Exhibit 27(h)(20) Form of Participation Agreement
FORM OF PARTICIPATION AGREEMENT
THIS AGREEMENT, made and entered into this __ day of ________, 2005 by and
between XXXXX FARGO VARIABLE TRUST, an unincorporated business trust formed
under the laws of Delaware (the "Trust"), XXXXX FARGO FUNDS DISTRIBUTOR, LLC, a
Delaware limited liability company (the "Distributor"), and _________________
LIFE INSURANCE COMPANY, a ________ life insurance company (the "Company"), on
its own behalf and on behalf of each separate account of the Company identified
herein.
WHEREAS, the Trust engages in business as an open-end, diversified
management investment company offering shares of beneficial interest (the "Trust
shares") consisting of one or more separate series ("Series") of shares, each
such Series representing an interest in a particular investment portfolio of
securities and other assets (a "Fund"), and which Series may be subdivided into
various classes ("Classes") with each such Class supporting a distinct charge
and expense arrangement; and
WHEREAS, the Trust was established for the purpose of serving as an
investment vehicle for insurance company separate accounts supporting variable
annuity contracts and variable life insurance policies offered by insurance
companies and may also be utilized by qualified retirement plans; and
WHEREAS, an order of the Securities and Exchange Commission dated September
28, 1998, (File No. 812-11158) grants certain separate accounts supporting
variable life insurance policies, their life insurance company depositors, and
their principal underwriters, exemptions from Sections 9(a), 13(a), 15(a) and
15(b) of the Investment Company Act of 1940, and from Rules 6e-2(b)(15) and
6e-3(T)(b)(15) thereunder, to the extent necessary for such separate accounts to
purchase and hold Trust shares at the same time that such shares are sold to or
held by separate accounts of affiliated and unaffiliated insurance companies
supporting either variable annuity contracts or variable life insurance
policies, or both, or by qualified pension and retirement plans (the "SEC
Order"); and
WHEREAS, the Distributor has the exclusive right to distribute Trust shares
to qualifying investors; and
WHEREAS, the Company desires that the Trust serve as an investment vehicle
for a certain separate account(s) of the Company and the Distributor desires to
sell shares of certain Series and/or Class(es) to such separate account(s);
NOW, THEREFORE, in consideration of their mutual promises, the Trust, the
Distributor and the Company agree as follows:
ARTICLE I
Additional Definitions
1.1. "Accounts" -- the separate accounts of the Company described more
specifically in Schedules 1, 2 and 3 to this Agreement.
1.2. "Business Day"--each day that the Trust is open for business as provided in
the Trust's Prospectus.
1.3. "Code"--the Internal Revenue Code of 1986, as amended, and any successor
thereto.
1.4. "Contracts"--the class or classes of variable annuity contracts and/or
variable life insurance policies issued by the Company and described more
specifically on Schedules 1, 2, or 3 to this Agreement.
1.5. "Contract Owners"--the owners of the Contracts, as distinguished from all
Product Owners.
1.6. "Participating Account"--a separate account investing all or a portion of
its assets in Trust shares, including the Accounts.
1.7. "Participating Insurance Company"--any insurance company with a
Participating Account, including the Company.
1.8. "Participating Plan"--any qualified retirement plan investing directly in
the Trust.
1.9. "Participating Investor"--any Participating Account, Participating
Insurance Company or Participating Plan, including the Accounts and the
Company.
1.10."Products"--variable annuity contracts and variable life insurance
policies supported by Participating Accounts, including the Contracts.
1.11. "Product Owners"--owners of Products, including Contract Owners.
1.12. "Trust Board"--the board of trustees of the Trust.
1.13."Registration Statement"--with respect to the Trust shares or a class of
Schedule 1 Contracts, the registration statement filed with the SEC to
register such securities under the 1933 Act, or the most recently filed
amendment thereto, in either case in the form in which it was declared or
became effective. The Contracts' Registration Statement for each class of
Contracts is described more specifically on Schedule 1 to this Agreement.
The Trust's Registration Statement is filed on Form N-1A (File No.
333-74283).
1.14."1940 Act Registration Statement"--with respect to the Trust or the
Schedule 1 Accounts, the registration statement filed with the SEC to
register such person as an investment company under the 1940 Act, or the
most recently filed amendment thereto. The Schedule 1 Accounts' 1940 Act
Registration Statements are described more specifically on Schedule 1 to
this Agreement. The Trust's 1940 Act Registration Statement is filed on
Form N-1A (File No. 811-09255).
1.15."Prospectus"--with respect to shares of a Series (or Class) of Trust
shares or a class of Schedule 1 Contracts, each version of the definitive
prospectus or supplement thereto filed with the SEC pursuant to Rule 497
under the 1933 Act. Unless indicated to the contrary, the term "Prospectus"
in this Agreement shall include any private placement memorandum or other
similar disclosure document used in connection with the offer or sale of
Schedule 2 or Schedule 3 Contracts. With respect to any provision of this
Agreement requiring a party to take action in accordance with a Prospectus,
such reference thereto shall be deemed to be to the version for the
applicable Series, Class or class of Schedule 1 Contracts last so filed
prior to the taking of such action. For purposes of Article IX, the term
"Prospectus" shall include any statement of additional information
incorporated therein.
1.16."Schedule 1 Accounts"--Accounts registered under the 1940 Act as a unit
investment trust and listed on Schedule 1.
1.17."Schedule 2 Accounts"--Accounts excluded from the definition of an
investment company as provided for by Section 3(c)(11) of the 1940 Act and
listed on Schedule 2.
1.18."Schedule 3 Accounts"--Accounts excluded from the definition of an
investment company as provided for by Section 3(c)(1) or Section 3(c)(7) of
the 1940 Act and listed on Schedule 3.
1.19."Schedule 1 Contracts"--Contracts through which interests in Schedule 1
Accounts are offered and issued, which interests are registered as
securities under the 1933 Act.
1.20."Schedule 2 Contracts"--Contracts through which interests in Schedule 2
Accounts are offered and issued to trustees of qualified pension and
profit-sharing plans and certain government plans identified in Section
3(a)(2) of the 1933 Act.
1.21."Schedule 3 Contracts"--Contracts through which interests in Schedule 3
Accounts are offered and issued to "accredited investors", as that term is
defined in Regulation D under the 1933 Act, or other investors permitted by
Regulation D.
1.22."Statement of Additional Information"--with respect to the shares of the
Trust or a class of Schedule 1 Contracts, each version of the definitive
statement of additional information or supplement thereto filed with the
SEC pursuant to Rule 497 under the 1933 Act. With respect to any provision
of this Agreement requiring a party to take action in accordance with a
Statement of Additional Information, such reference thereto shall be deemed
to be the last version so filed prior to the taking of such action.
1.23. "SEC"--the Securities and Exchange Commission.
1.24. "NASD"--The National Association of Securities Dealers, Inc.
1.25. "1933 Act"--the Securities Exchange Act of 1933, as amended.
1.26. "1940 Act"--the Investment Company Act of 1940, as amended.
ARTICLE II
Sale of Trust Shares
2.1. Availability of Shares
(a) The Trust has granted to the Distributor exclusive authority to distribute
the Trust shares and to select which Series or Classes of Trust shares
shall be made available to Participating Investors. Pursuant to such
authority, and subject to Article X hereof, the Distributor shall make
available to the Company for purchase on behalf of the Account, shares of
the Series and Classes listed on Schedule 4 to this Agreement, such
purchases to be effected at net asset value in accordance with Section 2.3
of this Agreement. Such Series and Classes shall be made available to the
Company in accordance with the terms and provisions of this Agreement until
this Agreement is terminated pursuant to Article X or the Distributor
suspends or terminates the offering of shares of such Series or Classes in
the circumstances described in Article X.
(b) Notwithstanding clause (a) of this Section 2.1, Series or Classes of Trust
shares in existence now, or that may be established in the future, will be
made available to the Company only as the Distributor may so provide,
subject to the Distributor's rights set forth in Article X to suspend or
terminate the offering of shares of any Series or Class or to terminate
this Agreement.
(c) The parties acknowledge and agree that: (i) the Trust may revoke the
Distributor's authority pursuant to the terms and conditions of its
distribution agreement with the Distributor, and (ii) the Trust reserves
the right in its sole discretion to refuse to accept a request for the
purchase of Trust shares.
2.2. Redemptions. The Trust shall redeem, at the Company's request, any full or
fractional Trust shares held by the Company on behalf of the Account, such
redemptions to be effected at net asset value in accordance with Section
2.3 of this Agreement. Notwithstanding the foregoing: (a) the Company shall
not redeem Trust shares attributable to Contract Owners except in the
circumstances permitted in Article X of this Agreement, and (b) the Trust
may delay redemption of Trust shares of any Series or Class to the extent
permitted by the 1940 Act, any rules, regulations or orders thereunder, or
the Prospectus for such Series or Class.
2.3. Purchase and Redemption Procedures
(a) The Trust hereby appoints the Company as its agent for the limited purpose
of receiving purchase and redemption requests on behalf of the Accounts for
shares of those Series or Classes made available hereunder, based on
transactions in units issued by an Account (or sub-account of an Account)
under the Contracts, other transactions relating to the Contracts or the
Accounts and customary processing of such transactions. Receipt of requests
for transactions in Account (or sub-account) units, or other transactions
relating to the Contracts or the Accounts, on any Business Day by the
Company as such limited agent of the Trust prior to the Trust's close of
business as defined from time to time in the applicable Prospectus for such
Series or Class (which as of the date of execution of this Agreement is the
close of regular trading on the New York Stock Exchange (normally 4:00 p.m.
New York Time)) shall constitute receipt by the Trust on that same Business
Day, provided that the Trust receives actual and sufficient notice of such
request by 9:00 a.m. Eastern Time on the next following Business Day (the
"Notice Day"). Such notice may be communicated by facsimile to the office
or person designated for such notice by the Trust.
(b) The Company shall pay for shares of each Series or Class on the Notice Day.
