter and any
other changes in circumstances since the giving of such notice, such
determination shall continue to apply on the sixtieth (60th) day
following the giving of such notice, which sixtieth day shall be the
effective date of termination; or
(k) in the case of an Account not registered under the 1933 Act or 1940
Act, the Company shall give the Fund 90 days' prior written notice if
the Company chooses to cease using any Series as an investment vehicle
for such Account.
It is understood and agreed that the right of any party hereto to terminate this
Agreement pursuant to Section 10.1(a) may be exercised for any reason or for no
reason.
10.2 Notice Requirement. No termination of this Agreement shall be effective
unless and until the party terminating this Agreement gives prior
written notice to all other parties to this Agreement of its intent to
terminate which notice shall set forth the basis for such termination.
Furthermore, in the event that any termination is based upon the
provisions of Article VII, or the provision of Section 10.1(a), 10.1(i)
or 10.1(j) of this Agreement, such prior written notice shall be given
in advance of the effective date of termination as required by such
provisions; and
15
10.3 In the event that any termination is based upon the provisions of
Section 10.1(c) or 10.1(d) of this Agreement, such prior written notice
shall be given at least ninety (90) days before the effective date of
termination.
10.4 Effect of Termination. Notwithstanding any termination of this
Agreement, the Fund and the Underwriter shall, at the option of the
Company, continue to make available additional shares of each Series
pursuant to the terms and conditions of this Agreement, for all
Contracts in effect on the effective date of termination of this
Agreement (hereinafter referred to as "Existing Contracts").
Specifically, without limitation, the owners of the Existing Contracts
shall be permitted to reallocate investments in the Fund, redeem
investments in the Fund and/or invest in the Fund upon the making of
additional purchase payments under the Existing Contracts. The parties
agree that this Section 10.4 shall not apply to any terminations under
Section 10.1(b) or Section 7, and in the case of terminations under
Section 7 terminations, the effect of such terminations shall be
governed by Section 7 of this Agreement.
11. 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 Fund or to the Adviser:
000 Xxxxxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Attention: Xxxxxx X. Xxxx, Secretary
If to the Company:
Metropolitan Life Insurance Company
Xxx Xxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxxxxxxx X. Xxxxxxxx
If to the Underwriter:
000 Xxxxxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Attention: Xxxx X. Xxxxxxx, Secretary
12. MISCELLANEOUS.
16
12.1 A copy of the Agreement and Declaration of Trust establishing New
England Zenith Fund is on file with the Secretary of the Commonwealth
of Massachusetts, and notice is hereby given that this Agreement is
executed on behalf of the Fund by officers of the Fund as officers and
not individually and that the obligations of or arising out of this
Agreement are not binding upon any of the trustees, officers or
shareholders of the Fund individually but are binding only upon the
assets and property belonging to the Series.
12.2 Subject to the requirements of legal process and regulatory authority,
each party hereto shall treat as confidential the names and addresses
of the owners of the Contracts and all information reasonably
identified as confidential in writing by any other party hereto and,
except as permitted by this Agreement, shall not disclose, disseminate
or utilize such names and addresses and other confidential information
until such time as it may come into the public domain without the
express written consent of the affected party.
12.3 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.
12.4 This Agreement may be executed simultaneously in two or more
counterparts, each of which taken together shall constitute one and the
same instrument.
12.5 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.
12.6 Each party hereto shall cooperate with each other party and all
appropriate governmental authorities (including without limitation the
SEC, the NASD and state insurance regulators) and shall permit such
authorities reasonable access to its books and records in connection
with any investigation or inquiry relating to this Agreement or the
transactions contemplated hereby.
12.7 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.
17
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 below.
METROPOLITAN LIFE INSURANCE COMPANY
By: /s/ Xxxxxxx Xxxx
---------------------------
Name: Xxxxxxx Xxxx
Title: Vice President
Date: May 1, 2000
NEW ENGLAND ZENITH FUND
By: /s/ Xxxx X. Xxxxxx
---------------------------
Name: Xxxx X. Xxxxxx
Title: Chairman and President
Date: May 1, 2000
NEW ENGLAND INVESTMENT MANAGEMENT, INC.
By: /s/ Xxxx X. Xxxxxx
---------------------------
Name: Xxxx X. Xxxxxx
Title: Chairman and President
Date: May 1, 2000
NEW ENGLAND SECURITIES CORPORATION
By: /s/ Xxxx X. Xxxxxxx
---------------------------
Name: Xxxx X. Xxxxxxx
Title: Secretary
Date: May 1, 2000
18
PARTICIPATION AGREEMENT
Among
NEW ENGLAND ZENITH FUND,
NEW ENGLAND INVESTMENT MANAGEMENT, INC.,
NEW ENGLAND SECURITIES CORPORATION
and
METROPOLITAN LIFE INSURANCE COMPANY
SCHEDULE A
With respect to each Account, all shares of each Series attributable to such
policies and contracts for which no owner instructions have been received by the
Company and all shares of the Series attributable to charges assessed by the
Company against such policies and contracts will be voted for, voted against, or
withheld from voting on any proposal in the same proportions as are the shares
for which owner instructions have been received by the Company with respect to
policies or contracts issued by such Account. To the extent the Company has so
agreed with respect to an Account not registered with the SEC under the 1940
Act, all shares of each Series held by the Account will be voted for, voted
against or withheld from voting on any proposal in the same proportions as are
the shares of such Series for which contract owners' voting instructions have
been received. If the Company has not so agreed, the shares of each Series
attributable to such unregistered Account will be voted for, voted against, or
withheld from voting on any proposal in the same proportions as are all other
shares for which the Company has received voting instructions.
PARTICIPATION AGREEMENT
AMONG
METROPOLITAN LIFE INSURANCE COMPANY
ALLIANCE CAPITAL MANAGEMENT L.P.
AND
ALLIANCE FUND DISTRIBUTORS, INC.
DATED AS OF
September 1, 2000
PARTICIPATION AGREEMENT
THIS AGREEMENT, made and entered into as of the 1 day of September,
2000 ("Agreement"), by and among Metropolitan Life Insurance Company, an
insurance company ("Insurer") (on behalf of itself and its "Separate Account,"
defined below); Alliance Capital Management L.P., a Delaware limited partnership
("Adviser"), the investment adviser of the Fund referred to below; and Alliance
Fund Distributors, Inc., a Delaware corporation ("Distributor"), the Fund's
principal Distributor (collectively, the "Parties"),
WITNESSETH THAT:
WHEREAS Insurer, the Distributor, and Alliance Variable Products Series
Fund, Inc. (the "Fund") desire that Class B shares of the Fund's Growth & Income
Portfolio, Premier Growth Portfolio, and Technology Portfolio, (the
"Portfolios"; reference herein to the "Fund" includes reference to each
Portfolio to the extent the context requires) be made available by Distributor
to serve as underlying investment media for Variable life insurance contracts of
Insurer that are the subject of Insurer's Form S-6 registration statement filed
with the Securities and Exchange Commission (the "SEC"), File No. 33-57320 (the
"Contracts"), to be offered through the Insurer and other registered
broker-dealer firms as agreed to by Insurer; and
WHEREAS the Contracts provide for the allocation of net amounts
received by Insurer to separate series (the "Divisions"; reference herein to the
"Separate Account" includes reference to each Division to the extent the context
requires) of the Separate Account for investment in Class B shares of
corresponding Portfolios of the Fund that are made available through the
Separate Account to act as underlying investment media,
NOW, THEREFORE, in consideration of the mutual benefits and promises
contained herein, the Fund and Distributor will make Class B shares of the
Portfolios available to Insurer
1
for this purpose at net asset value and with no sales charges, all subject to
the following provisions:
SECTION 1. ADDITIONAL PORTFOLIOS
The Fund has and may, from time to time, add additional Portfolios,
which will become subject to this Agreement, if, upon the written consent of
each of the Parties hereto, they are made available as investment media for the
Contracts.
