EX-99.h.5
JNL VARIABLE FUND III LLC
TRANSFER AGENCY AGREEMENT
AGREEMENT made as of this 31st day of January, 2001, by and between JNL
Variable Fund III LLC, a Delaware limited liability corporation (the "Variable
Fund"), and Xxxxxxx National Asset Management, LLC, a Michigan limited liability
corporation ("JNAM").
WITNESSETH
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WHEREAS, the Variable Fund is an open-end, management company
registered under the Investment Company Act of 1940 (the "1940 Act"); and
WHEREAS, the Variable Fund is empowered to issue units of beneficial
interest ("Units") in separate series ("Series"), each such Series, pursuant to
Section 18(f)(2) of the 1940 Act, being preferred over all other Series in
respect of the assets specifically allocated to such Series; and
WHEREAS, the Variable Fund presently intends to offer to insurance
company separate accounts and certain qualified retirement plans Units of 1
Series of the Variable Fund, listed in Exhibit A, (the "Current Portfolios") but
may create additional Series from time to time; and
WHEREAS, the Variable Fund desires to retain JNAM to render the
transfer agency and other services contemplated hereby with respect to each
Series of Units and the owners of record thereof ("Unitholders") and JNAM is
willing to render such services.
NOW, THEREFORE, in consideration of the premises and mutual convenants
hereinafter set forth, the parties hereto agree as follows:
1. Appointment. The Variable Fund hereby appoints JNAM to provide the
transfer agency and other services contemplated hereby with respect to each
Series of Units and Unitholders for the periods and on the terms set forth. JNAM
accepts such appointment and agrees to render such transfer agency and other
services for the compensation herein provided.
2. Duties to JNAM. JNAM will act as transfer agent with respect to each
Series of Units, provide information in connection with the Variable Fund's
preparation of various regulatory reports and prepare reports to the Managers
and management of the Variable Fund. In this connection, JNAM, subject to
Section 3 below, shall perform the following services (as may be from time to
time further specified in or modified by Exhibit A attached hereto by mutual
written consent of the parties):
(a) process purchase orders and redemption requests from
Unitholders, furnish confirmations and disburse redemption
proceeds;
(b) act as the income disbursing agent of the Variable Fund;
(c) provide periodic statements of account to each Unitholder;
(d) furnish necessary office space, facilities and personnel;
(e) maintain all records relating to its activities and
obligations under this Agreement in such manner as will
enable the Variable Fund and JNAM to meet their respective
obligations under: (i) the current prospectus; (ii) the 1940
Act, particularly Sections 30 and 31 thereof, and the rules
and regulations thereunder; (iii) applicable Federal and
state tax laws; and (iv) any other law or administrative
rule or procedure which may be applicable to the Variable
Fund or JNAM. JNAM shall preserve all records and other data
created and maintained pursuant to this Agreement in
accordance with Instructions from the Variable Fund;
(f) prepare and file with the Internal Revenue Service and with
the appropriate state agencies, and mail to the Unitholders
of record, such returns for reporting, and information as to
the Federal income tax consequences of, dividends and
distributions paid, created or withheld as are required on
the part of the Variable Fund or JNAM by the current
prospectus or applicable law or regulation to be so filed
and mailed. Without limiting the generality of the
foregoing, such returns and information shall be prepared in
conformity with such Instructions, if any, from the Variable
Fund as may be given to JNAM from time to time, and;
(g) render to the Variable Fund such periodic and special
reports as it may reasonably request.
3. Subcontracting. Upon written consent of the Variable Fund, JNAM may
subcontract certain obligations hereunder. JNAM shall remain responsible on a
primary basis to the Variable Fund for the timely and proper performance of such
obligations in accordance with the terms of this Agreement.
4. Fees and Expenses. For the services provided and the expenses assumed by
JNAM pursuant to this Agreement, the Variable Fund will pay JNAM through the
Advisory Fee.
