EXHIBIT 24(C)(8)(JJ)
FUND PARTICIPATION AND SERVICE AGREEMENT
Minnesota Life Insurance Company ("Insurance Company"), for itself and on
behalf of one or more separate accounts of the Insurance Company ("Separate
Accounts"), American Funds Distributors, Inc. ("AFD"), American Funds Service
Company ("Transfer Agent"), Capital Research and Management Company ("CRMC"),
and the American Funds Insurance Series (the "Series"), an open-end investment
company for which AFD, CRMC and Transfer Agent provide services and which is
divided into funds (hereinafter collectively called the "Funds" and,
individually, a "Fund"), for good and valuable consideration, hereby agree on
this 7/th/ day of January 2011, that Class 1 or Class 2 shares of the Funds
(collectively "shares" or individually "Class 1 Shares" or "Class 2 Shares")
shall be made available to serve as underlying investment media for certain
variable annuity contracts and life insurance policies (hereinafter called
"Contract(s)"; holders of such Contracts hereinafter called
"Contractholder(s)") to be offered by the Insurance Company subject to the
following provisions:
1. Authorization; Services.
a. As distributor of the Series, AFD agrees to make shares of the Funds
listed on the attached Exhibit A available to the Insurance Company for
itself and on behalf of the Separate Accounts on the attached Exhibit B
pursuant to the terms of this Agreement. The Insurance Company will
offer shares of the Funds in connection with the sale of Contracts to
Contractholders. Fund shares to be made available to Separate Accounts
for the Contracts shall be sold by the Series and purchased by the
Insurance Company for a given account in accordance with the provisions
of this Agreement and at the net asset value of the respective class of
the respective Fund (without the imposition of a sales load) computed in
accordance with the provisions of the then current Prospectus of the
Series. This Agreement is in all respects subject to statements
regarding the sale and repurchase or redemption of shares made in the
offering prospectuses of the Funds, and to the applicable Rules of
FINRA, which shall control and override any provision to the contrary in
this Agreement.
b. Transfer Agent hereby appoints Insurance Company as limited agent and
designee with respect to shares of the Funds purchased, held, and
redeemed by the Separate Accounts solely for purposes of the provisions
of this Agreement, and Insurance Company accepts such appointment, on
the terms set forth herein.
c. The Insurance Company, directly or through subcontractors (including a
designated affiliate), shall provide the certain services described in
this Agreement on behalf of AFD, Transfer Agent and the Funds in
connection with the sale and servicing of the Contracts. The services to
be provided by the Insurance Company to its Separate Accounts include,
(i) mailing and otherwise making available to Contractholders,
shareholder communications including, without limitation, prospectuses,
shareholder reports, unaudited semi-annual and audited
annual financial statements, and other notices; (ii) handling general
questions regarding the Accounts or the Funds from Contractholders; and
(iii) preparing and mailing periodic account statements showing the
total number of Separate Account units owned by the Contractholder in
that account, the value of such units, and purchases, redemptions,
dividends, and distributions in the account during the period covered by
the statement. Administrative services to Contractholders shall be the
responsibility of the Insurance Company and shall not be the
responsibility of AFD, Transfer Agent or any of their affiliates.
d. Insurance Company shall transmit to Transfer Agent or the Funds (or to
any agent designated by either of them) such information in the
possession of Insurance Company concerning the Contractholders as shall
reasonably be necessary for Transfer Agent to provide services as
transfer agent for the Funds and as any Fund shall reasonably conclude
is necessary to enable that Fund to comply with applicable state Blue
Sky laws or regulations.
2. a. The Insurance Company will be entitled to a Rule 12b-1 service fee paid
by the Series, to be accrued daily and paid monthly at an annual rate of
0.25% of the average daily net assets of the Class 2 shares of each Fund
attributable to the Contracts for personal services and account
maintenance services for Contract owners for as long as the Series' Plan
of Distribution pursuant to Rule 12b-1 under the 1940 Act remains in
effect.
b. The Series will promptly notify Insurance Company of any potential
change in its 12b-1 plan. If the Series 12b-1 plan is no longer
effective or is no longer applicable to the Funds in the Contracts (the
"12b-1 Termination"), AFD, CRMC and the Series shall discuss with
Insurance Company, in good faith, alternate fee arrangements and/or a
reallocation of marketing expenses. If no new agreement is reached
within thirty days after the 12b-1 Termination (or at such later date
mutually acceptable to all of the parties), Insurance Company, at its
option, may elect to terminate this Agreement, and/or may elect to
obtain an order of exemption pursuant to Section 26(b) of the 1940 Act
("Substitution Order") for the Fund(s) or a vote of Contract owners
authorizing redemption and substitution of Fund shares. The Series, AFD
and CRMC shall cooperate with Insurance Company in obtaining and
implementing any such Substitution Order.
3. Compliance with Laws; Reliance on Instructions.
a. AFD and CRMC acknowledge and agree that Insurance Company is not
responsible for: (i) any information contained in any prospectus,
registration statement, annual report, proxy statement, or item of
advertising or marketing material prepared by AFD and/or CRMC, which
relates to any Fund; (ii) registration or qualification of any shares of
any Fund under any federal or state laws; or (iii) compliance by AFD,
CRMC and the Funds with all applicable federal and state laws, rules and
regulations, the rules and regulations of any self-
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regulatory organization with jurisdiction (the foregoing laws, rules and
regulations are collectively referred to herein as "Applicable Law")
over AFD, CRMC or Funds, and the provisions of the Funds' prospectus and
statement of additional information.
b. Insurance Company acknowledges and agrees that it is responsible for
(i) any representations concerning the Funds made by Insurance Company
or its agents that are not included in the prospectuses, statements of
additional information or advertising or marketing material relating to
the Funds and prepared or approved in writing by AFD; (ii) satisfying
prospectus delivery requirements, to the extent required by law; and
(iii) in connection with the services performed in connection with this
Agreement, the compliance or failure to comply with any Applicable Law
with jurisdiction over Insurance Company.
c. Insurance Company and its affiliates shall make no representations
concerning the Funds' shares except those contained in the then current
Prospectus of the Series, in such printed information subsequently
issued on behalf of the Series or other funds managed by CRMC as
supplemental to the Series' Prospectus, in information published on the
Series' or CRMC's internet site, or in materials approved by AFD, as
provided in the Business Agreement in effect among Insurance Company,
AFD and CRMC dated as of the date hereof (the "Business Agreement").
d. Each party is entitled to rely on any written records or instructions
provided to it by responsible persons of the other party(ies).
