EXHIBIT 8(q)
PARTICIPATION AGREEMENT
EXHIBIT 8(q)
PARTICIPATION AGREEMENT
THIS AGREEMENT, is made as of January 30, 2001, by and among IL Annuity
and Insurance Company ("Company"), on its own behalf and on behalf of IL Annuity
& Insurance Company Separate Account I, a segregated asset account of the
Company ("Account"), Strong Variable Insurance Funds, Inc. ("Strong Variable")
on behalf of the Portfolios of Strong Variable listed on the attached Exhibit A
as such Exhibit may be amended from time to time (the "Designated Portfolios"),
Strong Opportunity Fund II, Inc. ("Opportunity Fund II"), Strong Capital
Management, Inc. (the "Adviser"), the investment adviser and transfer agent for
the Opportunity Fund II and Strong Variable, and Strong Investments, Inc.
("Distributors"), the distributor for Strong Variable and the Opportunity Fund
II (each, a "Party," and collectively, the "Parties").
PRELIMINARY STATEMENTS
A. Beneficial interests in Strong Variable are divided into
several series of shares, each representing the interest in a particular managed
portfolio of securities and other assets (each, a "Portfolio").
B. To the extent permitted by applicable insurance laws and
regulations, the Company intends to purchase shares of Opportunity Fund II and
the Designated Portfolios ("Fund" or "Funds" shall be deemed to refer to each
Designated Portfolio and to the Opportunity Fund II to the extent the context
requires), on behalf of the Account to fund the variable annuity contracts that
use the Funds as an underlying investment medium (the "Contracts").
C. The Company, Adviser and Distributors desire to facilitate the
purchase and redemption of shares of the Funds by the Company for the Account
through one or more accounts, which number shall be as mutually agreed upon by
the parties, in each Fund (each an "Omnibus Account"), to be maintained of
record by the Company, subject to the terms and conditions of this Agreement.
D. The Company desires to provide administrative services and
functions (the "Services") for purchasers of Contracts ("Owners") who are
beneficial owners of shares of the Funds on the terms and conditions set forth
in this Agreement.
AGREEMENTS
The parties to this Agreement agree as follows:
1. Performance of Services. Company agrees to perform the
administrative functions and services specified in Exhibit B attached
to this Agreement with respect to the shares of the Funds beneficially
owned by the Owners and included in the Account. Nothing in this
Agreement shall limit Company's right to engage one or more of its
wholly owned subsidiaries (each, a "Designee") to provide all or any
portion of the Services, but no such engagement shall relieve Company
of its duties, responsibilities or liabilities under this Agreement.
2. The Omnibus Accounts.
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2.1 Each Omnibus Account will be opened based upon the
information contained in Exhibit C to this Agreement. In
connection with each Omnibus Account, Company represents and
warrants that it is authorized to act on behalf of each Owner
effecting transactions in the Omnibus Account and that the
information specified on Exhibit C to this Agreement is
correct.
2.2 Each Fund shall designate each Omnibus Account with
an account number. These account numbers will be the means of
identification when the Parties are transacting in the Omnibus
Accounts. The assets in the Accounts are segregated from the
Company's own assets. The Adviser agrees to cause the Omnibus
Accounts to be kept open on each Fund's books, as applicable,
regardless of a lack of activity or small position size except
to the extent the Company takes specific action to close an
Omnibus Account or to the extent a Fund's prospectus reserves
the right to close accounts which are inactive or of a small
position size. In the latter two cases, the Adviser will give
prior notice to the Company before closing an Omnibus Account.
2.3 The Company agrees to provide Adviser such
information as Adviser or Distributors may reasonably request
concerning Owners as may be necessary or advisable to enable
Adviser and Distributors to comply with applicable laws,
including state "Blue Sky" laws relating to the sales of
shares of the Funds to the Accounts.
3. Fund Shares Transactions.
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3.1 In General. Shares of the Funds shall be sold on
behalf of the Funds by Distributors and purchased by Company
for the Account and, indirectly for the appropriate subaccount
thereof at the net asset value next computed after receipt by
Distributors of each order of the Company or its Designee, in
accordance with the provisions of this Agreement, the then
current prospectuses of the Funds, and the Contracts. Company
may purchase shares of the Funds for its own account subject
to (a) receipt of prior written approval by Distributors; and
(b) such purchases being in accordance with the then current
prospectuses of the Fund and the Contracts. The Board of
Directors of each Fund ("Directors") may refuse to sell shares
of the applicable Fund to any person, or suspend or terminate
the offering of shares of the Fund if such action is required
by law or by regulatory authorities having jurisdiction.
Company agrees to purchase and redeem the shares of the Funds
in accordance with the provisions of this Agreement, of the
Contracts and of the then current prospectuses for the
Contracts and Funds. Except as necessary to implement
transactions initiated by Owners, or as
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otherwise permitted by state or federal laws or regulations,
Company shall not redeem shares of Funds attributable to the
Contracts.
3.2 Purchase and Redemption Orders. On each day that a
Fund is open for business (a "Business Day"), the Company or
its Designee shall aggregate and calculate the net purchase or
redemption order it receives for the Account from the Owners
for shares of the Fund that it received prior to the close of
trading on the New York Stock Exchange (the "NYSE") (i.e.,
3:00 p.m., Central time, unless the NYSE closes at an earlier
time in which case such earlier time shall apply) and
communicate to Distributors, by telephone or facsimile (or by
such other means as the Parties to this Agreement may agree to
in writing), the net aggregate purchase or redemption order
(if any) for the Omnibus Account for such Business Day (such
Business Day is sometimes referred to herein as the "Trade
Date"). The Company or its Designee will communicate such
orders to Distributors prior to 9:00 a.m., Central time, on
the next Business Day following the Trade Date. All trades
communicated to Distributors by the foregoing deadline shall
be treated by Distributors as if they were received by
Distributors prior to the close of trading on the Trade Date.
3.3 Settlement of Transactions.
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(a) Purchases. Company or its Designee will wire,
or arrange for the wire of, the purchase price of
each purchase order to the custodian for the Fund in
accordance with written instructions provided by
Distributors to the Company so that either (i) such
funds are received by the custodian for the Fund
prior to 10:30 a.m., Central time, on the next
Business Day following the Trade Date, or (ii)
Distributors is provided with a Federal Funds wire
system reference number prior to such 10:30 a.m.
deadline evidencing the entry of the wire transfer of
the purchase price to the applicable custodian into
the Federal Funds wire system prior to such time.