5. Duration and Termination.
a. Subject to the provisions hereinafter set forth, this Agreement
shall commence on the date hereof and shall continue in force and
effect until terminated by either party by giving to the other
party written notice at least ninety (90) days in advance.
b. If either of the parties hereto shall breach this Agreement or be
in default in the performance of any of its duties and
obligations hereunder, the non-defaulting party may give written
notice thereof to the defaulting party and if such default or
breach shall not have been remedied within thirty (30) days after
such written notice is given, then the party giving such written
notice may terminate this Agreement at the end of such thirty
(30) day period. Termination of this Agreement by one party by
reason of default or breach of the other party shall not
constitute a waiver by the terminating party of any other rights
it might have under this Agreement against the other party,
including without limitation rights with reference to services
performed or not performed prior to such terminating or rights of
JNAM to be reimbursed for out-of-pocket expenditures or equipment
or communication circuit termination fees, if any.
c. If this Agreement is terminated for any reason, JNAM will act in
good faith to cooperate in an orderly transition to a successor
transfer agent or in an orderly termination of the operations of
the Variable Fund, as the case may be.
6. Representations, Warranties and Covenants.
a. JNAM represents and warrants to the Variable Fund, and covenants
to the Variable Fund for the duration of this Agreement, as
follows:
(i) It is a limited liability company duly organized and
existing and in good standing under the laws of the State of
Michigan;
(ii) It is empowered under applicable laws and regulations and by
its Operating Agreement to enter into and perform the
services contemplated in this Agreement;
(iii)All requisite proceedings have been taken to authorize it
to enter into and perform this Agreement;
(iv) It has and will continue to have and maintain the necessary
facilities, equipment and personnel to perform its duties
and obligations under this Agreement;
(v) It has obtained all federal and state regulatory approvals,
authorizations and licenses required to perform its duties
and obligations under this Agreement and will keep current
such approvals, authorizations and licenses; and
(vi) Various procedures and systems which it has implemented with
regard to safeguarding from loss or damage attributable to
fire, theft or any other cause the Variable Fund's records
and other data and JNAM's records, data, equipment,
facilities and other property used in the performance of its
obligations hereunder are adequate and that it will make
such changes therein from time to time as in its judgment
are required for the secure performance of its obligations
hereunder.
b. The Variable Fund represents and warrants to JNAM, and covenants
to JNAM for the duration of this Agreement, as follows:
(i) It is a limited liability company duly organized under the
laws of the State of Delaware;
(ii) It is, and at all times relevant hereto will continue to be,
an open-end management company registered under the
Investment Company Act of 1940:
(iii)A registration statement under the Securities Act of 1933
has been declared effective by the Securities and Exchange
Commission and will remain effective at all time relevant
hereto, and, if necessary, appropriate state securities laws
filings will have been made and will continue to be made at
all times relevant hereto; and
(iv) It is empowered under applicable laws and regulations and by
its Operating Agreement to enter into and perform this
Agreement; and all requisite proceedings have been taken to
authorize it to enter into and perform under this Agreement.
7. Instructions.
a. JNAM shall be deemed to have received Instructions (as that term
is used herein) upon receipt of written instructions (including
receipt by facsimile), which may be continuing instructions,
signed by one or more persons the Managers shall have from time
to time authorized to give the particular class of Instructions
in question. Different persons may be authorized to give
Instructions for different purposes, and Instructions may be
general or specific in terms. A certified copy of a bylaw,
resolution or action of the Managers of the Variable Fund may be
received and accepted by JNAM as conclusive evidence of the
authority of any such persons to act and may be considered to be
in full force and effect until receipt of written notice (or oral
notice followed by written confirmation within seven days) to the
contrary.
b. One or more designated persons may be authorized to issue oral
(such term as used herein including, without limitation,
telephoned) instructions, specifying the type or types of
instructions that may be so issued, in which case the Variable
Fund shall deliver to JNAM resolutions of the Managers to such
effect. Such oral instructions shall promptly be confirmed in
writing to JNAM. Such instructions when given in accordance with
the provisions hereof and with such resolutions shall be deemed
Instructions hereunder. In the case of conflict between oral
Instructions given by a person designated in the resolution of
the Managers referred to in the first sentence of this
subparagraph (b) and any written Instructions, the Instructions
most recently received by JNAM shall prevail following such
receipt, and in case of conflict between oral Instructions given
by a person designated in such resolution and any written
confirmation or purported confirmation of oral Instructions, such
written confirmation or purported confirmation shall prevail
following receipt thereof by JNAM; provided that any transaction
initiated by JNAM pursuant to such oral Instructions, may, but
need not, be completed by JNAM notwithstanding JNAM's receipt of
conflicting subsequent Instructions hereunder or written
confirmation or purported confirmation of oral Instructions
hereunder subsequent to JNAM's initiation of such transaction.