SECTION 2. PROCESSING TRANSACTIONS
2.1 Distributor agrees to sell to the Insurer those shares of the Fund
which each Account orders, executing such orders on a daily basis at the net
asset value next computed after receipt by the Fund or its designee of the order
for the shares of the Fund. For purposes of this Section 2.1, the Insurer shall
be the designee of the Fund for receipt of such orders from the Accounts that
correspond to Contract transactions that are not within the Insurer's discretion
and receipt by such designee shall constitute receipt by the Fund; provided that
the Fund receives such orders by 8:00 a.m., Eastern Time, on the next following
Business Day. "Business Day" shall mean any day on which the New York Stock
Exchange is open for trading and on which the Fund calculates its net asset
value pursuant to the rules of the Commission.
2.2 The Fund agrees to make its shares available for purchase at the
applicable net asset value per share by the Insurer and its Accounts on those
days on which the Fund calculates its Portfolios' net asset values on each day
on which the New York Stock Exchange is open for trading. Notwithstanding the
foregoing, the board of directors of the Fund (hereinafter the "Board") may
refuse to sell shares of any Portfolio to any person, or suspend or terminate
the offering of shares of any Portfolio if such action is required by law or by
regulatory authorities
2
having jurisdiction or is, in the sole discretion of the Board acting in good
faith and in light of their fiduciary duties under federal and any applicable
state laws, necessary in the best interests of the shareholders of that
Portfolio. When practicable, the Fund will provide Insurer with 30 days written
notice of its intention to refuse to sell Fund shares pursuant to this
Agreement.
2.3 The Fund and Distributor agree that shares of the Fund will be sold
only to participating insurance companies and their separate accounts. No shares
of any Portfolio will be sold to the general public.
2.4. The Fund and Distributor will not sell Fund shares to any
insurance company or separate account unless an agreement containing provisions
substantially the same as Sections 5.1(b), 5.1(d), 5.3, 5.4, 5.5, 5.6, and 13 of
this Agreement in its effect to govern such sales.
2.5 The Fund agrees to redeem, on the Insurer's request, any full or
fractional shares of the Fund held by the Insurer, executing such requests on a
daily basis at the net asset value next computed after receipt by the Fund or
its designee of the request for redemption. For purposes of this Section 2.5,
the Insurer shall be the designee of the Fund for receipt of requests for
redemption from each Account that correspond to Contract transactions that are
not within the Insurer's discretion and receipt by that designee shall
constitute receipt by the Fund; provided that the Fund receives the request for
redemption by 8:00 a.m., Eastern Time, on the next following Business Day.
2.6 The Insurer shall pay for Fund shares by 9:00 a.m., Eastern Time,
on the next following Business Day after an order to purchase Fund shares is
made in accordance with the provisions of Section 2.1 hereof. Payment shall be
in federal funds transmitted by wire.
3
2.7 Issuance and transfer of the Fund shares will be by book entry
only. Stock certificates will not be issued to the Insurer or any Account.
Shares ordered from the Insurer will be recorded in an appropriate title for
each Account or the appropriate sub account of each Account.
2.8 The Fund shall furnish same day notice (by wire or telephone,
followed by written confirmation) to the insurer of any income, dividends or
capital gain distributions payable on the Portfolios' shares. The Insurer hereby
elects to receive all income dividends and capital gain distributions payable on
a Portfolio's shares in additional shares of that Portfolio. The Insurer
reserves the right to revoke this election and to receive all such income
dividends and capital gain distributions in cash. The Fund shall notify the
Insurer of the number of shares issued as payment of dividends and
distributions.
2.9 The Fund shall make the net asset value per share for each
Portfolio available to the Insurer on a daily basis, in accordance with mutually
agreed upon guidelines for electronic transmission, as soon as reasonably
practical after the net asset value per share is calculated and shall use its
best efforts to make those per-share net asset values available by 6:00 p.m.
Eastern Time.
2.10 If the Fund provides materially incorrect share net asset value
information, the Insurer shall receive adjustment to the number of shares
purchased or redeemed to reflect the correct net asset value per share (and, if
and to the extent necessary, the Insurer shall make adjustments to the number of
units credited, and/or unit values for the Contracts for the periods affected).
In the event adjustments are required to correct any error in the computation of
the Fund's net asset value per share, or dividend or capital gain distribution,
Adviser or the Fund shall promptly notify the Insurer after discovering the need
for such adjustments. If an
4
adjustment is necessary to correct an error which has caused Contract owners to
be credited with more or less than the amount to which they are entitled,
Adviser shall make all necessary adjustments to the number of shares owned by
the Account and distribute to the Account the amount of the underpayment. The
Insurer will adjust the number of units of each Contract owner and credit the
appropriate amount of such payment to each Contract owner. In no event shall the
Insurer be liable to Contract owner for any such adjustments or underpayments
amounts, provided that the underpayment was not caused by the Insurer. In no
event shall the Insurer be liable to the Fund or the Adviser for any such
adjustments or overpayment amounts, provided that the overpayment was not caused
by the Insurer. In the event that any known overpayment are made to Contract
owners, as a result of any such error, Insurer will take commercially reasonable
steps, within the constraints of state and federal law, to recover overpayment
amounts. All of the Insurer's reasonable expenses incident to any adjustments
required hereunder (including any uncollected, overpaid amounts) shall be borne
by Adviser, provided that the need for the adjustment was not caused by the
Insurer.
SECTION 3. COSTS AND EXPENSES
3.1 GENERAL.
Except as otherwise specifically provided herein, each Party will bear
all expenses incident to its performance under this Agreement.
3.2 REGISTRATION.
The Fund will bear the cost of its registering as a management
investment company under the 1940 Act and registering its shares under the
Securities Act of 1933, as amended (the "1933 Act"), and keeping such
registrations current and effective; including, without limitation, the
preparation of and filing with the SEC of Forms N-SAR and Rule 24f-2 Notices
respecting the Fund
5
and its shares and payment of all applicable registration or filing fees with
respect to any of the foregoing. Insurer will bear the cost of registering the
Separate Account as a unit investment trust under the 1940 Act and registering
units of interest under the Contracts under the 1933 Act and keeping such
registrations current and effective; including, without limitation, the
preparation and filing with the SEC of Forms N-SAR and Rule 24f-2 Notices
respecting the Separate Account and its units of interest and payment of all
applicable registration or filing fees with respect to any of the foregoing.
3.3 OTHER (NON-SALES-RELATED) EXPENSES.
If requested by the Insurer, the Fund shall provide camera-ready film
containing the Fund's prospectus and all alternate forms of prospectuses for
each funding option or any combination of funding options that the Insurer is
offering (collectively "Prospectus" for this Section 3.3), Statement of
Additional Information, and such other assistance as is reasonably necessary,
including a diskette in the form sent to the financial printer, in order for the
Insurer once each year (or more frequently if the Prospectus and/or Statement of
Additional Information for the Fund is amended during the year) to have the
prospectus for the Contracts, other funds and the Fund's Prospectus printed
together in one document, and to have the Statement of Additional Information
for the Fund and the Statement of Additional Information for the Contracts
printed together in one document. The Insurer may print the Fund's Prospectus or
its Statement of Additional Information in combination with other fund
companies' prospectuses and statements of additional information. Except as
provided in the following three sentences, all expenses of printing and
distributing Fund Prospectuses and Statements of Additional Information shall be
the expense of the Insurer. For Prospectuses and Statements of Additional
Information provided by the Insurer to its existing owners of Contracts in order
to update
6
disclosure annually as required by the 1933 Act and/or the 1940 Act, the cost of
printing shall be borne by the Fund. The Fund will bear the costs of printing in
quantity and delivering to existing Participants the documents as to which it
bears the cost of preparation as set forth above in this Section 3.3, it being
understood that reasonable cost allocations will be made in cases where any such
Fund and Insurer documents are printed or mailed on a combined or coordinated
basis. The same procedures shall be followed with respect to the Fund's
Statement of Additional Information.