Payment for Series or Class shares shall be made in federal funds
transmitted to the Trust by wire to be received by the Trust by 2:00 pm
Eastern Time on the Notice Day (unless the Trust determines and so advises
the Company that sufficient proceeds are available from redemption of
shares of other Series or Classes effected pursuant to redemption requests
tendered by the Company on behalf of the Account). In no event may proceeds
from the redemption of shares requested pursuant to an order received by
the Company after the Trust's close of business on any Business Day be
applied to the payment for shares for which a purchase order was received
prior to the Trust's close of business on such day. If the issuance of
shares is canceled because federal funds are not timely received, the
Company shall indemnify the respective Fund and Distributor with respect to
all costs, expenses and losses relating thereto. Upon the Trust's receipt
of federal funds so wired, such funds shall cease to be the responsibility
of the Company and shall become the responsibility of the Trust. If federal
funds are not received on time, such funds will be invested, and Series or
Class shares purchased thereby will be issued, as soon as practicable after
actual receipt of such funds but in any event not on the same day that the
purchase order was received.
(c) Payment for Series or Class shares redeemed by the Accounts or the Company
shall be made in federal funds transmitted by wire to the Company (or any
person designated in writing by the Company), such funds normally to be
transmitted by 6:00 p.m. Eastern Time on the Notice Day of the redemption
order for Series or Class shares (unless redemption proceeds are to be
applied to the purchase of Trust shares of other Series or Classes in
accordance with Section 2.3(b) of this Agreement), except that the Trust
reserves the right to redeem Series or Class shares in assets other than
cash and to delay payment of redemption proceeds to the extent permitted by
the 1940 Act, any rules or regulations or orders thereunder, or the
applicable Prospectus. The Trust shall not bear any responsibility
whatsoever for the proper disbursement or crediting of redemption proceeds
by the Company.
(d) Prior to the first purchase of any Trust shares hereunder, the Company and
the Trust shall provide each other with all information necessary to effect
wire transmissions of federal funds to the other party and all other
designated persons pursuant to such protocols and security procedures as
the parties may agree upon. Should such information change thereafter, the
Trust and the Company, as applicable, shall notify the other in writing of
such changes, observing the same protocols and security procedures, at
least three Business Days in advance of when such change is to take effect.
The Company and the Trust shall observe customary procedures to protect the
confidentiality and security of such information, but the Trust shall not
be liable to the Company for any breach of security.
(e) The procedures set forth herein are subject to any additional terms set
forth in the applicable Prospectus for the Series or Class or by the
requirements of applicable law.
2.4. Net Asset Value. The Trust shall inform the Company of the net asset value
per share for each Series or Class available to the Company as soon as
reasonably practicable after the net asset value per share for such Series
or Class is calculated and shall use its best efforts to provide this
information to the Company by 6:30 p.m. Pacific Time each Business Day. The
Trust shall calculate such net asset value in accordance with the
Prospectus for such Series or Class.
2.5. Dividends and Distributions. The Trust shall furnish notice to the Company
as soon as reasonably practicable of any income dividends or capital gain
distributions payable on any Series or Class shares. The Company, on its
behalf and on behalf of the Account, hereby elects to receive all such
dividends and distributions as are payable on any Series or Class shares in
the form of additional shares of that Series or Class. The Company reserves
the right, on its behalf and on behalf of the Account, to revoke this
election and to receive all such dividends and capital gain distributions
in cash; to be effective, such revocation must be made in writing and
received by the Trust at least ten Business Days prior to a dividend or
distribution date. The Trust shall notify the Company promptly of the
number of Series or Class shares so issued as payment of such dividends and
distributions.
2.6. Book Entry. Issuance and transfer of Trust shares shall be by book entry
only. Share certificates will not be issued to the Company or the Accounts.
Purchase and redemption orders for Trust shares shall be recorded in an
appropriate ledger for each Account (or sub-account).
2.7. Pricing Errors. Any material errors in the calculation of net asset value,
dividends or capital gain information shall be reported immediately upon
discovery to the Company. The Trust or its agent will promptly correct any
such errors and promptly recalculate transactions made under this Agreement
using the correct net asset value, dividends or capital gains consistent
with the Trust's then current net asset value error correction policy
(including the policy's definition of the term "material"). To the extent
that recalculation of one or more transactions does not make the Company's
account with a Fund "whole," the Distributor shall make such account
"whole." The Distributor shall not be responsible for payment of any costs
of reprocessing transactions in units issued by an Account (or a
sub-account of an Account) under the Contracts arising out of an error in
the calculation of a Fund's net asset value, dividends or capital gains
distributions if such error is discovered and corrected within five
business days. Neither the Trust, any Fund, the Distributor, nor any of
their affiliates shall be liable for any information provided to the
Company pursuant to this Agreement which information is based on incorrect
information supplied by or on behalf of the Company or any other
Participating Investor to the Trust or the Distributor.
2.8. Limits on Purchasers. The Distributor and the Trust shall sell Trust shares
only to life insurance companies and their separate accounts and to persons
or plans ("Qualified Persons") that qualify to purchase shares of the Trust
under Section 817(h) of the Code and the regulations thereunder without
impairing the ability of the Accounts to consider the portfolio investments
of the Trust as constituting investments of the Accounts for the purpose of
satisfying the diversification requirements of Section 817(h). The Company
hereby represents and warrants that it and each Account are Qualified
Persons. The Distributor and the Trust shall not sell Trust shares to any
insurance company or separate account unless an agreement is in effect
between the Distributor, the Trust and the insurance company containing
provisions substantially the same as those in Article VIII of this
Agreement. The Distributor and the Trust shall not sell more than 10% of
any Series of Trust shares to any Participating Plan unless an agreement is
in effect between the Distributor, the Trust and the trustee (or other
fiduciary) of the Plan containing provisions substantially the same as
those in Article VIII of this Agreement. The Distributor and the Trust
shall not sell Trust shares to any Participating Plan unless a written
acknowledgment of the foregoing condition is received from the trustee (or
other fiduciary) of the Plan.
2.9 Disruptive Trading. The Trust has adopted policies designed to prevent
frequent purchases and redemptions of any Series of Trust shares in
quantities great enough to disrupt orderly management of the corresponding
Fund's investment portfolio. These policies are disclosed in the Trust's
prospectus. From time to time, the Trust and the Distributor implement
procedures reasonably designed to enforce the Trust's disruptive trading
policies and shall provide a written description of such procedures (and
revisions thereto) to the Company. Such procedures may include the
imposition of redemption fees as identified in Article 7.5 of this
Agreement. The Company agrees to develop, adopt and maintain policies
regarding transactions in Account units reasonably designed to complement
the Trust's disruptive trading policies, and to implement Account
transaction procedures reasonably designed, from time to time, to
effectuate the Trust's procedures for preventing disruptive trading in
Trust shares.
ARTICLE III
Representations and Warranties
3.1. Company. The Company represents and warrants that: (a) it is an insurance
company duly organized and in good standing under applicable law; (b) it
has legally and validly established each Account as a segregated asset
account under applicable state law to serve as segregated investment
accounts for the Contracts; (c) each Schedule 1 Account is duly registered
as a unit investment trust under the 1940 Act and each such Account's 1940
Act Registration Statement has been filed with the SEC in accordance with
the 1940 Act; (d) the Schedule 2 Accounts and Schedule 3 Accounts each
qualify for the exclusions on which they rely for not registering as
investment companies under the 1940 Act; (e) it has registered, or will
register, all Schedule 1 Contracts offered and sold pursuant to this
Agreement under the 1933 Act and has an effective Registration Statement
for that purpose; (f) it will offer and sell the Contracts in compliance in
all material respects with all applicable federal and state laws and
regulations, including, but not limited to, state insurance law and federal
securities law suitability requirements; (g) the Contracts have been filed,
qualified and/or approved for sale, as applicable, under the insurance laws
and regulations of the states in which the Contracts will be offered; (h)
sales of the Schedule 2 Contracts and Schedule 3 Contracts properly qualify
for exemptions on which the Company relies in not registering such
Contracts, or interests in the Account through which each is issued, under
the 1933 Act; (i) its activities and those of its employees in promoting
the sale and distribution of the Contracts and effecting Contract Owner
transactions in Account units have not caused, and will not cause, the
Company to be deemed a broker-dealer, (j) orders it places for the purchase
and redemption of Trust shares pursuant to Article 2.3 of this Agreement
are the net result of transactions in units issued by an Account,
instructions for which are received by the Company prior to the Trust's
close of business as defined from time to time in the applicable Prospectus
for such Series or Class (which as of the date of execution of this
Agreement is the close of regular trading on the New York Stock Exchange
(normally 4:00 p.m. New York Time)), (k) as long as this Agreement remains
in effect, it shall remain in continuous compliance with Article 6.3,
Article 6.4 and Article 6.5 of this Agreement and (l) it will notify the
Distributor and the Trust promptly if for any reason it is unable to
perform its obligations under this Agreement.
3.2. Trust. The Trust represents and warrants that: (a) it is a statutory trust
duly organized and validly existing under the Delaware law; (b) it is duly
registered under the 1940 Act as an open-end management investment company
and has filed a 1940 Act Registration Statement with the SEC in accordance
with the provisions of the 1940 Act; (c) Trust shares issued pursuant to
this Agreement have been, or will be, duly authorized and validly issued in
accordance with applicable law; (d) it will offer and sell Trust shares
pursuant to this Agreement in compliance in all material respects with all
applicable federal and state laws and regulations; (e) it has registered,
or will register, all Trust shares offered and sold pursuant to this
Agreement under the 1933 Act and has an effective Registration Statement
for that purpose; (f) as long as this Agreement remains in effect, it shall
remain in continuous compliance with Article 6.1 and Article 6.2 of this
Agreement; and (g) the Trust's Board, a majority of whom are not interested
persons of the Trust, has formulated and approved a plan under Rule 12b-1
("Rule 12b-1 Plan") to finance distribution expenses.
3.3. Distributor. The Distributor represents and warrants that: (a) it is a
limited liability company duly organized and in good standing under
Delaware law; (b) it is registered as a broker-dealer under federal and
applicable state securities laws and is a member in good standing of the
NASD; and (c) Xxxxx Fargo Bank, the Trust's investment adviser, is exempt
from registration as an investment adviser under all applicable federal and
state securities laws and that Xxxxx Fargo Bank will perform its
obligations to the Trust in accordance with any applicable state and
federal securities laws.
3.4. Legal Authority. Each party represents and warrants that the execution and
delivery of this Agreement and the consummation of the transactions
contemplated herein have been duly authorized by all necessary corporate,
or trust action, as applicable, by such party, and, when so executed and
delivered, this Agreement will be the valid and binding obligation of such
party enforceable in accordance with its terms.
