AMENDED AND RESTATED
MASTER AGREEMENT
AMONG
X. XXXX PRICE INVESTMENT SERVICES, INC.,
X. XXXX PRICE ASSOCIATES, INC.,
AND
SECURITY BENEFIT LIFE INSURANCE COMPANY
THIS AGREEMENT is made as of the 25th day of April, 1995, amended and restated
as of May 1, 1998, by and among X. XXXX PRICE INVESTMENT SERVICES, INC.
("INVESTMENT SERVICES"), X. XXXX PRICE ASSOCIATES, INC. ("PRICE ASSOCIATES"),
both Maryland corporations with principal offices at 000 Xxxx Xxxxx Xxxxxx,
Xxxxxxxxx, Xxxxxxxx 00000, and SECURITY BENEFIT LIFE INSURANCE COMPANY
("SECURITY Benefit"), a Kansas insurance company with principal offices at 000
Xxxxxxxx Xxxxxx, Xxxxxx, Xxxxxx 00000.
WITNESSETH:
WHEREAS, Security Benefit is a life insurance company authorized to conduct an
insurance business in 49 states and the District of Columbia;
WHEREAS, Security Benefit issues, among other things, variable insurance
products;
WHEREAS, Investment Services markets various investment products;
WHEREAS, Price Associates is the parent company of Investment Services;
WHEREAS, the parties are desirous of entering into a relationship whereby
Investment Services will market and distribute a variable annuity product to be
issued by Security Benefit;
WHEREAS, this Agreement is intended to serve as the framework for setting
forth certain rights, responsibilities and obligations of the parties;
WHEREAS, at or about the same time as entering into this Agreement, Security
Benefit will enter into a Distribution Agreement with Investment Services, a
Participation Agreement with Investment Services and the Funds, an Insurance
Agency Agreement ("AGENCY AGREEMENT") with X. Xxxx Price Insurance Agency, Inc.
("AGENCY"), and a Consulting Agreement ("CONSULTING AGREEMENT") with Investment
Services or an Affiliate thereof; and
WHEREAS, this Agreement together with the Distribution Agreement, the
Participation Agreement, the Agency Agreement, and the Consulting Agreement are
intended to serve as the framework for setting forth the various rights,
responsibilities and obligations of the parties vis-a-vis one another with
respect to the overall relationship;
NOW THEREFORE, it is agreed as follows:
ARTICLE 1
ADDITIONAL DEFINITIONS
1.1 AFFILIATE -- With respect to a party, any person controlling, controlled
by, or under common control with, such party, but shall not include a Fund or
Fund Series.
1.2 CONTRACTS -- The variable annuity products developed by the parties in
accordance with Article 2, which shall consist of the variable annuity products
identified on SCHEDULE 1 to this Agreement as of the Effective Date and any
class of variable insurance products that may be added to SCHEDULE 1 from time
to time in accordance with Article 2 of this Agreement. For this purpose and
under this Agreement generally, the phrase a "class of Contracts" shall mean
those Contracts: (i) issued by Security Benefit on the same contract form (but
allowing for state variations) with the same benefits, features and charges
distinguishing such class and reflected on the schedule pages included therein;
(ii) providing for investment in the same Subaccounts which in turn invest in
the same Funds; and (iii) covered by the same Registration Statement.
1.3 DISTRIBUTOR -- The same meaning as provided in the Distribution Agreement.
1.4 EFFECTIVE DATE -- The date as of which this Agreement is executed.
1.5 FUND AND FUND SERIES -- An investment company or series thereof serving as
a funding medium for the Contracts or a class thereof, which shall include those
Funds and Fund Series named on SCHEDULE 2 to this Agreement as of the Effective
Date, and any other investment company or series thereof that may be added to
SCHEDULE 2 from time to time in accordance with Article 2 of this Agreement.
1.6 GENERAL ACCOUNT -- The assets of Security Benefit other than those
allocated to a separate account.
1.7 ICA-40 -- The federal Investment Company Act of 1940, as amended.
1.8 INSURANCE COMMISSION -- The appropriate agency charged with regulating
insurance activities in a state or other jurisdiction.
1.9 N.Y. AGREEMENTS -- The distribution agreement, participation agreement,
agency agreement, and master agreement, substantially in the form of this
Agreement and the Related Agreements, which shall be entered into by First
Security Benefit Life Insurance and Annuity Company of New York ("SBL-N.Y."), an
Affiliate of Security Benefit, and Investment Services and certain of its
Affiliates, pursuant to which SBL-N.Y. shall issue the Contracts in the state of
New York.
1.10 PROSPECTUS -- Unless the context otherwise requires, the prospectus and
statement of additional information, if any, included in a Registration
Statement or the definitive form thereof for any class of Contracts, including
any supplement thereto, as filed with the SEC under SA-33.
1.11 REGISTRATION STATEMENT -- Unless the context otherwise requires, a
registration statement or amendment thereto for a class of Contracts filed with
the SEC under SA-33.
1.12 RELATED AGREEMENT(S) -- The Distribution Agreement, the Participation
Agreement, the Agency Agreement, and the Consulting Agreement including the
schedules to each, as such Agreements and schedules may be amended from time to
time.
1.13 SA-33 -- The Securities Act of 1933, as amended.
1.14 SEC -- The Securities and Exchange Commission.
1.15 SECURITIES COMMISSION -- The appropriate agency charged with regulating
securities activities in a state or other jurisdiction, but not the SEC.
1.16 SEPARATE ACCOUNT -- Each separate account of Security Benefit supporting
a class of Contracts, which shall consist of the separate accounts named or
otherwise identified on SCHEDULE 3 to this Agreement as of the Effective Date,
and any other separate account of Security Benefit that may be added to SCHEDULE
3 from time to time in accordance with Article 2 of this Agreement.
1.17 SUBACCOUNT -- A sub-division of the Separate Account available under a
class of Contracts, which shall include those subaccounts named or otherwise
identified on SCHEDULE 3 to this Agreement as of the Effective Date, and any
other subaccount that may be added to SCHEDULE 3 from time to time in accordance
with Article 2 of this Agreement.
ARTICLE 2
PRODUCT DESIGN AND PRODUCT DEVELOPMENT
2.1 SCOPE. The parties intend that this Agreement shall govern certain aspects
of their relationship with respect to the development, administration and
offering of one or more classes of Contracts, to be marketed and distributed by
Investment Services or other Distributors and to be issued, underwritten and
administered by Security Benefit. Nothing contained in this Agreement creates
the relationship of employer-employee, joint venture, partnership or association
between Security Benefit on the one hand and Investment Services and Price
Associates on the other hand.
2.2 EXCLUSIVITY.
(a) Until May 1, 1999, neither Security Benefit, nor an Affiliate thereof,
shall commence, proceed with or finalize discussions or negotiations with any
mutual fund or brokerage complex, or any Affiliate thereof, set forth on
SCHEDULE 4 (the "SCHEDULE 4 COMPANIES") regarding the development,
registration or distribution of any variable annuity or variable life
insurance product without the prior written consent of Investment Services.
Until May 1, 1999, neither Investment Services nor any Affiliate thereof shall
commence, proceed with or finalize any discussions or negotiations with any
insurance company which is not Security Benefit or an Affiliate thereof
regarding the development, registration or distribution of any variable
annuity product without the prior written consent of Security Benefit. Until
October 1, 2004, neither Investment Services nor any Affiliate thereof shall
commence, proceed with, or finalize any discussion or negotiations with any
insurance company which is not Security Benefit or an Affiliate thereof
regarding the development, registration or distribution of any immediate
variable annuity product without the prior written consent of Security
Benefit. Until October 1, 2003, neither Security Benefit, nor any Affiliate
thereof, shall commence, proceed with, or finalize negotiations or discussions
with any of the Schedule 4 Companies regarding the development, registration
or distribution of any immediate variable annuity product without the prior
written consent of Investment Services. In the event that, prior to May 1,
1999, Investment Services determines to enter into an agreement for the
development, registration or distribution of any variable life insurance
product for distribution by Investment Services, Investment Services will
consider Security Benefit, or an Affiliate thereof, for such product; provided
that Investment Services shall not be prohibited from entering into such an
agreement with any other party.
(b) Nothing in this Agreement shall prohibit:
(i) Funds managed by Price Associates or Xxxx Xxxxx-Xxxxxxx
International, Inc. ("XXXX XXXXX-XXXXXXX") or their respective
Affiliates from entering into agreements with insurance companies
other than Security Benefit to act as investment vehicles for such
companies' separate accounts; or
(ii) Price Associates, Xxxx Xxxxx-Xxxxxxx or their respective Affiliates
from providing investment advisory services to insurance companies
other than Security Benefit, as a sub-adviser or otherwise, with
respect to such companies' variable insurance products; or
(iii)Security Benefit, or an Affiliate thereof, from entering into a
participation agreement with a fund established or operated by a
Schedule 4 Company, to act as a funding vehicle for a variable
insurance product established or operated by Security Benefit, or an
Affiliate thereof, provided that such variable insurance product is
marketed and/or distributed by Security Benefit or an Affiliate
thereof; or
(iv) Security Benefit, or an Affiliate thereof, from entering into an
agreement with a Schedule 4 Company for the provision of investment
advisory services to an underlying investment vehicle of a variable
insurance product established or operated by Security Benefit or an
Affiliate thereof, provided that such variable insurance product is
marketed and/or distributed by Security Benefit, or an Affiliate
thereof.
2.3 PRODUCT DESIGN. The first class of Contracts shall contain the features
indicated in SCHEDULE 5 and Sections 2.5 and 2.6, provided that such features
are not inconsistent with the features described in the initial Registration
Statement filed with the SEC and declared effective on or prior to the Effective
Date and as provided in the Contract filed as an exhibit thereto. Security
Benefit and Investment Services shall consult in good faith with each other in
connection with the development of any subsequent class of Contract with respect
to the parameters set forth in Sections 2.5 and 2.6, and the desired features
and benefits for each class of Contracts. The features and benefits may include,
among others:
(a) minimum and maximum initial and subsequent premium payments and premium
payment plans;
(b) premium payment allocations, including limits thereon;
(c) transfers among Subaccounts, including transfers made in connection with
various asset rebalancing and dollar cost averaging programs, and limits
thereon and charges therefor;
(d) full and partial withdrawals, including limits and charges thereon;
(e) minimum guaranteed death benefits;
(f) annuity options and modes, including any such options or modes that
Security Benefit has available, and partial annuitization;
(g) overall limits on charges and expenses, and any limits on allocations
thereof to subaccounts;
(h) funding media underlying the Subaccounts;
(i) availability of a General Account option and terms and conditions
thereof;
(j) a liquidity feature for the withdrawal of contract value; and
(k) a minimum guarantee to the level of annuity payments.