Company agrees that if it fails to provide funds to
the Fund's custodian by the close of business on the
next Business Day following the Trade Date, then, at
the option of Distributors, (A) the transaction may
be canceled, or (B) the transaction may be processed
at the next determined net asset value for the
applicable Fund after purchase order funds are
received. In such event, the Company shall indemnify
and hold harmless Distributors, Adviser and the Funds
from any liabilities, costs and damages either may
suffer as a result of such failure.
(b) Redemptions. The Adviser will use its best
efforts to cause to be transmitted to such custodial
account as Company shall direct in writing, the
proceeds of all redemption orders placed by Company
or its Designee by 9:00 a.m., Central time, on the
Business Day immediately following the Trade Date, by
wire transfer on that Business Day. Should Adviser
need to extend the settlement on a trade, it will
contact Company to discuss the
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extension. For purposes of determining the length of
settlement, Adviser agrees to treat the Account no
less favorably than other shareholders of the Funds.
Each wire transfer of redemption proceeds shall
indicate, on the Federal Funds wire system, the
amount thereof attributable to each Fund; provided,
however, that if the number of entries would be too
great to be transmitted through the Federal Funds
wire system, the Adviser shall, on the day the wire
is sent, fax such entries to Company or if possible,
send via direct or indirect systems access until
otherwise directed by the Company in writing.
3.4 Book Entry Only. Issuance and transfer of shares of
a Fund will be by book entry only. Stock certificates will not
be issued to the Company or the Account. Shares of the Funds
ordered from Distributors will be recorded in the appropriate
book entry title for the Account.
3.5 Distribution Information. The Adviser or Distributors
shall provide the Company with all distribution announcement
information as soon as it is announced by the Funds. The
distribution information shall set forth, as applicable,
ex-dates, record date, payable date, distribution rate per
share, record date share balances, cash and reinvested payment
amounts and all other information reasonably requested by the
Company. Where possible, the Adviser or Distributors shall
provide the Company with direct or indirect systems access to
the Adviser's systems for obtaining such distribution
information.
3.6 Reinvestment. All dividends and capital gains
distributions will be automatically reinvested on the payable
date in additional shares of the applicable Fund at net asset
value in accordance with each Fund's then current prospectus.
3.7 Pricing Information. Distributors shall use its best
efforts to furnish to the Company prior to 6:00 p.m., Central
time, on each Business Day each Fund's closing net asset value
for that day, and for those Funds for which such information
is calculated, the daily accrual for interest rate factor (mil
rate). Such information shall be communicated via fax, or
indirect or direct systems access acceptable to the Company.
3.8 Price Errors.
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(a) Notification. If an adjustment is required in
accordance with a Fund's then current policies on
reimbursement ("Fund Reimbursement Policies") to
correct any error in the computation of the net asset
value of Fund shares ("Price Error"), Adviser or
Distributors shall notify Company as soon as
practicable after discovering the Price Error. Notice
may be made via facsimile or via direct or indirect
systems access and shall state the incorrect price,
the correct price and, to the extent communicated to
the Fund's shareholders, the reason for the price
change.
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(b) Underpayments. If a Price Error causes an
Account to receive less than the amount to which it
otherwise would have been entitled, Adviser shall
make all necessary adjustments (subject to the Fund
Reimbursement Policies) so that the Account receives
the amount to which it would have been entitled
(c) Overpayments. If a Price Error causes an
Account to receive more than the amount to which it
otherwise would have been entitled, Company, when
requested by Adviser (in accordance with the Fund
Reimbursement Policies), will use its best efforts to
collect such excess amounts from the applicable
Owners.
(d) Fund Reimbursement Policies. Adviser agrees
to treat Company's customers no less favorably than
Adviser treats its retail shareholders in applying
the provisions of paragraphs 3.8(b) and 3.8(c).
(e) Expenses. Adviser shall reimburse Company for
all reasonable and necessary out-of-pocket expenses
incurred by Company for payroll overtime, stationery
and postage in adjusting Owner accounts affected by a
Price Error described in paragraphs 3.8(b) and
3.8(c). Company shall use its best efforts to
mitigate all expenses which may be reimbursable under
this section 3.8(e) and agrees that payroll overtime
shall not include any time spent programming
computers or otherwise customizing Company's
recordkeeping system. Upon requesting reimbursement,
Company shall present an itemized xxxx to Adviser
detailing the costs for which it seeks reimbursement.
3.9 Agency. Distributors hereby appoints the Company or
its Designee as its agents for the limited purpose of
accepting purchase and redemption instructions from the Owners
for the purchase and redemption of shares of the Funds by the
Company on behalf of Account.
3.10 Quarterly Reports. Adviser agrees to provide Company
a statement of Fund assets as soon as practicable and in any
event within 30 days after the end of each fiscal quarter, and
a statement certifying the compliance by the Funds during that
fiscal quarter with the diversification requirements and
qualification as a regulated investment company. In the event
of a breach of Section 6.4(a), Adviser will take all
reasonable steps (a) to notify Company of such breach and (b)
to adequately diversify the Fund so as to achieve compliance
within the grace period afforded by Treasury Regulation
1.817-5.
4. Proxy Solicitations and Voting.
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The Company shall, at its expense, distribute or arrange for
the distribution of all proxy materials furnished by the Funds
to the Account and shall: (a) solicit voting instructions from
Owners; (b) vote the Fund shares in
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accordance with instructions received from Owners; and (c)
vote the Fund shares for which no instructions have been
received, as well as shares attributable to it, in the same
proportion as Fund shares for which instructions have been
received from Owners, so long as and to the extent that the
Securities and Exchange Commission (the "SEC") continues to
interpret the Investment Company Act of 1940, as amended (the
"1940 Act"), to require pass-through voting privileges for
various contract owners. The Company and its Designees will
not recommend action in connection with, or oppose or
interfere with, the solicitation of proxies for the Fund
shares held for Owners.
5. Customer Communications.
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5.1 Prospectuses. The Adviser or Distributors, at its
expense, will provide the Company with as many copies of the
current prospectus for the Funds as the Company may reasonably
request for distribution, at the Company's expense, to
existing or prospective Owners,
5.2 Shareholder Materials. The Adviser and Distributors
shall, as applicable, provide in bulk to the Company or its
authorized representative, at a single address and at no
expense to the Company, the following shareholder
communications materials prepared for circulation to Owners in
quantities requested by the Company which are sufficient to
allow mailing thereof by the Company and, to the extent
required by applicable law, to all Owners: proxy or
information statements, annual reports, semi-annual reports,
and all initial and updated prospectuses, supplements and
amendments thereof. None of the Funds, the Adviser or
Distributors shall be responsible for the cost of distributing
such materials to Owners.