3.5. Bonding Requirement. Each party represents and warrants that all of its
directors, trustees, officers, members and employees dealing with the money
and/or securities of the Trust are and shall continue to be at all times
covered by a blanket fidelity bond or similar coverage for the benefit of
the Trust in an amount not less than the amount required by the applicable
rules of the NASD and the federal securities laws. The aforesaid bond shall
include coverage for larceny and embezzlement and shall be issued by a
reputable bonding company. All parties shall make all reasonable efforts to
see that this bond or another bond containing these provisions is always in
effect, shall provide evidence thereof promptly to any other party upon
written request therefor, and shall notify the other parties promptly in
the event that such coverage no longer applies.
ARTICLE IV
Regulatory Requirements
4.1. Trust Filings. The Trust shall amend the Trust's Registration Statement
from time to time and maintain its effectiveness as required in order to
effect the continuous offering of Trust shares in compliance with
applicable law. Notwithstanding the foregoing, the Trust shall register and
qualify Trust shares for sale in accordance with the laws of various states
if, and to the extent, deemed advisable by the Trust or the Distributor.
The Trust shall amend the Trust's 1940 Act Registration Statement as
required by the 1940 Act to maintain the Trust's registration under the
1940 Act for as long as Trust shares are outstanding. The Trust shall
comply in all material respects with the 1940 Act.
4.2. Account Filings. The Company shall amend the Registration Statement for
each Schedule 1 Contract from time to time and maintain its effectiveness
as required in order to effect the continuous offering of such Contracts in
compliance with applicable law for as long as purchase payments are made
under such Contracts. Notwithstanding the foregoing, the Company: (a) may
permit the effectiveness of a Schedule 1 Contract's Registration Statement
to expire if the Company has supplied the Trust with an SEC no-action
letter or opinion of counsel satisfactory to the Trust's counsel to the
effect that maintaining such Registration Statement on a current basis is
no longer required, and (b) shall register and qualify the Contracts for
sale in accordance with the securities laws of the various states only if,
and to the extent, it considers such registration and qualification
necessary. The Company shall amend each Schedule 1 Account's 1940 Act
Registration Statement as required by the 1940 Act to maintain the
Account's registration under the 1940 Act for as long as the Schedule 1
Contracts issued through that Account are in force. With regard to each
Schedule 1 Account, the Company shall comply in all material respects with
the 1940 Act.
The Company shall be responsible for filing all Contract forms,
applications, marketing materials and other documents relating to the
Contracts and/or the Account with state insurance commissions, as required
or customary, and shall use its best efforts: (a) to obtain any and all
approvals thereof, under applicable state insurance law, of each state or
other jurisdiction in which Contracts are or may be offered for sale; and
(b) to keep such approvals in effect for so long as the Contracts are
outstanding.
4.3 Delivery of Prospectuses by the Company. The Company shall deliver (or
arrange for delivery of) an appropriate Prospectus to each prospective
Contract Owner describing in all material respects the terms and features
of the Contract being offered. The Company also shall deliver (or arrange
for delivery of) a Prospectus for each Fund that a prospective Contract
Owner identifies on his or her application as an intended investment option
under a Contract or to which a Schedule 1 Contract Owner allocates premium
payments to or transfers Contract value. The Company shall deliver (or
arrange for delivery of) such Prospectuses at the times required by
applicable provisions of the 1933 Act and rules or regulations thereunder.
4.3. Voting of Trust Shares. The extent required by applicable law, whenever the
Trust shall have a meeting of holders of any Series or Class of Trust
shares, the Company shall:
o solicit voting instructions from Contract Owners
o vote Trust shares held in each Account at such shareholder meetings in
accordance with instructions received from Contract Owners, and
o vote Trust shares held in each Account for which it has not received timely
instructions in the same proportion as it votes the applicable Series or
Class of Trust shares for which it has received timely instructions.
Except with respect to matters as to which the Company has the right under
Rule 6e-2 or Rule 6e-3(T) under the 1940 Act, to vote Trust shares without
regard to voting instructions from Contract Owners, neither the Company nor
any of its affiliates will recommend action in connection with, or oppose
or interfere with, the actions of the Trust Board to hold shareholder
meetings for the purpose of obtaining approval or disapproval from
shareholders (and, indirectly, from Contract Owners) of matters put before
the shareholders.
As required by the conditions attaching to the SEC Order, the Company shall
remain responsible for ensuring that it calculates voting instructions and
votes Trust shares at shareholder meetings in a manner consistent with
other Participating Investors. The Trust will notify the Company of any
changes to the SEC Order, the conditions attaching thereto, or to any
interpretation of the Order or conditions.
The Trust will comply with all provisions of the 1940 Act requiring voting
by shareholders, and in particular, the Trust will either provide for
annual meetings (except to the extent that the SEC may interpret Section 16
of the 1940 Act not to require such meetings) or comply with Section 16(c)
of the 1940 Act (although the Trust is not one of the trusts described in
Section 16(c) of that Act) as well as with Sections 16(a) and, if and when
applicable, 16(b) of the 1940 Act. Further, the Trust will act in
accordance with the SEC's interpretation of the requirements of Section
16(a) with respect to periodic elections of trustees and with whatever
rules the SEC may promulgate with respect thereto.
4.4. State Insurance Restrictions. The Company acknowledges and agrees that it
is the responsibility of the Company and other Participating Insurance
Companies to determine investment restrictions and any other restrictions,
limitations or requirements under state insurance law applicable to any
Fund or the Trust or the Distributor, and that neither the Trust nor the
Distributor shall bear any responsibility to the Company, other
Participating Insurance Companies or any Product Owners for any such
determination or the correctness of such determination.
4.5. Interpretation of Law. Under no circumstances will the Trust, the
Distributor or any of their affiliates (excluding Participating Investors)
be held responsible or liable in any respect for any statements or
representations made by them or their legal advisers to the Company or any
Contract Owner concerning the applicability of any federal or state laws,
regulations or other authorities to the activities contemplated by this
Agreement.
4.6. Disclosure. The Trust's prospectus shall state that the statement of
additional information for the Trust is available from either the
Distributor or the Trust. The Trust hereby notifies the Company that it is
appropriate to include in Contract Prospectuses, disclosure of the
potential risks of mixed and shared funding.
4.7. Drafts of Filings. As requested, the Trust and the Company shall provide to
each other copies of draft versions of any Registration Statements,
Prospectuses, Statements of Additional Information, periodic and other
shareholder or Contract Owner reports, proxy statements, solicitations for
voting instructions, applications for exemptions, requests for no-action
letters, and all amendments or supplements to any of the above, prepared by
or on behalf of either of them and that mentions the other party by name.
Such drafts shall be provided to the other party sufficiently in advance of
filing such materials with regulatory authorities in order to allow such
other party a reasonable opportunity to review the materials.
4.8. Copies of Filings. The Trust and the Company shall provide to each other at
least one complete copy of all Registration Statements, Prospectuses,
Statements of Additional Information, periodic and other shareholder or
Contract Owner reports, proxy statements, solicitations of voting
instructions, applications for exemptions, requests for no-action letters,
and all amendments or supplements to any of the above, that relate to the
Trust, the Contracts or the Account, as the case may be, promptly after the
filing by or on behalf of each such party of such document with the SEC or
other regulatory authorities (it being understood that this provision is
not intended to require the Trust to provide to the Company copies of any
such documents prepared, filed or used by Participating Investors other
than the Company and the Account).
4.9. Regulatory Responses. Each party shall promptly provide to all other
parties copies of responses to no-action requests, notices, orders and
other rulings received by such party with respect to any filing covered by
Section 4.8 of this Agreement.
4.10. Complaints and Proceedings
(a) The Trust and/or the Distributor shall immediately notify the Company of:
(i) the issuance by any court or regulatory body of any stop order, cease
and desist order, or other similar order (but not including an order of a
regulatory body exempting or approving a proposed transaction or
arrangement) with respect to the Trust's Registration Statement or the
Prospectus of any Series or Class; (ii) any request by the SEC for any
amendment to the Trust's Registration Statement or the Prospectus of any
Series or Class; (iii) the initiation of any proceedings for that purpose
or for any other purposes relating to the registration or offering of the
Trust shares; or (iv) any other action or circumstances that may prevent
the lawful offer or sale of Trust shares or any Class or Series in any
state or jurisdiction, including, without limitation, any circumstance in
which (A) such shares are not registered and, in all material respects,
issued and sold in accordance with applicable state and federal law or (B)
such law precludes the use of such shares as an underlying investment
medium for the Contracts or the Accounts. The Trust 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) The Company shall immediately notify the Trust and the Distributor of: (i)
the issuance by any court or regulatory body of any stop order, cease and
desist order, or other similar order (but not including an order of a
regulatory body exempting or approving a proposed transaction or
arrangement) with respect to the Contracts' Registration Statement or the
Contracts' Prospectus; (ii) any request by the SEC for any amendment to the
Contracts' Registration Statement or Prospectus; (iii) the initiation of
any proceedings for that purpose or for any other purposes relating to the
registration or offering of the Contracts; or (iv) any other action or
circumstances that may prevent the lawful offer or sale of the Contracts or
any class of Contracts in any state or jurisdiction, including, without
limitation, any circumstance in which such Contracts are not registered,
qualified and approved, and, in all material respects, issued and sold in
accordance with applicable state and federal laws. The Company 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.
(c) Each party shall immediately notify the other parties when it receives
notice, or otherwise becomes aware of, the commencement of any litigation
or proceeding against such party or a person affiliated therewith in
connection with the issuance or sale of Trust shares or the Contracts.
(d) The Company shall provide to the Trust and the Distributor any complaints
it has received from Contract Owners pertaining to the Trust or a Fund, and
the Trust and Distributor shall each provide to the Company any complaints
it has received from Contract Owners relating to the Contracts or the
Company.
4.11.Cooperation. Each party hereto shall cooperate with the other parties and
all appropriate government authorities (including without limitation the
SEC, the NASD and state securities and insurance regulators) and shall
permit such authorities reasonable access to its books and records in
connection with any examination, inquiry, or investigation by any such
authority relating to this Agreement or the transactions contemplated
hereby. However, such access shall not extend to attorney-client privileged
information.
ARTICLE V
Sale, Administration and Servicing of the Contracts
5.1. Sale of the Contracts. The Company shall be fully responsible as to the
Trust and the Distributor for the sale and marketing of the Contracts. The
Company shall provide Contracts, the Contracts' and Trust's Prospectuses,
Contracts' and Trust's Statements of Additional Information, and all
amendments or supplements to any of the foregoing to Contract Owners and
prospective Contract Owners, all in accordance with federal and state laws.