Security Benefit shall be responsible for creating one or more Contract forms,
as appropriate for the states or jurisdictions agreed upon for the marketing of
the Contracts.
2.4 GEOGRAPHIC SCOPE OF MARKETING. Unless otherwise agreed in writing,
Security Benefit shall use its best efforts to make the Contracts available for
issuance in all fifty states and the District of Columbia ("D.C.") (it being
understood that SBL-N.Y. shall issue the Contract in New York). Security
Benefit, recognizing the business needs of Investment Services, will use its
best efforts, as appropriate, to make the Contracts available as promptly as
practicable in California, D.C., Florida, Maryland, New York, and Virginia. It
is understood that Security Benefit will make all reasonable efforts to have the
Contracts approved, filed or otherwise cleared in a substantial majority of all
states and jurisdictions, which majority shall include all the jurisdictions
specifically identified above, so that the first class of Contracts can be
offered no later than the second quarter of 1995.
2.5 SPECIFIC PARAMETERS. The specific parameters to be reflected in the first
class of Contracts and to be considered in the development of any subsequent
class of Contracts include the following:
(A) PREMIUM TAX. Assessments of a premium tax against a Contract only upon
annuitization, surrender or death, and not against premium payments when
accepted by Security Benefit; except that Security Benefit may reserve
the right to deduct premium taxes at any time;
(B) RESERVATION OF RIGHTS. That any right to restrict, terminate, or
otherwise limit transfer, premium payment allocation, or partial
withdrawal privileges, or to impose charges therefor, to deduct premium
tax assessments, or to impose or increase other expenses or charges
related to such Contracts and reserved by Security Benefit may not be
exercised without the written consent of Investment Services and without
first having made appropriate modifications to applicable Contract forms,
Registration Statements and Prospectuses;
(C) ANNUITY OPTIONS. The annuity options available shall be similar in kind
and number to those offered by competitors and include any annuity
options that Security Benefit or its Affiliates have available, and any
change or amendment to the assumed interest rate used in connection with
such annuity options from that used in the first class of Contracts may
be made only with the written consent of Investment Services; and
(D) GENERAL ACCOUNT. The General Account option shall be designed and offered
in a manner that will qualify the interests therein for the exclusion
provided by Section 3(a)(8) of SA-33. The General Account option shall
offer rates of interest determined, under normal circumstances, in
accordance with Security Benefit's normal interest rate crediting
procedures set forth in SCHEDULE 6 to this Agreement. Security Benefit
shall consult with Investment Services in advance with respect to the
General Account's current interest rates to be declared, and the views of
Investment Services shall be reasonably considered in the establishment
of such rates; provided that the determination of the current rate to be
credited shall be made by Security Benefit. Security Benefit and
Investment Services have determined to use interest rate crediting
procedures that maintain sufficient liquidity in the General Account to
allow exchanges from such Account to any Subaccount pursuant to the
dollar cost averaging and asset rebalancing options. Security Benefit and
Investment Services agree that in the event that short-term rates fall to
a level such that it is difficult to maintain the contractually
guaranteed minimum interest rate of three (3) percent that must be
credited on the General Account, the parties hereto shall in good faith
enter into discussions with a view to changing the interest rate
crediting procedures, or taking other steps to allow Security Benefit to
support the contractually guaranteed interest rate, which steps may
include requiring the dollar cost averaging from the General Account be
implemented over a minimum period of time in excess of the one-year
period currently required or Investment Services ceasing to collect from
Security Benefit any or all of the fee described in Section 4.2(a)(ii).
2.6 SECTION 403(B) PLANS. Security Benefit has informed Investment Services of
its profitability concerns if the Contracts are used to fund plans under Section
403(b) of the Internal Revenue Code of 1986, as amended ("403(b) Plans"). As a
result, Security Benefit reserves the right to cease offering the first class of
Contracts in connection with 403(b) Plans and to create a separate contract for
403(b) Plans with different specifications than those of the Contracts. Security
Benefit shall consult with Investment Services prior to creating such separate
contracts and take such action only after obtaining Investment Services' written
consent, which shall not be unreasonably withheld. Once such separate contracts
are available, Investment Services will no longer offer the first class of
Contracts to fund 403(b) Plans; provided, however, that 403(b) Plans to which
the Contracts have been offered prior to the creation of such separate contracts
may continue to offer the Contracts. In the event Security Benefit demonstrates
to Investment Services' reasonable satisfaction that the Contracts are not
sufficiently profitable when used to fund 403(b) Plans, measured solely with
respect to such Plans, then Investment Services will cease to collect from
Security Benefit all or a portion of the fee described in Section 4.2(a)(i) with
respect to 403(b) Plan separate account assets funding the Contracts. Security
Benefit shall assist Investment Services in understanding its approach to
marketing, administering and processing 403(b) Plans.
2.7 CHANGES IN OR RELATING TO A CONTRACT FORM. After the initial Registration
Statement for a class of Contracts has been declared effective by the SEC, the
parties from time to time may mutually agree upon a material change in the terms
and provisions of a Contract form(s) for such class or an amendment or rider to
such Contract form(s). Except to the extent necessary to comply with applicable
laws, rules, regulations or orders, or to accommodate the termination of a Fund
or Fund Series pursuant to a decision of that Fund's management, Security
Benefit shall not change unilaterally in any material respect the terms and
provisions of a Contract form for a class of Contracts, including, but not
limited to, a change in the variable information included in schedule pages
distinguishing such class of Contracts, or a change in the Separate Account or
Subaccounts thereof designated to support such Contract or any Fund or other
funding media underlying any Subaccount, or make any amendment or rider to such
Contract form whatsoever, without first obtaining Investment Services' written
consent thereto, which shall not be unreasonably withheld. Any such change
agreed upon or consented to in accordance with this Section shall be reflected
on the Schedules to this Agreement, to the extent appropriate, in accordance
with the provisions of Section 2.9.
2.8 CHANGES RELATING TO OUTSTANDING CONTRACTS OR RELATED SEPARATE ACCOUNTS,
SUBACCOUNTS AND FUNDS. After a Contract has been issued and is outstanding,
Security Benefit shall not make any material change unilaterally to such
Contract or the class of Contracts including such Contract or to the Separate
Account or Subaccounts supporting such Contract or class, including, but not
limited to, reinsuring such Contract or such class with another insurer,
transferring a Separate Account or Subaccount to another insurer, substituting a
Fund or Fund Series or terminating investment therein, or adding new funding
media, without first giving Investment Services the opportunity to review such
change and obtaining Investment Services' written consent thereto, which shall
not be unreasonably withheld, except to the extent necessary to comply with
applicable laws, rules, regulations or orders, or to accommodate the termination
of a Fund or Fund Series pursuant to a decision of that Fund's management.
Notwithstanding the above, Security Benefit will not substitute a Fund or Fund
Series or terminate investment therein without the consent of Investment
Services and Price Associates unless it is necessary for the best interests of
Contract owners in all states in which the Contracts are held, the continuation
of such option would cause undue risk to Security Benefit, and Investment
Services and Price Associates shall have received an opinion from counsel,
acceptable to them, that the substitution or termination is in the best
interests of Contract owners in all states in which the Contracts are held and
the continuation of such option would cause undue risk to Security Benefit. Any
such change implemented in accordance with this Section shall be reflected on
the Schedules to this Agreement, to the extent appropriate, in accordance with
the provisions of Section 2.9.
2.9 SCHEDULES. The Schedules as in effect on the Effective Date provide
particular information concerning the class of Contracts agreed upon as of such
Date. When the parties agree upon the features and benefits of another class of
Contracts, the parties shall execute an additional Schedule 5 to this Agreement
which shall be the proposed specifications reflecting the minimum requirements
for such Contracts. When the parties agree upon any change to any class of
Contracts pursuant to Section 2.7 or 2.8, the Schedules may be amended and
updated and signed by parties to reflect such changes, to the extent
appropriate. The provisions of this Agreement shall be equally applicable to
each such added class of Contracts, Separate Account(s) and Subaccounts
supporting such Contracts and Funds and Fund Series, unless the context
otherwise requires. With respect to SCHEDULE 7, Security Benefit shall update
such Schedule promptly or otherwise notify Investment Services in writing of any
changes to such Schedule.
ARTICLE 3
REGISTRATION, DISTRIBUTION AND ADMINISTRATION
OF THE CONTRACTS
3.1 REGISTRATION, FILINGS AND APPROVALS RELATING TO THE CONTRACTS.
(a) Security Benefit shall be solely responsible for developing and preparing
all necessary Contract forms and related applications, Registration
Statements, Prospectuses and other documents in the usual form, and for
establishing the appropriate Separate Accounts and Subaccounts to support the
Contracts and invest in the designated Funds. Security Benefit may establish
more than one Separate Account for this purpose; however, no variable
insurance products other than the Contracts shall be issued through a Separate
Account, nor shall the Funds be made available to any other variable insurance
products issued by Security Benefit, if any, without Investment Services'
prior written consent. Each Separate Account shall be established in
accordance with applicable state law.
(b) Security Benefit shall be responsible for filing all such Contract forms,
applications, Registration Statements, Prospectuses, exemptive applications
relating to the Contract features, and other documents with the SEC and
applicable Securities Commissions.
(c) Security Benefit shall be responsible for filing all such Contract forms,
applications and other documents relating to the Contracts and/or the Separate
Accounts, as required or customary, with Insurance Commissions. Security
Benefit shall be responsible for one year from the effective date of this
Agreement for informing Investment Services of any states or jurisdictions
requiring the registration of a Fund or Fund Series with a regulatory body of
such state or jurisdiction.
(d) Security Benefit shall be responsible for filing amendments to such
Contract forms, applications, Registration Statements, Prospectuses and other
documents to the extent appropriate or required by applicable law.
3.2 REGISTRATIONS, FILINGS AND APPROVALS RELATING TO THE FUNDS
(a) Investment Services shall be responsible for establishing any Fund or
Fund Series selected as a funding medium for a class of Contracts, to the
extent such Fund or Fund Series is not otherwise established or maintained by
another person.
(b) With respect to each Fund or Fund Series for which Investment Services is
responsible pursuant to paragraph (a) hereof, Investment Services shall be
responsible for filing all initial registration statements, applications,
prospectuses and other documents for the Fund and its shares with the SEC and
applicable Securities Commissions, it being understood that, once a Fund has
been established and has begun to offer its shares to investors, such Fund
shall thereafter be responsible for its own operations and compliance with
applicable requirements.