The Insurer agrees to provide the Fund or its designee with such
information as may be reasonably requested by the Fund to assure that the Fund's
expenses do not include the cost of printing any Prospectuses or Statements of
Additional Information other than those actually distributed to existing owners
of the Contracts.
The Insurer agrees that it shall not alter in any way the forms of the
Fund's Prospectus and Statement of Additional Information provided to it,
including but not limited to the contents, layout and format of those documents.
The Fund agrees to cooperate with the Insurer to make the Prospectuses
of the Fund available to the Insurer in a format that will facilitate making the
prospectus available to contract holders and prospects on the internet (e.g. in
HTML or PDF file formats). The Insurer will be familiar with all federal, state,
and SRO rules and regulations concerning: the electronic offer and sale of
securities and the electronic distribution of advertising and sales literature,
and will conform its materially and procedures to these rules and regulations,
in the event that these means are used by the Insurer with respect to any offer
or sale of the Fund's shares.
7
3.4 OTHER SALES-RELATED EXPENSES.
Expenses of distributing the Portfolio's shares and the Contracts will
be paid by the Insurer and other parties, as they shall determine by separate
agreement.
3.5 PARTIES TO COOPERATE.
The Adviser, Insurer, and Distributor each agrees to cooperate with the
others, as applicable, in arranging to print, mail and/or deliver combined or
coordinated prospectuses or other materials of the Fund and Separate Account.
SECTION 4. SALES MATERIAL AND INFORMATION.
4.1 Except with respect to "fact sheets", the Insurer shall furnish, or
shall cause to be furnished, to the Fund or its designee, each piece of sales
literature or other promotional material in which the Fund, Adviser or
Distributor is named, at least fifteen Business Days prior to its use. No such
material shall be used if the Fund or its designee reasonably objects to such
use within fifteen Business Days after receipt of such material. The Insurer
intends to create and provide Contract owners with "fact sheets" of
participating Funds on a regular basis. The Insurer will initially provide a
template fact sheet to the Fund for the Fund's approval. Thereafter, the Insurer
will provide the Portfolio with samples of the fact sheets for approval by the
Fund only if the content or format of the report changes substantially.
Generally, the Fund and the Insurer agree to good faith mutual cooperation in
the resolution of novel or controversial issues concerning sales literature that
may arise pursuant to this Agreement. Upon request of the Insurer, the Fund
agrees to provide the Insurer with the information necessary to complete the
fact sheet not later than 10 business days after the end of the quarter for
which the information is requested.
8
4.2 The Insurer shall not give any information or make any
representations or statements on behalf of the Fund or concerning the Fund in
connection with the sale of the Contracts other than the information or
representations contained in the registration statement for the Fund shares, or
Fund Prospectus as such registration statement and Fund Prospectus may be
amended or supplemented from time to time, or in reports or proxy statements for
the Fund, or in sales literature or other promotional material approved by the
Fund or its designee or by the Distributor, except with the permission of the
Fund or the Distributor or designee of either.
4.3 The Fund, Distributor, or its designee shall furnish, or shall
cause to be furnished, to the Insurer or its designee, each piece of sales
literature or other promotional material in which the Insurer and/or its
separate account(s), is named at least fifteen Business Days prior to its use.
No such material shall be used if the Insurer or its designee reasonably objects
to such use within fifteen Business Days after receipt of such material.
4.4 The Fund and Distributor shall not give any information, except as
required by law, or make any representations on behalf of the Insurer or
concerning the Insurer, the Separate Account, or the Contracts other than the
information or representations contained in a registration statement for the
Contract or Separate Account Prospectus, as such registration statement and
Prospectus may be amended or supplemented from time to time, or in published
reports for the Separate Account which are in the public domain or approved by
the Insurer for distribution to Contract owners, or in sales literature or other
promotional material approved by the Insurer or its designee, except with the
permission of the Insurer.
4.6 For the purposes of this Article IV, the phrase "sales literature
or other promotional material" includes, but is not limited to, any of the
following that refer to the Fund or any affiliate of the Fund: advertisements
(such as material published, or designed for use in, a newspaper,
9
magazine, or other periodical, radio, television, telephone or tape recording,
videotape display, signs or billboards, motion pictures, or other public media),
sales literature (i.e., any written communication distributed or made generally
available to customers or the public, including brochures, circulars, research
reports, market letters, form letters, seminar texts, reprints or excerpts of
any other advertisement, sales literature, or published article), educational or
training materials or other communications distributed or made generally
available to some or all agents or employees, and registration statements,
prospectuses, statements of additional information, shareholder reports, and
proxy materials.
4.8. At the request of any Party to this Agreement, each other Party
will make available to the other Party's independent auditors and/or
representatives of the appropriate regulatory agencies, all relevant records,
data and access to operating procedures that may be reasonably requested. The
Fund agrees that the Insurer shall have the right to inspect, audit and copy all
relevant records pertaining to the performance of services under this Agreement
pursuant to the requirements of any state insurance regulator(s). However, the
Fund shall own and control all of its respective records pertaining to its
performance of the services under this Agreement.
4.9 The Fund shall send to the Insurer (i) confirmations of activity in
the Separate Account within five (5) business days after each date on which a
purchase or redemption of shares of the Fund is effected for the Separate
Account, which the parties acknowledge can be through DST Vision when available,
and (ii) statements detailing activity in the Separate Account no less
frequently than quarterly.
4.10 The Fund shall provide the Insurer with any information it
reasonably requests from time to time, in connection with the Insurer's
performance of this Agreement, and reporting
10
to management and customers. This information will be provided by the Fund
within a reasonable time period after receiving such request from the Insurer.
SECTION 5. LEGAL COMPLIANCE
5.1 TAX LAWS.
(a) The Adviser will use its best efforts to qualify and to maintain
qualification of each Portfolio as a regulated investment company ("RIC") under
Subchapter M of the Internal Revenue Code of 1986, as amended (the "Code"), and
the Adviser or Distributor will notify Insurer immediately upon having a
reasonable basis for believing that a Portfolio has ceased to so qualify or that
it might not so qualify in the future.
(b) Insurer represents that it believes, in good faith, that the
Contracts will be treated as life insurance, annuity or endowment contracts
under applicable provisions of the Code and that it will make every effort to
maintain such treatment. Insurer will notify the Fund and Distributor
immediately upon having a reasonable basis for believing that any of the
Contracts have ceased to be so treated or that they might not be so treated in
the future.
(c) The Fund will use its best efforts to comply and to maintain each
Portfolio's compliance with the diversification requirements set forth in
Section 817(h) of the Code and Section 1.817-5(b) of the regulations under the
Code, and the Fund, Adviser or Distributor will notify Insurer immediately upon
having a reasonable basis for believing that a Portfolio has ceased to so comply
or that a Portfolio might not so comply in the future.
(d) Insurer represents that it believes, in good faith, that the
Separate Account is a "segregated asset account" and that interests in the
Separate Account are offered exclusively through the purchase of or transfer
into a "variable contract," within the meaning of such terms under Section
817(h) of the Code and the regulations thereunder. Insurer will make every
effort to
11
continue to meet such definitional requirements, and it will notify the Fund and
Distributor immediately upon having a reasonable basis for believing that such
requirements have ceased to be met or that they might not be met in the future.
(e) The Adviser will manage the Fund as a RIC in compliance with
Subchapter M of the Code and will use its best efforts to manage to be in
compliance with Section 817(h) of the Code and regulations thereunder. The Fund
has adopted and will maintain procedures for ensuring that the Fund is managed
in compliance with Subchapter M and Section 817(h) and regulations thereunder.
On a quarterly basis, not more than 30 days after quarter end, the Adviser shall
provide the Insurer with a Certificate of Compliance of the Fund's compliance
with Section 817(h) of the Code and the regulations thereunder, in the form of
the attached Schedule A.
(f) Should the Distributor or Adviser become aware of a failure of
Fund, or any of its Portfolios, to be in compliance with Subchapter M of the
Code or Section 817(h) of the Code and regulations thereunder, they represent
and agree that they will immediately notify Insurer of such in writing.