Without limiting the generality of the foregoing, the Company shall: (1)
enter into and enforce agreements with affiliated and unaffiliated parties
to, and (2) adopt and implement written compliance policies and procedures
reasonably designed to, ensure that:
o all persons offering or selling the Contracts are duly licensed and
registered under applicable insurance and securities laws,
o all individuals offering or selling the Contracts are duly appointed agents
of the Company and are registered representatives of a NASD member
broker-dealer,
o each sale of a Contract satisfies applicable suitability requirements under
insurance and securities laws and regulations, including without limitation
the rules of the NASD,
o persons offering or selling the Contracts disclose to prospective Contract
Owners remuneration each expects to receive in connection with sales of the
Contracts and any conflicts of interest arising therefrom as required by
applicable law, and
o persons offering or selling the Contracts do not intend to engage in
Account unit transactions that would violate the Company's or the Trust's
disruptive trading policies.
5.2. Anti-Money Laundering. The Company shall comply with all
applicable laws and regulations designed to prevent money "laundering", and if
required by such laws or regulations, to share with the Trust information about
individuals, entities, organizations and countries suspected of possible
terrorist or money "laundering" activities in accordance with Section 314(b) of
the USA Patriot Act. In particular, the Company agrees that:
o as part of processing an application for a Contract, it will verify the
identity of applicants and, if an applicant is not a natural person, will
verify the identity of prospective principal and beneficial owners
submitting an application for a Contract,
o as part of its ongoing compliance with the USA Patriot Act, it will, from
time to time, reverify the identity of Contract Owners, including the
identity of principal and beneficial owners of Contracts held by
non-natural persons,
o as part of processing an application for a Contract, it will verify that no
applicant, including prospective principal or beneficial Contract Owners,
is a "specially designated national" or a person from an embargoed or
"blocked" country as indicated by the Office of Foreign Asset Control
("OFAC") list of such persons,
o as part of its ongoing compliance with the USA Patriot Act, it will, from
time to time, reverify that no Contract Owner, including a principal or
beneficial Contract Owners, is a "specially designated national" or a
person from an embargoed or "blocked" country as indicated by the Office of
Foreign Asset Control ("OFAC") list of such persons,
o it will ensure that money tendered to the Trust as payment for Trust shares
did not originate with a bank lacking a physical place of business (i.e., a
"shell" bank) or from a country or territory named on the list of high-risk
or non-cooperating countries or jurisdictions published by the Financial
Action Task Force, and
o if any of the foregoing cease to be true, the Trust or its agents, in
compliance with the USA Patriot Act or Bank Secrecy Act, may seek authority
to block transactions in Account units arising from accounts of one or more
such Contract Owners with the Company or of one or more of the Company's
accounts with the Trust.
The Trust and the Distributor shall comply with all applicable laws and
regulations designed to prevent money "laundering", and if required by such
laws or regulations, to share with the Company information about
individuals, entities, organizations and countries suspected of possible
terrorist or money "laundering" activities in accordance with Section
314(b) of the USA Patriot Act.
5.3. Administration and Servicing of the Contracts. The Company shall be fully
responsible for the underwriting, issuance, service and administration of
the Contracts and for the administration of the Account, including, without
limitation, the calculation of performance information for the Contracts,
the timely payment of Contract Owner redemption requests and processing of
Contract transactions, and the maintenance of a service center, such
functions to be performed in all respects at a level commensurate with
those standards prevailing in the variable insurance industry. The Company
shall provide to Contract Owners all Trust reports, solicitations for
voting instructions including any related Trust proxy solicitation
materials, and updated Trust Prospectuses as required under the federal
securities laws.
5.4. Customer Complaints. The Company shall promptly address all complaints from
Contract Owners and resolve such complaints consistent with high ethical
standards and principles of ethical conduct.
5.5. Trust Prospectuses and Reports. In order to enable the Company to
fulfill its obligations under this Agreement and the federal securities laws,
the Trust shall provide the Company with a copy, in camera-ready form or form
otherwise suitable for printing or duplication of: (a) the Trust's Prospectus
for the Series and Classes listed on Schedule 4 and any supplement thereto; (b)
any Trust proxy soliciting material for such Series or Classes; and (c) any
Trust periodic shareholder reports. The Trust and the Company may agree upon
alternate arrangements, but in all cases, the Trust reserves the right to
approve the printing of any such material. The Trust shall make available to the
Company on the Trust's website each Statement of Additional Information and
supplement thereto. The Trust shall provide the Company at least 10 days advance
written notice when any such material shall become available, provided, however,
that in the case of a supplement, the Trust shall provide the Company reasonable
notice in the circumstances, it being understood that circumstances surrounding
such supplement may not allow for advance notice. The Company may not alter any
material so provided by the Trust or the Distributor (including, without
limitation, presenting or delivering such material in a different medium such as
electronic mail or attachments thereto) without the prior written consent of the
Distributor.
5.6. Trust Advertising Material. Neither the Company or any person
directly or indirectly authorized by the Company (including, without limitation,
underwriters, distributors, and sellers of the Contracts) shall use any piece of
advertising, sales literature or other promotional material in which the Trust,
the Distributor, Xxxxx Fargo Bank, or a sub-adviser retained by Xxxxx Fargo Bank
to manage a Fund, is named, except with the prior written consent of the Trust
or the Distributor. The Company shall furnish to the Trust or the Distributor
each such piece of advertising, sales literature or other promotional material
at least five (5) days prior to its use. The Trust or the Distributor shall
respond to any request for written consent on a prompt and timely basis, but
failure to respond shall not relieve the Company of the obligation to obtain the
prior written consent of the Trust or the Distributor. After receiving the
Trust's or Distributor's consent to the use of any such material, no further
changes may be made without obtaining the Trust's or Distributor's consent to
such changes. The Trust or Distributor may at any time in its sole discretion
revoke such written consent, and upon notification of such revocation, the
Company shall no longer use the material subject to such revocation. The Company
shall be responsible for filing any such materials with the NASD as applicable.
5.7. Contracts Advertising Material. The Trust and the Distributor shall not use
any piece of advertising or sales literature or other promotional material
in which the Company, an Account or a Contract is named, except with the
prior written consent of the Company. The Trust or the Distributor shall
furnish to the Company each such piece of advertising, sales literature or
other promotional material at least five (5) days prior to its use. The
Company shall respond to any request for written consent on a prompt and
timely basis, but failure to respond shall not relieve the Trust or the
Distributor of the obligation to obtain the prior written consent of the
Company. After receiving the Company's consent to the use of any such
material, no further changes may be made by the Trust or Distributor
without obtaining the Company's consent to such changes. The Company may at
any time in its sole discretion revoke any written consent, and upon
notification of such revocation, neither the Trust nor the Distributor
shall use the material subject to such revocation. The Trust and the
Distributor shall be responsible for filing any such materials with the
NASD as applicable.
5.8. Trade Names. No party shall use any other party's names, logos, trademarks
or service marks, whether registered or unregistered, without the prior
written consent of such other party, or after written consent therefor has
been revoked. The Company shall not use in advertising, publicity or
otherwise the name of the Trust, Distributor, or any of their affiliates
nor any trade name, trademark, trade device, service xxxx, symbol or any
abbreviation, contraction or simulation thereof of the Trust, Distributor,
or their affiliates without the prior written consent of the Trust or the
Distributor in each instance.
5.9. Representations by Company. Except with the prior written consent of the
Trust, the Company shall not give any information or make any
representations or statements about the Trust or the Funds nor shall it
authorize or allow any other person to do so except information or
representations contained in the Trust's Registration Statement or the
Trust's Prospectuses or in reports or proxy statements for the Trust, or in
advertisements, sales literature or other promotional material approved in
writing by the Trust or its designee in accordance with this Article V, or
in published reports or statements of the Trust in the public domain.
The Company agrees to ensure that advertisements, sales literature or other
promotional material for the Contracts prepared by the Company or its
affiliates will be consistent with every law, rule, and regulation of any
regulatory agency or self-regulatory agency that applies to the Contracts
or to the sale of the Contracts, including, but not limited to, NASD
Conduct Rule 2210 and XX-0000-0, XX-0000-0 and IM-2210-3 thereunder.
The Company has adopted and implemented, or shall adopt and implement, written
compliance procedures reasonably designed to ensure that information
concerning the Trust, the Distributor, or any of their affiliates which is
intended for use by brokers or agents selling the Contracts (i.e.,
information that is not intended for distribution to Contract Owners or
prospective Contract Owners) is so used, and neither the Trust, the
Distributor, nor any of their affiliates shall be liable for any losses,
damages, or expenses relating to the improper use of such broker only
materials by agents of the Company or its affiliates who are unaffiliated
with the Trust or the Distributor. The parties hereto agree that this
Section 5.9 is not intended to designate nor otherwise imply that the
Company is an underwriter or distributor of the Trust's shares.
5.10.Representations by Trust. Except with the prior written consent of the
Company, the Trust shall not give any information or make any
representations on behalf of the Company or concerning the Company, the
Accounts or the Contracts other than the information or representations
contained in the appropriate Contract Registration Statement or Contract
Prospectus or in published reports of the Company or the Accounts which are
in the public domain or in advertisements, sales literature or other
promotional material approved in writing by the Company in accordance with
this Article V.
The Trust agrees to ensure that advertisements, sales literature or other
promotional material for the Trust prepared by the Distributor or its
affiliates in connection with the sale of the Contracts will be consistent
with every law, rule, and Regulation of any regulatory agency or self
regulatory agency that applies to the Trust or to the sale of Trust shares,
including, but not limited to, NASD Conduct Rule 2210 and XX-0000-0,
XX-0000-0 and IM-2210-3 thereunder.
The Trust or the Distributor shall xxxx information produced by or on behalf of
the Trust which is intended for use by brokers or agents selling the
Contracts (i.e., information that is not intended for distribution to
Contract Owners or prospective Contract Owners) "FOR BROKER USE ONLY," and
neither the Company nor any of its affiliates shall be liable for any
losses, damages, or expenses arising on account of the use by brokers of
such information with third parties in the event that is not so marked.
