FUND PARTICIPATION AGREEMENT
AXA EQUITABLE LIFE INSURANCE COMPANY,
AMERICAN CENTURY INVESTMENT MANAGEMENT, INC.,
AND
AMERICAN CENTURY INVESTMENT SERVICES, INC.
DATE
FUND PARTICIPATION AGREEMENT
Among
AXA Equitable Life Insurance Company,
American Century Investment Management, Inc.
and
American Century Investment Services, Inc.
THIS AGREEMENT, effective______________, by and among AXA Equitable
Life Insurance Company (the "Company"), a New York Corporation, on its own
behalf and on behalf of certain separate accounts (the "Accounts"); ADVISER (the
"Adviser"), a Delaware corporation; and DISTRIBUTOR (the "Distributor"), a
Missouri corporation.
WHEREAS, American Century Variable Portfolios, Inc. and American
Century Variable Portfolios II, Inc. (collectively "the Fund") engage in
business as open-end management investment companies and are available to act as
the investment vehicle for separate accounts established for variable life
insurance policies and/or variable annuity contracts (collectively, the
"Variable Insurance Products") to be offered by insurance companies (the
"Participating Insurance Companies"); and
WHEREAS, Adviser and Distributor serve as the investment adviser and
distributor of the Fund, respectively, and are authorized to enter into this
Agreement on behalf of the Fund; and
WHEREAS, the beneficial interest in the Fund is divided into several
series of shares, each designated a "Portfolio" and representing the interest in
a particular managed portfolio of securities and other assets; and
WHEREAS, the Fund has obtained an order from the Securities and
Exchange Commission (the "SEC"), dated March 22, 1988 (File No. IC-16332) (the
"Mixed and Shared Funding Exemptive Order"), granting Participating Insurance
Companies and variable annuity and variable life insurance separate accounts
exemptions from the provisions of sections 9(a), 13(a), 15(a), and 15(b) of the
Investment Company Act of 1940, as amended (hereinafter the "1940 Act"), and
Rules 6e-2(b)(15) and 6e-3(T)(b)(15) thereunder, to the extent necessary to
permit shares of the Fund to be sold to and held by variable annuity and
variable life insurance separate accounts of life insurance companies that may
or may not be affiliated with one another and qualified pension and retirement
plans ("Qualified Plans"); and
WHEREAS, the Fund is registered as an open-end management investment
company under the 1940 Act and shares of the Portfolio(s) are registered under
the Securities Act of 1933, as amended (the "1933 Act"); and
WHEREAS, the Adviser is duly registered as an investment adviser under
the Investment Advisers Act of 1940, as amended; and
WHEREAS, the Distributor is duly registered as a broker-dealer under
the Securities Exchange Act of 1934, as amended, (the "1934 Act") and is a
member in good standing of the Financial Industry Regulatory Authority (the
"FINRA"); and
WHEREAS, the Company has issued and plans to continue to issue certain
variable life insurance policies and/or variable annuity contracts supported
wholly or partially by the Accounts (the "Contracts"); and such Contracts are
listed in Schedule A attached hereto and incorporated herein by reference, as
such schedule may be amended from time to time by mutual written agreement of
the parties; and
WHEREAS, each Account is a duly organized, validly existing segregated
asset account, established by resolution of the Board of Directors of the
Company under the insurance laws of the State of NewYork, to set aside and
invest assets attributable to the Contracts; and
WHEREAS, to the extent permitted by applicable insurance laws and
regulations, the
Company intends to continue to purchase shares in the Portfolios listed on
Schedule B attached hereto and incorporated herein by reference, as such
schedule may be amended from time to time by mutual written agreement of the
parties (the "Portfolios"), on behalf of the Accounts to fund the Contracts, and
the Fund is authorized to sell such shares to unit investment trusts such as the
Accounts at net asset value; and
WHEREAS, to the extent permitted by applicable insurance laws and
regulations, the Company also intends to continue to purchase shares in other
open-end investment companies or series thereof not affiliated with the Fund
(the "Unaffiliated Funds") on behalf of the Accounts to fund the Contracts.
NOW, THEREFORE, in consideration of their mutual promises, the Company,
the Fund, the Distributor and the Adviser agree as follows:
ARTICLE I. Sale of Fund Shares
1.1. Distributor hereby appoints the Company as agent for the Funds for
the limited purpose of accepting purchase and redemption orders for Fund shares
from the Contract owners. On each day the New York Stock Exchange (the
"Exchange") is open for business (each, a "Business Day"), the Company may
receive instructions from the Contract owners for the purchase or redemption of
shares of the Funds ("Orders"). Orders received and accepted by the Company
prior to the price time for each Fund as set forth in its prospectus (the "Price
Time") generally the close of regular trading on the Exchange (the "Close of
Trading") on any given Business Day (currently, 4:00 p.m. Eastern time) and
transmitted to the Funds' transfer agent as provided below will be executed at
the net asset value determined as of the relevant Fund's Price Time on the
Business Day the Company received such Order. Any Orders received by the Company
on such day but after the relevant Fund's Price Time on a Business Day, will be
executed at the net asset value next determined as of that Fund's Price Time on
the next Business Day. The day as of which an Order is executed by the Funds'
transfer agent pursuant to the provisions set forth above is referred to herein
as the "Trade Date". All Orders are subject to acceptance or rejection by
Distributor or the Funds in the sole discretion of any of them. For
purposes of this Section 1.1, receipt by the Company such Orders shall
constitute receipt by the Fund, provided that the Fund receives notice of any
such order by 10:00 a.m. Eastern time on the next following Business Day.
1.2. The Distributor, on behalf of the Fund, agrees to make shares of
the Portfolios available for purchase at the applicable net asset value per
share by the Company and the Accounts on each Business Day. Notwithstanding the
foregoing, the Distributor or the Fund may refuse to sell shares of any
Portfolio to any person, or suspend or terminate the offering of shares of any
Portfolio if such action is required by law or by regulatory authorities having
jurisdiction or is, in their sole discretion acting in good faith, necessary or
appropriate in the best interests of the shareholders of such Portfolio. All
Orders accepted by the Company shall be subject to the terms of the then current
prospectus of the applicable Portfolio. The Company shall use its best efforts,
and shall reasonably cooperate with, the Distributor and the Adviser to enforce
stated prospectus policies regarding transactions in Portfolio shares. The
Company acknowledges that orders for Portfolio shares accepted by it in
violation of the stated policies of the Fund as set forth in the Fund's
then-current prospectus may be subsequently revoked or cancelled by the Fund and
that the Fund shall not be responsible for any losses incurred by the Company or
the Contract owner as a result of such cancellation. In addition, the Company
acknowledges that the Fund has the right to refuse any purchase order for any
reason, particularly if the Fund determines that a Portfolio would be unable to
invest the money effectively in accordance with its investment policies or would
otherwise be adversely affected due to the size of the transaction, frequency of
trading, or other factors.
1.3. The Fund will not sell shares of the Portfolios to any other
Participating Insurance Company separate account unless an agreement consistent
with the terms of the Mixed and Shared Funding Exemptive Order is in effect to
govern such sales.
1.4. The Distributor, on behalf of the Fund, agrees to redeem for cash,
on the Company's request, any full or fractional shares of the Fund held by the
Company, executing such requests on each Business Day at the net asset value
next computed after receipt by the Fund or its designee of the request for
redemption. For purposes of this Section 1.4, the
Company shall be the designee of the Fund for receipt of requests for redemption
and receipt by such designee shall constitute receipt by the Fund, provided that
the Company received such request for redemption prior to the Fund's Price Time
on the applicable Business Day and the Distributor receives notice of any such
request for redemption by 10:00 a.m. Eastern time on the next following Business
Day.