5.2 INSURANCE AND CERTAIN OTHER LAWS.
(a) The Adviser will use its best efforts to cause the Fund to comply
with any applicable state insurance laws or regulations, to the extent
specifically requested in writing by Insurer. If it cannot comply, it will so
notify Insurer in writing.
(b) Insurer represents and warrants that (i) it is an insurance company
duly organized, validly existing and in good standing under the laws of the
State of New York and has full corporate power, authority and legal right to
execute, deliver and perform its duties and comply with its obligations under
this Agreement, (ii) it has legally and validly established and maintains the
12
Separate Account as a segregated asset account under New York Law, and (iii) the
Contracts comply in all material respects with all other applicable federal and
state laws and regulations.
(c) Distributor represents and warrants that it is a business
corporation duly organized, validly existing, and in good standing under the
laws of the State of Delaware and has full corporate power, authority and legal
right to execute, deliver, and perform its duties and comply with its
obligations under this Agreement.
(d) Distributor represents and warrants that the Fund is a corporation
duly organized, validly existing, and in good standing under the laws of the
State of Maryland and has full power, authority, and legal right to execute,
deliver, and perform its duties and comply with its obligations under this
Agreement.
(e) Adviser represents and warrants that it is a limited partnership,
duly organized, validly existing and in good standing under the laws of the
State of Delaware and has full power, authority, and legal right to execute,
deliver, and perform its duties and comply with its obligations under this
Agreement.
5.3 SECURITIES LAWS.
(a) Insurer represents and warrants that (i) interests in the Separate
Account pursuant to the Contracts will be registered under the 1933 Act to the
extent required by the 1933 Act and the Contracts will be duly authorized for
issuance and sold in compliance with New York law, (ii) the Separate Account is
and will remain registered under the 1940 Act to the extent required by the 1940
Act, (iii) the Separate Account does and will comply in all material respects
with the applicable requirements of the 1940 Act and the rules thereunder, (iv)
the Separate Account's 1933 Act registration statement relating to the
Contracts, together with any amendments thereto, will, at
13
all times comply in all material respects with the requirements of the 1933 Act
and the rules thereunder, and (v) the Separate Account Prospectus will at all
times comply in all material respects with the requirements of the 1933 Act and
the rules thereunder.
(b) The Adviser and Distributor represent and warrant that (i) Fund
shares sold pursuant to this Agreement will be registered under the 1933 Act to
the extent required by the 1933 Act and duly authorized for issuance and sold in
compliance with Maryland law, (ii) the Fund is and will remain registered under
the 1940 Act to the extent required by the 1940 Act, (iii) the Fund will amend
the registration statement for its shares under the 1933 Act and itself under
the 1940 Act from time to time as required in order to effect the continuous
offering of its shares, (iv) the Fund does and will comply in all material
respects with the requirements of the 1940 Act and the rules thereunder, (v) the
Fund's 1933 Act registration statement, together with any amendments thereto,
will at all times comply in all material respects with the requirements of the
1933 Act and rules thereunder, and (vi) the Fund Prospectus will at all times
comply in all material respects with the requirements of the 1933 Act and the
rules thereunder.
(c) The Fund will register and qualify its shares for sale in
accordance with the laws of any state or other jurisdiction only if and to the
extent reasonably deemed advisable by the Fund, Insurer or any other life
insurance company utilizing the Fund.
(d) Distributor and Insurer each represents and warrants that it is
registered as a broker-dealer with the SEC under the Securities Exchange Act of
1934, as amended, and is a member in good standing of the National Association
of Securities Dealers Inc. (the "NASD").
14
5.4 NOTICE OF CERTAIN PROCEEDINGS AND OTHER CIRCUMSTANCES.
(a) Distributor or the Fund shall immediately notify Insurer of (i) the
issuance by any court or regulatory body of any stop order, cease and desist
order, or other similar order with respect to the Fund's registration statement
under the 1933 Act or the Fund Prospectus, (ii) any request by the SEC for any
amendment to such registration statement or Fund Prospectus, (iii) the
initiation of any proceedings for that purpose or for any other purpose relating
to the registration or offering of the Fund's shares, or (iv) any other action
or circumstances that may prevent the lawful offer or sale of Fund shares in any
state or jurisdiction, including, without limitation, any circumstances in which
the Fund's shares are not registered and, in all material respects, issued and
sold in accordance with applicable state and federal law or such law precludes
the use of such shares as an underlying investment medium of the Contracts
issued or to be issued by Insurer. Distributor and the Fund will make every
reasonable effort to prevent the issuance of any such stop order, cease and
desist order or similar order and, if any such order is issued, to obtain the
lifting thereof at the earliest possible time.
(b) Insurer shall immediately notify the Fund of (i) the issuance by
any court or regulatory body of any stop order, cease and desist order or
similar order with respect to the Separate Account's registration statement
under the 1933 Act relating to the Contracts or the Separate Account Prospectus,
(ii) any request by the SEC for any amendment to such registration statement or
Separate Account Prospectus, (iii) the initiation of any proceedings for that
purpose or for any other purpose relating to the registration or offering of the
Separate Account interests pursuant to the Contracts, or (iv) any other action
or circumstances that may prevent the lawful offer or sale of said interests in
any state or jurisdiction, including, without limitation, any circumstances in
which said interests are not registered and, in all material respects, issued
and sold in accordance
15
with applicable state and federal law. Insurer will make every reasonable effort
to prevent the issuance of any such stop order, cease and desist order or
similar order and, if any such order is issued, to obtain the lifting thereof at
the earliest possible time.
5.5 INSURER TO PROVIDE DOCUMENTS.
Upon request, Insurer will provide the Fund and the Distributor one
complete copy of SEC registration statements, Separate Account Prospectuses,
reports, any preliminary and final voting instruction solicitation material,
applications for exemptions, requests for no-action letters, and amendments to
any of the above, that relate to the Separate Account or the Contracts,
contemporaneously with the filing of such document with the SEC or other
regulatory authorities.
5.6 FUND TO PROVIDE DOCUMENTS.
Upon request, the Fund will provide to Insurer one complete copy of SEC
registration statements, Fund Prospectuses, reports, any preliminary and final
proxy material, applications for exemptions, requests for no-action letters, and
all amendments to any of the above, that relate to the Fund or its shares,
contemporaneously with the filing of such document with the SEC or other
regulatory authorities.
SECTION 6. MIXED AND SHARED FUNDING
6.1 General.
The Fund has obtained an order exempting it from certain provisions of
the 1940 Act and rules thereunder so that the Fund is available for investment
by certain other entities, including, without limitation, separate accounts
funding variable life insurance policies and separate accounts of insurance
companies unaffiliated with Insurer ("Mixed and Shared Funding Order"). The
Parties
16
recognize that the SEC has imposed terms and conditions for such orders that are
substantially identical to many of the provisions of this Section 6.
6.2 DISINTERESTED DIRECTORS.
The Fund agrees that its Board of Directors shall at all times consist
of directors a majority of whom (the "Disinterested Directors") are not
interested persons of Adviser or Distributor within the meaning of Section
2(a)(19) of the 1940 Act.
6.3 MONITORING FOR MATERIAL IRRECONCILABLE CONFLICTS.
The Fund agrees that its Board of Directors will monitor for the
existence of any material irreconcilable conflict between the interests of the
participants in all separate accounts of life insurance companies utilizing the
Fund, including the Separate Account. Insurer agrees to inform the Board of
Directors of the Fund of the existence of or any potential for any such material
irreconcilable conflict of which it is aware. The concept of a "material
irreconcilable conflict" is not defined by the 1940 Act or the rules thereunder,
but the Parties recognize that such a conflict may arise for a variety of
reasons, including, without limitation:
(a) an action by any state insurance or other regulatory authority;
(b) a change in applicable federal or state insurance, tax or
securities laws or regulations, or a public ruling, private letter ruling,
no-action or interpretative letter, or any similar action by insurance, tax or
securities regulatory authorities;
(c) an administrative or judicial decision in any relevant
proceeding;
(d) the manner in which the investments of any Portfolio are being
managed;
17
(e) a difference in voting instructions given by variable annuity
contract and variable life insurance contract participants or by participants of
different life insurance companies utilizing the Fund; or
(f) a decision by a life insurance company utilizing the Fund to
disregard the voting instructions of participants.