6. Representations and Warranties.
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6.1 The Company represents and warrants that:
(a) It is an insurance company duly organized and
in good standing under the laws of the State of
Kansas and that it has legally and validly
established the Account prior to any issuance or sale
thereof as a segregated asset account and that the
Company has and will maintain the capacity to issue
all Contracts that may be sold; and that it is and
will remain duly registered, licensed, qualified and
in good standing to sell the Contracts in all the
jurisdictions in which such Contracts are to be
offered or sold;
(b) It and each of its Designees is and will
remain duly registered and licensed in all material
respects under all applicable federal and state
securities and insurance laws and shall perform its
obligations under this Agreement in compliance in all
material respects with any applicable state and
federal laws;
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(c) The Contracts are and will be registered
under the Securities Act of 1933, as amended (the
"1933 Act"), and are and will be registered and
qualified for sale in the states where so required;
and the Account is and will be registered as a unit
investment trust in accordance with the 1940 Act and
shall be a segregated investment account for the
Contracts;
(d) The Contracts are currently treated as
annuity contracts, under applicable provisions of the
Internal Revenue Code of 1986, as amended (the
"Code"), and the Company will maintain such treatment
and will notify Adviser, Distributors and Funds
promptly upon having a reasonable basis for believing
that the Contracts have ceased to be so treated or
that they might not be so treated in the future;
(e) It and each of its Designees is registered as
a transfer agent pursuant to Section 17A of the
Securities Exchange Act of 1934, as amended (the
"1934 Act"), or is not required to be registered as
such;
(f) The arrangements provided for in this
Agreement will be disclosed to the Owners; and
(g) It is registered as a broker-dealer under the
1934 Act and any applicable state securities laws,
including as a result of entering into and performing
the Services set forth in this Agreement, or is not
required to be registered as such.
6.2 The Funds each represent and warrant that Fund shares
sold pursuant to this Agreement are and will be registered
under the 1933 Act and the Fund is and will be registered as a
registered investment company under the Investment Company Act
of 1940, in each case, except to the extent the Company is so
notified in writing;
6.3 Distributors represents and warrants that:
(a) It is and will be a member in good standing
of the National Association of Securities Dealers,
Inc. ("NASD") and is and will be registered as a
broker-dealer with the SEC.
and
(b) It will sell and distribute Fund shares in
accordance with all applicable state and federal laws
and regulations.
6.4 Adviser represents and warrants that:
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(a) It will cause each Fund to invest money from
the Contracts in such a manner as to ensure that the
Contracts will be treated as variable annuity
contracts under the Code and the regulations issued
thereunder, and that each Fund will comply with
Section 817(h) of the Code as amended from time to
time and with all applicable regulations promulgated
thereunder; and
(b) It is and will remain duly registered and
licensed in all material respects under all
applicable federal and state securities and insurance
laws and shall perform its obligations under this
Agreement in compliance in all material respects with
any applicable state and federal laws.
6.5 Each of the Parties to this Agreement represents and
warrants to the others that:
(a) It has full power and authority under
applicable law, and has taken all action necessary,
to enter into and perform this Agreement and the
person executing this Agreement on its behalf is duly
authorized and empowered to execute and deliver this
Agreement;
(b) This Agreement constitutes its legal, valid
and binding obligation, enforceable against it in
accordance with its terms and it shall comply in all
material respects with all laws, rules and
regulations applicable to it by virtue of entering
into this Agreement;
(c) No consent or authorization of, filing with,
or other act by or in respect of any governmental
authority, is required in connection with the
execution, delivery, performance, validity or
enforceability of this Agreement;
(d) The execution, performance and delivery of
this Agreement will not result in it violating any
applicable law or breaching or otherwise impairing
any of its contractual obligations;
(e) Each Party to this Agreement is entitled to
rely on any written records or instructions provided
to it by another Party; and
(f) Its directors, officers, employees, and
investment advisers, and other individuals/entities
dealing with the money or securities of a Fund are
and shall continue to be at all times covered by a
blanket fidelity bond or similar coverage for the
benefit of the Fund in an amount not less than the
amount required by the applicable rules of the NASD
and the federal securities laws, which bond shall
include coverage for larceny and embezzlement and
shall be issued by a reputable bonding company.
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7. Sales Material and Information.
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7.1 NASD Filings. The Company shall promptly inform
Distributors as to the status of all sales literature filings
pertaining to the Funds and shall promptly notify Distributors
of all approvals or disapprovals of sales literature filings
with the NASD pertaining to the Funds. For purposes of this
Section 7, the phrase "sales literature or other promotional
material" shall be construed in accordance with all applicable
securities laws and regulations.
7.2 Company Representations. Neither the Company nor any
of its Designees shall make any material representations
concerning the Adviser, the Distributors, or a Fund other than
the information or representations contained in: (a) a
registration statement of the Fund or prospectus of a Fund, as
amended or supplemented from time to time; (b) published
reports or statements of the Funds which are in the public
domain or are approved by Distributors or the Funds; or (c)
sales literature or other promotional material of the Funds.
7.3 Adviser, Distributors and Fund Representations. None
of Adviser, Distributors or any Fund shall make any material
representations concerning the Company or its Designees other
than the information or representations contained in: (a) a
registration statement or prospectus for the Contracts, as
amended or supplemented from time to time; (b) published
reports or statements of the Contracts or the Account which
are in the public domain or are approved by the Company; or
(c) sales literature or other promotional material of the
Company.
7.4 Trademarks, etc. Except to the extent required by
applicable law, no Party shall use any other Party's names,
logos, trademarks or service marks, whether registered or
unregistered, without the prior consent of such Party,
7.5 Information from Distributors and Adviser. Upon
request, Distributors or Adviser will provide to Company at
least one complete copy of all registration statements,
prospectuses, Statements of Additional Information, reports,
proxy statements, solicitations for voting instructions,
applications for exemptions, requests for no action letters,
and all amendments to any of the above, that relate to the
Funds, in final form as filed with the SEC, NASD and other
regulatory authorities.
7.6 Information from Company. Company will provide to
Distributors at least one complete copy of all registration
statements, prospectuses, Statements of Additional
Information, reports, solicitations for voting instructions,
sales literature and other promotional materials, applications
for exemptions, requests for no action letters and all
amendments to any of the above, that relate to a Fund and the
Contracts, in final form as filed with the SEC, NASD and other
regulatory authorities.
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7.7 Review of Marketing Materials. If so requested by
Company, the Adviser or Distributors will use its best efforts
to review sales literature and other marketing materials
prepared by Company which relate to the Funds, the Adviser or
Distributors for factual accuracy as to such entities,
provided that the Adviser or Distributors is provided at least
five (5) Business Days to review such materials. Neither the
Adviser nor Distributors will review such materials for
compliance with applicable laws. Company shall provide the
Adviser with copies of all sales literature and other
marketing materials which refer to the Funds, the Adviser or
Distributors within five (5) Business Days after their first
use, regardless of whether the Adviser or Distributors has
previously reviewed such materials. If so requested by the
Adviser or Distributors, Company shall cease to use any sales
literature or marketing materials which refer to the Funds,
the Adviser or Distributors that the Adviser or Distributors
determines to be inaccurate, misleading or otherwise
unacceptable.