1.5. The parties hereto acknowledge that the arrangement contemplated
by this Agreement is not exclusive; the Fund's shares may be sold to other
Participating Insurance Companies (subject to Section 1.3) and the cash value of
the Contracts may be invested in other investment companies.
1.6. The Company shall pay for Fund shares by 3:00 p.m. Eastern time on
the next Business Day after an order to purchase Fund shares is received in
accordance with the provisions of Section 1.1 hereof. Payment shall be in
federal funds transmitted by wire and/or by a credit for any shares redeemed the
same day as the purchase. If payment for a purchase Order is not timely
received, the Fund may cancel the Order, or at Distributor's option, resell the
shares to the applicable Fund at the then prevailing net asset value, and the
Company shall be responsible for all costs to Distributor, the Funds or any
affiliate of the Funds resulting from such resale. The Company shall be
responsible for any loss, expense, liability or damage, including loss of profit
suffered by Distributor and/or the respective Fund resulting from delay or
failure to make timely payment for such shares or cancellation of any trade, or
for any Orders that are processed on an "as of" basis as an accommodation to the
Company. The Company shall not be entitled to any gains generated thereby.
1.7. The Fund shall pay and transmit the proceeds of redemptions of
Fund shares by 12:00 p.m. Eastern Time on the next Business Day after a
redemption order is received in accordance with Section 1.4 hereof; provided,
however, that the Fund may delay payment in extraordinary circumstances to the
extent permitted under Section 22(e) of the 1940 Act. Payment shall be in
federal funds transmitted by wire and/or a credit for any shares purchased the
same day as the redemption.
1.8. Issuance and transfer of the Fund's shares will be by book entry
only. Stock certificates will not be issued to the Company or the Accounts.
Shares purchased from the Fund will be recorded in an appropriate title for the
relevant Account or the relevant sub-account of an Account.
1.10. The Fund shall furnish same day notice (by electronic
communication or telephone, followed by electronic confirmation) to the Company
of any income, dividends or capital gain distributions payable on a Portfolio's
shares. The Company hereby elects to receive all such income dividends and
capital gain distributions as are payable on a Portfolio's shares in additional
shares of that Portfolio. The Company reserves the right to revoke this election
and to receive all such income dividends and capital gain distributions in cash.
The Fund shall notify the Company by the end of the next following Business Day
of the number of shares so issued as payment of such dividends and
distributions.
1.11. The Fund shall make the net asset value per share for each
Portfolio available to the Company on each Business Day as soon as reasonably
practicable after the net asset value per share is calculated and shall use its
best efforts to make the net asset value per share for each Portfolio available
by 7:00 p.m. Eastern time. In the event of an error in the computation of a
Portfolio's net asset value per share ("NAV") or any dividend or capital gain
distribution (each, a "pricing error"), the Adviser or the Distributor shall
notify the Company as soon as reasonably possible after discovery of the error.
Such notification may be verbal, but shall be confirmed promptly in writing. A
pricing error shall be corrected as follows: (a) if the pricing error results in
a difference between the erroneous NAV and the correct NAV of less than $0.01
per share, then no corrective action need be taken; (b) if the pricing error
results in a difference between the erroneous NAV and the correct NAV equal to
or greater than $0.01 per share, but less than 1/2 of 1% of the Portfolio's NAV
at the time of the error, then the Adviser shall reimburse the Portfolio for any
loss, after taking into consideration any positive effect of such error;
however, no adjustments to Contract owner accounts need be made; and (c) if the
pricing error results in a difference between the erroneous NAV and the correct
NAV equal to or greater than 1/2 of 1% of the Portfolio's NAV at the time of the
error, then the Adviser shall reimburse the Portfolio for any loss (without
taking into consideration any positive effect of such error) and shall reimburse
the Company for the costs of adjustments made to correct Contract owner accounts
in accordance with the provisions of Schedule C. If an adjustment is necessary
to correct a material error (as described below) which has caused Contract
owners to receive less than the amount to which they are entitled, the number of
shares of the applicable sub-account of such Contract owners will be adjusted
and the amount of any underpayments shall be credited by the Distributor to the
Company for crediting of such amounts to the applicable sub-accounts of such
Contract owners. Upon notification by the Adviser or the Distributor of any
overpayment due to a material error, the Company shall promptly remit to the
Distributor any overpayment that has not been paid to Contract owners. In no
event shall the Company be liable to Contract owners for any such adjustments or
underpayment amounts. A pricing error within categories (b) or (c) above shall
be deemed to be "materially incorrect" or constitute a "material error" for
purposes of this Agreement. The standards set forth in this Section 1.10 are
based on the parties' understanding of the views expressed by the staff of the
SEC as of the date of this Agreement. In the event the views of the SEC staff
are later modified or superseded by SEC or judicial interpretation, the parties
shall amend the foregoing provisions of this Agreement to comport with the
then-currently acceptable standards, on terms mutually satisfactory to all
parties.
ARTICLE II. Representations and Warranties
2.1. The Company represents and warrants that: (a) the securities
deemed to be issued by the Accounts under the Contracts are or will be
registered under the 1933 Act, or are not so registered in proper reliance upon
an exemption from such registration requirements; (b) the Contracts will be
issued and sold in compliance in all material respects with all applicable
federal and state laws; and (c) the sale of the Contracts shall comply in all
material respects with state insurance suitability requirements.
2.2. The Company represents and warrants that: (a) it is an insurance
company duly organized and in good standing under applicable law; (b) it has
legally and validly established each Account prior to any issuance or sale of
units thereof as a separate account under New York State law; and (c) it has
registered each Account as a unit investment trust in accordance with the
provisions of the 1940 Act to serve as a segregated investment account for the
Contracts, and
will maintain such registration for so long as any Contracts are outstanding as
required by applicable law or, alternatively, the Company has not registered one
or more Accounts in proper reliance upon an exclusion from such registration
requirements.
2.3. The Distributor and the Adviser represent and warrant on behalf of
the Fund that: (a) the Fund shares sold pursuant to this Agreement shall be
registered under the 1933 Act; (b) the Fund shares sold pursuant to this
Agreement shall be duly authorized for issuance and sold in compliance with all
applicable federal securities laws including, without limitation, the 1933 Act,
the 1934 Act, and the 1940 Act; (c) the Fund is and shall remain a registered
investment company under the 1940 Act; and (d) the Distributor or the Adviser
shall cause the Fund to amend the registration statement for its shares under
the 1933 Act and the 1940 Act from time to time as required in order to effect
the continuous offering of its shares.
2.4. The Distributor and the Adviser, on behalf of the Fund, represent
and warrant that the Fund has adopted a plan pursuant to Rule 12b-1 under the
1940 Act for its Class II shares. The parties acknowledge that the Fund reserves
the right to modify its existing plan or to adopt additional plans pursuant to
Rule 12b-1 under the 1940 Act (including with respect to its Class I and Class
III shares) and to impose an asset-based or other charge to finance distribution
expenses as permitted by applicable law and regulation. The Distributor and the
Adviser agree to comply and shall cause the Fund to comply with applicable
provisions and SEC interpretation of the 1940 Act with respect to any
distribution plan.
2.5. The Distributor, on behalf of the Fund, represents and warrants
that it shall register and qualify the shares for sale in accordance with the
laws of the various states if and to the extent required by applicable law.
2.6. The Distributor, on behalf of the Fund, represents and warrants
that the Fund is lawfully organized and validly existing under the laws of the
State of Maryland and that the Fund does and will comply in all material
respects with the 1940 Act.