3.3 DISTRIBUTION. The Contracts shall be distributed solely through Investment
Services, any Affiliate thereof, or a Distributor, pursuant to the Distribution
Agreement. Investment Services and its Affiliates shall develop, implement and
manage the marketing programs for the Contracts, including, but not limited to,
the operation of the Investment Services telesales center(s). In the event that
the Separate Account assets and the General Account assets attributable to the
Contracts have not reached mutually agreeable levels, or, regardless of mutual
agreement, in any case where the Separate Account assets and General Account
assets attributable to the first class of Contracts do not exceed $325 million,
and with respect to the second class of Contracts do not exceed $150 million,
twenty-four months (or for the second class of Contracts, thirty-six months)
after the respective class of Contracts may be offered in the fifty states (it
being understood the Contract will be issued by SBL-N.Y. in New York) and D.C.,
the parties shall enter into good faith negotiations with a view to enhancing
the profitability to the parties of the distribution of the Contracts under this
Agreement and the Related Agreements. In the event the second class of Contracts
is not approved in all states and D.C., the thirty-six month period discussed
above will run from the date that Security Benefit reasonably concludes it has
obtained approval in all states (and D.C.) where it is feasible to do so.
3.4 AGENT LICENSING.
(a) Licensing of insurance agents to solicit applications for the Contracts
shall be governed by the Agency Agreement.
(b) Security Benefit shall be responsible for compliance with applicable
insurance laws governing agent appointment of all persons including persons
associated with Investment Services or an Affiliate thereof, or a Distributor,
engaged in the sale or solicitation of the Contracts. Security Benefit shall
provide such persons with an Agent and Administration Manual ("MANUAL"),
substantially in the form attached hereto as EXHIBIT A. Security Benefit shall
inform Investment Services of any applicable insurance rules and regulations
of which it becomes aware and which it has reason to believe Investment
Services is not aware.
3.5 CONTRACT AND SEPARATE ACCOUNT ADMINISTRATION
(a) Security Benefit shall be responsible for the insurance underwriting,
issuance, service, and administration of the Contracts and for the
administration of the Separate Accounts, including, without limitation,
maintenance of a toll-free telephone service center, such function to be
performed in all respects at a level commensurate with those standards
prevailing in the variable insurance industry. Security Benefit has developed
procedures for performing such underwriting, issuing, servicing and
administrative functions, which procedures are set forth in the Manual.
Security Benefit shall not materially amend or supplement the Manual or adopt
or implement any other administrative rules, procedures or systems without
first giving Investment Services an opportunity to review any such material
and obtaining Investment Services' written consent.
(b) Nothing in this Section 3.5 shall relieve Security Benefit of its duty,
or otherwise diminish such duty, to perform its obligations under this
Agreement, nor shall this Section relieve Security Benefit of its liabilities,
or otherwise diminish such liabilities, for its failure to perform its
obligations under this Agreement.
ARTICLE 4
COMPENSATION AND EXPENSES
4.1 COMPENSATION FOR SECURITY BENEFIT. Unless the parties otherwise agree in
writing, the sole source of compensation for Security Benefit for carrying out
its responsibilities and obligations assumed under this Agreement or the Related
Agreements shall be the revenues derived from the charges deducted in connection
with the Contracts.
4.2 COMPENSATION FOR INVESTMENT SERVICES
(a) For certain services provided in connection with the distribution and
ongoing servicing of the Contracts, Security Benefit shall pay Investment
Services (or, if appropriate, an Affiliate thereof):
(i) compensation at the annual rate of 0.10% of the net asset value of
the Separate Account as of each month end, including any assets of
persons who have annuitized their Contracts under a variable payment
option;
(ii) compensation at the annual rate of 0.20% of the net asset value of
assets attributable to the Contracts as of each month-end that are
(i) in the accumulation period; or (ii) in payout under Annuity
Option 5, 6 or 7; and (iii) allocated to the General Account; and
(iii)a lump sum payment upon annuitization of an amount equal to 1.8% of
amounts allocated under the contracts to purchase a fixed annuity
under Annuity Option 1 through 4 or 8 in accordance with the
calculation set forth in SCHEDULE 8 of this Agreement.
(b) Such compensation provided for in subsection (a) hereof shall be
calculated and paid monthly within fifteen (15) days after the end of each
calendar month.
(c) Upon request, Security Benefit shall furnish Investment Services with
satisfactory information and materials documenting the calculation of
compensation provided for in this Section.
4.3 COMPENSATION FOR INVESTMENT ADVISORY SERVICES. Price Associates and/or
Xxxx Xxxxx-Xxxxxxx have executed investment management agreements with the Funds
specified on SCHEDULE 2 as of the Effective Date. Security Benefit, other than
as a shareholder, bears no responsibility in any respect for payment of
investment advisory services to the Funds.
4.4 COMPENSATION FOR AGENCY, INC. Agency, an affiliate of Investment Services,
shall enter into an insurance agency agreement with Security Benefit and shall
receive the compensation provided for therein, if any, subject to any amendment
to such agreement mutually agreed to by the parties thereto.
4.5 COMPENSATION FOR THE DISTRIBUTORS. Investment Services may enter into
sales agreements with Distributors under the terms specified in the Distribution
Agreement. Investment Services and the Agency shall be solely responsible for
the payment of compensation to the Distributors for solicitation activities
relating to the Contracts.
4.6 SEEDING OF FUNDS AND FUND SERIES. Investment Services or an Affiliate
thereof shall be responsible for providing seed capital for any Fund or Fund
Series for whose establishment it is responsible under Section 3.2(a).
4.7 OTHER INVESTMENT VEHICLES OF SEPARATE ACCOUNTS OF SECURITY BENEFIT. In the
event that Security Benefit or an Affiliate thereof is seeking an unaffiliated
investment manager for any mutual funds serving as investment vehicles for other
separate accounts established and operated by Security Benefit or such
Affiliate, Security Benefit will consider the appointment of Price Associates or
Xxxx Xxxxx-Xxxxxxx, or an Affiliate of the foregoing, as a sub-adviser for such
funds, or, in the alternative, to enter into a participation agreement with a
fund managed by any of the foregoing; provided that Security Benefit believes,
in its sole discretion, that Price Associates or Xxxx Xxxxx-Xxxxxxx meets the
criteria and standards, including marketing standards, that the Company employs
for selecting investment managers for such mutual funds, and provided further
that Security Benefit shall not be prohibited from providing such recommendation
of, or entering into an agreement with, any other party.
4.8 EXPENSES. Security Benefit shall be responsible to pay for the expense of
a third party licensing service to facilitate the initial state insurance
licensing process for thirty-five (35) agents and any continuing expenses with
respect to such licensing through December 31, 1995. Thereafter, Investment
Services shall be responsible for state insurance licensing expenses. Except as
otherwise provided herein and in the Related Agreements, or in SCHEDULE 9 to
this Agreement, each party shall bear the expenses it incurs in carrying out its
responsibilities and obligations assumed under this Agreement or the Related
Agreements.
ARTICLE 5
ADDITIONAL RESPONSIBILITIES AND OBLIGATIONS
5.1 RESOURCES. Security Benefit and Investment Services shall each allocate
sufficient technical support, human resources and all other resources reasonably
necessary to carry out their respective responsibilities and obligations assumed
under this Agreement and the related Agreements in a timely manner.
5.2 DUE DILIGENCE. Each party shall provide the other parties access to such
of its records, officers and employees at reasonable times as is necessary to
enable the parties to fulfill their obligations under this Agreement and any
Related Agreements and applicable law.
5.3 EXCHANGES AND REPLACEMENTS.
(A) SECURITY BENEFIT. During the term of this Agreement and subject to
Sections 9.1 and 9.3 hereof, neither Security Benefit nor any of its
Affiliates shall knowingly induce or cause, or attempt to induce or cause,
directly or indirectly, any Contract owner to lapse, terminate, surrender,
exchange or cancel his or her Contract, or to cease or discontinue making
premium payments thereunder except where such act or attempt to cause a lapse,
termination, surrender, exchange or cancellation is in response to an
enactment of federal or state legislation, order or decision of any court or
regulatory body, administrative agency, or any other governmental
instrumentality, a change in circumstances which makes the Contracts or
insurance contracts of that type (E.G., annuity contracts or life insurance
policies) an unsuitable investment for existing Contract owners, or is in
response to any event or occurrence which results or is likely to result in
material adverse publicity pertaining to any party to this Agreement.
(B) INVESTMENT SERVICES. Unless the parties otherwise agree in writing,
during the term of this Agreement and subject to Sections 9.1 and 9.2 hereof,
neither Investment Services nor any of its Affiliates shall execute a program
to induce or cause, or attempt to induce or cause, directly or indirectly, all
or substantially all Contract owners of a class of Contracts to lapse,
terminate, surrender, exchange or cancel their Contracts, or to cease or
discontinue making premium payments thereunder except where such lapse,
termination, surrender, exchange or cancellation is in response to an
enactment of federal or state legislation, order or decision of any court or
regulatory body, administrative agency, or any other governmental
instrumentality, a change in circumstances which makes the contracts or
insurance contracts of that type (E.G., annuity contracts of life insurance
policies) an unsuitable investment for existing Contract owners, is in
response to any event or occurrence which results or is likely to result in
material adverse publicity pertaining to any party to this Agreement, or is in
response to normal marketing activities or practices of Investment Services or
its Affiliates.
(c) COMPLIANCE. Insurer shall be responsible for obtaining from owners of
the Contracts any replacement forms required by the insurance laws of the
various states. Insurer will notify Investment Services promptly of any
material changes in the required replacement forms or of any forms newly
required by a state. Insurer will maintain in accordance with the
recordkeeping requirements of the applicable state copies of any replacement
forms received in connection with the Contracts.
5.4 SERVICE AND QUALITY STANDARDS. Security Benefit and Investment Services
have agreed to implement certain additional service and quality standards as set
forth in EXHIBIT B, which may be amended from time to time.
ARTICLE 6
PROPRIETARY MATTERS
6.1 TRADEMARKS
(A) X. XXXX PRICE LICENSED MARKS. Investment Services is a wholly owned
subsidiary of Price Associates, which acts as the investment adviser to a
number of registered investment companies (such investment companies,
Investment Services, Xxxx Xxxxx-Xxxxxxx and Price Associates being referred to
herein as the "X. Xxxx Price Family"). Investment Services acts as principal
underwriter for each registered investment company in the X. Xxxx Price
Family, including X. Xxxx Price Equity Series, Inc., X. Xxxx Price
International Series, Inc. and X. Xxxx Price Fixed Income Series, Inc., the
underlying investment media for the Contracts. Entities in the X. Xxxx Price
Family own all right, title and interest in and to the names, trademarks and
service marks "X. Xxxx Price," "Invest with Confidence," "Tele Access," "X.