Insurer will assist the Board of Directors in carrying out its
responsibilities by providing the Board of Directors with all information
reasonably necessary for the Board of Directors to consider any issue raised,
including information as to a decision by Insurer to disregard voting
instructions of Participants.
6.4 CONFLICT REMEDIES.
(a) It is agreed that if it is determined by a majority of the
members of the Board of Directors or a majority of the Disinterested Directors
that a material irreconcilable conflict exists, Insurer and the other life
insurance companies utilizing the Fund will, at their own expense and to the
extent reasonably practicable (as determined by a majority of the Disinterested
Directors), take whatever steps are necessary to remedy or eliminate the
material irreconcilable conflict, which steps may include, but are not limited
to:
(i) withdrawing the assets allocable to some or all of the
separate accounts from the Fund or any Portfolio and
reinvesting such assets in a different investment medium,
including another Portfolio of the Fund, or submitting the
question whether such segregation should be implemented to a
vote of all affected participants and, as appropriate,
segregating the assets of any particular group (e.g., annuity
contract owners or participants, life insurance contract
owners or all
18
contract owners and participants of one or more life insurance
companies utilizing the Fund) that votes in favor of such
segregation, or offering to the affected contract owners or
participants the option of making such a change; and
(ii) establishing a new registered investment company of the type
defined as a "Management Company" in Section 4(3) of the 1940
Act or a new separate account that is operated as a Management
Company.
(b) If the material irreconcilable conflict arises because of Insurer's
decision to disregard Participant voting instructions and that decision
represents a minority position or would preclude a majority vote, Insurer may be
required, at the Fund's election, to withdraw the Separate Account's investment
in the Fund. No charge or penalty will be imposed as a result of such
withdrawal. Any such withdrawal must take place within 180 days after the Fund
gives notice to Insurer that this provision is being implemented, and until such
withdrawal Distributor and the Fund shall continue to accept and implement
orders by Insurer for the purchase and redemption of shares of the Fund.
(c) If a material irreconcilable conflict arises because a particular
state insurance regulator's decision applicable to Insurer conflicts with the
majority of other state regulators, then Insurer will withdraw the Separate
Account's investment in the Fund within 180 days after the Fund's Board of
Directors informs Insurer that it has determined that such decision has created
a material irreconcilable conflict, and until such withdrawal Distributor and
Fund shall continue to accept and implement orders by Insurer for the purchase
and redemption of shares of the Fund.
(d) Insurer agrees that any remedial action taken by it in resolving
any material irreconcilable conflict will be carried out at its expense and with
a view only to the interests of Participants.
19
(e) For purposes hereof, a majority of the Disinterested Directors will
determine whether or not any proposed action adequately remedies any material
irreconcilable conflict. In no event, however, will the Fund or Distributor be
required to establish a new funding medium for any Contracts. Insurer will not
be required by the terms hereof to establish a new funding medium for any
Contracts if an offer to do so has been declined by vote of a majority of
Participants materially adversely affected by the material irreconcilable
conflict.
6.5 NOTICE TO INSURER.
The Fund will promptly make known in writing to Insurer the Board of
Directors' determination of the existence of a material irreconcilable conflict,
a description of the facts that give rise to such conflict and the implications
of such conflict.
6.6 INFORMATION REQUESTED BY BOARD OF DIRECTORS.
Insurer and the Fund will at least annually submit to the Board of
Directors of the Fund such reports, materials or data as the Board of Directors
may reasonably request so that the Board of Directors may fully carry out the
obligations imposed upon it by the provisions hereof, and said reports,
materials and data will be submitted at any reasonable time deemed appropriate
by the Board of Directors. All reports received by the Board of Directors of
potential or existing conflicts, and all Board of Directors actions with regard
to determining the existence of a conflict, notifying life insurance companies
utilizing the Fund of a conflict, and determining whether any proposed action
adequately remedies a conflict, will be properly recorded in the minutes of the
Board of Directors or other appropriate records, and such minutes or other
records will be made available to the SEC upon request.
20
6.7 COMPLIANCE WITH SEC RULES.
If, at any time during which the Fund is serving an investment medium
for variable life insurance policies, 1940 Act Rules 6e-3(T) or, if applicable,
6e-2 are amended or Rule 6e-3 is adopted to provide exemptive relief with
respect to mixed and shared funding, the Parties agree that they will comply
with the terms and conditions thereof and that the terms of this Section 6 shall
be deemed modified if and only to the extent required in order also to comply
with the terms and conditions of such exemptive relief that is afforded by any
of said rules that are applicable.
SECTION 7. TERMINATION
7.1 EVENTS OF TERMINATION.
Subject to Section 7.4 below, this Agreement will terminate as to a
Portfolio:
(a) at the option of Insurer or Distributor upon at least 180 days
advance written notice to the other Parties, or
(b) at the option of the Fund upon (i) at least sixty days advance
written notice to the other parties, and (ii) approval by a majority of the
disinterested Directors upon a reasonable good faith finding that a continuation
of this Contract would have a material adverse impact on the Fund, or a majority
vote of the shares of the affected Portfolio in the corresponding Division of
the Separate Account (pursuant to the procedures set forth in Section 12 of this
Agreement for voting Trust shares in accordance with Participant instructions).
(c) at the option of the Fund upon institution of formal proceedings
against Insurer by the NASD, the SEC, any state insurance regulator or any other
regulatory body regarding Insurer's obligations under this Agreement or related
to the sale of the Contracts, the operation of the Separate Account, or the
purchase of the Fund shares, if, in each case, the Fund reasonably
21
determines that such proceedings, or the facts on which such proceedings would
be based, have a material likelihood of imposing material adverse consequences
on the Portfolio to be terminated; or
(d) at the option of Insurer upon institution of formal proceedings
against the Fund, Adviser, or Distributor by the NASD, the SEC, or any state
insurance regulator or any other regulatory body regarding the Fund's, Adviser's
or Distributor's obligations under this Agreement or related to the operation or
management of the Fund or the purchase of Fund shares, if, in each case, Insurer
reasonably determines that such proceedings, or the facts on which such
proceedings would be based, have a material likelihood of imposing material
adverse consequences on Insurer or the Division corresponding to the Portfolio
to be terminated; or
(e) at the option of any Party in the event that (i) the Portfolio's
shares are not registered and, in all material respects, issued and sold in
accordance with any applicable state and federal law or (ii) such law precludes
the use of such shares as an underlying investment medium of the Contracts
issued or to be issued by Insurer; or
(f) upon termination of the corresponding Division's investment in the
Portfolio pursuant to Section 6 hereof; or
(g) at the option of Insurer if the Portfolio ceases to qualify as a
RIC under Subchapter M of the Code or under successor or similar provisions; or
(h) at the option of Insurer if the Portfolio fails to comply with
Section 817(h) of the Code or with successor or similar provisions; or
(i) at the option of Insurer if Insurer reasonably believes that any
change in a Fund's investment adviser or investment practices will materially
increase the risks incurred by Insurer.
22
7.2 FUNDS TO REMAIN AVAILABLE.
Except (i) as necessary to implement Participant-initiated
transactions, (ii) as required by state insurance laws or regulations, (iii) as
required pursuant to Section 6 of this Agreement, or (iv) with respect to any
Portfolio as to which this Agreement has terminated, Insurer shall not redeem
Fund shares attributable to the Contracts, or prevent Participants from
allocating payments to or transferring amounts from a Portfolio that was
otherwise available under the Contracts, until, in either case, 60 calendar days
after Insurer shall have notified the Fund or Distributor of its intention to do
so.
7.3 SURVIVAL OF WARRANTIES AND INDEMNIFICATIONS.
All warranties and indemnifications will survive the termination of
this Agreement.