2.7. The Adviser, on behalf of the Fund, will at all times invest money
from the Contracts in such a manner as to ensure that the Contracts will be
treated as variable contracts
under the Code and the regulations issued thereunder. Without limiting the scope
of the foregoing or anything contained in Article VI of this Agreement, the
Adviser, on behalf of the Fund, represents and warrants that each Portfolio of
the Fund will comply with Section 817(h) of the Code and Treasury Regulation
1.817-5, relating to the diversification requirements for variable annuity,
endowment, or life insurance contracts and any amendments or other modifications
to such Section or Regulations (and any revenue rulings, revenue procedures,
notices, and other published announcements of the Internal Revenue Service
interpreting these provisions). In the event the Fund should fail to so qualify,
the Adviser will take all reasonable steps (a) to notify the Company of such
breach and (b) to cause the Fund to resume compliance with such diversification
requirement within the grace period afforded by Treasury Regulations 1.817-5.
2.8. The Adviser represents and warrants that it is and shall remain
duly registered as an investment adviser under all applicable federal and state
securities laws and that it shall perform its obligations for the Fund in
compliance in all material respects with any applicable state and federal
securities laws.
2.9. The Distributor represents and warrants that it is and shall
remain duly registered under all applicable federal and state securities laws
and that it shall perform its obligations for the Fund in compliance in all
material respects with the laws of any applicable state and federal securities
laws.
2.10. The Distributor and the Adviser represent and warrant that all of
their respective officers, employees, investment advisers, and other individuals
or entities dealing with the money and/or securities of the Fund are, and shall
continue to be at all times, covered by one or more blanket fidelity bonds or
similar coverage for the benefit of the Fund in an amount not less than the
minimal coverage required by Rule 17g-1 under the 1940 Act or related provisions
as may be promulgated from time to time. The aforesaid bonds shall include
coverage for larceny and embezzlement and shall be issued by a reputable bonding
company.
2.11. Adviser and Distributor represent and warrant that each Portfolio
is currently
qualified as a Regulated Investment Company under Subchapter M of the Internal
Revenue Code (the "Code"), and that they will maintain such qualification (under
Subchapter M or any successor or similar provision) and that no other
Participating Insurance Company will purchase shares in any Portfolio for any
purpose or under any circumstances that would preclude the Company from "looking
through" to the investments of each Designated Portfolio in which it invests,
pursuant to the "look through" rules found in Treasury Regulation 1.817-5.
Distributor will notify the Company immediately upon having a reasonable basis
for believing that any Portfolio has ceased to so qualify or that any might not
so qualify in the future.
2.12. The Distributor and the Adviser, on behalf of the Fund, represent
and warrant that they will provide the Company with as much advance notice as is
reasonably practicable of any material change affecting the Portfolios
(including, but not limited to, any material change in the registration
statement or prospectus affecting the Portfolios) and any proxy solicitation
affecting the Portfolios and consult with the Company in order to implement any
such change in an orderly manner, recognizing the expenses of changes and
attempting to minimize such expenses by implementing them in conjunction with
regular annual updates of the prospectus for the Contracts.
2.13. The Company represents and warrants, for purposes other than
diversification under Section 817 of the Code, that the Contracts are currently
and at the time of issuance will be treated as annuity contracts or life
insurance policies under applicable provisions of the Code, and that it will
make every effort to maintain such treatment and that it will notify the Fund,
the Distributor and the Adviser immediately upon having a reasonable basis for
believing that the Contracts have ceased to be so treated or that they may not
be so treated in the future. In addition, the Company represents and warrants
that interests in each Account are offered exclusively through the purchase of
or transfer into a "variable contract" within the meaning of such terms under
Section 817 of the Code and the regulations thereunder. The Company will use
best efforts to continue to meet such definitional requirements, and it will
notify the Fund, the Distributor and the Adviser immediately upon having a
reasonable basis for believing that such requirements have ceased to be met or
that they may not be met in the future.
2.14. Each party represents and warrants that it is currently in
compliance, and will remain in compliance, with all applicable anti-money
laundering laws, regulations, and requirements. In addition, the Company
represents and warrants that it has adopted and implemented policies and
procedures reasonably designed to achieve compliance with the applicable
requirements administered by the Office of Foreign Assets Control ("OFAC") of
the U.S. Department of the Treasury.
2.15. The Company represents and warrants that it is currently in
compliance, and will remain in compliance, with all applicable laws, rules and
regulations relating to consumer privacy, including, but not limited to,
Regulation S-P.
2.16. The Company represents and warrants that it has adopted, and will
at all times during the term of this Agreement maintain, reasonable and
appropriate procedures ("Late Trading Procedures") designed to ensure that any
and all orders relating to the purchase, sale or exchange of Fund shares
communicated to the Fund are treated in accordance with Article I of this
Agreement as having been received on a Business Day have been received by the
Price Time on such Business Day and were not modified after the Price Time, and
that all Orders received from Contract owners but not rescinded by the Price
Time were communicated to the Fund or its agent as received for that Business
Day. Each transmission of Orders by the Company shall constitute a
representation by the Company that such orders are accurate and complete and
relate to orders received by the Company by the Price Time on the Business Day
for which the Order is to be priced and that such transmission includes all
Orders relating to Fund shares received from Contract owners but not rescinded
by the Price Time. The Company agrees to provide the Distributor or its designee
with a copy of the Late Trading Procedures and such certifications and
representations regarding the Late Trading Procedures as the Fund or its
designee may reasonably request. The Company will promptly notify the
Distributor in writing of any material change to the Late Trading Procedures.
2.17. The Company represents and warrants that it has adopted, and will
at all times during the term of this Agreement maintain, reasonable and
appropriate procedures ("Market Timing Procedures") designed to minimize any
adverse impact on other Fund investors due to
excessive trading. The Company agrees to provide the Distributor or its designee
with a copy of the Market Timing Procedures and such certifications and
representations regarding the Market Timing Procedures as the Distributor or its
designee may reasonably request. The Company will promptly notify the
Distributor in writing of any material change to the Market Timing Procedures.
The parties agree to cooperate in light of any conflict between the Market
Timing Procedures and actions taken or policies adopted by the Fund designed to
minimize any adverse impact on other Fund investors due to excessive trading.
2.18. The Adviser and the Distributor make no representation as to
whether any aspect of the Fund's operations (including, but not limited to, fees
and expenses and investment policies) complies with the insurance laws or
regulations of the various states.
ARTICLE III. Prospectuses and Proxy Statements; Voting
3.1. At least annually, the Adviser or Distributor shall provide the
Company with as many copies of the Fund's current prospectuses as the Company
may reasonably request, with expenses to be borne in accordance with Schedule C
hereof. If requested by the Company in lieu thereof, the Adviser or Distributor
shall provide such documentation (including an electronic version of the current
prospectus) and other assistance as is reasonably necessary in order for the
Company once each year (or more frequently if the prospectus for the Fund is
amended) to have the prospectus for the Contracts and the prospectus for the
Fund printed together in one document.
3.2. If applicable state or federal laws or regulations require that
the Statement of Additional Information ("SAI") for the Fund be distributed to
all Contract owners, then the Distributor and/or the Adviser shall provide the
Company with copies of the Fund's SAI in such quantities, with expenses to be
borne in accordance with Schedule C hereof, as the Company may reasonably
require to permit timely distribution thereof to Contract owners. The Adviser,
and/or the Distributor shall also provide an SAI to any Contract owner or
prospective owner who requests such SAI from the Fund.
3.3. The Distributor and/or the Adviser shall provide the Company with
copies of the
Fund's proxy material, reports to shareholders and other communications to
shareholders in such quantity, with expenses to be borne in accordance with
Schedule C hereof, as the Company may reasonably require to permit timely
distribution thereof to Contract owners.
