PARTICIPATION AGREEMENT
PARTICIPATION AGREEMENT (the "Agreement") made by and between XXXXXXX
VARIABLE LIFE INVESTMENT FUND (the "Fund"), a Massachusetts business trust
created under a Declaration of Trust dated March 15, 1985, as amended, with a
principal place of business in Boston, Massachusetts and [PARTICIPATING
INSURANCE COMPANY], a [STATE OF INCORPORATION] corporation (the "Company"),
with a principal place of business in [PRINCIPAL PLACE OF BUSINESS, CITY,
STATE] on behalf of [SEPARATE ACCOUNT NAME], a separate account of the
Company, and any other separate account of the Company as designated by the
Company from time to time, upon written notice to the Fund in accordance
with Section 9 herein (each, an "Account").
WHEREAS, the Fund acts as the investment vehicle for the separate
accounts established for variable life insurance policies and variable
annuity contracts (collectively referred to herein as "Variable Insurance
Products") to be offered by insurance companies which have entered into
participation agreements substantially identical to this Agreement
("Participating Insurance Companies") and their affiliated insurance
companies; and
WHEREAS, the beneficial interest in the Fund is divided into several
series of shares of beneficial interest without par value ("Shares"), and
additional series of Shares may be established, each designated a "Portfolio"
and representing the interest in a particular managed portfolio of
securities; and
WHEREAS, each Portfolio of the Fund, except the Money Market Portfolio,
is divided into two classes of Shares, and additional classes of Shares may
be established; and
WHEREAS, the Parties desire to evidence their agreement as to certain
other matters,
NOW THEREFORE, in consideration of the foregoing and the mutual
covenants and agreements hereinafter contained, the parties hereto agree as
follows:
1. DUTY OF FUND TO SELL.
The Fund shall make its Shares available for purchase at the applicable net
asset value per Share by Participating Insurance Companies and their affiliates
and separate accounts on those days
on which the Fund calculates its net asset value pursuant to rules of the
Securities and Exchange Commission; provided, however, that the Trustees of
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
the sole discretion of the Trustees, necessary in the best interest of the
shareholders of any Portfolio.
2. FUND MATERIALS.
The Fund, at its expense, shall provide the Company or its designee with
camera-ready copy or computer diskette versions of all prospectuses,
statements of additional information, annual and semi-annual reports and
proxy materials (collectively, "Fund Materials") to be printed and
distributed by the Company or its broker/dealer to the Company's existing or
prospective contract owners, as appropriate. The Company agrees to bear the
cost of printing and distributing such Fund Materials.
3. REQUIREMENT TO EXECUTE PARTICIPATION AGREEMENT; REQUESTS.
Each Participating Insurance Company shall, prior to purchasing Shares
in the Fund, execute and deliver a participation agreement in a form
substantially identical to this Agreement.
The Fund shall make available, upon written request from the
Participating Insurance Company given in accordance with Paragraph 9, to each
Participating Insurance Company which has executed an Agreement and which
Agreement has not been terminated pursuant to Paragraph 7 (i) a list of all
other Participating Insurance Companies, and (ii) a copy of the Agreement as
executed by any other Participating Insurance Company.
The Fund shall also make available upon request to each Participating
Insurance Company which has executed an Agreement and which Agreement has not
been terminated pursuant to Paragraph 7, the net asset value of any Portfolio
of the Fund as of any date upon which the Fund calculates the net asset value
of its Portfolios for the purpose of purchase and redemption of Shares.