8. Status of JNAM as Independent Contractor. JNAM shall for all purposes
herein be deemed to be an independent contractor and shall, unless otherwise
expressly provided herein or authorized by the Managers of the Variable Fund
from time to time, have no authority to act for or represent the Variable Fund
in any way or otherwise be deemed an agent of the Variable Fund.
9. Managers, Officer and Unitholder Liability. This Agreement is executed
by or on behalf of the Variable Fund and the obligations hereunder are not
binding upon any of the Managers, Officers or Unitholders of the Variable Fund
individually but are binding only upon the Variable Fund and its assets and
property. All obligations of the Variable Fund under this Agreement shall apply
only on a Series by Series basis, and the assets of one Series shall be liable
for the obligations of another Series.
10. Indemnification.
a. JNAM shall not be responsible for, and the Variable Fund shall
indemnify and hold JNAM harmless from and against, any and all
losses, damages, costs, charges, counsel fees, payments, expenses
and liability which may be asserted against JNAM or for which
JNAM may be held to be liable, arising out of or attributable to:
(i) All actions of JNAM required to be taken by it pursuant to
this Agreement provided that JNAM has not acted in bad
faith, gross negligence or willful misconduct;
(ii) The Variable Fund's refusal or failure to comply with the
terms of this Agreement, the Variable Fund's gross
negligence or willful misconduct, or the breach of any
representation or warranty of the Variable Fund hereunder;
(iii)The good faith reliance on, or the carrying out of, any
written or oral Instructions or requests of persons
designated pursuant to Section 7 hereof as persons who are
authorized to give instruction on behalf of the Variable
Fund, or representatives of the Variable Fund's investment
adviser or sponsor, or JNAM's good faith reliance on, or use
of, information, data, records and documents received them,
or which have been prepared and/or maintained by the
Variable Fund, its investment adviser or sponsor;
(iv) Any non-payment for Unit orders previously entered;
(v) The offer or sale of the Variable Fund's Units in violation
of any requirement under federal securities laws or
regulations or the securities laws or regulations of any
state or in violation of any stop order or other
determination or ruling by any federal agency or state with
respect to the offer or sale of such Units in such state;
(vi) The Variable Fund's errors and mistakes in the use of any
information provided by JNAM;
(vii) Errors, inaccuracies and omissions in, or errors,
inaccuracies or omissions of JNAM arising out of or
resulting from such errors, inaccuracies and omissions in,
the Variable Fund's records, Unitholders and other records,
delivered to JNAM hereunder by the Variable Fund or its
agent(s); and
(viii) The condition of any endorsements, markings or the like on
any redemption order or other writing submitted by any
Unitholder or other person or entity in connection with
JNAM's duties hereunder, provided that notwithstanding the
foregoing JNAM shall be responsible for losses arising out
of the forgery on a redemption order or other written
redemption request of the signature of the Unitholder whose
Units are sought to be redeemed if by only if: (A) such
losses resulted from and no losses would have occurred if
not for JNAM's own bad faith, gross negligence or willful
misconduct; (B) the particular Unitholder or the Variable
Fund notifies JNAM in writing of such forgery or the
suspicion thereof within fifteen (15) days after JNAM sends
the monthly statement on which the item first appears to the
Unitholder and the Variable Fund; (C) the Variable Fund and
the Unitholder have themselves acted in good faith and
exercised reasonable care in connection with such redemption
order in all respects; and (D) prior to JNAM's processing of
such redemption order JNAM has been furnished with a
current, legible signature card (or mutually agreed upon
substitute therefor) for such Unitholder.
b. JNAM shall indemnify and hold the Variable Fund harmless from and
against any and all losses, damages, costs, charges, counsel
fees, payments, expenses and liability arising out of JNAM's
failure to comply with the terms of this Agreement or arising out
of or attributable to JNAM's bad faith, gross negligence or
willful misconduct or breach of any representation or warranty of
JNAM hereunder.
c. At any time JNAM may apply to any person authorized pursuant to
Section 7 hereof for instructions, and may, with the prior
consent of the Variable Fund, consult with legal counsel for the
Variable Fund, its investment adviser or sponsor, or with JNAM's
own legal counsel, all at the expense of the Variable Fund, with
respect to any matter arising in connection with the services to
be performed by JNAM under this Agreement, and JNAM shall not be
liable and shall be indemnified by the Variable Fund for any
action taken or omitted by it in good faith in reliance upon such
instructions or upon the opinion of such counsel. JNAM shall be
protected and indemnified in acting upon any paper or document
reasonably believed by it to be genuine and to have been signed
by any person or persons whom JNAM reasonably believes to have
been authorized to represent the Variable Fund and shall not be
held to have notice of any change of authority of any person
until receipt of written notice thereof from the Variable Fund.