3.4. It is understood and agreed that, except with respect to
information regarding the Company provided in writing by that party, the Company
shall not be responsible for the content of the prospectus or SAI for the Fund.
It is also understood and agreed that, except with respect to information
regarding the Fund, the Distributor, the Adviser or the Portfolios provided in
writing or approved of in writing by the Distributor or the Adviser, neither the
Fund, the Distributor nor Adviser are responsible for the content of the
prospectus or SAI for the Contracts.
3.5. If and to the extent required by law the Company shall:
(a) solicit voting instructions from Contract owners;
(b) vote the Portfolio shares held in the Accounts in accordance
with instructions received from Contract owners;
(c) vote Portfolio shares held in the Accounts for which no
instructions have been received in the same proportion as Portfolio shares for
which instructions have been received from Contract owners, so long as and to
the extent that the SEC continues to interpret the 1940 Act to require
pass-through voting privileges for variable contract owners; and
(d) vote Portfolio shares held in its general account or otherwise
in the same proportion as Portfolio shares for which instructions have been
received from Contract owners, so long as and to the extent that the SEC
continues to interpret the 1940 Act to require such voting by the insurance
company. The Company reserves the right to vote Fund shares in its own right, to
the extent permitted by law.
3.6. The Company shall be responsible for assuring that each of its
separate accounts holding shares of a Portfolio calculates voting privileges as
directed by the applicable Fund policies. The Distributor or Adviser agrees to
promptly notify the Company of any changes of
interpretations or amendments of the Mixed and Shared Funding Exemptive Order.
3.7. The Distributor and the Adviser agree to cause the Fund to comply
with all provisions of the 1940 Act and regulations promulgated thereunder
requiring voting by shareholders.
ARTICLE IV. Sales Material and Information
4.1. The Company shall furnish, or shall cause to be furnished, to the
Distributor or its designee, a copy of each piece of sales literature or other
promotional material that the Company develops or proposes to use and in which
the Fund (or a Portfolio thereof), the Adviser or the Distributor is named in
connection with the Contracts, at least five (5) Business Days prior to its use.
No such material shall be used if the Fund or its designee objects to such use
within five (5) Business Days after receipt of such material.
4.2. The Company shall not give any information or make any
representations or statements on behalf of or concerning the Fund, the
Portfolios, the Adviser or the Distributor in connection with the sale of the
Contracts other than the information or representations contained in the
registration statement, including the prospectus or SAI for the Fund, as the
same may be amended or supplemented from time to time, or in sales literature or
other promotional material approved by the Distributor or the Adviser, except
with the permission of the Distributor or the Adviser.
4.3. The Adviser or the Distributor shall furnish, or shall cause to be
furnished, to the Company, a copy of each piece of sales literature or other
promotional material in which the Company and/or its separate account(s) is
named at least five (5) Business Days prior to its use. No such material shall
be used if the Company objects to such use within five (5) Business Days after
receipt of such material.
4.4. The Fund, the Distributor and the Adviser shall not give any
information or make any representations on behalf of the Company or concerning
the Company, the Accounts, or the Contracts other than the information or
representations contained in a registration statement,
including the prospectus or SAI for the Contracts, as the same may be amended or
supplemented from time to time, or in sales literature or other promotional
material approved by the Company or its designee, except with the permission of
the Company.
4.5. The Distributor or its designees will provide to the Company at
least one complete copy of all registration statements, prospectuses, SAIs,
sales literature and other promotional materials, applications for exemptions,
requests for no-action letters, and all amendments and supplements to any of the
above, that relate to the Fund within a reasonable period of time following the
filing of such document(s) with the SEC or FINRA or other regulatory
authorities.
4.6. The Company will provide to the Fund or its designees at least one
complete copy of all registration statements, prospectuses, SAIs, reports,
solicitations for voting instructions, sales literature and other promotional
materials, applications for exemptions, requests for no-action letters, and all
amendments and supplements to any of the above, that relate to the Accounts with
respect to the Fund, within a reasonable period of time following the filing of
such document(s) with the SEC, FINRA, or other regulatory authority.
4.7. For purposes of Articles IV and VIII, the phrase "sales literature
and other promotional material" includes, but is not limited to, advertisements
(such as material published, or designed for use in, a newspaper, magazine, or
other periodical, radio, television, telephone or tape recording, videotape
display, signs or billboards, motion pictures, or other public media; e.g.,
on-line networks such as the Internet or other electronic media), sales
literature (i.e., any written communication distributed or made generally
available to customers or the public, including brochures, circulars, research
reports, market letters, form letters, seminar texts, reprints or excerpts of
any other advertisement, sales literature, or published article), educational or
training materials or other communications distributed or made generally
available to some or all agents or employees, and shareholder reports, and proxy
materials (including solicitations for voting instructions) and any other
material constituting sales literature or advertising under the FINRA rules, the
1933 Act or the 0000 Xxx.
4.8. At the request of any party to this Agreement, each other party
will make available to the other party's independent auditors and/or
representatives of the appropriate regulatory authorities, all records, data and
access to operating procedures that may be reasonably requested in connection
with compliance and regulatory requirements related to this Agreement or any
party's obligations under this Agreement.
ARTICLE V. Fees and Expenses
5.1. The Fund, the Distributor and the Adviser shall pay no fee or
other compensation to the Company under this Agreement, and the Company shall
pay no fee or other compensation to the Fund, the Distributor or Adviser under
this Agreement; provided, however, (a) the parties will bear their own expenses
as reflected in Schedule C and other provisions of this Agreement, and (b) the
parties may enter into other agreements relating to the Company's investment in
the Fund, including services agreements.
ARTICLE VI. Diversification and Qualification
6.1. The Distributor and the Adviser represent and warrant on behalf of
the Fund that the Fund and each Portfolio thereof will at all times comply with
Section 817(h) of the Code and Treasury Regulation ss.1.817-5, as amended from
time to time, and any Treasury interpretations thereof, relating to the
diversification requirements for variable annuity, endowment, or life insurance
contracts and any amendments or other modifications or successor provisions to
such Section or Regulations. The Distributor or the Adviser shall provide timely
to the Company a quarterly written diversification certification, in the form
attached hereto as Schedule D, as to whether each Portfolio complies with the
diversification requirements of Section 817(h) of the Code.
6.2. The Distributor and the Adviser represent and warrant that shares
of the Portfolios will be sold only to Participating Insurance Companies and
their separate accounts and to Qualified Plans. No shares of any Portfolio of
the Fund will be sold to the general public.
6.3. The Fund, the Distributor and the Adviser represent and warrant
that prior to
allowing an purchase of shares of the Fund, the status of each purchaser,
including any insurance company separate account or Qualified Plan, is verified.
6.4. The Distributor or the Adviser will notify the Company immediately
upon having a reasonable basis for believing that the Fund or any Portfolio has
ceased to comply with the aforesaid Section 817(h) diversification requirements
or might not so comply in the future.
6.5. Without in any way limiting the effect of Sections 8.2 hereof and
without in any way limiting or restricting any other remedies available to the
Company, the Adviser or Distributor will pay all costs associated with or
arising out of any failure, or any anticipated or reasonably foreseeable
failure, of the Fund or any Portfolio to comply with Sections 6.1 or 6.2 hereof,
including all costs associated with reasonable and appropriate corrections or
responses to any such failure; such costs may include, but are not limited to,
the costs involved in creating, organizing, and registering a new investment
company as a funding medium for the Contracts and/or the costs of obtaining
whatever regulatory authorizations are required to substitute shares of another
investment company for those of the failed Portfolio (including, but not limited
to, an order pursuant to Section 26(c) of the 1940 Act).