7.4 CONTINUANCE OF AGREEMENT FOR CERTAIN PURPOSES.
Notwithstanding any termination of this Agreement, the Distributor
shall continue to make available shares of the Portfolios pursuant to the terms
and conditions of this Agreement, for all Contracts in effect on the effective
date of termination of this Agreement (the "Existing Contracts"), except as
otherwise provided under Section 6 of this Agreement. Specifically, and without
limitation, the Distributor shall facilitate the sale and purchase of shares of
the Portfolios as necessary in order to process premium payments, surrenders and
other withdrawals, and transfers or reallocations of values under Existing
Contracts.
SECTION 8. PARTIES TO COOPERATE RESPECTING TERMINATION
The other Parties hereto agree to cooperate with and give reasonable
assistance to Insurer in taking all necessary and appropriate steps for the
purpose of ensuring that the Separate Account owns no shares of a Portfolio
after the Final Termination Date with respect thereto.
23
SECTION 9. ASSIGNMENT
This Agreement may not be assigned by any Party, except with the
written consent of each other Party.
SECTION 10. CLASS B DISTRIBUTION PAYMENTS
From time to time during the term of this Agreement the Distributor may
make payments to the Insurer pursuant to a distribution plan adopted by the Fund
with respect to the Class B shares of the Portfolios pursuant to Rule 12b-1
under the 1940 Act (the "Rule 12b-1 Plan") in consideration of the Insurer's
furnishing distribution services relating to the Class B shares of the
Portfolios and providing administrative, accounting and other services,
including personal service and/or the maintenance of Participant accounts, with
respect to such shares. The Distributor has no obligation to make any such
payments, and the Insurer waives any such payment, until the Distributor
receives monies therefor from the Fund. Any such payments made pursuant to this
Section 10 shall be subject to the following terms and conditions:
(a) Any such payments shall be in such amounts as the Distributor may
from time to time advise the Insurer in writing but in any event not in excess
of the amounts permitted by the Rule 12b-1 Plan. Such payments may include a
service fee in the amount of .25 of 1% per annum of the average daily net assets
of the Fund attributable to the Class B shares of a Portfolio held by clients of
the Insurer. Any such service fee shall be paid solely for personal service
and/or the maintenance of Participant accounts.
(b) The provisions of this Section 10 relate to a plan adopted by the
Fund pursuant to Rule 12b-1. In accordance with Rule 12b-1, any person
authorized to direct the disposition of monies paid or payable by the Fund
pursuant to this Section 10 shall provide the Fund's Board of
24
Directors, and the Directors shall review, at least quarterly, a written report
of the amounts so expended and the purposes for which such expenditures were
made.
(c) The provisions of this Section 10 shall remain in effect for not
more than a year and thereafter for successive annual periods only so long as
such continuance is specifically approved at least annually in conformity with
Rule 12b-1 and the 1940 Act. The provisions of this Section 10 shall
automatically terminate in the event of the assignment (as defined by the 0000
Xxx) of this Agreement, in the event the Rule 12b-1 Plan terminates or is not
continued or in the event this Agreement terminates or ceases to remain in
effect. In addition, the provisions of this Section 10 may be terminated at any
time by the vote of a majority of the Fund's Board, or by a vote of a majority
of the outstanding shares as provided in the Plan, on sixty (60) days' written
notice delivered or mailed by registered mail, postage prepaid, to the other
party, without payment of any penalty.
SECTION 11. NOTICES
Notices and communications required or permitted by Section 2 hereof
will be given by means mutually acceptable to the Parties concerned. Each other
notice or communication required or permitted by this Agreement will be given to
the following persons at the following addresses and facsimile numbers, or such
other persons, addresses or facsimile numbers as the Party receiving such
notices or communications may subsequently direct in writing:
Metropolitan Life Insurance Company, Inc.
000-X Xxxxx Xxx Xxxxx, Xxxxx 000
Xxxxxx, XX 00000
Attn: Xxxxxxx Xxxxxxxx
FAX: (000) 000-0000
25
Metropolitan Life Insurance Company, Inc.
0 Xxxxxxx Xxx.
Xxx Xxxx, XX 00000
Attn: Xxxxx Xxxxxxxx
FAX: (000) 000-0000
Alliance Fund Distributors, Inc.
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, XX 00000
Attn.: Xxxxxx X. Xxxxxx
FAX: (000) 000-0000
Alliance Capital Management L.P.
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx XX 00000
Attn: Xxxxxx X. Xxxxxx
FAX: (000) 000-0000
SECTION 12. VOTING PROCEDURES
Subject to the cost allocation procedures set forth in Section 3
hereof, Insurer will distribute all proxy material furnished by the Fund to
Participants and will vote Fund shares in accordance with instructions received
from Participants. Insurer will vote Fund shares that are (a) not attributable
to Participants or (b) attributable to Participants, but for which no
instructions have been received, in the same proportion as Fund shares for which
said instructions have been received from Participants. Insurer agrees that it
will disregard Participant voting instructions only to the extent it would be
permitted to do so pursuant to Rule 6e-3 (T)(b)(15)(iii) under the 1940 Act if
the Contracts were variable life insurance policies subject to that rule. Other
participating life insurance companies utilizing the Fund will be responsible
for calculating voting privileges in a manner consistent with that of Insurer,
as prescribed by this Section 12.
26
SECTION 13. FOREIGN TAX CREDITS
The Adviser agrees to consult in advance with Insurer concerning any
decision to elect or not to elect pursuant to Section 853 of the Code to pass
through the benefit of any foreign tax credits to the Fund's shareholders.
SECTION 14. INDEMNIFICATION
14.1 INDEMNIFICATION BY THE INSURER
14.1(a). The Insurer agrees to indemnify and hold harmless the Fund,
Adviser, and Distributor, and each director of the Board and officers and each
person, if any, who controls the Fund, Adviser, and Distributor, within the
meaning of Section 15 of the 1933 Act ("Indemnified Party" and collectively, the
"Indemnified Parties" for purposes of this Section 14.1) against any and all
losses, claims, damages, liabilities (including amounts paid in settlement with
the written consent of the Insurer) or litigation (including legal and other
expenses), to which the Indemnified Parties 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 Fund shares or the Contracts and:
(i) arise out of or are based upon any untrue statements or alleged
untrue statements of any material fact contained in or in connection with the
registration statement, Separate Account, Prospectus, Contracts, or sales
literature for the Contracts (or any amendment or supplement to any of the
foregoing), or arise out of or are based upon the omission or the alleged
omission to state therein a material fact required to be stated therein or
necessary to make the
27
statements therein not misleading, provided that this agreement to indemnify
shall not apply as to any Indemnified Party if such statement or omission or
such alleged statement or omission was made in reliance upon and in conformity
with information furnished to Insurer by or on behalf of the Fund for use in the
registration statement for the Contracts or Separate Account Prospectus or in
the Contracts or sales literature (or any amendment or supplement) or otherwise
for use in connection with the sale of the Contracts or Fund shares; or
(ii) arise out of or as a result of statements or representations
(other than statements or representations contained in the registration
statement, Prospectus or sales literature of the Fund not supplied by Insurer or
persons under its control) or wrongful conduct of the Insurer or persons under
its control, with respect to the sale or distribution of the Contracts or Fund
shares; or
(iii) arise out of any untrue statement or alleged untrue statement of
a material fact contained in a registration statement, Prospectus, or sales
literature of the Fund or any amendment thereof or supplement thereto or the
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading if
such a statement or omission was made in reliance upon information furnished to
the Fund by or on behalf of Insurer; or
(iv) arise as a result of any failure by Insurer to provide the
services and furnish the materials under the terms of this Agreement; or
(v) arise out of or result from any material breach of any
representation and/or warranty made by Insurer in this Agreement or arise out of
or result from any other material breach of this Agreement by Insurer, as
limited by and in accordance with the provisions of Section 14.1(b) and 14.1(c)
hereof.