4. INDEMNIFICATION.
(a) The Company agrees to indemnify and hold harmless the Fund and each
of its Trustees and officers and each person, if any, who controls the Fund
within the meaning of Section 15 of the Securities Act of 1933 (the "Act")
against any and all losses, claims, damages, liabilities or litigation
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(including legal and other expenses), arising out of the acquisition of any
Shares by any person, to which the Fund or such Trustees, officers or
controlling person may become subject under the Act, under any other statute,
at common law or otherwise, which (i) may be based upon any wrongful act by
the Company, any of its employees or representatives, any affiliate of or any
person acting on behalf of the Company or a principal underwriter of its
insurance products, or (ii) may be based upon any untrue statement or alleged
untrue statement of a material fact contained in a registration statement or
prospectus covering Shares 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 to the Fund by the Company, or (iii) may be based on any untrue
statement or alleged untrue statement of a material fact contained in a
registration statement or prospectus covering insurance products sold by the
Company or any insurance company which is an affiliate thereof, or any
amendments 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, unless such
statement or omission was made in reliance upon information furnished to the
Company or such affiliate by or on behalf of the Fund; provided, however,
that in no case (i) is the Company's indemnity in favor of a Trustee or
officer or any other person deemed to protect such Trustee or officer or
other person against any liability to which any such person would otherwise
be subject by reason of willful misfeasance, bad faith, or gross negligence
in the performance of his duties or by reason of his reckless disregard of
obligations and duties under this Agreement or (ii) is the Company to be
liable under its indemnity agreement contained in this Paragraph 4 with
respect to any claim made against the Fund or any person indemnified unless
the Fund or such person, as the case may be, shall have notified the Company
in writing pursuant to Paragraph 9 within a reasonable time after the summons
or other first legal process giving information of the nature of the claims
shall have been served upon the Fund or upon such person (or after the Fund
or such person 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 has to the Fund or any person against
whom such action is brought
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otherwise than on account of its indemnity agreement contained in this
Paragraph 4. The Company shall be entitled to participate, at its own
expense, in the defense, or, if it so elects, to assume the defense of any
suit brought to enforce any such liability, but, if it elects to assume the
defense, such defense shall be conducted by counsel chosen by it and
satisfactory to the Fund, to its officers and Trustees, or to any controlling
person or persons, defendant or defendants in the suit. In the event that
the Company elects to assume the defense of any such suit and retain such
counsel, the Fund, such officers and Trustees or controlling person or
persons, defendant or defendants in the suit, shall bear the fees and
expenses of any additional counsel retained by them, but, in case the Company
does not elect to assume the defense of any such suit, the Company will
reimburse the Fund, such officers and Trustees or controlling person or
persons, defendant or defendants in such suit, for the reasonable fees and
expenses of any counsel retained by them. The Company agrees promptly to
notify the Fund pursuant to Paragraph 9 of the commencement of any litigation
or proceedings against it in connection with the issue and sale of any Shares.
(b) The Fund agrees to indemnify and hold harmless the Company and each
of its directors and officers and each person, if any, who controls the
Company within the meaning of Section 15 of the Act against any and all
losses, claims, damages, liabilities or litigation (including legal and other
expenses) to which it or such directors, officers or controlling person may
become subject under the Act, under any other statute, at common law or
otherwise, arising out of the acquisition of any Shares by any person which
(i) may be based upon any wrongful act by the Fund, any of its employees or
representatives or a principal underwriter of the Fund, or (ii) may be based
upon any untrue statement or alleged untrue statement of a material fact
contained in a registration statement or prospectus covering Shares 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
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to make the statements therein not misleading unless such statement or
omission was made in reliance upon information furnished to the Fund by the
Company or (iii) may be based on any untrue statement or alleged untrue
statement of a material fact contained in a registration statement or
prospectus covering insurance products sold by the Company, or any amendment
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 to the Company by or on
behalf of the Fund; provided, however, that in no case (i) is the Fund's
indemnity in favor of a director or officer or any other person deemed to
protect such director or officer or other person against any liability to
which any such person would otherwise be subject by reason of willful
misfeasance, bad faith, or gross negligence in the performance of his duties
or by reason of his reckless disregard of obligations and duties under this
Agreement or (ii) is the Fund to be liable under its indemnity agreement
contained in this Paragraph 4 with respect to any claims made against the
Company or any such director, officer or controlling person unless it or such
director, officer or controlling person, as the case may be, shall have
notified the Fund in writing pursuant to Paragraph 9 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 it or upon such director,
officer or controlling person (or after the Company or such director, officer
or controlling person shall have received notice of such service on any
designated agent), but failure to notify the Fund of any claim shall not
relieve it from any liability which it may have to the person against whom
such action is brought otherwise than on account of its indemnity agreement
contained in this Paragraph. The Fund will be entitled to participate at its
own expense in the defense, or, if it so elects, to assume the defense of any
suit brought to enforce any such liability, but if the Fund elects to assume
the defense, such defense shall be conducted by counsel chosen by it and
satisfactory to the Company, its directors, officers or controlling person or
persons, defendant or defendants, in the suit. In the event the Fund elects
to assume the defense of any such suit and retain such counsel, the Company,
its directors, officers or controlling person or persons, defendant or
defendants in the suit, shall bear the fees and expenses of any additional
counsel retained by them, but, in case the Fund does not elect to assume the
defense of any such suit, it will reimburse the Company or such directors,
officers or controlling person or persons, defendant or defendants in the
suit, for the reasonable fees and expenses of any counsel retained by them.