8. Fees and Expenses.
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8.1 Fund Registration Expenses. Fund or Distributors shall
bear the cost of registration and qualification of Fund
shares; preparation and filing of Fund prospectuses and
registration statements, proxy materials and reports;
preparation of all other statements and notices relating to
the Fund or Distributors required by any federal or state law;
payment of all applicable fees, including, without limitation,
any fees due under Rule 24f-2 of the 1940 Act, relating to a
Fund; and all taxes on the issuance or transfer of Fund shares
on the Fund's records.
8.2 Contract Registration Expenses. The Company shall bear
the expenses for the costs of preparation and filing of the
Company's prospectus and registration statement with respect
to the Contracts; preparation of all other statements and
notices relating to the Account or the Contracts required by
any federal or state law; expenses for the solicitation and
sale of the Contracts including all costs of printing and
distributing all copies of advertisements, prospectuses,
Statements of Additional Information, proxy materials, and
reports to Owners or potential purchasers of the Contracts as
required by applicable state and federal law; payment of all
applicable fees relating to the Contracts; all costs of
drafting, filing and obtaining approvals of the Contracts in
the various states under applicable insurance laws; filing of
annual reports on Form N-SAR, and all other costs associated
with ongoing compliance with all such laws and its obligations
under this Agreement.
9. Indemnification.
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9.1 Indemnification by Company.
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(a) Company agrees to indemnify and hold harmless
the Funds, Adviser and Distributors and each of their
directors, officers, employees
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and agents, and each person, if any, who controls any
of them within the meaning of Section 15 of the 1933
Act (each, an "Indemnified Party" and collectively,
the "Indemnified Parties" for purposes of this
Section 9.1 ) from and against any and all losses,
claims, damages, liabilities (including amounts paid
in settlement with the written consent of Company),
and expenses including reasonable legal fees and
expenses, (collectively, hereinafter "Losses"), to
which the Indemnified Parties may become subject
under any statute, regulation, at common law or
otherwise insofar as such Losses:
(i) arise out of or are based upon any
untrue statements or alleged untrue statements
of any material fact contained in the
registration statement, prospectus or sales
literature for the Contracts or contained in
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 paragraph 9.1(a) 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 written information furnished
to Company by or on behalf of a Fund,
Distributors or Adviser for use in the
registration statement or prospectus for the
Contracts or in the Contracts (or any amendment
or supplement) 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 or wrongful
conduct of Company, its Designees or its
agents, 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, or sales literature covering a 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 written
information furnished to a Fund, Adviser or
Distributors by or on behalf of Company; or
(iv) arise out of, or as a result of, any
failure by Company, its Designees or persons
under the Company's or Designees' control
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to provide the Services and furnish the
materials contemplated under the terms of this
Agreement; or
(v) arise out of or result from, any
material breach of any representation or
warranty made by Company, its Designees or
persons under the Company's or Designees'
control in this Agreement or arise out of or
result from any other material breach of this
Agreement by Company, its Designees or persons
under the Company's or Designees' control; as
limited by and in accordance with the
provisions of Sections 9.1(b) and 9.1(c)
hereof; or
(vi) arise out of, or as a result of,
adherence by Adviser or Distributors to
instructions that it reasonably believes were
originated by authorized agents of Company.
This indemnification provision is in addition to any
liability which the Company or its Designees may otherwise
have.
(b) Company shall not be liable under this
indemnification provision with respect to any Losses
to which an Indemnified Party would otherwise be
subject by reason of such Indemnified Party's willful
misfeasance, bad faith, or gross 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.
(c) 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 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 Company of
any such claim shall not relieve Company from any
liability which it may have to the Indemnified Party
otherwise than on account of this indemnification
provision. In case any such action is brought against
any Indemnified Party, and it notified the
indemnifying Party of the commencement thereof, the
indemnifying Party will be entitled to participate
therein and, to the extent that it may wish, assume
the defense thereof, with counsel satisfactory to
such Indemnified Party. After notice from the
Indemnifying Party of its intention to assume the
defense of an action, the Indemnified Party shall
bear the expenses of any additional counsel obtained
by it, and the Indemnifying Party shall not be liable
to such Indemnified Party under this Section for any
legal or other expenses subsequently incurred by such
Indemnified Party in connection with the defense
thereof other than reasonable costs of investigation.
The
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Indemnified Party may not settle any action without
the written consent of the Indemnifying Party. The
Indemnifying Party may not settle any action without
the written consent of the Indemnified Party unless
such settlement completely and finally releases the
Indemnified Party from any and all liability. In
either event, consent shall not be unreasonably
withheld.
(d) The Indemnified Parties will promptly notify
Company of the commencement of any litigation or
proceedings against the Indemnified Parties in
connection with the issuance or sale of Fund shares
or the Contracts or the operation of a Fund.
9.2 Indemnification by Adviser and Distributors.
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(a) Adviser and Distributors agrees to indemnify
and hold harmless Company and each of its directors,
officers, employees and agents and each person, if
any, who controls Company within the meaning of
Section l5 of the 1933 Act (each, an "Indemnified
Party" and collectively, the "Indemnified Parties"
for purposes of this Section 9.2) from and against
any and all Losses to which the Indemnified Parties
may become subject under any statute, regulation, at
common law or otherwise, insofar as such Losses:
(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 sales literature of
a Fund (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 Section 9.2(a) 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 written information furnished to a Fund,
Adviser or Distributors by or on behalf of
Company for use in the registration statement
or prospectus for a Fund or in sales literature
(or any amendment or supplement) 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 or wrongful
conduct of Adviser or Distributors or persons
under its control, with respect to the sale or
distribution of Fund shares; or
(iii) arise out of any untrue statement or
alleged untrue statement of a material fact
contained in a registration statement,
prospectus, or sales literature 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 statements therein
13
not misleading, if such statement or omission
was made in reliance upon written information
furnished to Company by or on behalf of Adviser
or Distributors; or
(iv) arise out of, or as a result of any
failure by Adviser or Distributors or persons
under its control to provide the services and
furnish the materials contemplated under the
terms of this Agreement; or
(v) arise out of or result from any
material breach of any representation or
warranty made by Adviser or Distributors or
persons under its control in this Agreement or
arise out of or result from any other material
breach of this Agreement by Adviser or
Distributors or persons under its control; as
limited by and in accordance with the
provisions of Sections 9.2(b) and 9.2(c)
hereof.