28
14.1(b) Insurer shall not be liable under this Section 14 with respect
to any losses, claims, damages, liabilities or litigation incurred or assessed
against an Indemnified Party as such may arise from such Indemnified Party's
willful misfeasance, bad faith, or gross negligence in the performance of such
Indemnified Party's duties or by the reason of such Indemnified Party's reckless
disregard of obligations or duties under this Agreement or to the Fund,
whichever is applicable.
14.1(c) Insurer shall not be liable under this indemnification
provision with respect to any claim made against an Indemnified Party unless
that Indemnified Party shall have notified the Insurer in writing within a
reasonable time after the summons or other first legal process giving
information of the nature of the claim shall have been served upon that
Indemnified Party (or after the Indemnified Party shall have received notice of
such service on any designated agent). Notwithstanding the foregoing, the
failure of any Indemnified Party to give notice as provided herein shall not
relieve Insurer of its obligations hereunder except to the extent that the
Insurer has been prejudiced by such failure to give notice. In addition, any
failure by the Indemnified Party to notify Insurer of any such claim shall not
relieve the Insurer from any liability which it may have to the Indemnified
Party against whom the action is brought otherwise than on account of this
indemnification provision. In case any such action is brought against the
Indemnified Parties, the insurer shall be entitled to participate, at its own
expense, in the defense of the action. The Insurer also shall be entitled to
assume the defense thereof, with counsel reasonably satisfactory to the party
named in the action; PROVIDED, HOWEVER, that if the Indemnified Party shall have
reasonably concluded that there may be defenses available to it which are
different from or additional to those available to Insurer, Insurer shall not
have the right to assume said defense, but shall pay the costs and expenses
thereof (except that in no event
29
shall the Insurer be liable for the fees and expenses of more than one counsel
for Indemnified Parties in connection with any one action or separate but
similar or related actions in the same jurisdiction arising out of the same
general allegations or circumstances). After notice from Insurer to the
Indemnified Party of Insurer's election to assume the defense thereof, and in
the absence of such a reasonable conclusion that there may be different or
additional defenses available to the Indemnified Party, the Indemnified Party
shall bear the fees and expenses of any additional counsel retained by it, and
Insurer will not be liable to that party under this Agreement for any legal or
other expenses subsequently incurred by the party independently in connection
with the defense thereof other than reasonable costs of investigation.
14.1(d) The Indemnified Parties will promptly notify Insurer in writing
of the commencement of any litigation or proceedings against them in connection
with the issuance or sale of the Fund Shares or the Contracts or the operation
of the Fund.
14.2 INDEMNIFICATION BY THE ADVISER
14.2(a) The Adviser agrees to indemnify and hold harmless Insurer and
each of its directors and officers and each person, if any, who controls Insurer
within the meaning of Section l5 of the 1933 Act ("Indemnified Party" and
collectively, the "Indemnified Parties" for purposes of this Section 14.2)
against any and all losses, claims, damages, liabilities (including amounts paid
in settlement with the written consent of the Distributor) or litigation
(including legal and other expenses) to which the Indemnified Parties 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 Fund shares or the
Contracts and:
30
(i) arise out of or are based upon any untrue statement or alleged
untrue statement of any material fact contained in the registration statement or
sales literature of the Fund (or any amendment or supplement to any of the
foregoing), or Fund Prospectus or arise out of or are based upon the omission or
the alleged 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 or such alleged statement or omission was made in
reliance upon and in conformity with information furnished to the Adviser or
Fund by or on behalf of the Insurer for use in the registration statement or in
sales literature of the Fund (or any amendment or supplement) or Fund Prospectus
or otherwise for use in connection with the sale of the Contracts or Fund
shares; or
(ii) arise out of or as a result of statements or representations
(other than statements or representations contained in the registration
statement, prospectus or sales literature for the Contracts not supplied by
Distributor or persons under its control) or wrongful conducts of the Fund,
Adviser or Distributor or persons under their control, with respect to the sale
or distribution of the Contracts or Fund shares; or
(iii) arise out of any untrue statement or alleged untrue statement of
a material fact contained in a registration statement, or sales literature
covering the Contracts or Separate Account Prospectus, or any amendment thereof
or supplement thereto, or the omission or alleged 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 Insurer by or on behalf of the Fund; or
31
(iv) arise as a result of any failure by the Distributor, Fund or
Adviser to provide the services and furnish the material under the terms of this
Agreement (including a failure, whether unintentional or in good faith or
otherwise, to comply with the diversification requirements specified in Articles
VI of this Agreement); or
(v) arise out of or result from any material breach of any
representation and/or warranty made by the Distributor or Adviser in this
Agreement or arise out of or result from any other material breach of this
Agreement by the Distributor, Fund or Adviser; as limited by in accordance with
the provisions of Sections 14.2(b) and 14.2(c) hereof.
14.2(b) The Adviser shall not be liable under this indemnification
provision with respect to any losses, claims, damages, liabilities or litigation
to which the Indemnified Party would otherwise by subject by reason of such
Indemnified Party's willful misfeasance, bad faith, 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 or to
Insurer or the Separate Account, whichever is applicable.
14.2(c) The Adviser shall not be liable under this indemnification
provision with respect to any claim made against the Indemnified Party unless
the Indemnified Party shall have notified Adviser in writing within a reasonable
time after the summons or other first legal process giving information of the
nature of the claim shall have been served upon the Indemnified Party (or after
the Indemnified Party shall have received notice of such service on any
designated agent). Notwithstanding the foregoing, the failure of the Indemnified
Party to give notice as provided herein shall not relieve Adviser of its
obligations hereunder except to the extent that Adviser has been prejudiced by
such failure to give notice. In addition, any failure by the Indemnified Party
to notify Adviser of any such claim shall not relieve Adviser from any liability
that it may have
32
to the Indemnified Party against whom such action is brought otherwise than
account of this indemnification provision. In case any such action is brought
against the Indemnified Party, Adviser will be entitled to participate, at its
own expense, in the defense thereof. Unless the Indemnified Party releases
Adviser from any further obligation under this Section 14.2, Adviser also shall
be entitled to assume the defense thereof, with counsel satisfactory to the
party named in the action; PROVIDED, HOWEVER, that if the Indemnified Party
shall have reasonably concluded that there may be defenses available to it which
are different from or additional to those available to Adviser, Adviser shall
not have the right to assume said defense, but shall pay the costs and expenses
thereof (except that in no event shall Adviser be liable for the fees and
expenses of more than one counsel for the Indemnified Party in connection with
any one action or separate but similar or related actions in the same
jurisdiction arising out of the same general allegations or circumstances).
After notice from Adviser to the Indemnified Party of Adviser's election to
assume the defense thereof, and in the absence of such a reasonable conclusion
that there may be different or additional defenses available to the Indemnified
Party, the Indemnified Party shall bear the fees and expenses of any additional
counsel retained by it, and Adviser will not be liable to that party under this
Agreement for any legal or other expenses subsequently incurred by that party
independently in connection with the defense thereof other than reasonable costs
of investigation. Notwithstanding any other provision of this Paragraph 14.2(c)
Insurer shall be entitled to refuse any request by Adviser to assume the defense
of any action brought against Insurer by the Internal Revenue Service ("IRS") or
any other tax authority, provided that following such refusal, Adviser shall be
released from any further obligation for costs of defense under this Section
14.2. If they are so allowed by rules of procedure, however, Adviser and Insurer
will be entitled to participate in the defense of any action brought against
Adviser by the
33
IRS or any other tax authority, with any and all costs associated with the
Adviser's or Insurer's defense to be the responsibility of Adviser or Insurer.
14.2(d) The Insurer agrees promptly to notify the Adviser of the
commencement of any litigation or proceedings against it or any of its officers
or directors in connection with the issuance or sale of the Contracts or the
operation of the Separate Account.