5.11.Advertising. For purposes of this Article V, the phrase "advertising,
sales literature or other promotional material" includes, but is not
limited to, any material constituting sales literature or advertising under
the NASD Conduct rules, the 1940 Act or the 1933 Act. Such material
includes, without limitation, the following materials for prospective
Contract Owners, existing Contract Owners, wholesalers and other
broker-dealers, rating or ranking agencies, or the press:
o 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,
websites, or other public media),
o 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,
electronic mail, or published article),
o educational or training materials or other communications distributed or
made generally available to some or all agents or employees, and
o registration statements, prospectuses, statements of additional
information, shareholder reports, and proxy materials.
ARTICLE VI
Compliance with Code
6.1. Section 817(h). The Trust 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 the Code and regulations thereunder. Without limiting
the scope of the foregoing, the Trust shall ensure that each Fund will
comply with Section 817(h) of the Code and Treasury Regulation 1.817-5
thereunder, relating to the diversification requirements for variable
annuity, endowment, or life insurance contracts, and any amendments or
other modifications to such Section and Regulation or successors thereto.
The Trust shall notify the Company immediately upon having a reasonable
basis for believing that a Fund has failed to so comply or that it might
not comply in the future.
6.2. Subchapter M. The Trust shall maintain the qualification of each Fund as a
regulated investment company (under Subchapter M or any successor or
similar provision), and the Trust shall notify the Company immediately upon
having a reasonable basis for believing that a Fund has ceased to so
qualify or that it might not so qualify in the future.
6.3. Contracts. The Company shall ensure that at the time each Contract is
issued it is treated as a life insurance, endowment, or annuity contract
under applicable provisions of the Code, and that as long as the Accounts
hold shares of the Trust the Company shall maintain such treatment for each
outstanding Contract. The Company shall notify the Trust and the
Distributor immediately upon having any basis for believing that the
Contracts will not be treated as life insurance, endowment, or annuity
contracts under applicable provisions of the Code.
6.4 Regulation 1.817-5(f). The Company shall ensure that no Fund fails to
remain eligible for "look-through" treatment under Treasury Regulation
1.817-5(f) by reason of a current or future failure of the Company, the
Accounts or the Contracts to comply with any applicable requirements of the
Code or Treasury Regulations. The Company shall notify the Trust and the
Distributor immediately upon having any basis for believing that the
failure of the Company, the Accounts or the Contracts to comply with any
applicable requirements of the Code or Treasury Regulations could render a
Fund ineligible, or jeopardize a Fund's eligibility, for "look-through"
treatment under Treasury Regulation 1.817-5(f). In the event of such a
failure, the Company shall take all necessary steps to cure any such
failure, including, if necessary, obtaining a waiver or closing agreement
with respect to such failure from the U.S. Internal Revenue Service at the
Company's expense.
6.5 Modified Endowment Contracts. The Company shall ensure that any Prospectus
offering a variable life insurance Contract in circumstances where it is
reasonably probable that such Contract would be a "modified endowment
contract," as that term is defined in Section 7702A of the Internal Revenue
Code, will identify such Contract as a modified endowment contract.
ARTICLE VII
Expenses
7.1. Expenses. All expenses incident to each party's performance under this
Agreement (including expenses expressly assumed by such party pursuant to
this Agreement) shall be paid by such party to the extent permitted by law.
7.2. Trust Expenses. Expenses incident to the Trust's performance of its duties
and obligations under this Agreement include, but are not limited to, the
costs of:
(a) registration and qualification of the Trust shares under the federal
securities laws;
(b) preparation and filing with the SEC of the Trust's Prospectuses, Trust's
Statement of Additional Information, Trust's Registration Statement, Trust
proxy materials and shareholder reports, and preparation of a
"camera-ready" copy of the foregoing;
(c) preparation of all statements and notices required by any federal or state
securities law;
(d) printing of all proxy materials, shareholder reports, prospectuses and
other documents required to be provided by the Trust to its existing
shareholders, and providing sufficient copies of the same to the Company
for distribution to Contract Owners currently invested in the Trust;
provided, however, that if the Company prints copies of the Trust's
prospectuses (or portions thereof) as part of a larger document containing
prospectuses of other investment companies, the Trust shall bear the
expense only of its share of the cost of printing the document (for this
purpose, the Trust's share shall be the percentage of the total cost of the
document represented by the ratio that the number of pages of the Trust's
prospectus bears to the total number of pages);
(e) all taxes on the issuance or transfer of Trust shares;
(f) payment of all applicable fees relating to the Trust, including, without
limitation, all fees due under Rule 24f-2 in connection with sales of Trust
shares to qualified retirement plans, custodial, auditing, transfer agent
and advisory fees, fees for insurance coverage and Trustees' fees; and
(g) any expenses permitted to be paid or assumed by the Trust pursuant to a
plan, if any, under Rule 12b-1 under the 1940 Act.
7.3. Company Expenses. Expenses incident to the Company's performance
of its duties and obligations under this Agreement include, but are not limited
to, the costs of:
(a) registration and qualification of the Contracts under the federal
securities laws;
(b) preparation and filing with the SEC of the Contracts' Prospectus and
Contracts' Registration Statement;
(c) the sale, marketing and distribution of the Contracts, including printing
and dissemination of Contract Prospectuses to current and prospective
Contract owners and of the Trust's Prospectuses to prospective Contract
Owners as well as compensation for Contract sales;
(d) administration of the Contracts;
(e) solicitation of voting instructions, including distribution of Trust proxy
materials to Contract Owners;
(f) payment of all applicable fees relating to Accounts and the Contracts,
including, without limitation, all fees due under Rule 24f-2;
(g) preparation, printing and dissemination of all statements and notices to
Contract Owners required by any federal or state insurance law other than
those paid for by the Trust; and
(h) preparation, printing and dissemination of all marketing materials for the
Contracts and Trust except where other arrangements are made in advance.
7.4. Other Expenses and Payments. The Trust and the Distributor shall pay no fee
or other compensation to the Company under this Agreement. Each party,
however, shall, in accordance with the allocation of expenses specified in
this Agreement, reimburse other parties for expenses initially paid by one
party, but allocated to another party. In addition, nothing herein shall
prevent the parties from otherwise agreeing to perform, and arranging for
appropriate compensation for, other services relating to the Trust, the
Distributor, the Company or the Accounts. Notwithstanding the foregoing,
pursuant to the distribution plan adopted by the Trust pursuant to Rule
12b-1 under the 1940 Act, and as contemplated by Article 3.2(g) of this
Agreement, the Trust or any Series or Class thereof may pay the Distributor
and the Distributor may pay the principal underwriter or distributor of one
or more classes of Contracts for activities primarily intended to result in
the sale of Contracts or of Trust shares the Accounts through which such
Contracts are issued. Likewise, if the Trust or any Series or Class adopts
and implements a shareholder service plan pursuant to Rule 12b-1 under the
1940 Act, or otherwise, then the Trust or the appropriate Series or Class
may pay the Distributor and the Distributor may pay the principal
underwriter or distributor of one or more classes of Contracts, or the
Company, for activities related to personal service and/or maintenance of
Contract Owner accounts, as permitted by such Plan.
7.5. Redemption Fees. As a procedure in furtherance of its policies on
disruptive trading of Trust shares, the Trust may assess fees, to be paid
by one or more Accounts or by the Company, upon redemption of shares of one
or more Series or Classes of the Trust within certain stated time periods
after such shares have been purchased.
ARTICLE VIII
Potential Conflicts
8.1. SEC Order. The parties to this Agreement acknowledge that the Trust has
obtained an SEC order (the "SEC Order") granting exemptions from various
provisions of the 1940 Act and the rules thereunder to Participant Accounts
supporting variable life insurance policies to the extent necessary to
permit them to hold Trust shares when Trust share also are sold to and held
by variable annuity and variable life insurance separate accounts of both
affiliated and unaffiliated Participating Insurance Companies and other
Qualified Persons (as defined in Section 2.8 hereof). The SEC Order is
conditioned upon the Trust and each Participating Insurance Company
complying with conditions and undertakings substantially as provided in
this Article VIII. The Trust will not enter into a participation agreement
with any other Participating Insurance Company unless it imposes the same
conditions and undertakings on that company as are imposed on the Company
pursuant to this Article VIII.
8.2. Company Monitoring Requirements. The Company will monitor its operations
and those of the Trust for the purpose of identifying any material
irreconcilable conflicts or potential material irreconcilable conflicts
between or among the interests of Participating Plans, Product Owners of
variable life insurance policies and Product Owners of variable annuity
contracts.
8.3. Company Reporting Requirements. The Company shall report any conflicts or
potential conflicts to the Trust Board and will provide the Trust Board, at
least annually, with all information reasonably necessary for the Trust
Board to consider any issues raised by such existing or potential conflicts
or by the conditions and undertakings required by the Exemptive Order. The
Company also shall assist the Trust Board in carrying out its obligations
including, but not limited to: (a) informing the Trust Board whenever it
disregards Contract Owner voting instructions with respect to variable life
insurance policies, and (b) providing such other information and reports as
the Trust Board may reasonably request. The Company will carry out these
obligations with a view only to the interests of Contract Owners.
8.4. Trust Board Monitoring and Determination. The Trust Board shall monitor the
Trust for the existence of any material irreconcilable conflicts between or
among the interests of Participating Plans, Product Owners of variable life
insurance policies and Product Owners of variable annuity contracts and
determine what action, if any, should be taken in response to those
conflicts. A majority vote of Trustees who are not interested persons of
the Trust as defined in the 1940 Act (the "disinterested trustees") shall
represent a conclusive determination as to the existence of a material
irreconcilable conflict between or among the interests of Product Owners
and Participating Plans and as to whether any proposed action adequately
remedies any material irreconcilable conflict. The Trust Board shall give
prompt written notice to the Company and Participating Plan of any such
determination. Minutes of the meetings of the Trust Board, or other
appropriate records of the Trust, shall record all reports received by the
Board regarding such conflicts and all actions taken by the Board in
response.
8.5. Undertaking to Resolve Conflict. In the event that a material
irreconcilable conflict of interest arises between Product Owners of
variable life insurance policies or Product Owners of variable annuity
contracts and Participating Plans, the Company will, at its own expense,
take whatever action is necessary to remedy such conflict as it adversely
affects Contract Owners up to and including (1) establishing a new
registered management investment company, and (2) withdrawing assets from
the Trust attributable to reserves for the Contracts subject to the
conflict and reinvesting such assets in a different investment medium
(including another Fund) or submitting the question of whether such
withdrawal should be implemented to a vote of all affected Contract Owners,
and, as appropriate, segregating the assets supporting the Contracts of any
group of such owners that votes in favor of such withdrawal, or offering to
such owners the option of making such a change. The Company will carry out
the responsibility to take the foregoing action with a view only to the
interests of Contract Owners.