This indemnification provision is in addition to any liability which
Adviser and Distributors may otherwise have.
(b) Adviser and Distributors shall not be liable
under this indemnification provision with respect to
any Losses to which an Indemnified Party would
otherwise be subject by reason of such Indemnified
Party's willful misfeasance, bad faith, or gross
negligence in the performance of such Indemnified
Party's duties or by reason of such Indemnified
Party's reckless disregard of obligations and duties
under this Agreement.
(c) Adviser and Distributors 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 Adviser
and Distributors 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 Adviser and Distributors of any such claim
shall not relieve Adviser and Distributors from any
liability which it may have to the Indemnified Party
otherwise than on account of this indemnification
provision. In case any such action is brought against
any Indemnified Party, and it notified the
Indemnifying Party of the commencement thereof, the
Indemnifying Party will be entitled to participate
therein and, to the extent that it may wish, assume
the defense thereof, with counsel satisfactory to
such Indemnified Party. After notice from the
Indemnifying Party of its intention to assume the
defense of an action, the Indemnified Party shall
bear the expenses of any additional counsel obtained
by it, and the Indemnifying Party shall not be liable
to such Indemnified Party under this Section for any
legal or other expenses subsequently incurred by such
Indemnified Party in connection with the defense
thereof other than reasonable costs of investigation.
The Indemnified Party may not settle any action
without the written consent of the Indemnifying
Party. The Indemnifying Party
14
may not settle any action without the written consent
of the Indemnified Party unless such settlement
completely and finally releases the Indemnified Party
from any and all liability. In either event, consent
shall not be unreasonably withheld.
(d) The Indemnified Parties will promptly notify
Adviser and Distributors of the commencement of any
litigation or proceedings against the Indemnified
Parties in connection with the issuance or sale of
the Contracts or the operation of the Account.
10. Potential Conflicts.
-------------------
10.1 Monitoring by Directors for Conflicts of Interest. The
Directors of each Fund will monitor the Fund for any potential
or existing material irreconcilable conflict of interest
between the interests of the contract owners of all separate
accounts investing in the Fund, including such conflict of
interest with any other separate account of any other
insurance company 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 interpretive
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 the Fund are being managed; (e) a
difference in voting instructions given by variable annuity
contract owners and variable life insurance contract owners or
by contract owners of different life insurance companies
utilizing the Fund; or (f) a decision by Company to disregard
the voting instructions of Owners. The Directors shall
promptly inform the Company, in writing, if they determine
that an irreconcilable material conflict exists and the
implications thereof.
10.2 Monitoring by the Company for Conflicts of Interest.
The Company will promptly notify the Directors, in writing, of
any potential or existing material irreconcilable conflicts of
interest, as described in Section 10.1 above, of which it is
aware. The Company will assist the Directors in carrying out
their responsibilities under any applicable provisions of the
federal securities laws and any exemptive orders granted by
the SEC ("Exemptive Order"), by providing the Directors, in a
timely manner, with all information reasonably necessary for
the Directors to consider any issues raised. This includes,
but is not limited to, an obligation by the Company to inform
the Directors whenever Owner voting instructions are
disregarded.
10.3 Remedies. If it is determined by a majority of the
Directors, or a majority of disinterested Directors, that a
material irreconcilable conflict exists, as described in
Section 10.1 above, the Company shall, at its own expense take
whatever steps are necessary to remedy or eliminate the
irreconcilable material conflict, up to and including, but not
limited to: (a) withdrawing the assets allocable to some or
al1 of the separate accounts from the applicable Fund and
reinvesting such assets in a different investment medium,
including (but not limited to) another fund managed by the
Adviser, or
15
submitting the question whether such segregation should be
implemented to a vote of all affected Owners and, as
appropriate, segregating the assets of any particular group
that votes in favor of such segregation, or offering to the
affected owners the option of making such a change; and (b)
establishing a new registered management investment company or
managed separate account.
10.4 Causes of Conflicts of Interest.
-------------------------------
(a) State Insurance Regulators. 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 affected Account's investment in
the applicable Fund and terminate this Agreement with respect
to such Account within the period of time permitted by such
decision, but in no event later than six months after the
Directors inform the Company in writing that it 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 disinterested Directors. Until the end of the
foregoing period, the Distributors and Funds shall continue to
accept and implement orders by the Company for the purchase
(and redemption) of shares of the Fund to the extent such
actions do not violate applicable law.
(b) Disregard of Owner Voting. If a material
irreconcilable conflict arises because of Company's decision
to disregard Owner voting instructions and that decision
represents a minority position or would preclude a majority
vote, Company may be required, at the applicable Fund's
election, to withdraw the Account's investment in said Fund.
No charge or penalty will be imposed against the Account as a
result of such withdrawal.
10.5 Limitations on Consequences. For purposes of Sections 10.3
through 10.5 of this Agreement, a majority of the disinterested
Directors shall determine whether any proposed action adequately
remedies any irreconcilable material conflict. In no event will a Fund,
the Adviser or the Distributors be required to establish a new funding
medium for any of the Contracts. The Company shall not be required by
Section 10.3 to establish a new funding medium for the Contracts if an
offer to do so has been declined by vote of a majority of Owners
affected by the irreconcilable material conflict. In the event that the
Directors determine that any proposed action does not adequately remedy
any irreconcilable material conflict, then the Company will withdraw
the Account's investment in the applicable Fund and terminate this
Agreement as quickly as may be required to comply with applicable law,
but in no event later than six (6) months after the Directors inform
the Company in writing of the foregoing determination, provided,
however, that such withdrawal and termination shall be limited to the
extent required by any such material irreconcilable conflict.
16
10.6 Changes in Laws. 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 Act or the rules
promulgated thereunder with respect to mixed or shared funding
(as defined in the Funds' Exemptive Order) on terms and
conditions materially different from those contained in the
Funds' Exemptive Order, then (a) the Funds and/or the Adviser,
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 10.1, 10.2, 10.3 and 10.4 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.
11. Maintenance of Records.
----------------------
(a) Recordkeeeping and other administrative services to
Owners shall be the responsibility of the Company and shall
not be the responsibility of the Funds, Adviser or
Distributors. None of the Funds, the Adviser or Distributors
shall maintain separate accounts or records for Owners.
Company shall maintain and preserve all records as required by
law to be maintained and preserved in connection with
providing the Services and in making shares of the Funds
available to the Account.