6.6. The Company agrees that if the Internal Revenue Service ("IRS")
asserts in writing in connection with any governmental audit or review of the
Company (or, to the Company's knowledge, of any Contract owner) that any
Portfolio has failed to comply with the diversification requirements of Section
817(h) of the Code or the Company otherwise becomes aware of any facts that
could give rise to any claim against the Fund, the Distributor or the Adviser as
a result of such a failure or alleged failure:
(a) The Company shall promptly notify the Distributor and the
Adviser of such assertion or potential claim;
(b) The Company shall consult with the Distributor and the Adviser
as to how to minimize any liability that may arise as a result of such failure
or alleged failure;
(c) The Company shall use its best efforts to minimize any
liability of the
Fund, the Distributor and the Adviser resulting from such failure, including,
without limitation, demonstrating, pursuant to Treasury Regulations, Section
1.817-5(a)(2), to the commissioner of the IRS that such failure was inadvertent;
(d) Any written materials to be submitted by the Company to the
IRS, any Contract owner or any other claimant in connection with any of the
foregoing proceedings or contests (including, without limitation, any such
materials to be submitted to the IRS pursuant to Treasury Regulations, Section
1.817-5(a)(2)) shall be provided by the Company to the Fund, the Distributor and
the Adviser (together with any supporting information or analysis)
contemporaneous with such submission;
(e) The Company shall provide the Distributor and the Adviser with
such cooperation as the Distributor and the Adviser shall reasonably request
(including, without limitation, by permitting the Distributor and the Adviser to
review the relevant books and records of the Company) in order to facilitate the
review by the Distributor and the Adviser of any written submissions provided to
it or its assessment of the validity or amount of any claim against it arising
from such failure or alleged failure;
(f) The Company shall not with respect to any claim of the IRS or
any Contract owner that would give rise to a claim against the Fund, the
Distributor and the Adviser (i) compromise or settle any claim, (ii) accept any
adjustment on audit, or (iii) forego any allowable administrative or judicial
appeals, without the express written consent of the Distributor and the Adviser,
which shall not be unreasonably withheld; provided that, the Company shall not
be required to appeal any adverse judicial decision unless the Distributor or
the Adviser shall have provided an opinion of independent counsel to the effect
that a reasonable basis exists for taking such appeal; and further provided that
the Distributor and the Adviser shall bear the costs and expenses, including
reasonable attorney's fees, incurred by the Company in complying with this
clause (f).
ARTICLE VII. Potential Conflicts and Compliance With Mixed and Shared Funding
Exemptive Order
7.1. The Fund's Board of Directors (the "Board") will monitor the Fund
for the existence of any material irreconcilable conflict between the interests
of the Contract owners of all separate accounts investing in the Fund. An
irreconcilable material conflict may arise for a variety of reasons, including:
(a) an action by any state insurance regulatory authority; (b) a change in
applicable federal or state insurance, tax, or securities laws or regulations,
or a public ruling, private letter ruling, no-action or interpretative letter,
or any similar action by insurance, tax, or securities regulatory authorities;
(c) an administrative or judicial decision in any relevant proceeding; (d) the
manner in which the investments of any Portfolio is being managed; (e) a
difference in voting instructions given by variable annuity contract and
variable life insurance contract owners or by contract owners of different
Participating Insurance Companies; or (f) a decision by a Participating
Insurance Company to disregard the voting instructions of Contract owners. The
Adviser or the Distributor shall promptly inform the Company in the event that
the Board determines that an irreconcilable material conflict exists and the
implications thereof.
7.2. The Company will report any potential or existing material
conflicts of which it is aware to the Distributor and/or the Adviser who will
provide such report to the Board. The Company will assist the Board in carrying
out its responsibilities under the Mixed and Shared Funding Exemptive Order, by
providing the Board with all information reasonably necessary for the Board to
consider any issues raised. This includes, but is not limited to, an obligation
by the Company to inform the Board whenever Contract owner voting instructions
are to be disregarded. Such responsibilities shall be carried out by the Company
with a view only to the interests of its Contract owners.
7.3. If it is determined by a majority of the Board, or a majority of
its directors who are not interested persons of the Fund, the Distributor, the
Adviser or any subadviser to any of the Portfolios, as defined in Section
2(a)(19) of the 1940 Act (the "Independent Directors"), that a material
irreconcilable conflict exists, the Company and other Participating Insurance
Companies shall, at their expense and to the extent reasonably practicable (as
determined by a majority of the Independent Directors), take whatever steps are
necessary to remedy or eliminate the irreconcilable material conflict, up to and
including: (1) withdrawing the assets allocable to some or all of the separate
accounts from the Fund or any Portfolio and reinvesting such assets in
a different investment medium, including (but not limited to) another Portfolio,
or submitting the question whether such segregation should be implemented to a
vote of all affected Contract owners and, as appropriate, segregating the assets
of any appropriate group (i.e., annuity contract owners, life insurance contract
owners, or variable contract owners of one or more Participating Insurance
Companies) that votes in favor of such segregation, or offering to the affected
contract owners the option of making such a change; and (2) establishing a new
registered management investment company or managed separate account.
7.4. If a material irreconcilable conflict arises because of a decision
by the Company to disregard Contract owner voting instructions and that decision
represents a minority position or would preclude a majority vote, the Company
may be required, at the Distributor's election, to withdraw the Account's
investment in the Fund and terminate this Agreement; provided, however, that
such withdrawal and termination shall be limited to the extent required by the
foregoing material irreconcilable conflict as determined by a majority of the
Independent Directors. Any such withdrawal and termination must take place
within six (6) months after the Distributor gives written notice that this
provision is being implemented, and until the end of that six-month period the
Distributor shall continue to accept and implement orders by the Company for the
purchase (and redemption) of shares of the Fund.
7.5. If a material irreconcilable conflict arises because a particular
state insurance regulator's decision applicable to the Company conflicts with
the majority of other state regulators, then the Company will withdraw the
Account's investment in the Fund and terminate this Agreement within six (6)
months after the Distributor or the Adviser informs the Company in writing that
the Board has determined that such decision has created an irreconcilable
material conflict; provided, however, that such withdrawal and termination shall
be limited to the extent required by the foregoing material irreconcilable
conflict as determined by a majority of the Independent Directors. Until the end
of the foregoing six-month period, the Distributor shall continue to accept and
implement orders by the Company for the purchase (and redemption) of shares of
the Fund.
7.6. For purposes of Sections 7.3 through 7.5 of this Agreement, a
majority of the
Independent Directors shall determine whether any proposed action adequately
remedies any irreconcilable material conflict, but in no event will the Fund be
required to establish a new funding medium for the Contracts. The Company shall
not be required by Section 7.3 to establish a new funding medium for the
Contracts if an offer to do so has been declined by vote of a majority of
Contract owners affected by the irreconcilable material conflict. In the event
that the Board determines that any proposed action does not adequately remedy
any irreconcilable material conflict, then the Company will withdraw the
Account's investment in the Fund and terminate this Agreement within six (6)
months after the Distributor informs the Company in writing of the foregoing
determination by the Board; provided, however, that such withdrawal and
termination shall be limited to the extent required by any such material
irreconcilable conflict as determined by a majority of the Independent
Directors.