4. Insurance Company Representations and Warranties.
a. The Insurance Company represents and warrants that:
(i) it has the corporate power and the authority to enter into and
perform all of its duties and obligations under this Agreement;
(ii) this Agreement constitutes its legal, valid and binding obligation,
enforceable against each above-named party in accordance with its terms;
(iii) no consent or authorization of, filing with, or other act by or in
respect of any governmental authority is required in connection with the
execution, delivery, performance, validity or enforceability of this
Agreement;
(iv) it will or has established the Separate Accounts as separate
accounts under Minnesota Insurance law;
(v) it has registered the Separate Accounts as unit investment trusts
under the Investment Company Act of 1940, as amended (the "1940 Act"),
to serve as
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investment vehicles for certain Contracts or, alternatively, has not
registered one or more of the Separate Accounts in proper reliance upon
an exclusion from registration under the 1940 Act;
(vi) the Contracts are or will be and at the time of issuance will be
treated as annuity contracts and life insurance policies, as applicable,
under applicable provisions of the Internal Revenue Code of 1986, as
amended, and the regulations thereunder (the "Code"), that Insurance
Company will maintain such treatment and that it will notify the Series
immediately upon having a reasonable basis for believing that the
Contracts have ceased to be so treated or that they might not be so
treated in the future;
(vii) the offer of the Contracts has been registered with the U.S.
Securities and Exchange Commission (the "SEC") under the Securities Act
of 1933, as amended (the "1933 Act"), or it is properly exempt from
registration under the 1933 Act, and each such registration statement
and any further amendments or supplements thereto will, when they become
effective, conform in all material respects to the requirements of the
1933 Act, and the rules and regulations of the SEC thereunder, and will
not contain any untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the
statements therein not misleading; provided, however, that this
representation and warranty shall not apply to any statement or omission
made in reliance upon and in conformity with the information furnished
in writing to Insurance Company by AFD, Transfer Agent, CRMC or the
Series expressly for use therein;
(viii) the Contracts provide for the allocation of net amounts received
by the Insurance Company to the Separate Accounts, for investment in the
shares of specified investment companies selected among those companies
available through the Separate Accounts to act as underlying investment
media;
(ix) it is validly existing as a stock life insurance company under the
laws of the State of Minnesota, with power (corporate or other) to own
its properties and conduct its business, and is duly qualified for the
transaction of business and is in good standing under the laws of each
other jurisdiction in which it owns or leases properties, or conducts
any business to the extent such qualification is required. Insurance
Company agrees to notify AFD immediately in writing if any of the
foregoing representations ceases to be true to a material extent.
(x) any information furnished in writing by Insurance Company for use in
the registration statement or annual report of the Series will not
contain any untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the
statements therein not misleading, nor result in the Series'
registration statement's failing to materially conform in all respects
to the requirements of the 1933 Act and 1940 Act and the rules and
regulations thereunder;
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(xi) investment by each Separate Account in a Fund is in reliance on and
consistent with the terms of the Series' Mixed and Shared Funding Order;
and
(xiii) the Separate Accounts invest in the Funds in reliance on the
status of each Separate Account as a "Permitted Investor" within the
meaning of Section 817(h)(4)(A) of the Internal Revenue Code of 1986, as
amended.
5. Representations and Warranties of AFD, Transfer Agent, CRMC and the Series.
a. AFD and Transfer Agent each represents and warrants (as applicable) that:
(i) this Agreement constitutes its legal, valid and binding obligation,
and is enforceable against it in accordance with its terms;
(ii) no consent or authorization of, filing with, or other act by or in
respect of any governmental authority is required in connection with the
execution, delivery, performance, validity or enforceability of this
Agreement;
(iii) the execution, performance and delivery of this Agreement by it
will not result in its violating any Applicable Law or breaching or
otherwise impairing any of its contractual obligations;
(iv) AFD represents that the Funds are registered as investment
companies under the 1940 Act and Fund shares sold by the Funds are, and
will be, registered under the Securities Act of 1933, as amended;
(v) AFD represents that it is registered as a broker-dealer under the
Securities Exchange Act of 1934, as amended, and may properly cause Fund
shares to be made available for the purposes of this Agreement;
(vi) Shares of the Series may be offered to separate accounts of various
insurance companies in addition to Insurance Company. AFD represents,
warrants and covenants that no shares of the Series shall be sold to the
general public in contravention of Section 817 of the Internal Revenue
Code of 1986, as amended, and the regulations thereunder (the "Code").
(vii) it has the corporate power and the authority to enter into and
perform all of its duties and obligations under this Agreement;
(viii) AFD and its affiliates are solely responsible for information
contained in any prospectus, registration statement, annual report,
proxy statement, or item of advertising or marketing material prepared
by AFD relating to any Fund; and
(ix) AFD represents that prospectuses, other materials concerning the
Funds
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are complete and accurate in all material respects and do not contain
any material omission or misstatement of a material fact necessary to
make the information not misleading or untrue.
b. CRMC and the Series represent and warrant that:
(i) the Series is, and shall be at all times while this Agreement is in
force, lawfully organized, validly existing, and properly qualified as
an open-end management investment company in accordance with the laws of
the Commonwealth of Massachusetts;
(ii) a registration statement under the 1933 Act and under the 1940 Act
with respect to the Series has been filed with the SEC in the form
previously delivered to Insurance Company and the Series' registration
statement and any further amendments thereto will, when they become
effective, and all definitive prospectuses and statements of additional
information and any further supplements thereto (the "Prospectus")
shall, conform in all material respects to the requirements of the 1933
Act and the 1940 Act and the rules and regulations of the SEC
thereunder, and will not contain any untrue statement of a material fact
or omit to state a material fact required to be stated therein or
necessary to make the statement therein not misleading; provided,
however, that this representation and warranty shall not apply to any
statements or omissions made in reliance upon and in conformity with
information furnished in writing to CRMC or the Series by Insurance
Company expressly for use therein.