Xxxx Price Variable Annuity Analyzer," "Variable Annuity Analyzer," and the
"Bighorn Sheep" logo in the style shown in EXHIBIT C attached hereto, and any
other names, trademarks, service marks or logos later specified by Investment
Services or Price Associates (the "X. XXXX PRICE LICENSED MARKS" or the
"LICENSOR'S LICENSED MARKS"). Entities within the X. Xxxx Price Family use the
X. Xxxx Price licensed marks pursuant to various agreements with one another.
Investment Services and Price Associates hereby grant to Security Benefit a
non-exclusive license to use the X. Xxxx Price licensed marks in connection
with its performance of the services contemplated under this Agreement and the
Related Agreements, subject to the terms and conditions set forth in paragraph
(c) hereof.
(B) SECURITY BENEFIT LICENSED MARKS. Security Benefit is the owner of all
right, title and interest in and to the name, trademark and service xxxx
"Security Benefit" used in connection with the sale and promotion of financial
and insurance products and any other names, trademarks, service marks or logos
later specified by Security Benefit (the "SECURITY BENEFIT LICENSED MARKS" or
the "LICENSOR'S LICENSED MARKS"). Security Benefit hereby grants to Investment
Services, Price Associates and their Affiliates a non-exclusive license to use
the Security Benefit licensed marks in connection with their performance of
the services contemplated by this Agreement and the Related Agreements,
subject to the terms and conditions set forth in paragraph (c) hereof.
(C) TERMS AND CONDITIONS
(I) TERM. The grant of license by Investment Services and Security
Benefit (each, a "LICENSOR") to the other and Affiliates thereof (the
"LICENSEES") shall terminate automatically when the Contracts shall cease to
be outstanding or invested in a Fund or Fund Series or sooner upon
termination by the licensor, unless otherwise agreed in writing by the
parties. Upon automatic termination, every licensee shall cease to use a
licensor's licensed marks. Upon Investment Services' termination of the
grant of license, Security Benefit shall immediately cease to issue new
annuity contracts or life insurance contracts or service existing Contracts
under any of the Investment Services licensed marks, and shall likewise
cease any activity which suggests that it has any right under any of the
Investment Services licensed marks or that it has any association with
Investment Services or an Affiliate thereof in connection with any such
contracts. Similarly, upon Security Benefit's termination of the grant of
license, Investment Services shall immediately cease to distribute new
annuity contracts or life insurance contracts or promotional, sales or
advertising material relating to any such contract under the Security
Benefit licensed marks and shall likewise cease any activity which suggests
that it has any right under the Security Benefit licensed marks or that it
has any association with Security Benefit or an Affiliate thereof in
connection with any such contracts.
(II) PRE-RELEASE APPROVAL OF TRADEMARK-BEARING MATERIALS. In addition to
any pre-release approvals that may be required under a Related Agreement or
a participation agreement, a licensee shall obtain the prior written
approval of the licensor for the public release by such licensee of any
materials bearing the licensor's licensed marks. Such material shall
include, but not be limited to, samples of each Contract form and
application, form correspondence with Contract owners, Contract owner
reports and any other materials that bear any of the licensor's licensed
marks.
(III) RECALL. During the term of this grant of license, a licensor may
request that a licensee submit samples of any materials bearing any of the
licensor's licensed marks which were previously approved by the licensor
but, due to changed circumstances, the licensor may wish to reconsider, or
which were not previously approved in the manner set forth above. If, on
reconsideration or on initial review, respectively, any such samples fail to
meet with the written approval of the licensor, then the licensee shall
immediately cease distributing such disapproved materials. The licensee
shall obtain the prior written approval of the licensor for the use of any
new materials developed to replace the disapproved materials, in the manner
set forth above.
(IV) ACKNOWLEDGMENT OF OWNERSHIP. Each licensee hereunder: (1)
acknowledges and stipulates that the licensor's licensed marks are valid and
enforceable trademarks and/or service marks; and that such licensee does not
own the licensor's licensed marks and claims no rights therein other than as
a licensee under this Agreement; (2) agrees never to contend otherwise in
legal proceedings or in other circumstances; and (3) acknowledges and agrees
that the use of the licensor's licensed marks pursuant to this grant of
license shall inure to the benefit of the licensor.
6.2 OWNERSHIP OF PROPRIETARY INFORMATION; CONFIDENTIALITY.
(A) INFORMATION AND PROSPECTS. The names, addresses and other information
relating to prospects or leads for the Contracts acquired by Investment
Services or its Affiliates or its agents or representatives in connection with
marketing activities shall be the exclusive property of, and shall be
exclusively owned by, Investment Services or its Affiliates, as the case may
be. The records created and maintained by Security Benefit, or by any
subcontractor on behalf of such Company, that pertain to Contract owners and
the servicing and administration of the Contracts shall be the exclusive
property of, and shall be exclusively owned by, Security Benefit. However, to
the extent that any information may come to the attention of Security Benefit
or any Affiliate thereof, or be entered into the records created or maintained
by or on behalf of such Company or an Affiliate thereof, as a result of its
relationship with Investment Services or an Affiliate thereof and not from an
independent source, such information shall be kept confidential and shall not
be used by Security Benefit or its Affiliates, or their respective agents or
employees for any purpose, including but not limited to any marketing purpose,
except in connection with the performance of its duties and responsibilities
hereunder or under a Related Agreement or under the Contracts. In no event
shall the names and addresses of such customers and prospective customers be
furnished by Security Benefit or its Affiliate, or any agent or subcontractor
thereof, to any other company or person (except as required by law or
regulation and then only upon prior written notice to Investment Services).
(B) CONFIDENTIALITY. Each party to this Agreement shall keep confidential
the terms and provisions of this Agreement (except as otherwise required by
law or regulation), the parties' respective methods of doing business, the
names, addresses and other personal information relating to customers or
prospective customers for the Contracts, the names, addresses and other
personal information relating to Contract owners, and any other information
proprietary to any party to this Agreement, and shall not reproduce,
disseminate or otherwise publish the same to any person not a party to this
Agreement, without the prior written approval of the other parties to this
Agreement (except as required by law or regulation and then only upon prior
written notice to the other party).
(C) RETURN OF INFORMATION. Upon a party's written request to another party,
such other party shall return to the requesting party any information or
materials of a proprietary nature obtained by or on behalf of such other party
in the course of the performance of this Agreement or any Related Agreement.
(D) OWNERSHIP OF CONTRACT, FORMS AND OTHER MATERIALS. Any Contract forms,
riders or materials developed or used by Security Benefit in connection with
the relationship between Security Benefit, Investment Services, and Price
Associates under this Agreement and the Related Agreements shall remain the
exclusive property of Security Benefit.
(E) GENERAL. The intent of this Section 6.2 is that no party or any
Affiliate thereof shall utilize, or permit to be utilized, its knowledge of
any other party or of any Affiliate thereof which is derived as a result of
the relationship created through the funding and sale of the Contracts or the
solicitation of sales of any product or service, except to the extent
necessary by the terms of this Agreement or to further the purposes of this
Agreement, or except as expressly permitted with the written consent of the
other parties. This Section 6.2 shall remain operative and in full force and
effect regardless of the termination of this Agreement, and shall survive any
such termination.
6.3 PUBLIC ANNOUNCEMENTS. To the extent reasonably feasible, the parties shall
confer with one another prior to the issuance of any reports, statements or
releases pertaining to this Agreement, the Contracts and the transactions
contemplated hereby, except that a party will in any event have the right to
issue any such reports, statements or releases if upon advice of its counsel
such issuance is required in order to comply with the requirements of any
applicable federal, state or local laws and regulations.
ARTICLE 7
REPRESENTATIONS AND WARRANTIES
7.1 ORGANIZATION AND GOOD STANDING. Each party hereto represents that it is a
corporation duly organized, validly existing and in good standing under the laws
of that jurisdiction set forth on page one of this Agreement; has all requisite
corporate power to carry on its businesses as it is now being conducted and is
qualified to do business in each jurisdiction in which it is required to be so
qualified; and is in good standing in each jurisdiction in which such
qualification is necessary under applicable law.
7.2 AUTHORIZATION. Each party hereto represents that the execution and
delivery of this Agreement and the consummation of the transactions contemplated
herein have been duly authorized by all necessary corporate action 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.
7.3 NO CONFLICTS. Each party hereto represents that the consummation of the
transactions contemplated herein, and the fulfillment of the terms of this
Agreement, shall not conflict with, result in any breach of any of the terms and
provisions of, or constitute (with or without notice or lapse of time) a default
under, the articles of incorporation or bylaws of such party, or any indenture,
agreement, mortgage, deed of trust, or other instrument to which such party is a
party or by which it is bound, or violate any law, or, to the best of such
party's knowledge, any order, rule or regulation applicable to such party of any
court or of any federal or state regulatory body, administrative agency or any
other governmental instrumentality having jurisdiction over such party or any of
its properties.
7.4 ADMINISTRATIVE SYSTEM. Security Benefit represents and warrants to
Investment Services and Price Associates that it has implemented the
administrative systems and procedures necessary to issue, underwrite for
insurance purposes, service and administer the Contracts and administer the
Separate Accounts in accordance with the terms and provisions of this Agreement.
ARTICLE 8
INDEMNIFICATION, REMEDIES AND DISPUTE RESOLUTION
8.1 INDEMNIFICATION
(A) INDEMNIFICATION BY SECURITY BENEFIT. In addition to any indemnification
liability Security Benefit may have under any of the Related Agreements or
otherwise, Security Benefit shall indemnify and hold harmless Investment
Services, Price Associates, and their Affiliates and any officer, director,
employee or agent of any of the foregoing, against any and all losses,
liabilities, damages, claims or expenses, joint or several (including the
reasonable costs of settling a claim, investigating or defending any alleged
loss, liability, damage, claim or expense and reasonable legal counsel fees
incurred in connection therewith), to which Investment Services, Price
Associates and/or any such person may become subject under any statute or
regulation, at common law or otherwise, insofar as such losses, liabilities,
damages, claims or expenses result because of a material breach by Security
Benefit of any provision of this Agreement or which proximately result from
any acts or omission of Security Benefit or Security Benefits's officers,
directors, employees, agents (which for these purposes shall not include an
Underwriter Representative or Distributor Representative as those terms are
defined in the Distribution Agreement) or subcontractors that are not in
accordance with this Agreement, including but not limited to any violation of
any federal or state statute or regulation. Further, Security Benefit shall
indemnify Investment Services, Price Associates and any Affiliate thereof
under this Agreement to the extent that SBL-N.Y. is unable to fulfill its
indemnification obligations under the N.Y. Agreements. Notwithstanding the
above, no person shall be entitled to indemnification pursuant to this Section
8.1(a) if such loss, liability, damage, claim or expense is due to the willful
misfeasance, bad faith, gross negligence or reckless disregard of duty by the
person seeking indemnification.