8.6. Withdrawal. If a material irreconcilable conflict arises because of the
Company's decision to disregard the voting instructions of Contract Owners
of variable life insurance policies and that decision represents a minority
position or would preclude a majority vote at any Fund shareholder meeting,
then, if Trust Board so requests, the Company will redeem the shares of the
Trust to which the disregarded voting instructions relate [and terminate
this Agreement with respect to the Account through which such Contracts
were issued]. No charge or penalty, however, will be imposed in connection
with such a redemption.
8.7. Expenses Associated with Remedial Action. In no event shall the Trust be
required to bear the expense of establishing a new funding medium for any
Contract. The Company shall not be required by this Article VIII to
establish a new funding medium for any Contract if an offer to do so has
been declined by vote of a majority of the Contract Owners materially
adversely affected by the irreconcilable material conflict.
8.8. Successor Rules. If and to the extent that Rule 6e-2 and Rule 6e-3(T) are
amended, or Rule 6e-3 is adopted, to provide exemptive relief from any
provisions of the 1940 Act or the rules promulgated thereunder with respect
to mixed and shared funding on terms and conditions materially different
from those contained in the SEC Order, then (a) the Trust and/or the
Company, as appropriate, shall take such steps as may be necessary to
comply with Rules 6e-2 and 6e-3(T), as amended, or Rule 6e-3, as adopted,
as applicable, to the extent such rules are applicable, and (b) Sections
8.2 through 8.7 of this Agreement shall continue in effect only to the
extent that terms and conditions substantially identical to such Sections
are contained in such Rule(s) as so amended or adopted.
ARTICLE IX
Indemnification
9.1. Indemnification by the Company. The Company hereby agrees to, and shall,
indemnify and hold harmless the Trust, the Distributor and each person who
controls or is affiliated with the Trust or the Distributor within the
meaning of such terms under the 1933 Act or 1940 Act (but not any
Participating Insurance Companies or Qualified Persons) and any officer,
trustee, partner, director, employee or agent of the foregoing, against any
and all losses, claims, damages or liabilities, joint or several (including
any investigative, legal and other expenses reasonably incurred in
connection with, and any amounts paid in settlement of, any action, suit or
proceeding or any claim asserted), to which they or any of them may become
subject under any statute or regulation, at common law or otherwise,
insofar as such losses, claims, damages, expenses or liabilities:
(a) arise out of or are based upon any untrue statement or alleged untrue
statement of any material fact contained in the Contracts Registration
Statement, Contracts Prospectus, sales literature or other promotional
material for the Contracts or the Contracts themselves (or any amendment or
supplement to any of the foregoing), or arise out of or are based upon the
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading in light of the
circumstances in which they were made; provided that this obligation to
indemnify shall not apply if such statement or omission was made in
reliance upon and in conformity with information furnished in writing to
the Company by the Trust or the Distributor for use in the Contracts
Registration Statement, Contracts Prospectus or in the Contracts or sales
literature or promotional material for the Contracts (or any amendment or
supplement to any of the foregoing) or otherwise for use in connection with
the sale of the Contracts or Trust shares; or
(b) arise out of any untrue statement or alleged untrue statement of a material
fact contained in the Trust Registration Statement, any Prospectus for
Series or Classes or sales literature or other promotional material of the
Trust (or any amendment or supplement to any of the foregoing), or the
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading in light of the
circumstances in which they were made, if such statement or omission was
made in reliance upon and in conformity with information furnished to the
Trust or Distributor in writing by or on behalf of the Company; or
(c) arise out of or are based upon statements or representations by or on
behalf of the Company (other than statements or representations contained
in the Trust Registration Statement, Trust Prospectus, or advertisements,
sales literature or other promotional material of the Trust not prepared or
supplied by the Company or persons under its control) or any wrongful
conduct of, or violation of federal or state law by, the Company or persons
under its control or subject to its authorization, including without
limitation, any broker-dealers or agents authorized to sell the Contracts,
with respect to the sale, marketing or distribution of the Contracts or
Trust shares, including, without limitation, any impermissible use of
broker-only material, unsuitable or improper sales of the Contracts or
unauthorized representations about the Contracts or the Trust; or
(d) arise as a result of any failure by the Company or persons under its
control (or subject to its authorization) to provide services, furnish
materials or make payments as required under this Agreement; or
(e) arise out of or result from any material breach by the Company or persons
under its control (or subject to its authorization) of this Agreement; or
(f) arise out of or result from any breach of any representation or warranty
made by the Company in this Agreement hereof, any failure to transmit a
request for redemption or purchase of Trust shares or payment therefor on a
timely basis in accordance with the procedures set forth in Article II, or
any failure to deliver a Fund's prospectus as required by Article 4.3
hereunder.
This indemnification is in addition to any liability that the Company may
otherwise have; provided, however, that no party shall be entitled to
indemnification if such loss, claim, damage or liability is caused by the
wilful misfeasance, bad faith, gross negligence or reckless disregard of
duty by the party seeking indemnification.
9.2. Indemnification by the Trust. The Trust hereby agrees to, and shall,
indemnify and hold harmless the Company and each person who controls or is
affiliated with the Company within the meaning of such terms under the 1933
Act or 1940 Act and any officer, director, employee or agent of the
foregoing, against any and all losses, claims, damages or liabilities,
joint or several (including any investigative, legal and other expenses
reasonably incurred in connection with, and any amounts paid in settlement
of, any action, suit or proceeding or any claim asserted), to which they or
any of them may become subject under any statute or regulation, at common
law or otherwise, insofar as such losses, claims, damages, expenses or
liabilities are related to the operations of the Trust and:
(a) arise out of or are based upon any failure by the Trust 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 and procedures related
thereto as specified in Article VI of this Agreement); or
(b) arise out of or result from any material breach of any representation or
warranty made by the Trust under this Agreement or arise out of or result
from any other material breach of this Agreement by the Trust.
it being understood that in no way shall the Trust be liable to the Company
with respect to any violation of insurance law, compliance with which is a
responsibility of the Company under this Agreement or otherwise or as to
which the Company failed to inform the Trust in accordance with Section 4.4
hereof. This indemnification is in addition to any liability that the Trust
may otherwise have; provided, however, that no party shall be entitled to
indemnification if such loss, claim, damage or liability is caused by the
willful misfeasance, bad faith, gross negligence or reckless disregard of
duty by the party seeking indemnification.
9.3. Indemnification by the Distributor. The Distributor hereby agrees to, and
shall, indemnify and hold harmless the Company and each person who controls
or is affiliated with the Company within the meaning of such terms under
the 1933 Act or 1940 Act and any officer, director, employee or agent of
the foregoing, against any and all losses, claims, damages or liabilities,
joint or several (including any investigative, legal and other expenses
reasonably incurred in connection with, and any amounts paid in settlement
of, any action, suit or proceeding or any claim asserted), to which they or
any of them may become subject under any statute or regulation, at common
law or otherwise, insofar as such losses, claims, damages, expenses or
liabilities:
(a) arise out of or are based upon any untrue statement or alleged untrue
statement of any material fact contained in the Trust Registration
Statement, any Prospectus for Series or Classes or sales literature or
other promotional material of the Trust (or any amendment or supplement to
any of the foregoing), or arise out of or are based upon 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 in light
of the circumstances in which they were made; provided that this obligation
to indemnify shall not apply if such statement or omission or alleged
statement or omission was made in reliance upon and in conformity with
information furnished in writing by the Company to the Trust or Distributor
for use in the Trust Registration Statement, Trust Prospectus or sales
literature or promotional material for the Trust (or any amendment or
supplement to any of the foregoing) or otherwise for use in connection with
the sale of the Contracts or Trust shares; or
(b) arise out of any untrue statement or alleged untrue statement of a material
fact contained in the Contracts Registration Statement, Contracts
Prospectus or sales literature or other promotional material for the
Contracts (or any amendment or supplement to any of the foregoing), 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 in light of the circumstances in which they were made, if such
statement or omission or alleged statement or omission was made in reliance
upon information furnished in writing by the Distributor to the Company; or
(c) arise out of or are based upon statements or representations by or on
behalf of the Distributor (other than statements or representations
contained in the Contracts or in the Contract or Trust Registration
Statement, Contract or Trust Prospectus, or advertisements, sales
literature or other promotional material of the Contracts or Trust not
prepared or supplied by the Distributor or persons under its control) or
wrongful conduct of the Distributor or persons under its control with
respect to the sale of Trust shares or the Contracts; or
(d) arise as a result of any failure by the Distributor or persons under its
control to provide services, furnish materials or make payments as required
under the terms of this Agreement; or
(e) arise out of or result from any material breach by the Distributor or
persons under its control of this Agreement;
(f) arise out of or result from any breach of any representation or warranty
made by the Distributor in this Agreement hereof.
it being understood that in no way shall the Distributor be liable to the
Company with respect to any violation of insurance law, compliance with
which is a responsibility of the Company under this Agreement or otherwise
or as to which the Company failed to inform the Distributor in accordance
with Section 4.4 hereof. This indemnification is in addition to any
liability that the Distributor may otherwise have; provided, however, that
no party shall be entitled to indemnification if such loss, claim, damage
or liability is caused by the wilful misfeasance, bad faith, gross
negligence or reckless disregard of duty by the party seeking
indemnification.
9.4. Rule of Construction. It is the parties' intention that, in the event of an
occurrence for which the Trust has agreed to indemnify the Company, the
Company shall seek indemnification from the Trust only in circumstances in
which the Trust is entitled to seek indemnification from a third party with
respect to the same event or cause thereof.