(b) Upon the request of the Adviser or Distributors, the
Company shall provide copies of all the historical records
relating to transactions between the Funds and the Account,
written communications regarding the Funds to or from the
Account and other materials, in each case (1) as are
maintained by the Company in the ordinary course of its
business and in compliance with applicable law, and (2) as may
reasonably be requested to enable the Adviser and
Distributors, or its representatives, including without
limitation its auditors or legal counsel, to (A) monitor and
review the Services, (B) comply with any request of a
governmental body or self-regulatory organization or the
Owners, (C) verify compliance by the Company with the terms of
this Agreement, (D) make required regulatory reports, (E)
verify to Advisor's reasonable satisfaction that all purchase
and redemption orders aggregated for each Trade Date were
received by Company prior to the close of trading on the NYSE
on such Trade Date, or (F) perform general customer
supervision. The Company agrees that it will permit the
Adviser and Distributors or such representatives of either to
have reasonable access to its personnel and records in order
to facilitate the monitoring of the quality of the Services.
(c) Upon the request of the Company, the Adviser and
Distributors shall provide copies of all the historical
records relating to transactions between the Funds and the
Account, written communications regarding the Funds to or from
the Account and other materials, in each case (1) as are
maintained by the Adviser and Distributors, as the case may
be, in the ordinary course of its business and in compliance
with applicable law, and (2) as may reasonably be requested to
enable the Company, or its representatives, including without
limitation its auditors or legal counsel, to (A) comply with
any request of a governmental body or self-regulatory
organization or the Owners, (B) verify
17
compliance by the Adviser and Distributors with the terms of
this Agreement, (C) make required regulatory reports, or (D)
perform general customer supervision.
(d) The Parties agree to cooperate in good faith in
providing records to one another pursuant to this Section 11.
12. Term and Termination.
--------------------
12.1 Term and Termination Without Cause. The initial term
of this Agreement shall be for a period of one year from the
date hereof. Unless terminated as to any Fund upon not less
than thirty (30) days prior written notice to the other
Parties, this Agreement shall thereafter automatically renew
for the remaining Funds from year to year, subject to
termination at the next applicable renewal date upon not less
than 30 days prior written notice. Any Party may terminate
this Agreement as to any Fund following the initial term upon
six (6) months advance written notice to the other Parties.
12.2 Termination by Fund, Distributors or Adviser for Cause.
Adviser, Fund or Distributors may terminate this Agreement by
written notice to the Company, if any of them shall determine,
in its sole judgment exercised in good faith, that (a) the
Company has suffered a material adverse change in its
business, operations, financial condition or prospects since
the date of this Agreement or is the subject of material
adverse publicity; or (b) any of the Contracts are not
registered, issued or sold in accordance with applicable state
and federal law or such law precludes the use of Fund shares
as the underlying investment media of the Contracts issued or
to be issued by the Company.
12.3 Termination by Company for Cause. Company may
terminate this Agreement by written notice to the Adviser,
Funds and Distributors in the event that (a) any of the Fund
shares are not registered, issued or sold in accordance with
applicable state or federal law or such law precludes the use
of such shares as the underlying investment media of the
Contracts issued or to be issued by the Company; (b) the Funds
cease to qualify as Regulated Investment Companies under
Subchapter M of the Code or under any successor or similar
provision, or if the Company reasonably believes that the
Funds may fail to so qualify; or (c) a Fund fails to meet the
diversification requirements specified in Section 6.4(a).
12.4 Termination by any Party. This Agreement may be
terminated as to any Fund by any Party at any time (a) by
giving 30 days' written notice to the other Parties in the
event of a material breach of this Agreement by the other
Party or Parties that is not cured during such 30 day period,
and (b) (i) upon institution of formal proceedings relating to
the legality of the terms and conditions of this Agreement
against the Account, Company, any Designee, the Funds, Adviser
or Distributors by the NASD, the SEC or any other regulatory
body provided that the terminating Party has a reasonable
belief that the institution of formal proceedings is not
without foundation and will have a material adverse impact on
the terminating Party, (ii) by the nonassigning Party upon the
assignment of this Agreement in contravention of the terms
hereof, or (iii) as is required
18
by law, order or instruction by a court of competent
jurisdiction or a regulatory body or self-regulatory
organization with jurisdiction over the terminating Party.
12.5 Limit on Termination. Notwithstanding the termination
of this Agreement with respect to any or all Funds, for so
long as any Contracts remain outstanding and invested in a
Fund each Party to this Agreement shall continue to perform
such of its duties under this Agreement as are necessary to
ensure the continued tax deferred status thereof and the
payment of benefits thereunder, except to the extent
prescribed by law, the SEC or other regulatory body.
Notwithstanding the foregoing, nothing in this Section 12.5
obligates a Fund to continue in existence. In the event that
any Fund elects to terminate its operations, the Company
shall, as soon as practicable, obtain an exemptive order or
order of substitution from the SEC to remove all Owners from
the applicable Fund.
13. Notices.
-------
All notices under this Agreement shall be given in writing
(and shall be deemed to have been duly given upon receipt) by delivery
in person, by facsimile, by registered or certified mail or by
overnight delivery (postage prepaid, return receipt requested) to the
respective Parties as follows:
If to Strong Variable:
Strong Variable Insurance Funds, Inc.
000 Xxxxxxxx Xxxxxxx
Xxxxxxxxx, XX 00000
Attention: General Counsel
Facsimile No.: 414/359-3948
If to Opportunity Fund II:
Strong Opportunity Fund II, Inc.
000 Xxxxxxxx Xxxxxxx
Xxxxxxxxx, XX 00000
Attention: General Counsel
Facsimile No.: 414/359-3948
If to Adviser:
Strong Capital Management, Inc.
000 Xxxxxxxx Xxxxxxx
Xxxxxxxxx, XX 00000
Attention: General Counsel
Facsimile No.: 414/359-3948
If to Distributors:
19
Strong Investments, Inc.
000 Xxxxxxxx Xxxxxxx
Xxxxxxxxx, XX 00000
Attention: General Counsel
Facsimile No.: 414/359-3948
If to Company:
IL Annuity and Insurance Company
0000 X. Xxxxxxxx Xxxxxx
Xxxxxxxxxxxx, XX 00000
Attention: Xxx XxXxxxx
Facsimile No.: 800/334-2023
14. Miscellaneous.
-------------
14.1. Captions. The captions in this Agreement are included
for convenience of reference only and in no way affect the
construction or effect of any provisions hereof.
14.2. Enforceability. If any portion 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.
14.3. Counterparts. This Agreement may be executed
simultaneously in two or more counterparts, each of which
taken together shall constitute one and the same instrument.
14.4. Remedies not Exclusive. 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 to this Agreement are
entitled to under state and federal laws.