(iii) Each Fund will comply with the diversification requirements of
Section 817 and shall maintain its qualification as a "regulated
investment company" ("RIC") under the Code.
(iv) The Series makes no representation or warranty as to whether any
aspect of its operations (including but not limited to fees expenses and
investment policies) complies or will comply with the insurance laws or
regulations of the various states.
6. Omnibus Accounts. The Funds recognize that the Insurance Company, for itself
or on behalf of the Separate Accounts, will be the sole shareholder of
shares of the Funds issued pursuant to the Contracts, and that the Insurance
Company intends to establish one or more omnibus accounts per Fund. Such
arrangement will result in aggregated share orders. In the event that the
aggregate Contractholder accounts maintained by the Insurance Company do not
balance with the omnibus accounts maintained by the Transfer Agent, neither
the Transfer Agent, any of its affiliates nor the Funds shall be liable to
the Contractholders for any shortfall, provided that such shortfall is not a
result of an error or omission on the part of the Transfer Agent, its
affiliates or the Funds.
7. Pricing Information. The Series or the Transfer Agent will compute the
closing net asset
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value, and any distribution information (including the applicable ex-date,
record date, payable date, distribution rate per share, income accrual and
capital gains information) for each Fund as of the close of regular trading
on the New York Stock Exchange (normally 4:00 p.m. Eastern Time) on each day
the New York Stock Exchange is open for business (a "Business Day") or at
such other time as the net asset value of a Fund is calculated, as disclosed
in the relevant Funds' current prospectuses. The Series or the Transfer
Agent will use their best efforts to communicate to the Insurance Company
such information by 6:30 p.m. Eastern Time on each Business Day. Such
information shall be accurate and true in all respects and updated
continuously.
8. Pricing Adjustments.
a. In the event an adjustment is made to the computation of the net asset
value of Fund shares as reported to Insurance Company under paragraph 7,
(1) the correction will be handled in a manner consistent with SEC
guidelines and the Investment Company Act of 1940, as amended and
(2) the Funds or Transfer Agent shall notify Insurance Company as soon
as practicable after discovering the need for any such adjustment.
Notification may be made in the following manner:
Method of Communication
(i) Fund/SERV Transactions. The parties agree that they will ordinarily
choose to use the National Securities Clearing Corporation's Mutual Fund
Settlement, Entry and Registration Verification ("Fund/SERV") system,
and if Fund/SERV is used, any corrections to the fund prices for the
prior trade date will be submitted through the Mutual Fund Profile with
the correct fund prices and applicable date.
(ii) Manual Transactions. If there are technical problems with
Fund/SERV, or if the parties are not able to transmit or receive
information through Fund/SERV, any corrections to the fund prices should
be communicated by facsimile or by electronic transmission acceptable to
Transfer Agent, and will include for each day on which an adjustment has
occurred the incorrect Fund price, the correct price, and, to the extent
communicated to the applicable Fund's shareholders, the reason for the
adjustment. Funds and Transfer Agent agree that the Insurance Company
may send this notification or a derivation thereof (so long as such
derivation is approved in advance by Funds or AFD, as applicable) to
Contractholders whose accounts are affected by the adjustment.
b. To the extent a price adjustment results in a deficiency or excess to a
Contractholder's account, Insurance Company and Transfer Agent agree to
evaluate the situation together on a case-by-case basis with the goal
towards pursuing an appropriate course of action. To the extent the
price adjustment was due to Transfer Agent's error, Transfer Agent shall
reimburse Contractholder's account.
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9. Purchases and Redemption Orders; Settlement of Transactions
a. Manual Transactions. Manual transactions via facsimile shall be used by
Insurance Company only in the event that Insurance Company is in receipt
of orders for purchase or redemption of shares and is unable to transmit
the orders to the Transfer Agent due to unforeseen circumstances such as
system wide computer failures experienced by Insurance Company or the
National Securities Clearing Corporation ("NSCC") or other events beyond
the Insurance Company's reasonable control. In the event manual
transactions are used, the following provisions shall apply:
(i) Next Day Transmission of Orders. The Insurance Company will notify
the Transfer Agent by 7:00 a.m. Eastern Time, on the next Business Day
the aggregate amounts of purchase orders and redemption orders, that
were placed by Contractholders in each Separate Account by 4:00 p.m.
Eastern time on the prior Business Day (the "Trade Date"). Insurance
Company represents that orders it receives after 4:00 p.m. Eastern time
on any given Business Day will be transmitted to the Transfer Agent
using the following Business Day's net asset value. Transfer Agent may
process orders it receives after the 7:00 a.m. deadline using the net
asset value next determined.
(ii) Purchases. All orders received by Insurance Company by 4:00 p.m. on
a Business Day and communicated to the Transfer Agent by the 7:00 a.m.
deadline shall be treated by the Transfer Agent as if received as of the
close of trading on the Trade Date and the Transfer Agent will therefore
execute orders at the net asset values determined as of the close of
trading on the Trade Date. Insurance Company will initiate payment by
wire transfer to a custodial account designated by the Funds for the
aggregate purchase amounts prior to 4:00 p.m. Eastern time on the next
Business Day following Trade Date.
(iii) Redemptions. Aggregate orders for redemption of shares of the
Funds will be paid in cash and wired from the Funds' custodial account
to an account designated by the Insurance Company. Transfer Agent will
initiate payment by wire to Insurance Company or its designee proceeds
of such redemptions two Business Days following the Trade Date (T+2).
b. Fund/SERV Transactions. The parties will ordinarily use the Fund/SERV
system, and if used, the following provisions shall apply:
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(i) Without limiting the generality of the following provisions of this
section, the Insurance Company and Transfer Agent each will perform any
and all duties, functions, procedures and responsibilities assigned to
it and as otherwise established by the NSCC applicable to Fund/SERV and
the Networking Matrix Level utilized.