The Fund agrees promptly to notify the Company pursuant to Paragraph 9 of the
commencement of any litigation or proceedings against it or any of its
officers or Trustees in connection with the issuance or sale of any Shares.
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The provisions of this Section 4 shall survive the termination of the
Agreement.
5. PROCEDURE FOR RESOLVING IRRECONCILABLE CONFLICTS.
(a) The Trustees of the Fund will monitor the operations of the Fund
for the existence of any material irreconcilable conflict among the interests
of all the contract holders and policy owners of Variable Insurance Products
(the "Participants") of all separate accounts investing in the Fund. An
irreconcilable material conflict may arise, among other things, from: (a) an
action by any state insurance regulatory authority; (b) a change in
applicable insurance laws or regulations; (c) a tax ruling or provision of
the Internal Revenue Code or the regulations thereunder; (d) any other
development relating to the tax treatment of insurers, contract holders or
policy owners or beneficiaries of Variable Insurance Products; (e) the manner
in which the investments of any Portfolio are being managed; (f) a difference
in voting instructions given by variable annuity contract holders, on the one
hand, and variable life insurance policy owners, on the other hand, or by the
contract holders or policy owners of different participating insurance
companies; or (g) a decision by an insurer to override the voting
instructions of Participants.
(b) The Company will be responsible for reporting any potential or
existing conflicts to the Trustees of the Fund. The Company will be
responsible for assisting the Trustees in carrying out their responsibilities
under this Paragraph 5(b) and Paragraph 5(a), by providing the Trustees with
all information reasonably necessary for the Trustees to consider the issues
raised. The Fund will also request its investment adviser to report to the
Trustees any such conflict which comes to the attention of the adviser.
(c) If it is determined by a majority of the Trustees of the Fund, or a
majority of its disinterested Trustees, that a material irreconcilable
conflict exists involving the Company, the Company shall, at its expense, and
to the extent reasonably practicable (as determined by a majority of the
disinterested Trustees), take whatever steps are necessary to eliminate the
irreconcilable material conflict, including withdrawing the assets allocable
to some or all of the separate accounts from the Fund or any Portfolio or
class thereof and reinvesting such assets in a different investment medium,
including another Portfolio of the Fund or class thereof, offering to the
affected Participants
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the option of making such a change or establishing a new funding medium
including a registered investment company.
For purposes of this Paragraph 5(c), the Trustees, or the disinterested
Trustees, shall determine whether or not any proposed action adequately
remedies any irreconcilable material conflict. In the event of a
determination of the existence of an irreconcilable material conflict, the
Trustees shall cause the Fund to take such action, such as the establishment
of one or more additional Portfolios or classes, as they in their sole
discretion determine to be in the interest of all shareholders and
Participants in view of all applicable factors, such as cost, feasibility,
tax, regulatory and other considerations. In no event will the Fund be
required by this Paragraph 5(c) to establish a new funding medium for any
variable contract or policy.
The Company shall not be required by this Paragraph 5(c) to establish a
new funding medium for any variable contract or policy if an offer to do so
has been declined by a vote of a majority of the Participants materially
adversely affected by the material irreconcilable conflict. The Company will
recommend to its Participants that they decline an offer to establish a new
funding medium only if the Company believes it is in the best interest of the
Participants.
(d) The Trustees' determination of the existence of an irreconcilable
material conflict and its implications promptly shall be communicated to all
Participating Insurance Companies by written notice thereof delivered or
mailed, first class postage prepaid.
6. VOTING PRIVILEGES.
The Company shall be responsible for assuring that its separate account
or accounts participating in the Fund shall use a calculation method of
voting procedures substantially the same as the following: those
Participants permitted to give instructions and the number of Shares for
which instructions may be given will be determined as of the record date for
the Fund shareholders' meeting, which shall not be more than 60 days before
the date of the meeting. Whether or not voting instructions are actually
given by a particular Participant, all Fund shares held in any separate
account or sub-account thereof and attributable to policies will be voted
for, against, or withheld from voting on any proposition in the same
proportion as (i) the aggregate record date cash value held in such
sub-account for policies giving instructions, respectively, to vote for,
against, or
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withhold votes on such proposition, bears to (ii) the aggregate record date
cash value held in the sub-account for all policies for which voting
instructions are received. Participants continued in effect under lapse
options will not be permitted to give voting instructions. Shares held in any
other insurance company general or separate account or sub-account thereof
will be voted in the proportion specified in the second preceding sentence
for shares attributable to policies.