14.5. Confidentiality. Subject to the requirements of legal
process and regulatory authority, the Funds and Distributors
shall treat as confidential the names and addresses of the
owners of the Contracts and all information reasonably
identified as confidential in writing by the Company to this
Agreement 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 Company until such time as it may come into the
public domain.
14.6. Governing Law. This Agreement shall be governed by and
interpreted in accordance with the internal laws of the State
of Wisconsin applicable to agreements fully executed and to be
performed therein; exclusive of conflicts of laws.
20
14.7. Survivability. Sections 6, 7.2, 7.3, 7.4, 9, 11 and
12.5 hereof shall survive termination of this Agreement. In
addition, all provisions of this Agreement shall survive
termination of this Agreement in the event that any Contracts
are invested in a Fund at the time the termination becomes
effective and shall survive for so long as such Contracts
remain so invested.
14.8. Amendment and Waiver. No modification of any provision
of this Agreement will be binding unless in writing and
executed by the Party to be bound thereby. No waiver of any
provision of this Agreement will be binding unless in writing
and executed by the Party granting such waiver.
Notwithstanding anything in this Agreement to the contrary,
the Adviser may unilaterally amend Exhibit A to this Agreement
to add additional series of Strong Variable Funds ("New
Funds") as Funds by sending to the Company a written notice of
the New Funds. Any valid waiver of a provision set forth
herein shall not constitute a waiver of any other provision of
this Agreement. In addition, any such waiver shall constitute
a present waiver of such provision and shall not constitute a
permanent future waiver of such provision.
14.9. Assignment. This Agreement shall be binding upon and
shall inure to the benefit of the Parties and their respective
successors and assigns; provided, however, that neither this
Agreement nor any rights, privileges, duties or obligations of
the Parties may be assigned by any Party without the written
consent of the other Parties or as expressly contemplated by
this Agreement.
14.10. Entire Agreement. This Agreement contains the full
and complete understanding between the Parties with respect to
the transactions covered and contemplated under this
Agreement, and supersedes all prior agreements and
understandings between the Parties relating to the subject
matter hereof, whether oral or written, express or implied.
14.11. Relationship of Parties; No Joint Venture, etc.
Except for the limited purpose provided in Section 3.8, it is
understood and agreed that the Company and each of its
Designees shall be acting as an independent contractor and not
as an employee or agent of the Adviser, Distributors or the
Funds, and none of the Parties shall hold itself out as an
agent of any other Party with the authority to bind such
Party. Neither the execution nor performance of this Agreement
shall be deemed to create a partnership or joint venture by
and among any of the Company, any Designees, Funds, Adviser,
or Distributors.
14.12. Expenses. All expenses incident to the performance by
each Party of its respective duties under this Agreement shall
be paid by that Party.
14.13. Time of Essence. Time shall be of the essence in this
Agreement.
14.14. Non-Exclusivity. Each of the Parties acknowledges and
agrees that this Agreement and the arrangements described
herein are intended to be non-exclusive and that each of the
Parties is free to enter into similar agreements and
arrangements with other entities.
21
14.15. Operations of Funds. In no way shall the provisions of this
Agreement limit the authority of the Funds, the Adviser or Distributors
to take such action as it may deem appropriate or advisable in
connection with all matters relating to the operation of such Fund and
the sale of its shares. In no way shall the provisions of this
Agreement limit the authority of the Company to take such action as it
may deem appropriate or advisable in connection with all matters
relating to the provision of Services or the shares of funds other than
the Funds offered to the Account.
IL ANNUITY AND INSURANCE COMPANY
BY /s/ Xxxxxx X. XxXxxxx
----------------------------------------------
NAME: Xxxxxx X. XxXxxxx
TITLE: Sales Officer
STRONG CAPITAL MANAGEMENT, INC.
BY: /s/ Xxxxxxxxx Xxxx
----------------------------------------------
NAME: Xxxxxxxxx Xxxx
STRONG INVESTMENTS, INC.
BY: /s/ Xxxxxxxxx Xxxx
----------------------------------------------
NAME: Xxxxxxxxx Xxxx
STRONG VARIABLE INSURANCE
FUNDS, INC. on behalf of the
Designated Portfolios
BY: /s/ Xxxxx X. Xxxxxxxxx
----------------------------------------------
NAME: Xxxxx X. Xxxxxxxxx
Vice President and Assistant Secretary
STRONG OPPORTUNITY FUND II, INC.
BY: /s/ Xxxxx X. Xxxxxxxxx
----------------------------------------------
NAME: Xxxxx X. Xxxxxxxxx
22
EXHIBIT A
---------
The following is a list of Designated Portfolios under this Agreement:
Strong Discovery Fund II
Strong Mid Cap Growth Fund II
Strong International Stock Fund II
Strong Opportunity Fund II
23
EXHIBIT B
---------
THE SERVICES
Company or its Designees shall perform the following services. Such
services shall be the responsibility of the Company and shall not be the
responsibility of the Funds, Adviser or Distributors.
1. Maintain separate records for each Account, which records shall
reflect Fund shares ("Shares") purchased and redeemed, including the date and
price for all transactions, Share balances, and the name and address of each
Owner, including zip codes and tax identification numbers.
2. Credit contributions to individual Owner accounts and invest such
contributions in shares of the Funds to the extent so designated by the Owner.
3. Disburse or credit to the Owners, and maintain records of, all
proceeds of redemptions of Fund shares and all other distributions not
reinvested in shares.
4. Prepare and transmit to the Owners, periodic account statements
showing, among other things, the total number of Fund shares owned as of the
statement closing date, purchases and redemptions of shares during the period
covered by the statement, the net asset value of the Funds as of a recent date,
and the dividends and other distributions paid during the statement period
(whether paid in cash or reinvested in shares).
5. Transmit to the Owners, as required by applicable law,
prospectuses, proxy materials, shareholder reports, and other information
provided by the Adviser, Distributors or Funds and required to be sent to
shareholders under the Federal securities laws.
6. Transmit to Distributors purchase orders and redemption requests
placed by the Account and arrange for the transmission of funds to and from the
Funds.
7. Transmit to Distributors such periodic reports as Distributors
shall reasonably conclude is necessary to enable the Funds to comply with
applicable Federal securities and state Blue Sky requirements.
8. Transmit to each Account conformations of purchase orders and
redemption requests placed by each Account.
9. Maintain all account balance information for the Account and
daily and monthly purchase summaries expressed in shares and dollar amounts.
10. Prepare, transmit and file any Federal, state and local
government reports and returns as required by law with respect to each account
maintained on behalf of the Account.
24
11. Respond to Owners' inquiries regarding, among other things, share
prices, account balances, dividend options, dividend amounts, and dividend
payment dates.