9.5. Indemnification Procedures. After receipt by a party entitled to
indemnification ("indemnified party") under this Article IX of notice of
the commencement of any action, if a claim in respect thereof is to be made
by the indemnified party against any person obligated to provide
indemnification under this Article IX ("indemnifying party"), such
indemnified party will notify the indemnifying party in writing of the
commencement thereof as soon as practicable thereafter, provided that the
omission to so notify the indemnifying party will not relieve the
indemnifying party from any liability under this Article IX, except to the
extent that the omission results in a failure of actual notice to the
indemnifying party and such indemnifying party is damaged solely as a
result of the failure to give such notice. The indemnifying party, upon the
request of the indemnified party, shall retain counsel reasonably
satisfactory to the indemnified party to represent the indemnified party
and any others the indemnifying party may designate in such proceeding and
shall pay the reasonable fees and disbursements of such counsel related to
such proceeding. In any such proceeding, any indemnified party shall have
the right to retain its own counsel, but the fees and expenses of such
counsel shall be at the expense of such indemnified party unless: (a) the
indemnifying party and the indemnified party shall have mutually agreed to
the retention of such counsel, or (b) the named parties to any such
proceeding (including any impleaded parties) include both the indemnifying
party and the indemnified party and representation of both parties by the
same counsel would be inappropriate due to actual or potential differing
interests between them. The indemnifying party shall not be liable for any
settlement of any proceeding effected without its written consent, but if
settled with such consent or if there be a final judgment for the
plaintiff, the indemnifying party agrees to indemnify the indemnified party
from and against any loss or liability by reason of such settlement or
judgment.
A successor by law of the parties to this Agreement shall be entitled to
the benefits of the indemnification contained in this Article IX. The
indemnification provisions contained in this Article IX shall survive any
termination of this Agreement.
ARTICLE X
Relationship of the Parties; Termination
10.1.Relationship of Parties. The Company is an independent contractor
vis-a-vis the Trust, the Distributor, or any of their affiliates for all
purposes hereunder and will have no authority to act for or represent any
of them (except to the limited extent the Company acts as agent of the
Trust pursuant to Section 2.3(a) of this Agreement). In addition, no
officer or employee of the Company will be deemed to be an employee or
agent of the Trust, Distributor, or any of their affiliates. The Company
will not act as an "underwriter" or "distributor" of Trust shares, as those
terms variously are used in the 1940 Act, the 1933 Act, and rules and
regulations promulgated thereunder. Likewise, the Company is not a
"transfer agent" of the Trust as that term is used in the 1934 Act and
rules and regulations thereunder. [Consistent with the foregoing, the
Company is not a "service provider" to the Trust as that term is defined in
Rule 38a-1 under the 1940 Act.] [Notwithstanding the foregoing, the Company
and the Trust agree that the Company is a "service provider" to the Trust
as that term is defined in Rule 38a-1 under the 1940 Act and the Company
agrees to cooperate with the Trust in the Trust's efforts to comply with
Rule 38a-1, including, but not limited to:
o adopting and implementing written compliance policies and procedures
reasonably designed to prevent the Company violating the federal securities
laws (as defined in the Rule) in its provision of services to the Trust
pursuant to this Agreement, and
o providing copies of such written compliance policies and procedures to the
Trust's chief compliance officer on an annual basis.]
10.2.Non-Exclusivity and Non-Interference. The parties hereto acknowledge that
the arrangement contemplated by this Agreement is not exclusive; the Trust
shares may be sold to other insurance companies and investors (subject to
Section 2.8 hereof) and the cash value of the Contracts may be invested in
other investment companies, provided, however, that until this Agreement is
terminated pursuant to this Article X:
(a) the Company shall promote the Trust and the Funds made available hereunder
on the same basis as other mutual funds available as investment options
under the Contracts;
(b) the Company shall not, without prior notice to the Distributor (unless
otherwise required by applicable law), take any action to operate the
Account as a management investment company under the 1940 Act;
(c) the Company shall not, without the prior written consent of the Distributor
(unless otherwise required by applicable law), solicit, induce or encourage
Contract Owners to change or modify the Trust to change the Trust's
distributor or investment adviser, to transfer or withdraw Contract Values
allocated to a Fund, or to exchange their Contracts for contracts not
allowing for investment in the Trust;
(d) the Company shall not substitute shares of another investment company for
shares one or more Funds without providing written notice to the
Distributor at least 90 days in advance of effecting any such substitution;
and
(e) the Company shall not withdraw the Account's investment in the Trust or a
Fund of the Trust except as necessary to facilitate Contract Owner requests
and routine transactions in Account units.
10.3.Termination of Agreement. This Agreement shall not terminate until (a) the
Trust is dissolved, liquidated, or merged into another entity, or (b) as to
any Fund that has been made available hereunder, no Accounts continue to
invest in that Fund and the Company has confirmed in writing to the
Distributor that it no longer intends to invest in such Fund. However,
certain obligations of, or restrictions on, the parties to this Agreement
may terminate as provided in Sections 10.4 through 10.6 and the Company may
be required to redeem Trust shares pursuant to Section 10.7 or in the
circumstances contemplated by Article VIII. Article IX and Sections 5.8,
and 10.8 shall survive any termination of this Agreement.
10.4. Termination of Offering of Trust Shares. The obligation of the
Trust and the Distributor to make Trust shares available to the Company for
purchase pursuant to Article II of this Agreement shall terminate at the option
of the Distributor upon written notice to the Company as provided below:
(a) upon institution of formal proceedings against the Company, or the
Distributor's reasonable determination that institution of such proceedings
is being considered by the NASD, the SEC, the insurance commission of any
state or any other regulatory body regarding the Company's duties under
this Agreement or related to the sale of the Contracts, the operation of
the Account, the administration of the Contracts or the purchase of Trust
shares, or an expected or anticipated ruling, judgment or outcome which
would, in the Distributor's reasonable judgment exercised in good faith,
materially impair the Company's or Trust's ability to meet and perform the
Company's or Trust's obligations and duties hereunder, such termination
effective upon 15 days prior written notice;
(b) in the event that any Schedule 1 Contract is not registered or in the event
any of the Contracts are not otherwise issued or sold in accordance with
applicable federal and/or state law, such termination effective immediately
upon receipt of written notice;
(c) if the Distributor shall determine, in its sole judgment exercised in good
faith, that either (1) the Company shall have suffered a material adverse
change in its business or financial condition or (2) the Company shall have
been the subject of material adverse publicity which is likely to have a
material adverse impact upon the business and operations of either the
Trust or the Distributor, such termination effective upon 30 days prior
written notice;
(d) if the Distributor suspends or terminates the offering of Trust shares of
any Series or Class to all Participating Investors or only designated
Participating Investors, if such action is required by law or by regulatory
authorities having jurisdiction or if, in the sole discretion of the
Distributor acting in good faith, suspension or termination is necessary in
the best interests of the shareholders of any Series or Class (it being
understood that "shareholders" for this purpose shall mean Product Owners),
such notice effective immediately upon receipt of written notice, it being
understood that a lack of Participating Investor interest in a Series or
Class may be grounds for a suspension or termination as to such Series or
Class and that a suspension or termination shall apply only to the
specified Series or Class;
(e) upon the Company's assignment of this Agreement (including, without
limitation, any transfer of the Contracts or the Account to another
insurance company pursuant to an assumption reinsurance agreement) unless
the Trust consents thereto, such termination effective upon 30 days prior
written notice;
(f) if the Company is in material breach of any provision of this Agreement,
which breach has not been cured to the satisfaction of the Trust within 10
days after written notice of such breach has been delivered to the Company,
such termination effective upon expiration of such 10-day period; or
(g) upon the determination of the Trust s Board to dissolve, liquidate or merge
the Trust as contemplated by Section 10.3(i), upon termination of the
Agreement pursuant to Section 10.3(ii), or upon notice from the Company
pursuant to Section 10.5 or 10.6, such termination pursuant hereto to be
effective upon 15 days prior written notice.
Except in the case of an option exercised under clause (b), (d) or (g), the
obligations shall terminate only as to new Contracts and the Distributor
shall continue to make Trust shares available to the extent necessary to
permit owners of Contracts in effect on the effective date of such
termination (hereinafter referred to as "Existing Contracts") to reallocate
investments in the Trust, redeem investments in the Trust and/or invest in
the Trust upon the making of additional purchase payments under the
Existing Contracts.
10.5.Termination by the Company of Investment in a Fund. The Company may elect
to cease investing in a Fund, promoting a Fund as an investment option
under the Contracts, or withdraw its investment or the Account's investment
in a Fund, subject to compliance with applicable law, upon 120 days written
notice to the Trust, or upon written notice to the Trust within 15 days of
the occurrence of any of the following events (unless provided otherwise
below):
(a) if the Trust informs the Company pursuant to Section 4.4 that it will not
cause such Fund to comply with investment restrictions as requested by the
Company and the Trust and the Company are unable to agree upon any
reasonable alternative accommodations;
(b) if shares in such Fund are not reasonably available to meet the
requirements of the Contracts as determined by the Company (including any
non-availability as a result of notice given by the Distributor pursuant to
Section 10.4(d)), and the Distributor, after receiving written notice from
the Company of such non-availability, fails to make available, within 10
days after receipt of such notice, a sufficient number of shares in such
Fund or an alternate Fund to meet the requirements of the Contracts; or
(c) if such Fund fails to meet the diversification requirements specified in
Section 817(h) of the Code and any regulations thereunder and the Trust,
upon written request, fails to provide reasonable assurance that it will
take action to cure or correct such failure; or
(d) if such Fund ceases to qualify as a regulated investment company under
Subchapter M of the Code, as defined therein, or any successor or similar
provision, or if the Company reasonably believes that the Fund may fail to
so qualify, and the Trust, upon written request, fails to provide
reasonable assurance that it will take action to cure or correct such
failure within 30 days;
Such termination shall apply only as to the affected Fund and shall not
apply to any other Fund in which the Company or the Account invests.
10.6.Termination by the Company of Investment in all Funds. The Company may
elect to cease investing in all Series or Classes of the Trust made
available hereunder, promoting the Trust as an investment option under the
Contracts, or withdraw its investment or an Account's investment in the
Trust, subject to compliance with applicable law, upon 180 days written
notice to the Trust, or upon written notice to the Trust within 15 days of
the occurrence of any of the following events (unless provided otherwise
below):
(a) upon institution of formal proceedings against the Trust or the Distributor
(but only with regard to the Trust) by the NASD, the SEC or any state
securities or insurance commission or any other regulatory body; or
(b) if the Trust or Distributor is in material breach of a provision of this
Agreement, which breach has not been cured to the satisfaction of the
Company within 10 days after written notice of such breach has been
delivered to the Trust or the Distributor, as the case may be.