7. DURATION AND TERMINATION.
This Agreement shall continue in effect for five (5) years from the date
of its execution. This Agreement may be terminated at any time, at the
option of either of the Company or the Fund, when neither the Company, any
insurance company nor the separate account or accounts of such insurance
company which is an affiliate thereof which is not a Participating Insurance
Company own any Shares of the Fund or may be terminated by either party to
the Agreement upon a determination by a majority of the Trustees of the Fund,
or a majority of its disinterested Trustees, following certification thereof
by a Participating Insurance Company given in accordance with Paragraph 9
that an irreconcilable conflict exists among the interests of (i) all
contract holders and policy holders of Variable Insurance Products of all
separate accounts or (ii) the interests of the Participating Insurance
Companies investing in the Fund. If this Agreement is so terminated, the Fund
may, at any time thereafter, automatically redeem the Shares of any Portfolio
held by a Participating Shareholder.
8. COMPLIANCE.
The Fund will comply with the provisions of Section 4240(a) of the New
York Insurance Law.
Each Portfolio of the Fund will use its best efforts to comply with the
provisions of Section 817(h) of the Internal Revenue Code of 1986, as amended
(the "Code"), relating to diversification requirements for variable annuity,
endowment and life insurance contracts. Specifically, each Portfolio will
comply with either (i) the requirement of Section 817(h)(1) of the Code that
its assets be adequately diversified, or (ii) the "Safe Harbor for
Diversification" specified in Section 817(h)(2) of the Code, or (iii) in the
case of variable life insurance contracts only, the diversification
requirement of Section 817(h)(1) of the Code by having all or part of its
assets invested in U.S.
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Treasury securities which qualify for the "Special Rule for Investments in
United States Obligations" specified in Section 817(h)(3) of the Code. The
Fund will notify the Company immediately upon having a reasonable basis for
believing that a Portfolio has ceased to comply with the requirements of
Section 817(h) of the Code or that the Portfolio might not so comply in the
future.
The provisions of Paragraphs 5 and 6 of this Agreement shall be
interpreted in a manner consistent with any Rule or order of the Securities
and Exchange Commission under the Investment Company Act of 1940, as amended,
applicable to the parties hereto.
No Shares of any Portfolio of the Fund may be sold to the general public.
9. NOTICES.
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 party.
If to the Fund:
Xxxxxxx Variable Life Investment Fund
Xxx Xxxxxxxxxxxxx Xxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
(000) 000-0000
Attn: Xxxxx X. Xxxxx
If to the Company:
10. MASSACHUSETTS LAW TO APPLY.
This Agreement shall be construed and the provisions hereof interpreted
under and in accordance with the laws of The Commonwealth of Massachusetts.
11. MISCELLANEOUS.
The name "Xxxxxxx Variable Life Investment Fund" is the designation of
the Trustees for the time being under a Declaration of Trust dated March 15,
1985, as amended, and all persons dealing with the Fund must look solely to
the property of the Fund for the enforcement of any claims against the Fund
as neither the Trustees, officers, agents or shareholders assume any personal
liability for
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obligations entered into on behalf of the Fund. No Portfolio shall be liable
for any obligations properly attributable to any other Portfolio.
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. This Agreement may be executed
simultaneously in two or more counterparts, each of which taken together
shall constitute one and the same instrument.
12. ENTIRE AGREEMENT.
This Agreement incorporates the entire understanding and agreement among
the parties hereto, and supersedes any and all prior understandings and
agreements between the parties hereto with respect to the subject matter
hereof.
IN WITNESS WHEREOF, each of the parties hereto has caused this Agreement
to be executed in its name and behalf by its duly authorized representative
and its seal to be hereunder affixed hereto as of the ____ day of __________,
1998.
SEAL XXXXXXX VARIABLE LIFE
INVESTMENT FUND
By:________________________________
Xxxxx X. Xxxxx
President
SEAL [PARTICIPATING INSURANCE
COMPANY]
By:________________________________
Its:_______________________________
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Xxxxxxx Investor Services, Inc.
Xxx Xxxxxxxxxxxxx Xxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
PARTICIPATING CONTRACT AND POLICY AGREEMENT
Ladies and Gentlemen:
We (sometimes hereinafter referred to as "Investor Services") are the
Principal Underwriter of shares of Xxxxxxx Variable Life Investment Fund (the
"Fund"), a no-load, open-end, diversified registered management investment
company established in 1985 as a Massachusetts business trust. The Fund is a
series fund consisting of the Balanced Portfolio, Bond Portfolio, Capital
Growth Portfolio, Global Discovery Portfolio, International Portfolio, Money
Market Portfolio, and Growth and Income Portfolio (individually or
collectively hereinafter referred to as the "Portfolio" or the "Portfolios").