(B) INDEMNIFICATION BY INVESTMENT SERVICES. In addition to any
indemnification liability Investment Services may have under any of the
Related Agreements, Investment Services shall indemnify and hold harmless
Security Benefit and any Affiliate and any officer, director, employee or
agent of any of the foregoing, against any and all losses, liabilities,
damages, claims or expenses, joint or several (including the reasonable costs
of settling a claim, investigating or defending any alleged loss, liability,
damage, claim or expense and reasonable legal counsel fees incurred in
connection therewith), to which Security Benefit and/or any such person may
become subject under any statute or regulation, at common law or otherwise,
insofar as such losses, liabilities, damages, claims or expenses result
because of a material breach by Investment Services of any provision of this
Agreement, or which proximately result from any acts or omission of Investment
Services's officers, directors, employees, agents or subcontractors that are
not in accordance with this Agreement, including but not limited to any
violation of any federal or state statute or regulation. Notwithstanding the
above, no person shall be entitled to indemnification pursuant to this Section
8.1(b) if such loss, liability, damage, claim or expense is due to the willful
misfeasance, bad faith, gross negligence or reckless disregard of duty by the
person seeking indemnification.
(C) INDEMNIFICATION BY PRICE ASSOCIATES. Price Associates shall indemnify
and hold harmless Security Benefit and any Affiliate and any officer,
director, employee or agent of any of the foregoing, against any and all
losses, liabilities, damages, claims or expenses, joint or several (including
the reasonable costs of settling a claim, investigating or defending any
alleged loss, liability, damage, claim or expense and reasonable legal counsel
fees incurred in connection therewith), to which Security Benefit and/or any
such person may become subject under any statute or regulation, at common law
or otherwise, insofar as such losses, liabilities, damages, claims or expenses
result because of the material breach by Price Associates of any provision of
this Agreement, including but not limited to any violation of any federal or
state statute or regulation. Further, Price Associates shall indemnify
Security Benefit under this Agreement and the Related Agreements to the extent
that its Affiliates are unable to fulfill their indemnification obligations
under this Agreement or any Related Agreements. Notwithstanding the above, no
person shall be entitled to indemnification pursuant to this Section 8.1(c) if
such loss, liability, damage, claim or expense is due to the willful
misfeasance, bad faith, gross negligence or reckless disregard of duty by the
person seeking indemnification.
(D) GENERAL. After receipt by a party entitled to indemnification
("indemnified party") under this Section 8.1 of notice of the commencement of
any action, if a claim in respect thereof is to be made against any person
obligated to provide indemnification under this Section 8.1 ("indemnifying
party"), such indemnified party will notify the indemnifying party in writing
of the commencement thereof within a reasonable time after the summons or
other first written notification giving information of the nature of the claim
shall have been served upon the indemnified party; provided that the failure
to so notify the indemnifying party shall not relieve the indemnifying party
from any liability under this Section 8.1 except to the extent that the
indemnifying party shall have been prejudiced as a result of the failure or
delay in giving such notice. The indemnifying party shall be entitled to
participate, at its own expense, in the defense, or, if the indemnifying party
so elects, to assume the defense of any suit brought to enforce any such
claim, but, if the indemnifying party elects to assume the defense, such
defense shall be conducted by legal counsel chosen by the indemnifying party
and satisfactory to the indemnified party, to its Affiliates and any officer,
director, employee or agent of any of the foregoing, in the suit. In the event
that the indemnifying party elects to assume the defense of any such suit and
retain such legal counsel, the indemnified party, its Affiliates and any
officer, director, employee or agent of any of the foregoing in the suit,
shall bear the fees and expenses of any additional legal counsel retained by
them. If the indemnifying party does not elect to assume the defense of any
such suit, the indemnifying party will reimburse the indemnified party, such
Affiliates, officers, directors, employees or agents in such suit for the
reasonable fees and expenses of any legal counsel retained by them.
(E) SUCCESSORS. A successor by law of Investment Services or Security
Benefit, as the case may be, shall be entitled to the benefits of the
indemnification provisions contained in this Section 8.1.
8.2 RIGHTS, REMEDIES, ETC. ARE CUMULATIVE. The rights, remedies and
obligations contained in this Agreement are cumulative and are in addition to
any and all rights, remedies and obligations, at law or in equity, which the
parties hereto are entitled to under state and federal laws. Failure of a party
to insist upon strict compliance with any of the conditions of this Agreement
shall not be construed as a waiver of any of the conditions, but the same shall
remain in full force and effect. No waiver of any of the provisions of this
Agreement shall be deemed, or shall constitute, a waiver of any other
provisions, whether or not similar, nor shall any waiver constitute a continuing
waiver.
8.3 INTERPRETATION, JURISDICTION, ETC. This Agreement, together with the
Related Agreements, constitutes the whole agreement between the parties hereto
with respect to the subject matter hereof, and supersedes all prior oral or
written understandings, agreements or negotiations between the parties with
respect to such subject matter. No prior writings by or between the parties with
respect to the subject matter hereof shall be used by a party in connection with
the interpretation of any provision of this Agreement. This Agreement shall be
construed and its provisions interpreted under and in accordance with the
internal laws of the state of Maryland without giving effect to principles of
conflict of laws. This Section 8.3 shall not be construed to deny Security
Benefit, or an Affiliate thereof, of any rights to which it is entitled as an
owner of shares of the Fund.
8.4 SEVERABILITY. This is a severable Agreement. In the event that any
provision of this Agreement would require a party to take action prohibited by
applicable federal or state law or prohibit a party from taking action required
by applicable federal or state law, then it is the intention of the parties
hereto that such provision shall be enforced only to the extent permitted under
the law, and, in any event, that all other provisions of this Agreement shall
remain valid and duly enforceable as if the provision at issue had never been a
part hereof.
ARTICLE 9
TERM AND TERMINATION
9.1 TERMINATION. This Agreement shall terminate of its own accord when all
Contracts issued pursuant to this Agreement and the Related Agreements are no
longer outstanding and no owner, annuitant, or beneficiary thereof is receiving
any annuity benefits from Security Benefit, or after five years from the
Effective Date may be terminated by any party upon six months written notice to
the other parties. Upon termination of this Agreement, Articles 3, 6 and 8 shall
nevertheless survive and continue in full force and effect.
9.2 CHANGES RELATING TO SECURITY BENEFIT. Upon the occurrence of any of the
following events, Investment Services shall have the right, in its sole
discretion, to make arrangements for an exchange of all or a portion of the
Contracts then outstanding, into insurance contracts issued by another insurance
carrier mutually acceptable to the parties, and, upon being notified of
Investment Services' exercise of such right, Security Benefit shall cooperate in
effecting transactions entitled by such exchange in an expeditious manner, it
being understood that Security Benefit may structure the exchange as a
reinsurance or similar transaction, and that Security Benefit shall be entitled
to reasonable compensation from such insurance carrier in connection with such
transaction:
(a) Security Benefit shall have become insolvent or its surplus shall have
become impaired as such terms are defined under applicable insurance law
of Security Benefit's state of domicile;
(b) the A.M. Best & Co. rating of Security Benefit is not "A" (or if such
rating organization changes its rating system after the Effective Date,
an equivalent rating) or better;
(c) the Standard & Poor's claims paying ability rating of Security Benefit
is not "A-" (or if such rating organization changes its rating system
after the Effective Date, an equivalent rating) or better;
(d) Investment Services determines that Security Benefit is in material
breach of any provision of this Agreement or of any Related Agreement,
unless such breach has been cured within ten (10) days after receipt of
notice of such breach;
(e) in Investment Services' good faith judgment, there is an event,
occurrence or circumstance (including the enactment of federal or state
legislation, court decision, a change in circumstances which makes the
Contracts or insurance contracts of that type (E.G., annuity contracts
or life insurance policies) an unsuitable investment for prospective
customers of Investment Services, or any event, occurrence or
circumstance which results or is likely to result in material adverse
publicity to any party to this Agreement or an Affiliate thereof) which
substantially and materially undermines the distribution or servicing of
the Contracts or the reputation and goodwill of any party to this
Agreement;
(f) an assignment or transfer of this Agreement by Security Benefit that
does not comply with the provisions of Section 9.4 of this Agreement;
9.3 CHANGES RELATING TO INVESTMENT SERVICES. Security Benefit shall have the
right, in its sole discretion, to make changes in the Contracts, including
causing a substitution of a Fund or Fund Series, upon the occurrence or
determination of any of the following events:
(a) Investment Services, Price Associates, or an Affiliate thereof files a
voluntary petition in bankruptcy or for reorganization or shall be the
subject of an involuntary petition in bankruptcy for liquidation or
reorganization;
(b) Investment Services, Price Associates, or an Affiliate thereof has a
receiver, liquidator or trustee appointed over its affairs;
(c) Security Benefit determines that Investment Services or Price Associates
is in material breach of any provision of this Agreement or of any
Related Agreement, unless such breach is cured with ten (10) days after
receipt of notice of such breach;
(d) an assignment or transfer of this Agreement by Investment Services or
Price Associates that does not comply with the provisions of Section 9.4
of this Agreement; or
(e) in Security Benefit's good faith judgment, there is an event, occurrence
or circumstance (including the enactment of federal or state
legislation, court decision, a change in circumstances which makes the
Contracts or insurance contracts of that type (E.G., annuity contracts
or life insurance policies) an unsuitable investment for prospective
customers of Security Benefit, or any event, occurrence or circumstance
which results or is likely to result in material adverse publicity to
any party to this Agreement or an Affiliate thereof) which substantially
and materially undermines the distribution or servicing of the Contracts
or the reputation and goodwill of any party to this Agreement.
9.4 ASSIGNMENT AND TRANSFER. This Agreement may not be assigned or transferred
by any party without the prior written consent of the other party hereto.
ARTICLE 10
GENERAL PROVISIONS
10.1 NOTICE, CONSENT AND REQUEST. Any notice, consent or request required or
permitted to be given by a party to any other party shall be deemed sufficient
if sent by facsimile transmission followed by Federal Express or other overnight
carrier, or if sent by registered or certified mail, postage prepaid, addressed
by the party giving notice to the other party at the following addresses (or at
such other address for a party as shall be specified by like notice);
if to Security Benefit, to:
Security Benefit Life Insurance Company
Attn: Xxx X. Xxx, Esq.
000 Xxxxxxxx Xxxxxx
Xxxxxx, Xxxxxx 00000
if to Investment Services, to:
X. Xxxx Price Investment Services, Inc.
Attn: Xxxxx X. Xxxxxxx, Esq.