00.0.Xxxxxxx Required to Redeem. The parties understand and acknowledge that it
is essential for compliance with Section 817(h) of the Code that the
Contracts qualify as annuity contracts or life insurance policies, as
applicable, under the Code. Accordingly, if any of the Contracts cease to
qualify as annuity contracts or life insurance policies, as applicable,
under the Code, or if the Trust reasonably believes that any such Contracts
may fail to so qualify, the Trust shall have the right to require the
Company to redeem Trust shares attributable to such Contracts upon notice
to the Company and the Company shall so redeem such Trust shares in order
to ensure that the Trust complies with the provisions of Section 817(h) of
the Code applicable to ownership of Trust shares. Notice to the Company
shall specify the period of time the Company has to redeem the Trust shares
or to make other arrangements satisfactory to the Trust and its counsel,
such period of time to be determined with reference to the requirements of
Section 817(h) of the Code. In addition, the Company may be required to
redeem Trust shares pursuant to action taken or request made by the Trust
Board in accordance with the SEC Order described in Article VIII or any
conditions or undertakings set forth or referenced therein, or other SEC
rule, regulation or order that may be adopted after the date hereof. The
Company agrees to redeem shares in the circumstances described herein and
to comply with applicable terms and provisions. Also, in the event that the
Distributor suspends or terminates the offering of a Series or Class
pursuant to Section 10.4(d) of this Agreement, the Company, upon request by
the Distributor, will cooperate in taking appropriate action to withdraw
the Account's investment in the respective Fund.
10.8.Confidentiality. The Company will keep confidential any information
acquired as a result of this Agreement regarding the business and affairs
of the Trust, the Distributor, and their affiliates.
ARTICLE XI
Applicability to New Accounts and New Contracts
The parties to this Agreement may amend the schedules to this Agreement from
time to time to reflect, as appropriate, changes in or relating to the
Contracts, any Series or Class, additions of new classes of Contracts to be
issued by the Company and separate accounts therefor investing in the Trust.
Such amendments may be made effective by each party acknowledging in writing its
approval of a copy of the revised schedule. The provisions of this Agreement
shall be equally applicable to each such class of Contracts, Series, Class or
separate account, as applicable, effective as of the date of amendment of such
Schedule, unless the context otherwise requires. The parties to this Agreement
may amend this Agreement from time to time by written agreement signed by all of
the parties.
ARTICLE XII
Notice, Request or Consent
Any notice, request or consent to be provided pursuant to this
Agreement is to be made in writing and shall be given:
If to the Trust or the Distributor:
National Accounts
Xxxxx Fargo Advantage Funds
000 Xxxxxx Xxxxxx, 00xx Xxxxx
MAC A0103-123
Xxx Xxxxxxxxx, XX 00000
If to the Company:
[Name]
[Title]
________________ Life Insurance Company
[Street Address]
[City, State]
or at such other address as such party may from time to time specify in writing
to the other party. Each such notice, request or consent to a party shall be
sent by registered or certified United States mail with return receipt requested
or by overnight delivery with a nationally recognized courier, and shall be
effective upon receipt. Notices pursuant to the provisions of Article II may be
sent by facsimile to the person designated in writing for such notices.
ARTICLE XIII
Miscellaneous
13.1.Interpretation. This Agreement shall be construed and the provisions
hereof interpreted under and in accordance with the laws of the state of
Delaware, without giving effect to the conflicts of laws provisions
thereof, subject to the following rules:
(a) This Agreement shall be subject to the provisions of the 1933 Act, 1940 Act
and Securities Exchange Act of 1934, as amended, and the rules, regulations
and rulings thereunder, including the SEC Order and such other exemptions
from those statutes, rules, and regulations as the SEC may grant, and the
terms hereof shall be limited, interpreted and construed in accordance
therewith. (b) 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.
(c) 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.
(d) 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.
13.2.Counterparts. This Agreement may be executed simultaneously in two or more
counterparts, each of which together shall constitute one and the same
instrument.
00.0.Xx Assignment. Neither this Agreement nor any of the rights and
obligations hereunder may be assigned by the Company, the Distributor or
the Trust without the prior written consent of the other parties.
13.4.Declaration of Trust. A copy of the Declaration of Trust of the Trust is
on file with the Secretary of State of the state of Delaware, and notice is
hereby given that this Agreement is executed on behalf of the Trustees of
the Trust as trustees, and is not binding upon any of the Trustees,
officers or shareholders of the Trust individually, but binding only upon
the assets and property of the Trust. No Series of the Trust shall be
liable for the obligations of any other Series of the Trust. IN WITNESS
WHEREOF, each of the parties hereto has caused this Agreement to be
executed in its name and behalf by its duly authorized officer on the date
specified below.
XXXXX FARGO VARIABLE TRUST
(Trust)
Date: ___________ By: ___________________________________________
Name:
Title:
XXXXX FARGO FUNDS DISTRIBUTORS, LLC
(Distributor)
Date: ___________ By: ___________________________________________
Name:
Title:
__________________ LIFE INSURANCE COMPANY
(Company)
Date: ___________ By: ____________________________________________
Name:
Title:
Schedule 1
Registered Accounts of the Company
Investing in the Trust
Effective as of the date the Agreement was executed, the following separate
accounts of the Company are subject to the Agreement:
============================================= ============================= ==================== =========================
Date Established by
Name of Account Board of Directors of the SEC 1940 Act Type of Product
Company Registration Number Supported by Account
============================================= ============================= ==================== =========================
--------------------------------------------- ----------------------------- -------------------- -------------------------
--------------------------------------------- ----------------------------- -------------------- -------------------------
--------------------------------------------- ----------------------------- -------------------- -------------------------
--------------------------------------------- ----------------------------- -------------------- -------------------------
--------------------------------------------- ----------------------------- -------------------- -------------------------
============================================= ============================= ==================== =========================
Classes of Contracts
Supported by Separate Accounts
Listed on Schedule 1
Effective as of the date the Agreement was executed, the following classes of
Contracts are subject to the Agreement:
============================================= ========================== ========================= ====================
Marketing Name SEC 1933 Act Contract Form Number Annuity or Life
Registration Number
============================================= ========================== ========================= ====================
--------------------------------------------- -------------------------- ------------------------- --------------------
--------------------------------------------- -------------------------- ------------------------- --------------------
--------------------------------------------- -------------------------- ------------------------- --------------------
--------------------------------------------- -------------------------- ------------------------- --------------------
--------------------------------------------- -------------------------- ------------------------- --------------------
============================================= ========================== ========================= ====================
Schedule 2
Qualified Plan Accounts of the Company
Investing in the Trust
Effective as of the date the Agreement was executed, the following separate
accounts of the Company are subject to the Agreement:
============================================= ============================= ============================
Date Established by
Name of Account Board of Directors of the Type of Product Supported
Company by Account
============================================= ============================= ============================
--------------------------------------------- ----------------------------- ----------------------------
--------------------------------------------- ----------------------------- ----------------------------
--------------------------------------------- ----------------------------- ----------------------------
--------------------------------------------- ----------------------------- ----------------------------
--------------------------------------------- ----------------------------- ----------------------------
============================================= ============================= ============================
Classes of Contracts
Supported by Separate Accounts
Listed on Schedule 2
Effective as of the date the Agreement was executed, the following classes of
Contracts are subject to the Agreement:
============================================= ============================= ============================
Marketing Name Contract Form Number Annuity or Life
============================================= ============================= ============================
--------------------------------------------- ----------------------------- ----------------------------
--------------------------------------------- ----------------------------- ----------------------------
--------------------------------------------- ----------------------------- ----------------------------
--------------------------------------------- ----------------------------- ----------------------------
--------------------------------------------- ----------------------------- ----------------------------
============================================= ============================= ============================
Schedule 3
Private Placement Accounts of the Company
Investing in the Trust
Effective as of the date the Agreement was executed, the following separate
accounts of the Company are subject to the Agreement:
============================================= ============================= ============================
Date Established by
Name of Account Board of Directors of the Type of Product Supported
Company by Account
============================================= ============================= ============================
--------------------------------------------- ----------------------------- ----------------------------
--------------------------------------------- ----------------------------- ----------------------------
--------------------------------------------- ----------------------------- ----------------------------
--------------------------------------------- ----------------------------- ----------------------------
--------------------------------------------- ----------------------------- ----------------------------
============================================= ============================= ============================
Classes of Contracts
Supported by Separate Accounts
Listed on Schedule 3
Effective as of the date the Agreement was executed, the following classes of
Contracts are subject to the Agreement:
============================================= ============================= ============================
Marketing Name Contract Form Number Annuity or Life
============================================= ============================= ============================
--------------------------------------------- ----------------------------- ----------------------------
--------------------------------------------- ----------------------------- ----------------------------
--------------------------------------------- ----------------------------- ----------------------------
--------------------------------------------- ----------------------------- ----------------------------
--------------------------------------------- ----------------------------- ----------------------------
============================================= ============================= ============================
Schedule 4
Trust Share Series and Classes
Available Under
Each Class of Contracts
Effective as of the date the Agreement was executed, the following Trust Classes
and Series are available under the Contracts:
========================================================== ===================================================
Contract Marketing Name Fund/Series -- Share Classes
========================================================== ===================================================
---------------------------------------------------------- ---------------------------------------------------
---------------------------------------------------------- ---------------------------------------------------
---------------------------------------------------------- ---------------------------------------------------
---------------------------------------------------------- ---------------------------------------------------
---------------------------------------------------------- ---------------------------------------------------
========================================================== ===================================================
Exhibit 27(n) Consent of Independent Registered Public Accounting Firm
We consent to the use in this Post-Effective Amendment No. 12 to
Registration Statement No. 333-47717 of Lincoln Benefit Life Variable Life
Account (the "Account") on Form N-6 of our report on the financial statements
and the related financial statement schedules of Lincoln Benefit Life Company
(the "Company") dated February 24, 2005 (which report expresses an unqualified
opinion and includes an explanatory paragraph relating to a change in method of
accounting for certain nontraditional long-duration contracts and for separate
accounts in 2004), and to the use of our report dated March 24, 2005 on the
financial statements of the sub-accounts of the Account, appearing in the
Statement of Additional Information (which is incorporated by reference in the
Prospectus of the Account), which is part of such Registration Statement, and to
the reference to us under the heading "Experts" in such Statement of Additional
Information.
/s/ Deloitte & Touche LLP
Chicago, Illinois
April 4, 2005