In addition, each Portfolio, except the Money Market Portfolio, is divided
into two classes of shares of beneficial interest ("Shares"). Additional
Portfolios and classes may be created from time to time. The Fund is the
funding vehicle for variable annuity contracts and variable life insurance
policies ("Participating Contracts and Policies") to be offered to the
separate accounts (the "Accounts") of certain life insurance companies
("Participating Insurance Companies"). Owners of Participating Contracts and
Policies will designate a portion of their premium to be invested in
insurance company separate accounts or sub-accounts which invest in, or
represent an investment in, directly or indirectly, Shares the Portfolios of
the Fund. You are a registered broker-dealer which intends to offer and sell
Participating Contracts and Policies. In connection with such offer and sale
you will be obligated to deliver the prospectuses of such Participating
Contracts and Policies and, contemporaneously therewith, the prospectus of
the Fund. Sales of Shares to Participating Insurance Companies or their
affiliates or the separate accounts of either shall be effected solely by us
as principal underwriter of the Fund, and not by you; provided, however, that
you shall be our agent in connection with the receipt of purchase orders for
Fund Shares and not in connection with their offer and sale. The
relationship between us shall be further governed by the following terms and
conditions:
1. To the extent, if any, that your activities or the activities of the
Participating Insurance Companies in connection with the sale of
Participating Contracts and Policies may
constitute the sale of Shares, you and we agree that (i) we are the
sole "principal underwriter" of the Fund and the sole "underwriter"
of the Shares as those terms are defined in the Investment Company
Act of 1940 (the "1940 Act") and the Securities Act of 1933 (the
"1933 Act"), respectively, and (ii) neither you nor the
Participating Insurance Companies or the Accounts shall be deemed
to be "principal underwriters" of the Fund or "underwriters" of the
Fund within the meaning of the 1940 Act and the 1933 Act,
respectively.
2. You hereby represent and warrant to us as follows:
(a) You are a corporation duly organized and validly existing in
good standing under the laws of the [STATE OF INCORPORATION]
and have full power and authority to enter into this Agreement.
(b) This Agreement has been duly authorized, executed and delivered
by you and is a valid and binding obligation enforceable
against you in accordance with its terms.
(c) Your compliance with the provisions of this Agreement will not
conflict with or result in a violation of the provisions of
your charter or by-laws, or any statute or any judgment, decree,
order, rule or regulation of any court or governmental agency or
body having jurisdiction.
3. We hereby represent and warrant to you as follows:
(a) A registration statement (File No. 2-96461) on Form N-1A with
respect to the Shares (x) has been prepared by the Fund in
conformity with the requirements of the 1940 Act and the 1933
Act and all applicable published instructions, rules and
regulations (the "Rules and Regulations") of the Securities
and Exchange Commission (the "Commission"), (y) has been filed
with the Commission, and (z) is currently effective. The
registration statement, including financial statements and
exhibits, and the final prospectus, including the statement of
additional information, as subsequently amended and
supplemented, are herein respectively referred to as the
"Registration Statement" and the "Prospectus".
(b) The Registration Statement and the Prospectus and any
amendment or supplement thereto will contain all statements
required to be stated therein and will comply in all material
respects with the requirements of the 1940 Act, the 1933 Act
and the Rules and Regulations, and the Registration Statement
and any post-effective amendment thereto will not contain or
incorporate by reference any untrue statement of a material
fact or omit to state any material fact required to be stated
therein or necessary to make the statements therein, in light
of the circumstances under which they were made, not
misleading, and the Prospectus and any amendment or supplement
thereto will not contain or incorporate by reference any
untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary in
order to make
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the statements therein, in light of the circumstances under
which they were made, not misleading.
(c) We are a corporation duly organized and validly existing in good
standing under the laws of The Commonwealth of Massachusetts and
have full power and authority to enter into this Agreement.
(d) This Agreement has been duly authorized, executed and delivered
by us and is a valid and binding obligation enforceable against
us in accordance with its terms.
(e) Our compliance with all of the provisions of this Agreement will
not conflict with or result in a violation of the provisions of
our charter or by-laws, or any statute or any judgment, decree,
order, rule or regulation of any court or governmental agency or
body having jurisdiction over us.