000 Xxxx Xxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxx 00000
if to Price Associates, to:
X. Xxxx Price Associates, Inc.
Attn: Xxxxx X. Xxxxxxx, Esq.
000 Xxxx Xxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxx 00000
10.2 CAPTIONS. The captions in this Agreement are included for convenience of
reference only and in no way define or limit any of the provisions hereof or
otherwise affect their construction or effect.
10.3 COUNTERPARTS. This Agreement may be executed in two or more counterparts,
each of which taken together shall be deemed to be one and the same instrument.
10.4 AMENDMENT. No provisions of this Agreement may be changed, waived,
discharged or terminated orally, but only by an instrument in writing signed by
the party against which enforcement of the change, waiver, discharge or
termination is sought.
IN WITNESS WHEREOF, the parties hereto have each duly executed this Agreement
as of the day and year first above written.
SECURITY BENEFIT LIFE INSURANCE COMPANY
By its authorized officer
By: XXXXXX XXXXX
---------------------------
Xxxxxx Xxxxx
Title: VICE PRESIDENT
Date: MAY 1, 1998
X. XXXX PRICE INVESTMENT SERVICES, INC.
By its authorized officer
By: XXXXXXX X. XXXXXX
---------------------------
Xxxxxxx X. Xxxxxx
Title: VICE PRESIDENT
Date: MAY 1, 1998
X. XXXX PRICE ASSOCIATES, INC.
By its authorized officer
By: XXXXXX X. XXXXX
--------------------------
Xxxxxx X. Xxxxx
Title: VICE PRESIDENT
Date: MAY 1, 1998
SCHEDULE 1
CLASSES OF CONTRACTS
SUPPORTED BY SEPARATE ACCOUNTS
LISTED ON SCHEDULE 3
Effective as of the Effective Date, the following classes of Contracts are
subject to the Agreement:
================================================================================
Policy SEC 1933 Act Name of Annuity
Marketing Registration Supporting or
Name Number Account Life
-------------------- ------------------- ------------------- -------------------
X. Xxxx Price 33-83238 X. Xxxx Price Annuity
No-Load Variable Annuity
Variable Annuity Account
================================================================================
Effective as of May 1, 1998, the following classes of Contracts are hereby added
to this Schedule 1 and made subject to the Agreement:
================================================================================
Policy SEC 1933 Act Name of Annuity
Marketing Registration Supporting or
Name Number Account Life
-------------------- ------------------- ------------------- -------------------
X. Xxxx Price No- 33-83238 X. Xxxx Price Annuity
Load Immediate Variable Annuity
Variable Annuity Account
================================================================================
IN WITNESS WHEREOF, Investment Services, Price Associates, and Security Benefit
hereby amend this Schedule 1 in accordance with Article II of the Agreement.
XXXXXX XXXXX XXXXXXX X. XXXXXX
--------------------- ---------------------
Security Benefit Investment Services
XXXXXX X. XXXXX
---------------------
Price Associates
SCHEDULE 2
FUNDS AVAILABLE UNDER
EACH CLASS OF CONTRACTS
Effective as of the Effective Date and January 2, 1997, the following Funds are
available under the Contracts:
================================================================================
Contracts Fund Fund Series
Marketing
Name
------------------- ------------------- ----------------------------------------
X. Xxxx Price X. Xxxx Price Equity Income Portfolio
No-Load Equity New America Growth Portfolio
Variable Annuity Series, Inc. X. Xxxx Price Personal Strategy Balanced
Portfolio
X. Xxxx Price Mid-Cap Growth Portfolio
------------------- ------------------- ----------------------------------------
X. Xxxx Price International Stock Portfolio
International
Series, Inc.
------------------- ------------------- ----------------------------------------
X. Xxxx Price Limited-Term Bond Portfolio
Fixed Income X. Xxxx Price Prime Reserve Portfolio
Series, Inc.
================================================================================
Effective as of May 1, 1998 this Schedule 2 is hereby amended to reflect the
following changes in Fund or Fund Series available under the Contracts:
================================================================================
Contracts Fund Fund Series
Marketing
Name
------------------- ------------------- ----------------------------------------
X. Xxxx Price X. Xxxx Price Equity Income Portfolio
No-Load Immediate Equity Series, Inc. New America Growth Portfolio
Variable Annuity X. Xxxx Price Personal Strategy Balanced
Portfolio
X. Xxxx Price Mid-Cap Growth Portfolio
------------------- ------------------- ----------------------------------------
X. Xxxx Price International Stock Portfolio
International
Series, Inc.
------------------- ------------------- ----------------------------------------
X. Xxxx Price Fixed Limited-Term Bond Portfolio
Income Series, Inc. X. Xxxx Price Prime Reserve Portfolio
================================================================================
IN WITNESS WHEREOF, Investment Services, Price Associates and Security Benefit
hereby amend this Schedule 2 in accordance with Article II of the Agreement.
XXXXXX XXXXX XXXXXXX X. XXXXXX
--------------------- ---------------------
Security Benefit Investment Services
XXXXXX X. XXXXX
---------------------
Price Associates
SCHEDULE 3
SEPARATE ACCOUNTS OF THE SECURITY BENEFIT
COMPANIES SUPPORTING THE CONTRACTS
Effective as of the Effective Date, the following separate account and
subaccounts are subject to the Agreement:
================================================================================
Name of Separate Date Established by SEC 1940 Act Type of Product
Account and Board of Directors Registration Supported
Subaccounts of the Company Number by Account
-------------------- ------------------- ------------------- -------------------
X. Xxxx Price March 28, 1994 811-8724 Variable Annuity
Variable Annuity
Account
Equity Income
Subaccount
International Stock
Subaccount
Limited Term Bond
Subaccount
New America Growth
Subaccount
Personal Strategy
Balanced Portfolio
================================================================================
Effective as of January 2, 1997, the following separate accounts and/or
subaccounts are hereby added to this Schedule 3 and made subject to the
Agreement:
================================================================================
Name of Separate Date Established by SEC 1940 Act Type of Product
Account and Board of Directors Registration Supported
Subaccounts of the Company Number by Account
-------------------- ------------------- ------------------- -------------------
Prime Reserve - Not applicable 811-8724 Variable Annuity
Subaccount
Mid-Cap Growth
Subaccount
================================================================================
IN WITNESS WHEREOF, Security Benefit, Investment Services, and Price Associates
hereby amend this Schedule 3 in accordance with Article II of the Agreement.
XXXXXX XXXXX XXXXXXX X. XXXXXX
--------------------- ---------------------
Security Benefit Investment Services
XXXXXX X. XXXXX
---------------------
Price Associates
SCHEDULE 4
BROKERAGE FIRMS AND MUTUAL FUNDS SPONSORS
American Century
Dreyfus
Fidelity
First Trust
Harbor Capital
Xxxxx Security
Invesco
Xxxx Xxxxx
Xxxxx
Xxxxxxxxx & Xxxxxx
Xxxxxx
Xxxxxxx
Xxxxxxxx
Strong
Vanguard
SCHEDULE 5
CONTRACT SPECIFICATIONS
IN WITNESS WHEREOF, Investment Services, Price Associates and Security
Benefit hereby approve the attached Contract Specifications in accordance with
accordance with Article 2 of the Agreement.
XXXXXX XXXXX XXXXXXX X. XXXXXX
--------------------- ---------------------
Security Benefit Investment Services
XXXXXX X. XXXXX
---------------------
Price Associates
SCHEDULE 6
INTEREST RATE CREDITING PROCEDURES
On Thursday, January 19, 1995, Xxx Xxxxxxx, Xxxx Xxxxxxxx and Xxxxxx Xxxxx met
in Investment Services' offices with Xxx Xxxxx, Xxx Xxxxx, Xxxx Xxxxxxx, Xxxxx
Xxxxxxxxx and Xxxx Xxxxxxx. The purpose of the meeting was to discuss Security
Benefit's investment strategy for the X. Xxxx Price No-Load Variable Annuity
(the "ANNUITY") Fixed Account.
Xxxxxx Xxxxx presented the results of the scenario testing performed by
Security Benefit, using assumptions previously discussed with Xxx Xxxxx. These
assumptions were based fundamentally on the premise that the fixed account would
not likely be viewed as a long term investment vehicle, but rather as a
temporary holding portfolio during market swings or to take advantage of dollar
cost averaging investment techniques. Accordingly, Security Benefit assumed only
10% of all contributions made to the Annuity would be allocated to the fixed
account. Other assumptions were made as to how long the assets would stay in the
fixed account and the rate of new sales. The overall conclusion from the tests
suggests that investments made for the fixed account should be in bonds with
durations of two to three years to match the estimated net asset flows.
Another significant issue discussed was the anticipated asset size of the
fixed account. With sales projections of $100 million for 1995, $250 million for
1996 and $350 million for 1997, and only 10% assumed to be invested in the fixed
account, the likelihood of the assets reaching $100 million is doubtful until
after six years. It is not deemed to be practical for Security Benefit to
segregate a portfolio of this size.
However, if a segregated portfolio is not maintained by Security Benefit, the
methodology of establishing the monthly crediting rate becomes an issue. In
discussing this matter with Investment Services, Security Benefit concluded that
an acceptable approach in setting the periodic rate would be to start with the
yield on 2 1/2 year duration Treasury notes [(2 yr. T-Note + 3 yr. T-Note)/2],
add 60 basis points for anticipated credit spread and then deduct an agreed upon
pricing spread of 145 basis points. The resulting rate will be compared to
direct market competitor rates and one year CD's and may be adjusted. Security
Benefit believes that once the fixed account reaches approximately $200 million,
it will then consider actually segregating a portfolio if it is deemed
beneficial to the contract.
After a period of one year, Security Benefit and Investment Services will
revisit the scenario testing based upon actual experience. Security Benefit and
Investment Services will revisit the scenario testing sooner if market
conditions warrant. Such experience will then be used to adjust asset movement
assumptions if necessary.