(ii) Any information transmitted through Networking by any party to the
other and pursuant to this Agreement will be accurate, complete, and in
the format prescribed by the NSCC. Each party will adopt, implement and
maintain procedures reasonably designed to ensure the accuracy of all
transmissions through Networking and to limit the access to, and the
inputting of data into, Networking to persons specifically authorized by
such party.
(iii) Same Day Trades. On each Business Day, the Insurance Company shall
aggregate and calculate the purchase orders and redemption orders for
each Separate Account received by the Insurance Company prior to 4:00
p.m. Eastern time. The Insurance Company shall communicate to Transfer
Agent for that Trade Date, by Fund/SERV, the aggregate purchase orders
and redemption orders (if any) for each Separate Account received by
4:00 p.m. Eastern time on such Trade Date by no later than 5:00 a.m.
Eastern time on the following Business Day. Transfer Agent shall treat
all trades communicated to Transfer Agent in accordance with the
foregoing as if received prior to 4:00 p.m. Eastern time on the Trade
Date. All orders received by the Insurance Company after 4:00 p.m.
Eastern time on a Business Day shall not be transmitted to NSCC prior to
5:00 a.m. Eastern time on the following Business Day, and Insurance
Company represents that orders it receives after 4:00 p.m. Eastern time
on any given Business Day will be transmitted to the Transfer Agent
using the following Business Day's net asset value. Transfer Agent may
process orders it receives after the 5:00 a.m. deadline using the net
asset value next determined.
(iv) When transmitting instructions for the purchase and/or redemption
of shares of the Funds, Insurance Company shall submit one order for all
contractholder purchase transactions and one order for all
contractholder redemption transactions, unless otherwise agreed to by
the Insurance Company and the Transfer Agent.
c. Contingencies. All orders are subject to acceptance by Transfer Agent
and become effective only upon confirmation by Transfer Agent. Upon
confirmation, the Transfer Agent will verify total purchases and
redemptions and the closing share position for each fund/account. In the
case of delayed settlement, Transfer Agent and Insurance Company shall
make arrangements for the settlement of redemptions by wire no later
than the time permitted for settlement of redemption orders by the
Investment Company Act of 1940.
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Such wires for Insurance Company should be sent to:
USBank NA
000 Xxxxxxxx Xxx
Xxxxxxxxxxx, XX 00000
Routing #: 000000000
Account #: 180110006004
Account Name: Minnesota Life Insurance Co. General
Account, 000 Xxxxxx Xx X, Xx Xxxx, XX 00000
OBI/Additional Information: Fund Accounting, x56918,
AFIS Funds
Such wires for Transfer Agent should be sent to:
XXXXX FARGO BANK
000 XXXXXXXX XXXX. 00XX XXXXX
XXX XXXXXXX, XX 00000
ABA#: 000000000
AFS ACCOUNT#: 4100-060532
FOR CREDIT TO AFS ACCT. NO. (ACCOUNT NUMBER AND FUND)
FBO MINNESOTA LIFE INSURANCE COMPANY
d. Processing Errors. Processing errors which result from any delay or
error caused by Insurance Company may be adjusted through the NSCC
System by Insurance Company by the necessary transactions on a current
basis.
e. Coding. If applicable, orders for the purchase of Fund shares shall
include the appropriate coding to enable Transfer Agent to properly
calculate commission payments to any broker-dealer firm assigned to the
Separate Account.
f. Reconciliation. Insurance Company shall reconcile share positions with
respect to each Fund for each Separate Account as reflected on its
records to those reflected on statements from Transfer Agent and shall,
on request, certify that each Separate Account's share positions with
respect to each Fund reported by Transfer Agent reconcile with Insurance
Company's share positions for that Separate Account. Insurance Company
shall promptly inform Transfer Agent of any record differences and shall
identify and resolve all non-reconciling items within five business days.
g. Verification. Within a reasonable period of time after receipt of a
confirmation relating to an instruction, Insurance Company shall verify
its accuracy in terms of such instruction and shall notify Transfer
Agent of any errors appearing on such confirmation.
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h. Order Processing. Any order by Insurance Company for the purchase of
shares of the respective Funds through AFD shall be accepted at the time
when it is received by AFD/Transfer Agent (or any clearinghouse agency
that AFD/Transfer Agent may designate from time to time), and at the
offering and sale price determined in accordance with this Agreement,
unless rejected by AFD, Transfer Agent or the respective Funds. In
addition to the right to reject any order, the Funds have reserved the
right to withhold shares from sale temporarily or permanently.
AFD/Transfer Agent will not accept any order from Insurance Company that
is placed on a conditional basis or subject to any delay or contingency
prior to execution. The procedure relating to the handling of orders
shall be subject to instructions that AFD shall forward from time to
time. The shares purchased will be issued by the respective Funds only
against receipt of the purchase price, in collected New York or Los
Angeles Clearing House funds. If payment for the shares purchased is not
received within three days after the date of confirmation, the sale may
be cancelled by AFD or by the respective Funds without any
responsibility or liability on the part of AFD or the Funds, and AFD
and/or the respective Funds may hold the Insurance Company responsible
for any loss, expense, liability or damage, including loss of profit
suffered by AFD and/or the respective Funds, resulting from Insurance
Company's delay or failure to make payment as aforesaid.
i. Dividends and Distributions. The Transfer Agent shall furnish notice
promptly to the Insurance Company of any dividend or distribution
payable on any Funds held by the Separate Accounts. The Insurance
Company hereby elects to receive all such dividends and distributions as
are payable on shares of a Fund recorded in the title for the
corresponding Separate Account in additional shares of that Fund. The
Series shall notify the Insurance Company of the number of shares so
issued. All such dividends and distributions shall be automatically
reinvested at the ex-dividend date net asset value. The Insurance
Company reserves the right to revoke this election and to receive all
such income dividends and capital gain distributions in cash.
j. Right to Suspend. The Series reserves the right to temporarily suspend
sales if the Board of Trustees of the Series, acting in good faith and
in light of its fiduciary duties under federal and any applicable state
laws, deems it appropriate and in the best interests of shareholders or
in response to the order of an appropriate regulatory authority.
Insurance Company shall abide by requirements of the Funds' frequent
trading policy as described in the Series' prospectus and statement of
additional information.
k. Book Entry. Transfer of the Series' shares will be by book entry only.