4. You hereby covenant and agree with us as follows:
(a) You shall be an independent contractor and neither you nor any
of your directors, partners, officers or employees as such, is
or shall be an employee of us or of the Fund. You are
responsible for your own conduct and the employment, control
and conduct of your agents and employees and for injury to such
agents or employees or to others through your agents or
employees.
(b) You or one or more Participating Insurance Companies will be
responsible for insuring compliance with all applicable laws and
regulations of any regulatory body having jurisdiction over you
or Participating Contracts and Policies.
(c) No person is authorized to make any representations concerning
Shares except those contained in the Prospectus relating thereto
and in such printed information as issued by us for use as
information supplemental to the prospectus. In offering
Participating Contracts and Policies you shall, with respect to
the Fund and the Shares, rely solely on the representations
contained in the Prospectus and in the above-mentioned
supplemental information.
(d) You are not entitled to any compensation whatsoever from us or
the Fund with respect to offers of Participating Contracts and
Policies.
(e) With respect to payments to be made to us pursuant to a Rule
12b-1 Plan for the Fund, you will not seek reimbursement for
administrative and recordkeeping services under the Fund's
Rule 12b-1 Plan that have been or will be paid for by any fees
or charges imposed on owners of Participating Contracts and
Policies by a Participating Insurance Company for such
services. This limitation does not, however, apply to profits
that you earn from fees and charges under Participating
Contracts and Policies for your nondistribution-related costs
and expenses, such as mortality and expense risk
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charges under Participating Contracts and Policies, which
profits may be available for your use to pay distribution and
other expense incurred by you. Further, this provision does
not restrict you from receiving sales charges on purchases and
redemptions, consistent with applicable law, made under or
redemption proceeds from a Participating Contract or Policy at
the same time that you are seeking reimbursement for expenses
under the Fund's Rule 12b-1 Plan.
5. We hereby covenant and agree with you as follows:
(a) If, at any time when a Prospectus relating to the Shares is
required to be delivered under the 1940 Act, the 1933 Act or
the Rules and Regulations, we become aware of the occurrence
of any event as a result of which the Prospectus as then
amended or supplemented would include any untrue statement of
a material fact, or omit to state a material fact necessary to
make the statements therein, in light of the circumstances
under which made, not misleading, or if we become aware that
it has become necessary at any time to amend or supplement the
Prospectus to comply with the 1940 Act, the 1933 Act or the
Rules and Regulations, we will promptly notify you and
promptly request the Fund to prepare and to file with the
Commission an amendment to the Registration Statement or
supplement to the Prospectus which will correct such statement
or omission or an amendment or supplement which will effect
such compliance, and deliver to you copies of any such
amendment or supplement.
(b) We will cooperate with you in taking such action as may be
necessary to qualify the Shares for offering and sale under
the securities or Blue Sky laws of any state or jurisdiction
as you may request and will continue such qualification in
effect so long as is required by applicable law in connection
with the distribution of Shares.
(c) We shall reimburse you, subject to the minimum amounts set
forth in the attached schedule, for those distribution and
shareholder servicing-related expenses that are permitted to
be paid for by the Fund under the Fund's Rule 12b-1 Plan and
for which (i) you submit documentation, as may be requested by
us or by the Fund's Board of Trustees, and (ii) we receive
payment for such expenses from the Fund under the Fund's Rule
12b-1 Plan. We shall remit to you as promptly as reasonably
practicable all payments received by us from the Fund for
remittance to you pursuant to the Fund's Rule 12b-1 Plan.
6. We reserve the right in our discretion, with 30 days' written
notice, to suspend sales or withdraw the offering of Shares
entirely, as to any person or generally, except that sales of
Shares may be suspended or the offering of Shares withdrawn without
notice (i) if the continued offering or sale of Shares would
violate any applicable statute or regulation, order or decree of
any court, governmental agency or self-regulatory organization
having jurisdiction, or (ii) if in the sole discretion of the
Trustees of the Fund, including a majority of those Trustees who
are not "interested persons" (as
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defined in the 0000 Xxx) of the Fund or of its investment adviser,
such action is determined to be necessary in the best interests of
the Shareholders of any Portfolio. We reserve the right to amend
this Agreement at any time, and you agree that the sale of
Participating Contracts and Policies, after notice of any such
amendment has been sent to you, including a written notice from
Investor Services stating that the amendment is necessary to
prevent the continued offering or sale of Shares from violating any
applicable statute or regulation, order or decree of any court,
governmental agency or self-regulatory organization having
jurisdiction, shall constitute your agreement to any such amendment.