SCHEDULE 7
STATES AND JURISDICTIONS WHERE SECURITY BENEFIT WILL OFFER THE CONTRACTS
Alabama
Alaska
Arizona
Arkansas
California
Colorado
Connecticut
Delaware
District of Columbia
Florida
Georgia
Hawaii
Idaho
Illinois
Indiana
Iowa
Kansas
Kentucky
Louisiana
Maine
Maryland
Massachusetts
Michigan
Minnesota
Mississippi
Missouri
Montana
Nebraska
Nevada
New Hampshire
New Jersey
New Mexico
North Carolina
North Dakota
Ohio
Oklahoma
Oregon
Pennsylvania
Rhode Island
South Carolina
South Dakota
Tennessee
Texas
Utah
Vermont
Xxxxxxxx
Xxxxxxxxxx
West Xxxxxxxx
Wisconsin
Wyoming
SCHEDULE 8
FIXED ANNUITY PAYMENT CALCULATION
The payment to be made on accounts that elect to annuitize using a fixed
annuity under option 1 through 4 or 8 is based on a 60/40 male/female split of
business and typical payout rates for these 65 year olds. Since there is no
account value or surrender value for life contingent payout options, the payment
is based on the general account reserves. The monthly rate (20bp/12) is applied
to the monthly reserve amounts. These resulting monthly amounts are discounted
to the issue date (at 6.00%), summed and divided by the "Annuity Start Amount."
Based on this methodology a 20bp payment is equivalent to 1.80% of the "Annuity
Start Amount."
SCHEDULE 9
OTHER EXPENSES
(1) Security Benefit shall pay the costs of printing and mailing the
Separate Account Financial Statement; provided, however, that Security
Benefit may make reasonable inquiry regarding the feasibility of
including such Financial Statement in any mailing to all Contract
owners made by Investment Services, and Investment Services may
determine in its sole judgment to include such Separate Account
Financial Statement in such mailing with no charge to Security Benefit
for mailing expenses unless the parties otherwise agree; and
(2) Security Benefit shall pay to Investment Services by each February 28,
the estimated cost of printing and mailing the Annual Statement of
Account to Contract owners based upon the number of Contract owners and
the cost of preparing Security Benefit's normal statement; provided,
however, that Investment Services shall be responsible for printing and
mailing such Annual Statement of Account to Contract owners.
EXHIBIT A
AGENT AND ADMINISTRATION MANUAL
TABLE OF CONTENTS
1 X. Xxxx Price and Security Benefit Relationship
* Who is SBG?
* Who is X. Xxxx Price?
* SBG and TRP Relationship
2 What is an Annuity?
* Annuity Basics
* Fixed and Variable Annuities
* Immediate vs. Deferred Annuities
* Accumulation and Annuitization Period
* Single and Periodic Premiums
3 General Provisions of the Contracts
* Free Look Period/Exchanges
* Dollar Cost Averaging/Asset Rebalancing
* Purchase Payments
* Ownership, Annuitant, and Beneficiary
4 Investment Options
* New America Growth
* International Stock and Equity Income
* Personal Strategy Balanced
* Limited Term Bond
* Fixed Interest Account
5 Benefits
* Death Benefit Amount and Distribution
* Periodic Withdrawal
* Systematic Withdrawal
6 Annuity Payout Options
* Dates
* Life Option (1)
* Life Annuity with Periodic Certain (2)
* Unity Refund Annuity (3)/Joint and Survivor Annuity (4)
* Payments for Fixed Period (5)/Payments for Fixed Amount (6)
* Age Recalculation
7 Screens
* User Identification/Client/Alpha Screen
* Values Information/Fixed Interest Account/ACH
* Services/Contract Names and Addresses/Transaction History
* Purchases/Exchanges/Notes
* Forms/DMS/Escheatment
8 Miscellaneous
* Confirmations/Statements of Accounts
* Application Check List
* Letters
* Checks
* Addresses and Writing Instructions
* Processing Questions
9 Administrative Procedures
* Document Handling Procedures
* New Application Procedure-CC Batch Entry Procedures
* New Application Procedure-AA
* Application Approval List
* 1035 Exchanges and Procedures
* DMS Indexing-Records Management
10 Administrative Screen Procedures
* Inquiry
* New Business
* Financial
* Service
* Communications
* Screen Navigation
EXHIBIT B
SERVICE AND QUALITY STANDARDS
Investment Services and Security Benefit both recognize the importance of
providing accurate and timely service to Variable Annuity Contract owners. The
parties, therefore, agree to measure and monitor performance to service
standards and processing quality, and to report results to each on a quarterly
basis. Investment Services and Security Benefit will meet on an annual basis to
review service levels and if necessary, establish an action plan for improving
performance levels.
1. SALES/NEW CONTRACTS
Security Benefit will:
1. Incoming calls from Investment Services representatives -- Security
Benefit will have a group of representatives adequate in number to answer
incoming calls from Investment Services representatives between the hours
of 9 a.m. - 6 p.m. EST each day the New York Stock Exchange is open. If
Security Benefit representatives are unavailable, the Investment Services
representative will leave a message. The Investment Services
representative should be called back within four hours, provided that
calls received by Security Benefit after 2 p.m. EST may be returned
within the first hour of the next business day. As needed, Security
Benefit representatives will be available for conference calls with
Investment Services representatives and potential Contract owners for
complex issues.
2. Contract Establishment -- New contracts will be established on the day of
application receipt, unless the application is not in good order.
Security Benefit will notify Investment Services weekly with the number
of applications being held (number and days and reason) for further
information from the applicant. The contract and welcome letter will be
issued within 2 days of contract establishment.
3. Confirmation Statements -- Security Benefit will send the Contract owners
a confirmation statement the business day after the contract is
established. For one-time transaction events (does not include automatic
transactions), Security Benefit will send the confirmation the next
business day.
4. Security Benefit will provide a weekly status report (see attached
example #1) for Investment Services.
Investment Services will:
1. Sales Calls -- Investment Services will answer all telephone sales
inquiries within the following timeframes:
80% of the calls will be answered within 20 seconds
The abandonment rate will not exceed 5%
If assistance from an Investment Services Representative is necessary,
and a message is taken, the call will be returned the same day, or if
the message was received late in the day, the following business
morning.
2. Fulfillment Kit -- Investment Services will mail the fulfillment kit the
business day after receiving the fulfillment request.
2. ADMINISTRATION AND OPERATION SERVICE STANDARDS
Security Benefit will:
1. Written Transaction Requests -- Security Benefit will process written
requests for transactions on the day of receipt (if a business day).
Investment Services is to be notified of the quantity of requests held
for further information from the contractholder.
2. Contract Maintenance Requests -- Security Benefit will process
contractholder maintenance (i.e., services options) requests and
Investment Services generated requests within two (2) business days of
receipt.
3. Correspondence -- If Security Benefit rejects a Contract owner
transaction request, Security Benefit will send a letter to the Contract
owner by the next business day. If a maintenance request is rejected,
Security Benefit will send a letter to the Contract owner by the next
business day. If Security Benefit rejects an Investment Services
generated transaction or maintenance request, Security Benefit will
notify the Investment Services representative on the day of receipt of
the request for Investment Services action. All non-system generated
correspondence will be noted on the Security Benefit Software in the
Notes screen of the Contract owner's records.
4. Adjustment Requests -- If a contract's records require adjustment,
Investment Services will notify Security Benefit in writing. Adjustment
requests will be processed by Security Benefit on the day of receipt if
received by 1:00 pm EST. (After 1:00 p.m. EST will be completed by end of
next business day). Security Benefit will notify Investment Services of
any outstanding adjustment requests weekly. Security Benefit to provide
monthly summary of adjustments processed.
5. Regulatory Changes -- Security Benefit will take timely action to comply
with legislation and/or regulations which result in changes to the
administration of the Variable Annuity Plan.
Investment Services will:
1. Service Calls - Investment Services will answer all telephone service
calls within the following timeframes:
80% of the calls will be answered within 20 seconds
The abandonment rate will not exceed 5%
If assistance from an Investment Services Representative is necessary,
and a message is taken, the call will be returned the same day, or if
the message was received late in the day, the following business
morning.
2. All financial transactions received via telephone in good order by 4:00
p.m. EST will be processed the same day.
3. All maintenance will be processed within two (2) business days following
receipt. Research requests will be completed within 3 business days. If
not completed by the third day, the request will be forwarded to an
Investment Services Supervisor for follow-up with Security Benefit.
4. Correspondence -- Any correspondence requests handled by Investment
Services will be answered within 3 business days of the requests.
Investment Services will note the correspondence on the Security Benefit
Software in the Notes screen of the contractholder's records.
3. QUALITY TARGET GOALS
Both Security Benefit and Investment Services will maintain the following
quality target goals:
FUNCTION GOAL (%)
Contract Set-up 98
Correspondence Rating Accuracy 98
Contract Maintenance Accuracy 98
Financial Transactions 99
Newday98
================================================================================
Contracts
Carried 1035 Transaction
Contracts Over-Pdng Exchanges - Purchases Requests Withdrawals
DATE Established & 1035 $ Received Processed Received Processed
-------- ----------- --------- ----------- --------- ----------- -----------
01/02/98 0 0 0 0 0 0
-------- ----------- --------- ----------- --------- ----------- -----------
wkly.
totals 0 0 0 0 0 0
-------- ----------- --------- ----------- --------- ----------- -----------
01/05/98 0 0 0 0 0 0
-------- ----------- --------- ----------- --------- ----------- -----------
01/06/98 0 0 0 0 0 0
-------- ----------- --------- ----------- --------- ----------- -----------
01/07/98 0 0 0 0 0 0
-------- ----------- --------- ----------- --------- ----------- -----------
01/08/98 0 0 0 0 0
-------- ----------- --------- ----------- --------- ----------- -----------
01/09/98 0 0 0 0 0 0
-------- ----------- --------- ----------- --------- ----------- -----------
wkly.
totals 0 0 0 0 0 0
-------- ----------- --------- ----------- --------- ----------- -----------
01/12/98 0 0 0 0 0 0
-------- ----------- --------- ----------- --------- ----------- -----------
01/13/98 0 0 0 0 0 0
-------- ----------- --------- ----------- --------- ----------- -----------
01/14/98 0 0 0 0 0 0
-------- ----------- --------- ----------- --------- ----------- -----------
01/15/98 0 0 0 0 0 0
-------- ----------- --------- ----------- --------- ----------- -----------
01/16/98 0 0 0 0 0 0
-------- ----------- --------- ----------- --------- ----------- -----------
wkly.
totals 0 0 0 0 0 0
-------- ----------- --------- ----------- --------- ----------- -----------
01/19/98 0 0 0 0 0 0
-------- ----------- --------- ----------- --------- ----------- -----------
01/20/98 0 0 0 0 0 0
-------- ----------- --------- ----------- --------- ----------- -----------
01/21/98 0 0 0 0 0 0
-------- ----------- --------- ----------- --------- ----------- -----------
01/22/98 0 0 0 0 0 0
-------- ----------- --------- ----------- --------- ----------- -----------
01/23/98 0 0 0 0 0 0
-------- ----------- --------- ----------- --------- ----------- -----------
wkly.