JNAM shall also be protected and indemnified in recognizing stock
certificates which JNAM reasonably believes to bear the proper
manual or facsimile signatures of the officers of the Variable
Fund, and proper counter signature of any former transfer agent
or registrar, or of a co-transfer agent or co-registrar.
d. In the event that either party is unable to perform its
obligations under the terms of this Agreement because of acts of
God, strikes, failure or damage of primary and secondary
equipment, utility or transmission facilities resulting from
circumstances beyond the control of such party, or other causes
reasonably beyond its control, such party shall be liable for
damages to the other resulting from such failure to perform,
provided that each party shall in all cases fully cooperate with
the other and take such measures as may be reasonably requested
so as to enable the Variable Fund to continue operations.
e. Each party shall promptly notify the other in writing of any
situation which presents or appears to involve a claim which may
be subject to indemnification hereunder and the indemnifying
party shall have the option to defend against any such claim. In
the event the indemnifying party so elects, it will notify the
indemnified party and shall assume the defense of such claim, and
the indemnified party shall cooperate fully with the indemnifying
party, at the indemnifying party's expense, in the defense of
such claim. Notwithstanding the foregoing, the indemnified party
shall be entitled to participate in the defense of such claim at
its own expense through counsel of its own choosing. Neither
party shall confess any claim nor make any compromise in any
action or proceeding in which the other party shall be named or
for which indemnification may be sought under this Agreement
without the other party's prior written consent.
f. IN NO EVENT AND UNDER NO CIRCUMSTANCES SHALL EITHER PARTY TO THIS
AGREEMENT, OR EITHER PARTY'S DIRECTORS OR MANAGERS, OFFICERS
EMPLOYEES OR AGENTS, BE LIABLE TO ANYONE INCLUDING, WITHOUT
LIMITATION, THE OTHER PARTY OR SUCH OTHER PARTY'S DIRECTORS OR
VARIABLE FUNDEES, OFFICERS, EMPLOYEES OR AGENTS, FOR
CONSEQUENTIAL DAMAGES FOR ANY ACT OR FAILURE TO ACT UNDER ANY
PROVISION OF THIS AGREEMENT EVEN IF ADVISED OF THE POSSIBILITY
THEREOF.
11. Books, Records and Other Proprietary Information.
a. As required by Section 31 of the Investment Company Act of 1940
and Rules thereunder, JNAM agrees that all records maintained by
JNAM relating to the services to be performed by JNAM under this
Agreement are the property of the Variable Fund and will be
preserved and will be surrendered promptly to the Variable Fund
or made available for inspection by persons designated by the
Variable Fund on request.
b. JNAM and the Variable Fund agree that all books, records,
information and data pertaining to the business of the other
party or relating to the design, structure or operation of any
computer systems which are exchanged or received or disclosed
pursuant to the negotiation of and the carrying out of this
Agreement (including Proprietary Information, as defined in
Subsection c below) are and shall remain confidential, and shall
be voluntarily disclosed to any other person without the written
consent of the other. Upon termination of this Agreement, each
party shall return to the other all such books, records and
written information and data pertaining to the business of the
other. JNAM shall notify the Variable Fund of any request or
demand to inspect the records of the Variable Fund and will act
upon the instructions of the Variable Fund as to permitting or
refusing such inspection, except where otherwise required by law.
c. The Variable Fund acknowledges that any software programs,
supporting documentation or procedures relating to or making up
any system developed by JNAM in connection with the services
provided by JNAM hereunder "Proprietary Information") are
confidential and are proprietary to and trade secrets of JNAM and
that any unauthorized use, misuse, disclosure or taking of any
Proprietary Information residing or existing internal or external
to a computer, computer system or computer network, or the
knowing and unauthorized accessing or causing to be accessed of
any computer, computer system or computer network, may be subject
to civil liabilities and criminal penalties under applicable
state law. The Variable Fund will, and will cause its investment
adviser and sponsor to, so advise each of their employees and
agents who have access to any Proprietary Information or to any
computer equipment capable of accessing the same. The Variable
Fund further agrees that it, its investment adviser and sponsor
will use and employ the Proprietary Information in accordance
with the procedures set forth in the reference manuals delivered
thereto, each of the foregoing shall utilize the control
procedures set forth and described therein, and each of the
foregoing shall verify promptly reports received through use of
the Proprietary Information.