7. If we elect to provide to you for the purpose of your offering
Participating Contracts and Policies copies of any Prospectus
relating to the Shares and printed information supplemental
thereto, we shall furnish you with such copies as you reasonably
request upon the payment of reasonable charges therefor by you or
one or more Participating Insurance Companies. If we elect not to
provide such copies of such documents, you or one or more
Participating Insurance Companies shall bear the entire cost of
printing copies for your use. You shall not use such copies of such
documents printed by you or one or more Participating Insurance
Companies until you shall have furnished us with a copy thereof and
we either have given you written approval for use or twenty days
shall have elapsed following our receipt thereof and we have not
objected thereto in writing.
8. (a) You will indemnify and hold harmless Investor Services and each
of its directors and officers and each person, if any, who
controls Investor Services within the meaning of Section 15 of
the 1933 Act, against any loss, liability, damages, claim or
expense (including the reasonable cost of investigating or
defending any alleged loss, liability, damages, claim or expense
and reasonable counsel fees incurred in connection therewith),
arising by reason of any person's acquiring any Shares, which may
be based upon the 1933 Act or any other statute or common law,
and which (i) may be based upon any wrongful act by you, any of
your employees or representatives, any affiliate of or any person
acting on behalf of you, or (ii) may be based upon any untrue
statement or alleged untrue statement of a material fact
contained in a registration statement or prospectus covering
Shares 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 to us or the Fund by you,
or (iii) may be based on any untrue statement or alleged untrue
statement of a material fact contained in a registration
statement or prospectus covering insurance products sold by you,
or any amendments 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, unless such statement or omission was
made in reliance upon information furnished to you or a
Participating Insurance Company by or on behalf of Investor
Services or the Fund; provided, however, that in no case (i) is
the indemnity by you in favor of any person indemnified to be
deemed to
5
protect Investor Services or any such person against any
liability to which Investor Services or any such person would
otherwise be subject by reason of willful misfeasance, bad
faith or gross negligence in the performance of its or his
duties or by reason of its or his reckless disregard of its
obligations and duties under this Agreement, or (ii) are you
to be liable under your indemnity agreement contained in this
paragraph with respect to any claim made against Investor
Services or any person indemnified unless Investor Services or
such person, as the case may be, shall have notified you 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 Investor Services or upon
such person (or after Investor Services or such person shall
have received notice of such service on any designated agent),
but failure to notify you of any such claim shall not relieve
you from any liability which you may have to Investor Services
or any person against whom such action is brought otherwise
than on account of your indemnity agreement contained in this
paragraph. You shall be entitled to participate, at your own
expense, in the defense, or, if you so elect, to assume the
defense of any suit brought to enforce any such liability,
but, if you elect to assume the defense, such defense shall be
conducted by counsel chosen by you and satisfactory to
Investor Services, or to its officers or directors, or to any
controlling person or persons, defendant or defendants in the
suit. In the event that you assume the defense of any such
suit and retain such counsel, Investor Services or such
officers or directors or controlling person or persons,
defendant or defendants in the suit, shall bear the fees and
expenses of any additional counsel retained by them, but, in
case you do not elect to assume the defense or any such suit,
you shall reimburse Investor Services and such officers,
directors or controlling person or persons, defendant of
defendants in such suit, for the reasonable fees and expenses
of any counsel retained by them. You agree promptly to notify
Investor Services of the commencement of any litigation or
proceedings against it in connection with the offer, issue and
sale of any shares.