totals 0 0 0 0 0 0
-------- ----------- --------- ----------- --------- ----------- -----------
01/26/98 0 0 0 0 0 0
-------- ----------- --------- ----------- --------- ----------- -----------
01/27/98 0 0 0 0 0 0
-------- ----------- --------- ----------- --------- ----------- -----------
01/28/98 0 0 0 0 0 0
-------- ----------- --------- ----------- --------- ----------- -----------
01/29/98 0 0 0 0 0 0
-------- ----------- --------- ----------- --------- ----------- -----------
01/30/98 0 0 0 0 0 0
-------- ----------- --------- ----------- --------- ----------- -----------
wkly.
totals 0 0 0 0 0 0
-------- ----------- --------- ----------- --------- ----------- -----------
Grand Total 0 0 0 0 0 0
================================================================================
================================================================================
Transaction Corres- Adjust-
Corres- Adjust- Requests pondence ments Total
pondence ments Carried Carried Carried Amount
DATE Received Received Over Over Over Received WITHDRAWALS
-------- -------- -------- ---------- -------- ------- -------- -----------
01/02/98 0 0 0 0 0
-------- -------- -------- ---------- -------- ------- -------- -----------
wkly.
totals 0 0 0 0 0 $
-------- -------- -------- ---------- -------- ------- -------- -----------
01/05/98 0 0 0 0 0
-------- -------- -------- ---------- -------- ------- -------- -----------
01/06/98 0 0 0 0 0
-------- -------- -------- ---------- -------- ------- -------- -----------
01/07/98 0 0 0 0 0
-------- -------- -------- ---------- -------- ------- -------- -----------
01/08/98 0 0 0 0 0
-------- -------- -------- ---------- -------- ------- -------- -----------
01/09/98 0 0 0 0 0
-------- -------- -------- ---------- -------- ------- -------- -----------
wkly.
totals 0 0 0 0 0 $
-------- -------- -------- ---------- -------- ------- -------- -----------
01/12/98 0 0 0 0 0
-------- -------- -------- ---------- -------- ------- -------- -----------
01/13/98 0 0 0 0 0
-------- -------- -------- ---------- -------- ------- -------- -----------
01/14/98 0 0 0 0 0
-------- -------- -------- ---------- -------- ------- -------- -----------
01/15/98 0 0 0 0 0
-------- -------- -------- ---------- -------- ------- -------- -----------
01/16/98 0 0 0 0 0
-------- -------- -------- ---------- -------- ------- -------- -----------
wkly.
totals 0 0 0 0 0 $
-------- -------- -------- ---------- -------- ------- -------- -----------
01/19/98 0 0 0 0 0
-------- -------- -------- ---------- -------- ------- -------- -----------
01/20/98 0 0 0 0 0
-------- -------- -------- ---------- -------- ------- -------- -----------
01/21/98 0 0 0 0 0
-------- -------- -------- ---------- -------- ------- -------- -----------
01/22/98 0 0 0 0 0
-------- -------- -------- ---------- -------- ------- -------- -----------
01/23/98 0 0 0 0 0
-------- -------- -------- ---------- -------- ------- -------- -----------
wkly.
totals 0 0 0 0 0 $
-------- -------- -------- ---------- -------- ------- -------- -----------
01/26/98 0 0 0 0 0
-------- -------- -------- ---------- -------- ------- -------- -----------
01/27/98 0 0 0 0 0
-------- -------- -------- ---------- -------- ------- -------- -----------
01/28/98 0 0 0 0 0
-------- -------- -------- ---------- -------- ------- -------- -----------
01/29/98 0 0 0 0 0
-------- -------- -------- ---------- -------- ------- -------- -----------
01/30/98 0 0 0 0 0
-------- -------- -------- ---------- -------- ------- -------- -----------
wkly.
totals 0 0 0 0 0 $
-------- -------- -------- ---------- -------- ------- -------- -----------
Grand Total 0 0 0 0 0 $
================================================================================
EXHIBIT C
BIGHORN SHEEP LOGO
SCHEDULE 2
FUNDS AVAILABLE UNDER
EACH CLASS OF CONTRACTS
Effective as of the Effective Date and January 2, 1997, the following Funds are
available under the Contracts:
========================================================================================
Contracts Marketing
Name Fund Fund Series
======================================================================================
X. Xxxx Price No-Load X. Xxxx Price Equity X. Xxxx Price Equity Income
Variable Annuity Series, Inc. Portfolio
X. Xxxx Price New America
Growth Portfolio
X. Xxxx Price Personal Strategy
Balanced Portfolio
X. Xxxx Price Mid-Cap
Growth Portfolio
---------------------------------------------------------------------------------------
X. Xxxx Price International X. Xxxx Price International
Series, Inc. Stock Portfolio
---------------------------------------------------------------------------------------
X. Xxxx Price Fixed Income X. Xxxx Price Limited-Term
Series, Inc. Bond Portfolio
X. Xxxx Price Prime Reserve
Portfolio
=======================================================================================
Effective as of May 1, 1998, this Schedule 2 is hereby amended to reflect the
following changes in Fund or Fund Series available under the Contracts:
=======================================================================================
Contracts Marketing
Name Fund Fund Series
=======================================================================================
X. Xxxx Price No-Load X. Xxxx Price Equity X. Xxxx Price Equity Income
Immediate Variable Series, Inc. Portfolio
Annuity X. Xxxx Price New America
Growth Portfolio
X. Xxxx Price Personal
Strategy Balanced Portfolio
X. Xxxx Price Mid-Cap
Growth Portfolio
---------------------------------------------------------------------------------------
X. Xxxx Price International X. Xxxx Price International
Series, Inc. Stock Portfolio
---------------------------------------------------------------------------------------
X. Xxxx Price Fixed Income X. Xxxx Price Limited-Term
Series, Inc. Bond Portfolio
X. Xxxx Price Prime Reserve
Portfolio
=======================================================================================
Effective as of February 1, 2001, this Schedule 2 is hereby amended to reflect
the following changes in Fund or Fund Series available under the Contracts:
=======================================================================================
Contracts Marketing
Name Fund Fund Series
=======================================================================================
X. Xxxx Price No-Load X. Xxxx Price Equity X. Xxxx Price Equity Income
Variable Annuity Series, Inc. Portfolio
X. Xxxx Price New America
Growth Portfolio
X. Xxxx Price Personal Strategy
Balanced Portfolio
X. Xxxx Price Mid-Cap Growth
Portfolio
X. Xxxx Price Blue Chip Growth
Portfolio
X. Xxxx Price Health Sciences
Portfolio
X. Xxxx Price Equity Index
500 Portfolio
---------------------------------------------------------------------------------------
X. Xxxx Price International X. Xxxx Price International
Series, Inc. Stock Portfolio
=======================================================================================
X. Xxxx Price Fixed Income X. Xxxx Price Limited-Term
Series, Inc. Bond Portfolio
X. Xxxx Price Prime Reserve
Portfolio
=======================================================================================
---------------------------------------------------------------------------------------
X. Xxxx Price No-Load X. Xxxx Price Equity X. Xxxx Price Equity Income
Immediate Variable Series, Inc. Portfolio
Annuity X. Xxxx Price New America
Growth Portfolio
X. Xxxx Price Personal Strategy
Balanced Portfolio
X. Xxxx Price Mid-Cap
Growth Portfolio
X. Xxxx Price Blue Chip
Growth Portfolio
X. Xxxx Price Health
Sciences Portfolio
X. Xxxx Price Equity
Index 500 Portfolio
---------------------------------------------------------------------------------------
X. Xxxx Price International X. Xxxx Price International
Series, Inc. Stock Portfolio
---------------------------------------------------------------------------------------
X. Xxxx Price Fixed Income X. Xxxx Price Limited-Term
Series, Inc. Bond Portfolio
X. Xxxx Price Prime Reserve
Portfolio
=======================================================================================
IN WITNESS WHEREOF, the parties hereby amend this Schedule 2 in accordance
with Article II of the Agreement.
SECURITY BENEFIT LIFE INSURANCE COMPANY
By its authorized officer
By: XXX X. XXX
---------------------------------------
Title: Vice President
Date: March 14, 2001
X. XXXX PRICE INVESTMENT SERVICES, INC
By its authorized officer
By: XXXXXXX XXXXXX
----------------------------------------
Title: Vice President
Date: March 23, 2001
X. XXXX PRICE ASSOCIATES, INC.
By its authorized officer
By: XXXXXX X. XXXXXX
---------------------------------------
Title: Vice President
Date: March 23, 2001
SCHEDULE 3
SEPARATE ACCOUNTS OF THE SECURITY BENEFIT
COMPANIES SUPPORTING THE CONTRACTS
Effective as of the Effective Date, the following separate account and
subaccounts are subject to the Agreement:
=================================================================================
Name of Separate Date Established by SEC 1940 Act Type of Product
Account and Board of Directors Registration Supported by
Subaccounts of the Company Number Account
=================================================================================
X. Xxxx Price Variable March 28, 1994 811-8724 Variable Annuity
Annuity Account
Equity Income
Subaccount
International Stock
Subaccount
Limited Term Bond
Subaccount
New America Growth
Subaccount
Personal Strategy
Balanced Portfolio
============================= =========================== =======================
Effective as of January 2, 1997, the following separate accounts and/or
subaccounts are hereby added to this Schedule 3 and made subject to the
Agreement:
=================================================================================
Name of Separate Date Established by SEC 1940 Act Type of Product
Account and Board of Directors Registration Supported by
Subaccounts of the Company Number Account
=================================================================================
Prime Reserve Not applicable 811-8724 Variable Annuity
Subaccount
Mid-Cap Growth
Subaccount
=================================================================================
Effective as of February 1, 2001, the following separate accounts and/or
subaccounts are hereby added to this Schedule 3 and made subject to the
Agreement:
=================================================================================
Name of Separate Date Established by SEC 1940 Act Type of Product
Account and Board of Directors Registration Supported by
Subaccounts of the Company Number Account
=================================================================================
Blue Chip Growth Not applicable 811-8724 Variable Annuity
Subaccount
Health Sciences
Subaccount
Equity Index 500
Subaccount
=================================================================================
IN WITNESS WHEREOF, the parties hereby amend this Schedule 3 in accordance with
Article II of the Agreement.
SECURITY BENEFIT LIFE INSURANCE COMPANY
By its authorized officer
By: XXX X. XXX
---------------------------------------
Title: Vice President
Date: March 14, 2001
X. XXXX PRICE INVESTMENT SERVICES, INC
By its authorized officer
By: XXXXXXX XXXXXX
----------------------------------------
Title: Vice President
Date: March 23, 2001
X. XXXX PRICE ASSOCIATES, INC.
By its authorized officer
By: XXXXXX X. XXXXXX
---------------------------------------
Title: Vice President
Date: March 23, 2001