7.7. If and to the extent that Rule 6e-2 and Rule 6e-3(T) are amended,
or Rule 6e-3 is adopted, to provide exemptive relief from any provision of the
1940 Act or the rules promulgated thereunder with respect to mixed or shared
funding (as defined in the Mixed and Shared Funding Exemptive Order) on terms
and conditions materially different from those contained in the Mixed and Shared
Funding Exemptive Order, then (a) the Distributor and Adviser, on behalf of the
Fund and/or the Participating Insurance Companies, as appropriate, shall take
such steps as may be necessary to comply with Rules 6e-2 and 6e-3(T), as
amended, and Rule 6e-3, as adopted, to the extent such rules are applicable; and
(b) Sections 3.5, 3.6, 3.7, 7.1, 7.2, 7.3, 7.4, and 7.5 of this Agreement shall
continue in effect only to the extent that terms and conditions substantially
identical to such Sections are contained in such Rule(s) as so amended or
adopted.
ARTICLE VIII. Indemnification
8.1. Indemnification By The Company
(a) As limited by and in accordance with Section 8.1(b) and 8.1(c)
hereof, the Company agrees to indemnify and hold harmless the Fund, the
Distributor and the Adviser and each of their respective officers and directors
or trustees and each person, if any, who controls
the Fund, the Distributor or the Adviser within the meaning of Section 15 of the
1933 Act (collectively, the "Indemnified Parties" for purposes of this Section
8.1) against any and all losses, claims, expenses, damages and liabilities
(including amounts paid in settlement with the written consent of the Company)
or litigation (including reasonable legal and other expenses) to which the
Indemnified Parties may become subject under any statute or regulation, at
common law or otherwise, insofar as such losses, claims, expenses, damages or
liabilities (or actions in respect thereof) or settlements are related to the
sale or acquisition of the Fund's shares or the Contracts and:
(i) arise out of or are based upon any untrue
statements or alleged untrue statements of any
material fact contained in the registration statement
or prospectus or SAI covering the Contracts or
contained in the Contracts or sales literature or
other promotional material for the Contracts (or any
amendment or supplement to any of the foregoing), or
arise out of or are based upon the omission or the
alleged omission to state therein a material fact
required to be stated therein or necessary to make
the statements therein not misleading, provided that
this Agreement to indemnify shall not apply as to any
Indemnified Party if such statement or omission or
such alleged statement or omission was made in
reliance upon and in conformity with information
furnished in writing to the Company or approved in
writing to the Company by or on behalf of the
Adviser, Distributor or Fund for use in the
registration statement or prospectus for the
Contracts or in the Contracts or sales literature or
other promotional material (or any amendment or
supplement to any of the foregoing) or otherwise for
use in connection with the sale of the Contracts or
Fund shares; or
(ii) arise out of or as a result of statements or
representations (other than statements or
representations contained in the registration
statement, prospectus, SAI or sales literature or
other promotional material of the Fund not supplied
by the Company or persons under its control) or
wrongful conduct of the Company or persons under its
control, with respect to the sale or distribution of
the Contracts or Fund Shares; or
(iii) arise out of any untrue statement or alleged
untrue statement of a material fact contained in a
registration statement, prospectus, SAI, or sales
literature or other promotional material of the Fund,
or any amendment thereof or supplement thereto, or
the omission or alleged omission to state therein a
material fact required to be stated therein or
necessary to make the statements therein not
misleading, if such a statement or omission was made
in reliance upon information furnished in writing to
the Fund by or on behalf of the Company; or
(iv) arise as a result of any failure by the Company
to provide the services and furnish the materials
under the terms of this Agreement; or
(v) arise out of or result from any material breach
of any representation and/or warranty made by the
Company in this Agreement or arise out of or result
from any other material breach of this Agreement by
the Company, including without limitation Section
2.13 and Section 6.5 hereof.
(b) The Company shall not be liable under this indemnification
provision with respect to any losses, claims, expenses, damages, liabilities or
litigation to which an Indemnified Party would otherwise be subject by reason of
such Indemnified Party's willful misfeasance, bad faith, or negligence in the
performance of such Indemnified Party's duties or by reason of such Indemnified
Party's reckless disregard of obligations or duties under this Agreement or to
any of the Indemnified Parties.
(c) The Company shall not be liable under this indemnification
provision with respect to any claim made against an Indemnified Party unless
such Indemnified Party shall have notified the Company in writing within a
reasonable time after the summons or other first legal process giving
information of the nature of the claim shall have been served upon such
Indemnified Party (or after such Indemnified Party shall have received notice of
such service on any designated agent), but failure to notify the Company of any
such claim shall not relieve the Company from any liability which it may have to
the Indemnified Party against whom such action is brought otherwise than on
account of this indemnification provision, except to the extent that the Company
has been prejudiced by such failure to give notice. In case any such action is
brought against the Indemnified Parties, the Company shall be entitled to
participate, at its own expense, in the defense of such action. The Company also
shall be entitled to assume the defense thereof, with counsel satisfactory to
the party named in the action. After notice from the Company to such party of
the Company's election to assume the defense thereof, the Indemnified Party
shall bear the fees and expenses of any additional counsel retained by it, and
the Company will not be liable to such party under this Agreement for any legal
or other expenses subsequently incurred by such party independently in
connection with the defense thereof other than reasonable costs of
investigation. The Company shall not be liable under this
indemnification provision with respect to any claim, action, suit, or preceding
settled by an Indemnified Party without the Company's written approval.
(d) The Indemnified Parties will promptly notify the Company of
the commencement of any litigation or proceedings against them in connection
with the issuance or sale of the Fund Shares or the Contracts or the operation
of the Fund.
8.2. Indemnification by the Adviser
(a) The Adviser agrees to indemnify and hold harmless the Company
and its directors and officers and each person, if any, who controls the Company
within the meaning of Section 15 of the 1933 Act (collectively, the "Indemnified
Parties" for purposes of this Section 8.2) against any and all losses, claims,
expenses, damages, liabilities (including amounts paid in settlement with the
written consent of the Adviser) or litigation (including reasonable legal and
other expenses) to which the Indemnified Parties may become subject under any
statute or regulation, at common law or otherwise, insofar as such losses,
claims, damages, liabilities or expenses (or actions in respect thereof) or
settlements are related to the sale or acquisition of the Fund's shares or the
Contracts and:
(i) arise out of or are based upon any untrue
statement or alleged untrue statement of any material
fact contained in the registration statement or
prospectus or SAI or sales literature or other
promotional material of the Fund prepared by the
Fund, the Distributor or the Adviser (or any
amendment or supplement to any of the foregoing), or
arise out of or are based upon the omission or the
alleged omission to state therein a material fact
required to be stated therein or necessary to make
the statements therein not misleading, provided that
this Agreement to indemnify shall not apply as to any
Indemnified Party if such statement or omission or
such alleged statement or omission was made in
reliance upon and in conformity with information
furnished in writing to the Adviser, the Distributor
or the Fund by or on behalf of the Company for use in
the registration statement, prospectus or SAI for the
Fund or in sales literature or other promotional
material (or any amendment or supplement to any of
the foregoing) or otherwise for use in connection
with the sale of the Contracts or the Fund shares; or
(ii) arise out of or as a result of statements or
representations (other than statements or
representations contained in the registration
statement,
prospectus, SAI or sales literature or other
promotional material for the Contracts not supplied
by the Adviser or persons under its control) or
wrongful conduct of the Fund, the Distributor or the
Adviser or persons under their control, with respect
to the sale or distribution of the Contracts or Fund
shares; or
(iii) arise out of any untrue statement or alleged
untrue statement of a material fact contained in a
registration statement, prospectus, SAI, or sales
literature or other promotional material covering the
Contracts, or any amendment thereof or supplement
thereto, or the omission or alleged omission to state
therein a material fact required to be stated therein
or necessary to make the statement or statements
therein not misleading, if such statement or omission
was made in reliance upon information furnished in
writing to the Company by or on behalf of the
Adviser, the Distributor or the Fund; or
(iv) arise as a result of any failure by the Fund,
the Distributor or the Adviser to provide the
services and furnish the materials under the terms of
this Agreement (including a failure, whether
unintentional or in good faith or otherwise, to
comply with the diversification and other
qualification requirements specified in Article VI of
this Agreement); or
(v) arise out of or result from any material breach
of any representation and/or warranty made by the
Fund, the Distributor or the Adviser in this
Agreement or arise out of or result from any other
material breach of this Agreement by the Adviser, the
Distributor or the Fund (including, without
limitation, any material breach, whether
unintentional or in good faith or otherwise, of the
representations, warranties, or covenants set forth
in Section 2.11 of this Agreement); or
(vi) arise out of or result from the incorrect or
untimely calculation or reporting by the Fund, the
Distributor or the Adviser of a Portfolio's daily NAV
per share (subject to Section 1.10 of this Agreement)
or dividend or capital gain distribution rate.
as limited by and in accordance with the provisions of Sections 8.2(b) and
8.2(c) hereof. This indemnification is in addition to and apart from the
responsibilities and obligations of the Adviser specified in Article VI hereof.