(b) Investor Services will indemnify and hold harmless you and
each of your directors and officers and each person, if any,
who controls you within the meaning of Section 15 of the 1933
Act, against any loss, liability, damages, claim or expense
(including the reasonable cost of investigating or defending
any alleged loss, liability, damages, claim or expense and
reasonable counsel fees incurred in connection therewith),
arising by reason of any person's acquiring any Shares, which
may be based upon the 1933 Act or any other statute or common
law, and which (i) may be based upon any wrongful act by
Investor Services, any of its employees or representatives, or
(ii) may be based upon any untrue
6
statement or alleged untrue statement of a material fact
contained in a registration statement or prospectus covering
Shares 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 unless such statement or
omission was made in reliance upon information furnished to
Investor Services or the Fund by you or (iii) may be based on
any untrue statement or alleged untrue statement of a material
fact contained in a registration statement or prospectus
covering insurance products sold by you, or any amendment 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 to you by or on behalf of Investor
Services or the Fund; provided, however, that in no case (i)
is the indemnity by Investor Services in favor of any person
indemnified to be deemed to protect you or any such person
against any liability to which you or any such person would
otherwise be subject by reason of willful misfeasance, bad
faith or gross negligence in the performance of your or his
duties by reason of your or his reckless disregard of your or
his obligations and duties under this Agreement, or (ii) is
Investor Services to be liable under its indemnity agreement
contained in this paragraph with respect to any claim made
against you or any person indemnified unless you or such
person, as the case may be, shall have notified Investor
Services 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 you or upon such
person (or after you or such person shall have received notice
of such service on any designated agent), but failure to
notify Investor Services of any such claim shall not relieve
Investor Services from any liability to which Investor
Services may have to you or any person against whom such
action is brought otherwise than on account of its indemnity
agreement contained in this paragraph. Investor Services
shall be entitled to participate, at its own expense, in the
defense, or, if it so elects, to assume the defense of any
suit brought to enforce any such liability, but, if it elects
to assume the defense, such defense shall be conducted by
counsel chosen by Investor Services and satisfactory to you,
or to your officers or directors, or to any controlling person
or persons, defendant or defendants in the suit. In the event
that Investor Services assumes the defense of any such suit
and retains such counsel, you or such officers or directors or
controlling person or persons, defendant or defendants in the
suit, shall bear the fees and expenses of any additional
counsel retained by you, but, in case Investor Services does
not elect to assume the defense of any such suit, Investor
Services shall reimburse you and such officers, directors or
controlling person or persons, defendant or defendants in such
suit, for the reasonable fees and expenses of any counsel
retained by you. Investor Services agrees promptly to notify
you of the commencement of any litigation or proceedings
against it in connection with the offer, issue and sale of any
Shares.
9. The indemnities, representations, warranties, covenants and
agreements of each party to this Agreement as set forth in this
Agreement will remain in full force and effect regardless of any
investigation made by or on behalf of either of such parties or any
of their respective officers, directors, partners or any
controlling person, and will survive delivery of and payment for
the Shares.
7
10. Any provision of this Agreement which may be determined by
competent authority to be prohibited or unenforceable in any
jurisdiction shall, as to such jurisdiction, be ineffective to the
extent of such prohibition or unenforceability without invalidating
the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction. To the
extent permitted by applicable law, each party hereto waives any
provision of law which renders any provision hereof prohibited or
unenforceable in any respect.
11. This Agreement constitutes the entire agreement among the parties
concerning the subject matter hereof, and supersedes any and all
prior understandings.
12. This Agreement shall automatically terminate in the event of its
assignment. This Agreement may be terminated at any time by either
party by 30 days' written notice given to the other party, except
that the Agreement may be terminated by Investor Services without
notice (i) if the continued offering or sale of Shares would
violate any applicable statute or regulation, order or decree of
any court, governmental agency or self-regulatory organization
having jurisdiction, or (ii) if in the sole discretion of the
Trustees of the Fund, including a majority of those Trustees who
are not "interested persons" (as defined in the 0000 Xxx) of the
Fund or of its investment adviser, such action is determined to be
necessary in the best interests of the Shareholders of any
Portfolio. The obligation of each party to indemnify the other
party pursuant to paragraph 8 hereof shall apply with respect to
any Shares sold before or after such termination. To the extent we
receive payments under any provision of this Agreement pursuant to
a Rule 12b-1 Plan for the Fund, both you and we understand and
agree that this Agreement will be subject to the applicable
approval, reporting and termination requirements as set forth in
Rule 12b-1.
13. Any notice hereunder shall be duly given if mailed or telegraphed
to the other party hereto at the address specified below. This
Agreement shall be governed by and construed in accordance with the
laws of The Commonwealth of Massachusetts.
14. This Agreement may be executed in any number of counterparts which,
taken together shall constitute one and the same instrument. This
Agreement shall become effective upon receipt by us of your
acceptance hereof.
15. This Agreement may not be modified or amended except by a written
instrument duly executed by the parties hereto.
8
XXXXXXX INVESTOR SERVICES, INC.
By: ___________________________________
President
Xxx Xxxxxxxxxxxxx Xxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
The undersigned hereby accepts the offer set forth
in the above letter.
[REGISTERED BROKER-DEALER]
Dated: ____________________ By:_____________________________________
Authorized Representative
Address:
9