14.3 INDEMNIFICATION BY THE DISTRIBUTOR
14.3(a) The Distributor agrees to indemnify and hold harmless Insurer
and each of its directors and officers and each person, if any, who controls
Insurer within the meaning of Section l5 of the 1933 Act ("Indemnified Party"
and collectively, the "Indemnified Parties" for purposes of this Section 14.3)
against any and all losses, claims, damages, liabilities (including amounts paid
in settlement with the written consent of the Advisor) or litigation (including
legal and other expenses) to which the Indemnified Parties 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 Fund shares or the Contracts and:
(i) arise out of or are based upon any untrue statement or alleged
untrue statement of any material fact contained in the registration statement or
sales literature of the Fund (or any amendment or supplement to any of the
foregoing), or Fund Prospectus or arise out of or are based upon the omission or
the alleged 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 or such alleged statement or omission was made in
reliance upon and in conformity with information furnished to the Distributor or
Fund by or on behalf of the Insurer for use in the
34
registration statement or in sales literature of the Fund (or any amendment or
supplement) or Fund Prospectus or otherwise for use in connection with the sale
of the Contracts or Fund shares; or
(ii) arise out of or as a result of statements or representations
(other than statements or representations contained in the registration
statement, prospectus or sales literature for the Contracts not supplied by
Adviser or persons under its control) or wrongful conducts of the Fund,
Distributor or Adviser or persons under their control, with respect to the sale
or distribution of the Contracts or Fund shares; or
(iii) arise out of any untrue statement or alleged untrue statement of
a material fact contained in a registration statement, or sales literature
covering the Contracts or Separate Account Prospectus, or any amendment thereof
or supplement thereto, or the omission or alleged 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 Insurer by or on behalf of the Fund; or
(iv) arise as a result of any failure by the Adviser, Fund or
Distributor to provide the services and furnish the material under the terms of
this Agreement (including a failure, whether unintentional or in good faith or
otherwise, to comply with the diversification requirements specified in Articles
VI of this Agreement); or
(v) arise out of or result from any material breach of any
representation and/or warranty made by the Adviser or Distributor in this
Agreement or arise out of or result from any other material breach of this
Agreement by the Adviser, Fund or A; as limited by in accordance with the
provisions of Sections 14.3(b) and 14.3(c) hereof.
35
14.3(b) The Distributor shall not be liable under this indemnification
provision with respect to any losses, claims, damages, liabilities or litigation
to which the Indemnified Party would otherwise by subject by reason of such
Indemnified Party's willful misfeasance, bad faith, 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 or to
Insurer or the Separate Account, whichever is applicable.
14.3(c) The Distributor shall not be liable under this indemnification
provision with respect to any claim made against the Indemnified Party unless
the Indemnified Party shall have notified Distributor in writing within a
reasonable time after the summons or other first legal process giving
information of the nature of the claim shall have been served upon the
Indemnified Party (or after the Indemnified Party shall have received notice of
such service on any designated agent). Notwithstanding the foregoing, the
failure of the Indemnified Party to give notice as provided herein shall not
relieve Distributor of its obligations hereunder except to the extent that
Distributor has been prejudiced by such failure to give notice. In addition, any
failure by the Indemnified Party to notify Distributor of any such claim shall
not relieve Distributor from any liability that it may have to the Indemnified
Party against whom such action is brought otherwise than account of this
indemnification provision. In case any such action is brought against the
Indemnified Party, Distributor will be entitled to participate, at its own
expense, in the defense thereof. Unless the Indemnified Party releases
Distributor from any further obligation under this Section 14.3, Distributor
also shall be entitled to assume the defense thereof, with counsel satisfactory
to the party named in the action; PROVIDED, HOWEVER, that if the Indemnified
Party shall have reasonably concluded that there may be defenses available to it
which are different from or additional to those available to A, Distributor
shall not have the right
36
to assume said defense, but shall pay the costs and expenses thereof (except
that in no event shall Distributor be liable for the fees and expenses of more
than one counsel for the Indemnified Party in connection with any one action or
separate but similar or related actions in the same jurisdiction arising out of
the same general allegations or circumstances). After notice from Distributor to
the Indemnified Party of A's election to assume the defense thereof, and in the
absence of such a reasonable conclusion that there may be different or
additional defenses available to the Indemnified Party, the Indemnified Party
shall bear the fees and expenses of any additional counsel retained by it, and
Distributor will not be liable to that party under this Agreement for any legal
or other expenses subsequently incurred by that party independently in
connection with the defense thereof other than reasonable costs of
investigation. Notwithstanding any other provision of this Paragraph 14.3(c)
Insurer shall be entitled to refuse any request by Distributor to assume the
defense of any action brought against Insurer by the IRS or any other tax
authority, provided that following such refusal, Distributor shall be released
from any further obligation for costs of defense under this Section 14.3. If
they are so allowed by rules of procedure, however, Distributor and Insurer will
be entitled to participate in the defense of any action brought against
Distributor by the IRS or any other tax authority, with any and all costs
associated with the A's or Insurer's defense to be the responsibility of
Distributor or Insurer.
14.3(d) The Insurer agrees promptly to notify the Distributor of the
commencement of any litigation or proceedings against it or any of its officers
or directors in connection with the issuance or sale of the Contracts or the
operation of the Separate Account.
37
SECTION 15. APPLICABLE LAW
This Agreement will be construed and the provisions hereof interpreted
under and in accordance with New York law, without regard for that state's
principles of conflict of laws.
SECTION 16. EXECUTION IN COUNTERPARTS
This Agreement may be executed simultaneously in two or more
counterparts, each of which taken together will constitute one and the same
instrument.
SECTION 17. SEVERABILITY
If any provision of this Agreement is held or made invalid by a court
decision, statute, rule or otherwise, the remainder of this Agreement will not
be affected thereby.
SECTION 18. RIGHTS CUMULATIVE
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, that the Parties are entitled to under federal and state
laws.
SECTION 19. RESTRICTIONS ON SALES OF FUND SHARES
Insurer agrees that the Fund will be permitted (subject to the other
terms of this Agreement) to make its shares available to separate accounts of
other life insurance companies.
SECTION 20. HEADINGS
The headings used in this Agreement are for purposes of reference only
and shall not limit or define the meaning of the provisions of this Agreement.
38
IN WITNESS WHEREOF, the Parties have caused this Agreement to be
executed in their names and on their behalf by and through their duly authorized
officers signing below.
METROPOLITAN LIFE INSURANCE
COMPANY, INC.
By: /s/ Xxxx Xxxx
Name: Xxxx Xxxx
Title: Vice President
ALLIANCE CAPITAL MANAGEMENT L.P.
By: Alliance Capital Management Corporation,
its General Partner
By:/s/ Xxxxxx X. Xxxxxx, Xx.
Name: Xxxxxx X. Xxxxxx, Xx.
Title: Vice President and Assistant
General Counsel
ALLIANCE FUND DISTRIBUTORS, INC.
By: /s/ Xxxxxxx X. Xxxxx
Name: Xxxxxxx X. Xxxxx
Title: Sr. Vice-President
39
SCHEDULE A
CERTIFICATE OF COMPLIANCE
Name of Fund(s):
------------------------------
To: Metropolitan Life Insurer, Inc.
000-X Xxxxx Xxx Xxxxx, Xxxxx 000
Xxxxxx, XX 00000
Attn: Xxxxxxx Xxxxxxxx
FAX: (000) 000-0000
Metropolitan Life Insurer, Inc.
0 Xxxxxxx Xxx.
Xxx Xxxx, XX 00000
Attn: Xxxxx Xxxxxxxx
FAX: (000) 000-0000
We have reviewed compliance of the Fund(s) named above with respect to
certain investment diversification requirements for the Fund(s) for the quarter
ending _________________. The review was limited to verifying whether the Fund
complied with the quarterly diversification requirements described in Section
817(h) of the Internal Revenue Code of 1986, as amended, and the regulations
thereunder (the "Section 817(h) Diversification Requirements").
The review did not include testing compliance with any other investment
limitations in the prospectus of Statement of Additional Information of the
Fund(s).
As of _____________ the Fund was in compliance with the Section 817(h)
Diversification Requirements.
Dated:
By:
Name:
Title:
40