(b) The Adviser shall not be liable under this indemnification
provision with respect to any losses, claims, expenses, damages, liabilities or
litigation to which an Indemnified Party would otherwise be subject by reason of
such Indemnified Party's willful misfeasance, bad
faith, or negligence in the performance of such Indemnified Party's duties or by
reason of such Indemnified Party's reckless disregard of obligations or duties
under this Agreement or to any of the Indemnified Parties.
(c) The Adviser shall not be liable under this indemnification
provision with respect to any claim made against an Indemnified Party unless
such Indemnified Party shall have notified the Adviser in writing within a
reasonable time after the summons or other first legal process giving
information of the nature of the claim shall have been served upon such
Indemnified Party (or after such Indemnified Party shall have received notice of
such service on any designated agent), but failure to notify the Adviser of any
such claim shall not relieve the Adviser from any liability which it may have to
the Indemnified Party against whom such action is brought otherwise than on
account of this indemnification provision, except to the extent that the Adviser
has been prejudiced by such failure to give notice. In case any such action is
brought against the Indemnified Parties, the Adviser will be entitled to
participate, at its own expense, in the defense thereof. The Adviser also shall
be entitled to assume the defense thereof, with counsel satisfactory to the
party named in the action. After notice from the Adviser to such party of the
Adviser's election to assume the defense thereof, the Indemnified Party shall
bear the fees and expenses of any additional counsel retained by it, and the
Adviser will not be liable to such party under this Agreement for any legal or
other expenses subsequently incurred by such party independently in connection
with the defense thereof other than reasonable costs of investigation. The
Adviser shall not be liable under this indemnification provision with respect to
any claim, action, suit, or preceding settled by an Indemnified Party without
the Adviser's written approval.
(d) The Company agrees promptly to notify the Adviser of the
commencement of any litigation or proceedings against it or any of its officers
or directors in connection with the issuance or sale of the Contracts or the
operation of the Account.
ARTICLE IX. Applicable Law
9.1. This Agreement shall be construed and the provisions hereof
interpreted under
and in accordance with the laws of the State of Delaware, without regard to the
Delaware conflict of laws provisions.
9.2. This Agreement shall be subject to the provisions of the 1933 Act,
the 1934 Act and the 1940 Act, and the rules and regulations and rulings
thereunder, including such exemptions from those statutes, rules and regulations
as the SEC may grant (including, but not limited to, the Mixed and Shared
Funding Exemptive Order) and the terms hereof shall be interpreted and construed
in accordance therewith.
ARTICLE X. Termination
10.1. This Agreement shall terminate:
(a) at the option of any party, with or without cause, with
respect to some or all Portfolios, upon sixty (60) days' advance written notice
delivered to the other parties; or
(b) at the option of the Company by written notice to the other
parties with respect to any Portfolio based upon the Company's good faith
determination that shares of such Portfolio are not reasonably available to meet
the requirements of the Contracts; or
(c) at the option of the Company by written notice to the other
parties with respect to any Portfolio in the event any of the Portfolio's shares
are not registered, issued or sold in accordance with applicable state and/or
federal law or such law precludes the use of such Portfolio as the underlying
investment option of the Contracts issued or to be issued by the Company; or
(d) at the option of the Distributor or the Adviser in the event
that formal administrative proceedings are instituted against the Company by
FINRA, the SEC, the insurance commissioner or comparable official of any state
or any other regulatory body regarding the Company's duties under this Agreement
or related to the sale of the Contracts, the operation of any Account, or the
purchase of the Fund shares, if, in each case, the Distributor or Adviser, as
the case may be, reasonably determines in its sole judgment exercised in good
faith,
that any such administrative proceedings will have a material adverse effect
upon the ability of the Company to perform its obligations under this Agreement;
or
(e) at the option of the Company in the event that formal
administrative proceedings are instituted against the Fund, the Distributor or
the Adviser by FINRA, the SEC, or any state securities or insurance department
or any other regulatory body, if the Company reasonably determines in its sole
judgment exercised in good faith, that any such administrative proceedings will
have a material adverse effect upon the ability of the Distributor or the
Adviser to perform their obligations under this Agreement; or
(f) at the option of the Company by written notice to the
Distributor with respect to any Portfolio if the Company reasonably believes
that the Portfolio will fail to meet the diversification requirements of Section
817(h) of the Code specified in Article VI hereof; or
(g) at the option of any non-defaulting party hereto in the event
of a material breach of this Agreement by any party hereto (the "defaulting
party") other than as described in Section 10.1(b)-(f); provided, that the
non-defaulting party gives written notice thereof to the defaulting party, with
copies of such notice to all other non-defaulting parties, and if such breach
shall not have been remedied within thirty (30) days after such written notice
is given, then the non-defaulting party giving such written notice may terminate
this Agreement by giving thirty (30) days written notice of termination to the
defaulting party; or
(h) at any time upon written agreement of all parties to this
Agreement; or
(i) at any time by a vote of the majority of the Independent
Directors
10.2. Notice Requirement
No termination of this Agreement shall be effective unless and until
the party terminating this Agreement gives prior written notice to all other
parties of its intent to terminate, which notice shall set forth the basis for
the termination. Furthermore,
(a) in the event any termination is based upon the provisions of
Article VII, or the provisions of Section 10.1(a) of this Agreement, the prior
written notice shall be given in
advance of the effective date of termination as required by those provisions
unless such notice period is shortened by mutual written agreement of the
parties;
(b) in the event any termination is based upon the provisions of
Section 10.1(d) or 10.1(e) of this Agreement, the prior written notice shall be
given at least sixty (60) days before the effective date of termination; and
(c) in the event any termination is based upon the provisions of
Section 10.1(b), 10.1(c), 10.1(f) or 10.1(g), the prior written notice shall be
given in advance of the effective date of termination, which date shall be
determined by the party sending the notice.
10.3. Effect of Termination
Notwithstanding any termination of this Agreement, other than as a
result of a failure by either the Fund or the Company to meet the
diversification requirements of Section 817(h) of the Code, the Fund, the
Distributor and the Adviser shall, at the option of the Company, continue to
make available additional shares of the Fund pursuant to the terms and
conditions of this Agreement, for all Contracts in effect on the effective date
of termination of this Agreement (hereinafter referred to as "Existing
Contracts"). Specifically, without limitation, the owners of the Existing
Contracts shall be permitted to reallocate investments in the Fund, redeem
investments in the Fund and/or invest in the Fund upon the making of additional
purchase payments under the Existing Contracts. The parties agree that this
Section 10.3 shall not apply to any terminations under Article VII of this
Agreement and the effect of such Article VII terminations shall be governed by
Article VII of this Agreement.