No stock certificates will be issued to the Separate Accounts. Shares
ordered from a particular Fund will be recorded by the Series as
instructed by Insurance Company in an appropriate title for the
corresponding Separate Account.
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l. Limitations on Redemptions. The Insurance Company shall not redeem Fund
shares attributable to the Contracts (as opposed to Fund shares
attributable to the Insurance Company's assets held in the Account)
except (i) as necessary to implement Contractholder-initiated
transactions, or (ii) as required by state and/or federal laws or
regulations or judicial or other legal precedent of general application
(a "Legally Required Redemption").
10.Account Activity. Upon request, the Transfer Agent shall send to the
Insurance Company, (i) confirmations of activity in each Separate Account
within five (5) Business Days after each Trade Date on which a purchase or
redemption of shares of a Fund is effected for a Separate Account;
(ii) statements detailing activity in each Separate Account no less
frequently than quarterly; and (iii) such other information as may
reasonably be requested by Insurance Company and agreed upon by Transfer
Agent.
11.Expenses. All expenses incident to each party's performance of this
Agreement shall be paid by the respective party.
The Funds shall pay the cost of registration of their shares with the SEC,
preparation of the Fund's prospectuses, proxy materials and reports, or the
preparation of other related statements and notices required by Applicable
Law. The Funds shall pay the cost of qualifying Fund shares in states where
required.
12.Proxy and Other Communication Materials. The Funds shall distribute to the
Insurance Company their proxy material and periodic Fund reports to
shareholders. AFD, Transfer Agent or the Funds shall provide the Insurance
Company with a reasonable quantity of the Funds' prospectuses and sales
literature upon request to be used for the Separate Accounts in connection
with the transactions contemplated by this Agreement. AFD, Transfer Agent or
the Funds shall provide to Insurance Company, or its authorized
representative, at no expense to Insurance Company, the following
Contractholder communication materials prepared for circulation to
Contractholders in quantities reasonably requested by Insurance Company
which are sufficient to allow mailing thereof by Insurance Company, to the
extent required by Applicable Law, to all Contractholders in the Separate
Accounts: proxy or information statements, annual reports, semi-annual
reports, and all updated prospectuses, supplements and amendments thereof.
AFD, Transfer Agent or the Funds shall provide Insurance Company with other
documents and materials as Insurance Company may reasonably request from
time to time.
AFD will provide Insurance Company on a timely basis with investment
performance information for each Fund, including (a) the top ten portfolio
holdings on a quarterly basis; and (b) on a monthly basis, average annual
total return for the prior one-year, three year, five-year, ten-year and
life of the Fund. AFD will endeavor to provide the information in clause
(a) to Insurance Company within twenty business days after the end of each
quarter, and will endeavor to provide the information in clause (b) to
Insurance Company within five business days after the end of each month.
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13.Reserved
14.Proxy Materials/Voting. The Insurance Company will cooperate with the Funds
or their proxy vendor so that all proxy material is distributed to the
extent required by Applicable Law. Insurance Company will not impose any
fees for such cooperation. For so long as the SEC interprets the 1940 Act to
require pass-through voting by insurance companies whose separate accounts
are registered as investment companies under the 1940 Act ("Registered
Separate Accounts"), the Insurance Company shall vote shares of the Funds
held in Registered Separate Accounts at shareholder meetings of the Funds in
accordance with instructions timely received by the Insurance Company (or
its designated agent) from owners of Contracts funded by such Registered
Separate Accounts having a voting interest in the Funds. The Insurance
Company shall vote shares of the Funds held in Registered Separate Accounts
that are attributable to the Contracts as to which no timely instructions
are received, as well as shares held in such Registered Separate Account
that are not attributable to the Contracts and owned beneficially by the
Insurance Company (resulting from charges against the Contracts or
otherwise), in the same proportion as the votes cast by owners of the
Contracts funded by the Registered Separate Account having a voting interest
in the Funds from whom instructions have been timely received. The Insurance
Company shall vote shares of the Funds held in its general account or in any
Separate Account that is not registered under the 1940 Act, if any, in its
discretion.
15.Future Registration of Separate Account(s). If Insurance Company registers a
Separate Account as a unit investment trust under the 1940 Act, Insurance
Company will provide to each Fund, at the Fund's request, at least one
complete copy of all registration statements, prospectuses, statements of
additional information, reports, solicitations for voting instructions,
sales literature and other promotional materials, applications for
exemptions, requests for no action letters, and all amendments to any of the
above, that relate to the Contracts or any Separate Account
contemporaneously with the filing of such document with the SEC, FINRA or
other regulatory authority.
16.Independent Contractor Status. The Insurance Company shall, for all purposes
herein, be deemed to be an independent contractor and shall have, unless
otherwise expressly provided or authorized, no authority to act for or
represent AFD or the Funds in any way or otherwise be deemed an agent of AFD
or the Funds.