12. Notice. Without limiting the other provisions hereof, notices and other
writings delivered or mailed postage prepaid as follows: (a) if to the Variable
Fund, to 0 Xxxxxxxxx Xxx, Xxxxxxx, Xxxxxxxx 00000, attention: Xxxxx X. Xxxx; (b)
if to JNAM, to 000 Xxxx Xxxxxx Xxxxx, Xxxxx 0000, Xxxxxxx, Xxxxxxxx 00000,
Attention: Xxxx X. Xxxxx; or (c) to such other address as the Variable Fund or
JNAM may hereafter specify by written notice to the most recent address
specified by the party to whom such notice is addressed, shall be deemed to have
been properly delivered or given hereunder to the respective addresses.
13. Forum. THE VARIABLE FUND IRREVOCABLY AGREES THAT, SUBJECT TO THE
AGENT'S SOLE AND ABSOLUTE ELECTION, ALL SUITS, ACTIONS OR OTHER PROCEEDINGS IN
ANY WAY, MANNER OR RESPECT, ARISING OUT OF OR FROM CONNECTION HEREWITH SHALL BE
SUBJECT TO LITIGATION IN COURTS HAVING SITUS WITHIN THE STATE OF MICHIGAN. THE
VARIABLE FUND HEREBY CONSENTS AND SUBMITS TO THE JURISDICTION OF ANY LOCAL,
STATE OR FEDERAL COURT LOCATED WITHIN SAID CITY AND STATE. THE VARIABLE FUND
HEREBY WAIVES ANY RIGHT IT MAY HAVE TO REQUEST OR DEMAND TRIAL BY JURY, TO
TRANSFER OR CHANGE THE VENUE OF ANY SUIT, ACTION OR OTHER PROCEEDING BROUGHT
AGAINST THE VARIABLE FUND BY JNAM IN ACCORDANCE WITH THIS SECTION, OR TO CLAIM
THAT ANY SUCH PROCEEDING HAS BEEN BROUGHT IN AN INCONVENIENT FORUM. THE VARIABLE
FUND ACKNOWLEDGES THAT ITS WAIVER OF JNAM TO ENTER INTO THIS AGREEMENT.
14. Miscellaneous. The Operating Agreement of Variable Fund as amended is
on file with the Secretary of The State of Delaware. The captions in this
Agreement are included for convenience of reference only and in no way define or
delimit any of the provisions hereof or otherwise affect their construction or
effect. If any provision of this Agreement shall be held or made invalid by a
court decision, statute, rule or otherwise, the remainder of this Agreement
shall not be affected thereby. Any provision in this Agreement requiring
compliance with any statute or regulation shall mean such statute or regulation
as amended and in effect from time to time. This Agreement shall be construed in
accordance with the laws of the State of Michigan (except as to paragraph 9
hereof which shall be construed in accordance with the laws of the State of
Delaware) and, subject to the other provisions hereof, shall be binding upon and
inure to the benefit of the parties hereto and their respective successors.
Neither this Agreement nor any rights or obligations hereunder may be assigned
by either party without the prior written consent of the other. This Agreement
constitutes the entire agreement between the parties hereto and supersedes any
prior agreement with respect to the subject matter hereof, whether oral or
written. This Agreement (including any exhibits or schedules hereto) may not be
amended except by written instrument executed by both parties, and any such
amendment which increases or otherwise alters JNAM's duties or obligations shall
not apply to any transaction or matter arising or occurring prior to such
amendment.
IN WITNESS WHEREOF, the parties have caused this instrument to be executed
as of the day and year first above written.
ATTEST: JNL VARIABLE FUND III LLC
___________________________ By:______________________________
Xxxx X. Xxxxx
As Its Vice President & Assistant
Treasurer
ATTEST: XXXXXXX NATIONAL ASSET
MANAGEMENT, LLC
___________________________ By:______________________________
Xxxxx X. Xxxx
As Its Secretary
EXHIBIT A
JNL/First Trust the Xxx XX Target 10 Series