10.4. Surviving Provisions
Notwithstanding any termination of this Agreement, each party's
obligations under Article VIII of this Agreement to indemnify other parties
shall survive and not be affected by any termination of this Agreement. In
addition, with respect to Existing Contracts, all provisions of this Agreement
shall also survive and not be affected by any termination of this Agreement.
ARTICLE XI. Notices
11.1. Any notice shall be sufficiently given when sent by registered or
certified mail to the other party at the address of such party set forth below
or at such other address as such party may from time to time specify in writing
to the other parties.
If to the Company:
AXA Equitable Life Insurance Company
1290 Avenue of the Xxxxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Funds Management Group
If to the Adviser or Distributor:
American Century Investments
0000 Xxxx Xxxxxx, 0xx Xxxxx
Xxxxxx Xxxx, Xxxxxxxx 00000
Attention: General Counsel
ARTICLE XII. Miscellaneous
12.1. Except as required by law, subpoena, court order or regulatory
order or request, each party hereto shall treat as confidential the names and
addresses of the owners of the Contracts and all information reasonably
identified as confidential in writing by any other party hereto and, except as
permitted by this Agreement, shall not disclose, disseminate or utilize such
names and addresses and other confidential information without the express
written consent of the affected party until such time as such information may
come into the public domain.
12.2. The captions in this Agreement are included for convenience of
reference only and in no way define or delineate any of the provisions hereof or
otherwise affect their construction or effect.
12.3. This Agreement may be executed simultaneously in two or more
counterparts,
each of which taken together shall constitute one and the same instrument.
12.4. If any provision of this Agreement shall be held or made invalid
by a court decision, statute, rule or otherwise, the remainder of the Agreement
shall not be affected thereby.
12.5. Each party hereto shall cooperate with each other party and all
appropriate governmental authorities (including without limitation the SEC,
FINRA and state insurance regulators) and shall permit such authorities
reasonable access to its books and records in connection with any investigation
or inquiry relating to this Agreement or the transactions contemplated hereby.
12.6. Any controversy or claim arising out of or relating to this
Agreement, or breach thereof, shall be settled by arbitration in a forum jointly
selected by the relevant parties (but if applicable law requires some other
forum, then such other forum) in accordance with the Commercial Arbitration
Rules of the American Arbitration Association, and judgment upon the award
rendered by the arbitrators may be entered in any court having jurisdiction
thereof.
12.6. 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.
12.7. This Agreement or any of the rights and obligations hereunder may
not be assigned by any party without the prior written consent of all parties
hereto; provided, however, that a transaction that does not result in a change
of actual control or management of a party hereto shall not be deemed to be an
assignment of this Agreement for purposes of this Section 12.8. Any assignment
of this Agreement in violation of this Section 12.8 shall be void.
12.8. The Company agrees that the obligations assumed by the
Distributor and the Adviser pursuant to this Agreement shall be limited in any
case to theDistributor and Adviser and their respective assets and the Company
shall not seek satisfaction of any such obligation from the shareholders of the
Fund, Distributor or the Adviser, the Directors, officers, employees or agents
of the Fund, Distributor or Adviser, or any of them.
12.9. The Distributor and the Adviser agree that the obligations
assumed by the Company pursuant to this Agreement shall be limited in any case
to the Company and its assets and neither the Fund, Distributor nor Adviser
shall seek satisfaction of any such obligation from the shareholders of the
Company, the directors, officers, employees or agents of the Company, or any of
them.
12.10. No provision of this Agreement may be deemed or construed to
modify or supersede any contractual rights, duties, or indemnifications, as
between the Adviser and the Fund, and the Distributor and the Fund.
IN WITNESS WHEREOF, each of the parties hereto has caused this
Agreement to be executed in its name and on its behalf by its duly authorized
representative and its seal to be hereunder affixed hereto as of the date
specified below.
AXA EQUTIABLE LIFE INSURANCE COMPANY, ON BEHALF OF CERTAIN
SEPARATE ACCOUNTS
By its authorized officer,
By:
Title: Senior Vice President
ADVISER - American Century Investment Management, Inc.
By its authorized officer,
By:
Title:
DISTRIBUTOR - American Century Investment Services, Inc.
By its authorized officer,
By:____________________________
Title:
SCHEDULE A
CONTRACTS
AXA Equitable Separate Account 49
AXA Equitable Separate Account 65
SCHEDULE B
PORTFOLIOS
Class I & Class II Shares of American Century Variable Portfolios, Inc. and
American Century Variable Portfolios II, Inc.
SCHEDULE C
EXPENSES
The Fund and/or the Distributor and/or Adviser, and the Company will coordinate
the functions and pay the costs of the completing these functions based upon an
allocation of costs in the tables below. Costs shall be allocated to reflect the
Fund's share of the total costs determined according to the number of pages of
the Fund's respective portions of the documents. Notwithstanding anything to the
contrary, the parties agree that in the event the Company undertakes to print
and/or distribute Fund materials itself, Distributor will only be required to
reimburse Company's expenses up to the amount Distributor would have paid its
own shareholder communications vendor for such printing and/or mailing.
------------------------------------------------------------------------------------------------------------------
ITEM FUNCTION PARTY RESPONSIBLE FOR PARTY RESPONSIBLE FOR
COORDINATION EXPENSE
------------------------------------------------------------------------------------------------------------------
Mutual Fund Prospectus Printing of prospectuses Company Inforce - Distributor
Prospective - Company
------------------------------------------------------------------------------------------------------------------
Distribution (including Company Distributor
postage) to Inforce
Clients
------------------------------------------------------------------------------------------------------------------
Distribution (including Company Company
postage) to Prospective
Clients
------------------------------------------------------------------------------------------------------------------
Mutual Fund Prospectus If Required by Fund, Distributor Distributor
Update & Distribution Distributor or Adviser
------------------------------------------------------------------------------------------------------------------
If Required by Company Company (Distributor to Company
provide Company with
document in PDF format)
------------------------------------------------------------------------------------------------------------------
Mutual Fund SAI Printing Distributor Distributor
------------------------------------------------------------------------------------------------------------------
Distribution (including Party who receives the Party who receives the
postage) request request
------------------------------------------------------------------------------------------------------------------
Proxy Material for Mutual Printing of proxy Distributor Distributor
Fund required by Law
------------------------------------------------------------------------------------------------------------------
Distribution (including Company Distributor
labor) of proxy required
by Law
------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------
Mutual Fund Annual & Printing of reports Distributor Distributor
Semi-Annual Report
------------------------------------------------------------------------------------------------------------------
Distribution Company Distributor
------------------------------------------------------------------------------------------------------------------
Other communication to New If Required by Law, the Company Distributor or Adviser
and Prospective clients Fund, Distributor or
Adviser
------------------------------------------------------------------------------------------------------------------
If Required by Company Company Company
------------------------------------------------------------------------------------------------------------------
Other communication to Distribution (including Company Distributor
inforce labor and printing) if
required by the Fund,
Distributor or Adviser
------------------------------------------------------------------------------------------------------------------
Distribution (including Company Company
labor and printing) if
required by Company
------------------------------------------------------------------------------------------------------------------
SCHEDULE D
Diversification Compliance Certification
Name of Portfolio: FUND
--------------------------------------------------------------------------------
CERTIFICATION
Fund was in compliance with the federal tax rules relating to diversification
requirements under Section 817(h) of the Internal Revenue Code and Treasury
Regulation 1.817-5, for the quarter ending [Insert most recently ended fiscal
quarter].
--------------------------------------------- ---------------------
Signed by Date
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