17.Termination. At the terminating party's election and the other party's
concurrence, termination of this Agreement may be limited solely as to new
Contracts. This Agreement shall terminate:
a. at the option of the Insurance Company, AFD, Transfer Agent, CRMC or the
Series upon 180 days advance written notice to the other parties;
b. at any time by giving 30 days written notice to the other party in the
event of a material breach of this Agreement by the other party that is
not cured during such
13
30-day period;
c. at the option of the Insurance Company, AFD or the Series, upon
institution of formal proceedings relating to (i) the marketing of the
Contracts, (ii) the Separate Accounts, (iii) the Insurance Company,
(iv) AFD or (v) the Funds by FINRA, the SEC or any other regulatory body;
d. at the option of Insurance Company immediately upon written notice, if
the Series or CRMC fails to meet the requirements for either
diversification under Section 817 or RIC status under the Code;
e. at the option of any party upon termination of CRMC's investment
advisory agreement with the Series. Notice of such termination shall be
promptly furnished. This paragraph (e) shall not be deemed to apply if,
contemporaneously with such termination, a new contract of substantially
similar terms is entered into between CRMC and the Series;
f. except for Insurance Company's delegation of its duties to a
subcontractor or to an affiliate, upon assignment of this Agreement, at
the option of any party not making the assignment, unless made with the
written consent of the other parties;
g. in the event interests in the Separate Accounts, the Contracts, or Fund
shares are not registered, issued or sold in conformity with Applicable
Law or such Applicable Law precludes the use of Fund shares as an
underlying investment medium of Contracts issued or to be issued by the
Insurance Company. Prompt notice shall be given by the terminating party
to the other parties in the event the conditions of this provision occur;
h. for Registered Separate Accounts, they may terminate upon a decision by
the Insurance Company, in accordance with regulations of the SEC for
Registered Separate Accounts, to substitute Fund shares with the shares
of another investment company for Contracts for which the Fund shares
have been selected to serve as the underlying investment medium for
Registered Separate Accounts, in which case the following provisions
shall apply:
(i) The Insurance Company will give 60 days written notice to the
applicable Fund and AFD upon the occurrence of the earlier of the
following actions taken for the purpose of substituting shares of the
Fund: (1) an application made to the SEC, (2) a proposed Contractholder
vote, or (3) the Insurance Company's determination to substitute Fund
shares with the shares of another investment company; and
(ii) The Funds or AFD will in no way recommend action in connection
with, or oppose or interfere with any application made to the SEC by the
Insurance Company with regard to the substitution of Fund shares with
shares of another
14
investment company or seek in any manner to oppose or interfere with a
proposed Contractholder vote; or
i. upon such shorter notice as is required by law, order or instruction by
a court of competent jurisdiction or a regulatory body or
self-regulatory organization with jurisdiction over the terminating
party.
Upon termination and at the request of the requesting party, the other party
shall deliver to the requesting party, any records which the requesting
party may be required by law or regulations to have access to or to maintain.
18.Notices. All notices under this Agreement, unless otherwise specified in the
Agreement shall be given in writing and delivered via overnight delivery
(postage prepaid, return receipt requested), facsimile transmission or
registered or certified mail, as follows:
If to the Insurance Company:
Minnesota Life Insurance Company
Attn: General Counsel
000 Xxxxxx Xx X
Xx Xxxx, XX 00000-0000
with a copy to:
Minnesota Life Insurance Company
Attn: Investment Operations A7-4478
000 Xxxxxx Xx X
Xx Xxxx, XX 00000-0000
If to AFD, Transfer Agent, CRMC or to the Series:
Xxxxxxx X. Xxxxxxxxxx
Capital Research and Management Company
000 Xxxxx Xxxx Xxxxxx
00/xx/ Xxxxx
Xxx Xxxxxxx, XX 00000
with a copy to:
Xxxx X. Xxxxx
American Funds Distributors, Inc.
000 Xxxxx Xxxx Xxxxxx
00/xx/ Xxxxx
Xxx Xxxxxxx, XX 00000
15
with an additional copy to:
American Funds Service Company
Attn: HOST - Contract Administration
0000 Xxxxxxx Xxxx.
Xxx Xxxxxxx, XX 00000-0000
phone: 800/000-0000, ext. 8
facsimile: 210/474-4088
or to such other address or person as may be specified in a written notice
given to the other parties. The date of service of any notice shall be the
date it is received by the recipient.
19.Books and Records. Each party hereto shall cooperate with the other parties
and all appropriate governmental authorities and shall permit authorities
reasonable access to its books and records upon proper notice in connection
with any investigation or inquiry relating to this Agreement or the
transactions contemplated hereby. Each party shall maintain and preserve all
records in its possession as required by law to be maintained and preserved
in connection with the provision of the services contemplated hereunder.
Upon the request of a party, the other party shall provide copies of all
records as may be necessary to (a) monitor and review the performance of
either party's activities, (b) assist either party in resolving disputes,
reconciling records or responding to auditor's inquiries, (c) comply with
any request of a governmental body or self-regulatory organization,
(d) verify compliance by a party with the terms of this Agreement, (e) make
required regulatory reports, or (f) perform general customer service. The
parties agree to cooperate in good faith in providing records to one another
under this provision.
20.Indemnification.
a. Insurance Company shall indemnify and hold harmless AFD, Transfer Agent,
CRMC, the Series, each of the Funds, and each of their affiliates,
directors, officers, employees and agents and each person who controls
them within the meaning of the 1933 Act, from and against any and all
losses, claims, damages, liabilities and expenses, including reasonable
attorneys' fees ("Losses"), they may incur, insofar as such Losses arise
out of or are based upon (i) Insurance Company's negligence or willful
misconduct in the performance of its duties and obligations under this
Agreement, (ii) Insurance Company's violation of any Applicable Law in
connection with the performance of its duties and obligations under this
Agreement, and (iii) any breach by Insurance Company of any provision of
this Agreement, including any representation, warranty or covenant made
in the Agreement. Insurance Company shall also reimburse AFD, Transfer
Agent, CRMC, the Series, the Funds and their respective affiliates for
any legal or other expenses reasonably incurred by any of them in
connection with investigating or defending against such Losses. This
indemnity provision is in addition to any other liability which
Insurance Company may otherwise have to
16
AFD, the Transfer Agent, CRMC, the Series, the Funds or their respective
affiliates.
b. AFD, Transfer Agent or CRMC, as applicable, shall indemnify and hold
harmless, Insurance Company and its directors, officers, employees and
agents and each person who controls them within the meaning of the 1933
Act, from and against any and all Losses they may incur, insofar as such
Losses arise out of or are based upon (i) AFD's, Transfer Agent's or
CRMC's negligence or willful misconduct in the performance of its duties
and obligations under this Agreement, (ii) AFD's, Transfer Agent's or
CRMC's violation of Applicable Law in connection with the performance of
its duties and obligations under this Agreement, and (iii) any breach by
AFD, Transfer Agent or CRMC of any provision of this Agreement,
including any representation, warranty or covenant made in the Agreement
by AFD, Transfer Agent or the Series. AFD, Transfer Agent or CRMC, as
applicable, shall also reimburse Insurance Company for any legal or
other expenses reasonably incurred in connection with investigating or
defending against such Losses. This indemnity provision is in addition
to any other liability which AFD, Transfer Agent or CRMC may otherwise
have to Insurance Company.
c. Promptly after receipt by a party entitled to indemnification under this
paragraph 20 (an "Indemnified Party") of notice of the commencement of
an investigation, action, claim or proceeding, such Indemnified Party
will, if a claim in respect thereof is to be made against the
indemnifying party under this paragraph 20, notify the indemnifying
party of the commencement thereof. The indemnifying party will be
entitled to assume the defense thereof, with counsel satisfactory to the
Indemnified Party. After notice from the indemnifying party of its
intention to assume the defense of an action and the appointment of
satisfactory counsel, Indemnified Party shall bear the expenses of any
additional counsel obtained by it, and the indemnifying party shall not
be liable to such Indemnified Party under this paragraph for any legal
expenses subsequently incurred by such Indemnified Party in connection
with the defense thereof other than reasonable costs of investigation.