25
SCHEDULE C--ACCOUNT INFORMATION
(FOR ACCOUNTS TO HAVE DIVIDENDS AND CAPITAL GAINS REINVESTED AUTOMATICALLY)
1. Entity in whose name each Account will be opened: ___ Mailing address.
2. Employer ID number (For internal usage only).
3. Authorized contact persons: The following persons are authorized on behalf
of the Recordkeeper to effect transactions in each Account:
Name:
Phone:
Name:
Phone:
Name:
Phone:
Name:
Phone:
4. Will the Accounts have telephone exchange? ___Yes ___ No (This option lets
Company redeem shares by telephone and apply the proceeds for purchase in
another identically registered Account.)
5. Will the Accounts have telephone redemption? ___Yes ___ No (This option
lets Company sell shares by telephone. The proceeds will be wired to the bank
account specified below.)
6. All dividends and capital gains will be reinvested automatically.
7. Instructions for all outgoing wire transfers:
8. If this Account Information Form contains changed information, the
undersigned authorized officer has executed this amended Account Information
Form as of the date set forth below and acknowledges the agreements and
representations set forth in the Services Agreement between the Recordkeeper,
Strong Capital Management, Inc. and Strong Funds Strong Distributors, Inc.
9. COMPANY CERTIFIES UNDER PENALTY OF PERJURY THAT:
(I) THE NUMBER SHOWN ON THIS FORM IS THE CORRECT EMPLOYER ID NUMBER (OR
THAT COMPANY IS WAITING TO BE ISSUED AN EMPLOYER ID NUMBER), AND
26
(II) COMPANY IS NOT SUBJECT TO BACKUP WITHHOLDING BECAUSE (A) COMPANY IS
EXEMPT FROM BACKUP WITHHOLDING, OR (B) COMPANY HAS NOT BEEN NOTIFIED BY THE
INTERNAL REVENUE SERVICE ("IRS") THAT IT IS SUBJECT TO BACKUP WITHHOLDING
AS A RESULT OF FAILURE TO REPORT ALL INTEREST OR DIVIDENDS, OR (C) THE IRS
HAS NOTIFIED THE COMPANY THAT IT IS NO LONGER SUBJECT TO BACKUP
WITHHOLDING.
(CROSS OUT (II) IF COMPANY HAS BEEN NOTIFIED BY THE IRS THAT IT IS SUBJECT TO
BACKUP WITHHOLDING BECAUSE OF UNDERREPORTING INTEREST OR DIVIDENDS ON ITS TAX
RETURN.)
THE IRS DOES NOT REQUIRE COMPANY'S CONSENT TO ANY PROVISION OF THIS
DOCUMENT OTHER THAN THE CERTIFICATIONS REQUIRED TO AVOID BACKUP WITHHOLDING.
(Signature of Authorized Officer) (Date)
(Company shall inform Adviser and Distributors of any changes to information
provided in this Account Information Form pursuant to Section 23 of the
Agreement.)
Please Note: Distributors employs reasonable procedures to confirm that
instructions communicated by telephone are genuine and may not be liable for
losses due to unauthorized or fraudulent instructions. Please see the prospectus
for the applicable Fund for more information on the telephone exchange and
redemption privileges.
27
SCHEDULE C--ACCOUNT INFORMATION
(FOR ACCOUNTS TO HAVE DIVIDENDS AND CAPITAL GAINS PAID OUT)
1. Entity in whose name each Account will be opened: ___ Mailing address
2. Employer ID number (For internal usage only)
3. Authorized contact persons: The following persons are authorized on behalf
of the Recordkeeper to effect transactions in each Account:
Name:
Phone:
Name:
Phone:
Name:
Phone:
Name:
Phone:
4. Will the Accounts have telephone exchange? ___ Yes ___No (This option lets
Servicer redeem shares by telephone and apply the proceeds for purchase in
another identically registered Account.)
5. Will the Accounts have telephone redemption? ___Yes ___ No (This option
lets Servicer sell shares by telephone. The proceeds will be wired to the bank
account specified below.)
6. All dividends and capital gains will NOT be reinvested automatically.
---
7. Instructions for all outgoing wire transfers.
8. If this Account Information Form contains changed information, the
undersigned authorized offIcer has executed this amended Account
Information Form as of the date set forth below and acknowledges the
agreements and representations set forth in the Services Agreement between
the Recordkeeper, Strong Capital Management, Inc. and Strong Funds Strong
Distributors, Inc.
9. SERVICER CERTIFIES UNDER PENALTY OF PERJURY THAT:
(I) THE NUMBER SHOWN ON THIS FORM IS THE CORRECT EMPLOYER ID NUMBER (OR
THAT SERVICER IS WAITING TO BE ISSUED AN EMPLOYER ID NUMBER), AND
28
(II) SERVICER IS NOT SUBJECT TO BACKUP WITHHOLDING BECAUSE (A) SERVICER IS
EXEMPT FROM BACKUP WITHHOLDING, OR (B) SERVICER HAS NOT BEEN NOTIFIED BY
THE INTERNAL REVENUE SERVICE ("IRS") THAT IT IS SUBJECT TO BACKUP
WITHHOLDING AS A RESULT OF FAILURE TO REPORT ALL INTEREST OR DIVIDENDS, OR
(C) THE IRS HAS NOTIFIED THE SERVICER THAT IT IS NO LONGER SUBJECT TO
BACKUP WITHHOLDING.
(CROSS OUT (II) IF SERVICER HAS BEEN NOTIFIED BY THE IRS THAT IT IS SUBJECT TO
BACKUP WITHHOLDING BECAUSE OF UNDERREPORTING INTEREST OR DIVIDENDS ON ITS TAX
RETURN.)
THE IRS DOES NOT REQUIRE SERVICER'S CONSENT TO ANY PROVISION OF THIS
DOCUMENT OTHER THAN THE CERTIFICATIONS REQUIRED TO AVOID BACKUP WITHHOLDING.
(Signature of Authorized Officer) (Date)
(Servicer shall inform Company and Distributors of any changes to information
provided in this Account Information Form pursuant to Section 23 of this
Agreement.)
Please Note: Distributors employs reasonable procedures to confirm that
instructions communicated by telephone are genuine and may not be liable for
losses due to unauthorized or fraudulent instructions. Please see the prospectus
for the applicable Fund for more information on the telephone exchange and
redemption privileges.
29
SCHEDULE D
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Billing and Count Information
1. Contact person to receive administrative fees:
Name:
Title:
Company Name:
Address:
City, State, Zip:
Phone Number:
Fax Number:
E-mail address:
2. Contact person that will furnish participant/shareholder counts:
Name:
Title:
Company Name:
Address:
City, State, Zip:
Phone Number:
Fax Number:
E-mail address:
30