The indemnifying party shall not, without the prior written consent of
the Indemnified Party, settle or compromise the liability of the
Indemnified Party; provided, however, that in the event that the
Indemnified Party fails to provide its written consent, the indemnifying
party shall thereafter be liable to provide indemnification only to the
extent of the amount for which the action could otherwise have been
settled or compromised.
21.Governing Law. This Agreement shall be governed by and interpreted in
accordance with the laws of the State of New York exclusive of conflicts of
laws.
22.Subchapter M. CRMC will endeavor to have each Fund comply with Subchapter M
of the Internal Revenue Code of 1986, as amended, and the regulations
thereunder and shall qualify as a regulated investment company thereunder.
17
23.Entire Agreement/Amendments. This Agreement (together with the Business
Agreement) contains the entire understanding and agreement among the parties
with respect to the subject matter of this Agreement and supersedes any and
all prior agreements, understandings, documents, projections, financial
data, statements, representations and warranties, oral or written, express
or implied, between the parties hereto and their respective affiliates,
representatives and agents in respect of the subject matter hereof. This
agreement may not be amended except by written agreement of the parties. If
there should be any conflict between the terms of this Agreement and those
of the Business Agreement, the terms of this Agreement shall govern.
24.Assignability. This Agreement shall extend to and be binding upon the
Insurance Company, the Series, AFD, CRMC and the Transfer Agent and their
respective successors and assigns. Nothing expressed or mentioned in this
Agreement is intended or shall be construed to give any person or
corporation, other than the parties hereto and their respective successors
and permitted assigns, any legal or equitable right, remedy or claim in
respect of this Agreement or any provision herein contained. Neither this
Agreement nor any rights, privileges, duties or obligations of the parties
hereto may be assigned by any party without the prior written consent of the
other parties or as expressly contemplated by this Agreement; provided,
however, that a merger of, reinsurance arrangement by, or change of control
of a party shall not be deemed to be an assignment for purposes of this
Agreement.
25.Proprietary Information. AFD and the Funds agree that the names, addresses,
and other information relating to the Contractholders or prospects for the
sale of the Contracts developed by Insurance Company are the exclusive
property of the Insurance Company and may not be used by AFD, Transfer
Agent, CRMC or the Funds without the written consent of the Insurance
Company except for carrying out the terms of this Agreement or as otherwise
provided for in this Agreement and any amendments thereto. Each party to
this Agreement agrees to maintain the confidentiality of all information
(including personal financial information of the customers of either party)
received from the other party pursuant to this Agreement. Each party agrees
not to use any such information for any purpose, or disclose any such
information to any person, except as permitted or required by applicable
laws, rules and regulations, including applicable state privacy laws and the
Xxxxx-Xxxxx-Xxxxxx Act and any regulations promulgated thereunder. This
provision, to the extent permissible by applicable law, shall not be
construed to limit the parties' obligation to comply with paragraph 19,
above.
AFD, the Transfer Agent, CRMC and the Series hereby consent to the Insurance
Company's use of the names of the Series, the Funds, AFD, the Transfer Agent
and CRMC in connection with marketing the Funds and Contracts, subject to
the terms of this Agreement and that certain Business Agreement, by and
among Insurance Company, CRMC, Insurance Company's Distributor and American
Funds Distributors. Insurance Company acknowledges and agrees that AFD, CRMC
and/or their affiliates own all right, title and interest in and to the
names American Funds, American Funds Distributors,
18
American Funds Insurance Series, American Funds Service Company and Capital
Research and Management Company and covenants not, at any time, to challenge
the rights of AFD, CRMC and/or its affiliates to such name or design, or the
validity or distinctiveness thereof. AFD, the Transfer Agent, CRMC and the
Series hereby consent to the use of any trademark, trade name, service xxxx
or logo used by AFD, the Transfer Agent, CRMC and the Series, subject to
AFD, the Transfer Agent, CRMC or the Series approval of such use and in
accordance with reasonable requirements of that party. Such consent will
terminate with the termination of this Agreement. The Insurance Company
agrees and acknowledges that all use of any designation comprised in whole
or in part of the name, trademark, trade name, service xxxx and logo under
this Agreement shall inure to the benefit of the AFD, the Transfer Agent,
CRMC and/or the Series.
26.Severability. If any provision of this Agreement shall be held or made
invalid by a court decision, statute, rule or otherwise, the remainder of
the Agreement shall not be affected thereby.
00.Xx Waiver. No waiver of any provision of this Agreement will be binding
unless in writing and executed by the party granting such waiver. Any valid
waiver of a provision set forth herein shall not constitute a waiver of any
other provision of this Agreement. In addition, any such waiver shall
constitute a present waiver of such provision and shall not constitute a
permanent future waiver of such provision.
00.Xx Joint Venture, Etc. Neither the execution nor performance of this
Agreement shall be deemed to create a partnership or joint venture by and
among Insurance Company, Transfer Agent, AFD, CRMC and the Funds.
29.Counterparts. This Agreement may be executed in one or more counterparts,
each of which shall be deemed an original, but all of which together shall
constitute one and the same Agreement. Neither this Agreement nor any
amendment shall become effective until all counterparts have been fully
executed and delivered.
30.Survival. The provisions of paragraphs 4, 5, 20 and 25 survive termination
of this Agreement. If this Agreement terminates, the Series, at Insurance
Company's option, will continue to make additional shares of the Funds
available for all existing Contracts as of the effective date of termination
(under the same terms and conditions as were in effect prior to termination
of this Agreement with respect to existing Contractholders), unless the
applicable Fund liquidates or applicable laws prohibit further sales.
31.Non-exclusivity. Each of the parties acknowledges and agrees that this
Agreement and the arrangements described herein are intended to be
non-exclusive and that each of the parties is free to enter into similar
agreements and arrangements with other entities.
00.Xxxxxxxxx. At all times Insurance Company shall maintain insurance coverage
that is reasonable and customary in light of all its responsibilities
hereunder. Such coverage shall insure for losses resulting from the criminal
acts or errors and omissions of
19
Insurance Company's employees and agents.
33.Oversight of Insurance Company. Insurance Company will permit Transfer Agent
or its representative to have reasonable access to Insurance Company's
personnel and records pertaining to this Agreement in order to facilitate
the monitoring of the services performed by Insurance Company under this
Agreement.
34.Independent Audit. In the event Transfer Agent determines, based on a review
of complaints received in accordance with paragraph 19, above, that
Insurance Company is not processing Contractholder transactions accurately,
Transfer Agent reserves the right to require that Insurance Company's data
processing activities as they relate to this Agreement be subject to an
audit by an independent accounting firm to ensure the existence of, and
adherence to, proper operational controls. Insurance Company shall make
available upon Transfer Agent's request a copy of any report by such
accounting firm as it relates to said audit. Insurance Company shall
promptly notify Transfer Agent in the event of a material breach of
operational controls.
35.Arbitration. In the event of a dispute between the parties with respect to
this Agreement, and in the event the parties are unable to resolve the
dispute between them, such dispute shall be settled by arbitration; one
arbitrator to be named by each party to the disagreement and a third
arbitrator to be selected by the two arbitrators named by the parties. The
decision of a majority of the arbitrators shall be final and binding on all
parties to the arbitration. The expenses of such arbitration shall be paid
by the non-prevailing party.
00.Xx Recourse. The obligations of the Series under this Agreement are not
binding upon any of the Trustees, officers, employees or shareholders
(except CRMC if it is a shareholder) of the Series individually, but bind
only the Series' assets. When seeking satisfaction for any liability of the
Series in respect of this Agreement, Insurance Company and the Account agree
not to seek recourse against said Trustees, officers, employees or
shareholders, or any of them, or any of their personal assets for such
satisfaction.
37.Conflicts. The parties to this Agreement recognize that due to differences
in tax treatment or other considerations, the interests of various
Contractholders participating in one or more Funds might, at some time, be
in conflict. Each party shall report to the other party any potential or
existing conflict of which it becomes aware. The Board of Trustees of the
Series shall promptly notify Insurance Company of the existence of
irreconcilable material conflict and its implications. If such a conflict
exists, Insurance Company will, at its own expense, take whatever action it
deems necessary to remedy such conflict; in any case, Contractholders will
not be required to bear such expenses.
38.Mixed and Shared Funding. The Series hereby notifies Insurance Company that
it may be appropriate to include in the Prospectus pursuant to which a
Contract is offered disclosure regarding the risks of mixed and shared
funding.
20
39.Shareholder Information Agreement. The Insurance Company has executed or
will execute an agreement with Transfer Agent pursuant to Rule 22c-2 under
the Investment Company Act of 1940, under which the Insurance Company is
required, upon request, to provide the Funds with certain account
information and to prohibit transactions that violate the policies
established by the Funds for the purpose of eliminating or reducing any
dilution of the value of the outstanding shares issued by the Funds.
21
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed as of the date first above written.
MINNESOTA LIFE INSURANCE COMPANY,
for itself and on behalf of the Separate
Accounts
By: /s/ Xxxxx X Xxxx
--------------------------------------
Name: Xxxxx X Xxxx
--------------------------------------
Title: Executive Vice President
--------------------------------------
Signature page to Minnesota Life FPA
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed as of the date first above written.
AMERICAN FUNDS DISTRIBUTORS, INC.
By: /s/ Xxxx X. Xxxxxxxx
--------------------------------------
Name: Xxxx X. Xxxxxxxx
--------------------------------------
Title: Senior Vice President
--------------------------------------
Signature page to Minnesota Life FPA
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed as of the date first above written.
AMERICAN FUNDS SERVICE COMPANY
By: /s/ Xxxxxx X. Xxxxxxxx
-----------------------
Name: Xxxxxx X. Xxxxxxxx
-----------------------
Title: Secretary
-----------------------
Signature page to Minnesota Life FPA
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed as of the date first above written.
CAPITAL RESEARCH AND MANAGEMENT COMPANY
By: /s/ Xxxxxxx X. Xxxxxx
------------------------------------
Name: Xxxxxxx X. Xxxxxx
------------------------------------
Title: Senior Vice President and Secretary
------------------------------------
Approved for Signature [GRAPHICS]
by CRMC Legal Dept.
Signature page to Minnesota Life FPA
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed as of the date first above written.
AMERICAN FUNDS INSURANCE SERIES
By: /s/ Xxxxxx X. Xxxxxxxx
--------------------------------------
Name: Xxxxxx X. Xxxxxxxx
--------------------------------------
Title: Secretary
--------------------------------------
Signature page to Minnesota Life FPA
EXHIBIT A
AMERICAN FUNDS INSURANCE SERIES FUNDS
1. American Funds Insurance Series - Global Bond Fund
2. American Funds Insurance Series - Global Growth Fund
3. American Funds Insurance Series - Global Small Capitalization Fund
4. American Funds Insurance Series - Growth Fund
5. American Funds Insurance Series - Growth-Income Fund
6. American Funds Insurance Series - International Fund
7. American Funds Insurance Series - U.S. Government/AAA-Rated Securities Fund
8. American Funds Insurance Series - New World Fund
Exhibit A
EXHIBIT B
INSURANCE COMPANY ACCOUNTS
Variable Annuity Account
Minnesota Life Variable Life Account
Minnesota Life Individual Variable Universal Life Account
Exhibit B
