AGREEMENT BETWEEN XXXXXXXXXXX VARIABLE ACCOUNT FUNDS, OPPENHEIMERFUNDS, INC.
AND GE CAPITAL LIFE ASSURANCE COMPANY OF NEW YORK
AGREEMENT DATED as of May 29, 1998 between XXXXXXXXXXX VARIABLE ACCOUNT FUNDS
(the "Fund"), OPPENHEIMERFUNDS, INC. (OFI), and GE CAPITAL LIFE ASSURANCE
COMPANY OF NEW YORK (GENY).
WHEREAS, the Fund represents and warrants that it is and will remain an open-end
diversified investment company registered as such under the Investment Company
Act of 1940 whose shares are registered under the Securities Act of 1933;
WHEREAS, the Fund represents and warrants that its shares, which currently are
issued with respect to ten (10) separate series, are offered only for purchase
by policies of life insurance companies ("Policies");
WHEREAS, the Fund and OFI represent and warrant that shares of the Fund shall be
sold only to insurance companies that are purchasing those shares for policies
established by certain life insurance companies ("participating insurance
companies");
WHEREAS, GENY desires to utilize shares of series of the Fund identified on
Schedule A hereto as one of the funding media of the policies identified on
Schedule B hereto;
WHEREAS, GENY represents and warrants the policies identified on Schedule B
hereto, have or will register as a unit investment trust(s) under the Investment
Company Act of 1940 unless an exemption from registration is available;
WHEREAS, the Fund represents and warrants that it has obtained an order from the
Securities and Exchange Commission granting participating insurance companies
and variable life insurance and variable annuity policies exemptions from the
provisions of Sections 9(a), 13(a), 15(a) and 15(b) of the Investment Company
Act of 1940, as amended, and Rules 6e-2(b) (15) and 6e-3(T)(b)(15) thereunder to
the extent necessary to permit shares of the fund to be sold to and held by
variable annuity and variable life policies of both affiliated and unaffiliated
life insurance companies (the "Order");
Now, therefore, in consideration of the premises and the mutual promises and
covenants hereinafter set forth, the Fund, OFI and GENY agree as follows:
1. The Fund shall make shares of the series identified on Schedule A hereto (as
may be modified by mutual consent from time to time) available for purchase at
net asset value by one or more policies of GENY identified on Schedule B hereto
(as may be modified by mutual consent from time to time) to support products of
GENY identified on Schedule C hereto (as may be modified by mutual consent from
time to time). Orders for such shares shall be executed on a daily basis at the
net asset value next computed after receipt by the Fund of the order. Requests
for such shares shall be executed on a daily basis at the net asset value next
computed after receipt by the Fund or its agent of the order for shares of the
Fund. For purposes of this Section 1, GENY shall be an agent of the Fund for
receipt of such orders and receipt by such agent shall constitute receipt by the
Fund; provided that such order is received by GENY by the Pricing Time on a
Business Day and the Fund receives written (or a facsimile) notice of such order
by 9:30 A.M. New York time on the next following Business Day. "Pricing Time"
shall mean the time of day as of which the Fund calculates its net asset value,
and "Business Day" shall mean any day on which the New York Stock Exchange is
open for trading and on which the Fund calculates its net asset value, pursuant
to the rules of the Securities and Exchange Commission.
2. The Fund agrees to redeem for cash, on GENY's request, any full or fractional
shares of the Fund held by GENY, executing such requests on a daily basis at the
net asset value next computed after receipt by the Fund of the request for
redemption. For purposes of this Section 2, GENY shall be the agent of the Fund
for receipt of requests for redemption, and receipt by such agent shall
constitute receipt by the Fund; provided that such request is received by GENY
by the Pricing Time on a Business Day and the Fund receives notice of such
request for redemption by 9:30 A.M. New York time on the next following Business
Day.
3. GENY shall pay for Fund shares on the next Business Day after an order to
purchase Fund shares is made in accordance with the provisions of Section 1.
4. The Fund shall furnish same day notice by telecopier to GENY of any income
dividends or capital gains distributions payable on the Fund's shares. GENY will
receive all such income dividends or capital gains distributions payable with
respect to a series in additional shares attributable to that series. The Fund
shall notify GENY of the number of shares issued as payment of such income
dividends or capital gains distributions.
5. The Fund shall make the net asset value per share of each series available to
GENY on a daily basis as soon as reasonably possible after the net asset value
per share is calculated and shall use its best efforts to make such net asset
value per share available to GENY by 5:30 pm New York time.
6. GENY shall pay for the reasonable costs of printing and mailing all
shareholder reports, notices, proxy materials (or similar materials such as
voting instruction solicitation materials) of the Fund that are required by the
federal securities laws to be sent to owners of policies issued by GENY for
which the Fund is serving or is to serve as an investment vehicle. GENY shall
also pay the reasonable costs of printing and distributing the Fund's
prospectuses and statements of additional information to owners of and
applicants applying for policies for which the Fund is serving or is to serve as
an investment vehicle.
7. The Fund shall prepare and be responsible for filing with the Securities and
Exchange Commission and any state securities regulators requiring such filing
all shareholder reports, notices, proxy materials (or similar materials such as
voting instruction solicitation materials), prospectuses and statements of
additional information of the Fund.
8. The Fund agrees that the investment portfolios of each series of the Fund
will comply with the diversification requirements set forth in Section 817(h) of
the Internal Revenue Code of 1986, as amended.
9. In the event this agreement is terminated, the Fund agrees that, as long as
shares of the Fund are available for purchase by policies of any other insurance
companies, it will permit GENY to continue to purchase shares of the Fund for
the account of its policyholders then funding policies, in whole or in part,
with shares of the Fund, provided GENY continues to pay the costs described in
Section 6 above.
10. GENY shall not give any information or make any representations or
statements on behalf of or concerning the Fund or OFI in connection with the
sale of the policies other than the information or representations contained in
the registration statement or prospectus for the Fund shares, as such
registration statement and prospectus may be amended from time to time, or in
reports or proxy statements for the Fund, or in sales literature approved by the
Fund or OFI, except as required by legal process or regulatory authorities or
with permission of the Fund and OFI.
11. The Fund and OFI shall not give any information or make any representation
on behalf of or concerning GENY, the separate account(s) of GENY, or the
policies, other than the information or representations contained in a
registration statement or prospectus for the policies, as such registration
statement and prospectus may be amended from time to time, or in materials
approved by GENY for distribution, including sales literature or promotional
materials, except as required by legal process or regulatory authorities or with
permission of GENY.
12. The Fund shall bear the cost of registration and qualification of the Fund's
shares, preparation and filing of the Fund's prospectus and registration
statement, proxy materials and reports (including all documents related to the
solicitation of voting instructions from owners of the policies), the
preparation of all statements and notices relating to the Fund that may be
required by any federal or state law, and all taxes to which an issuer is
subject on the issuance and transfer of the Fund's shares.
13.1 The Board of Trustees of the Fund will monitor the Fund for any material
irreconcilable conflicts between the interests of the owners of all policies
whose cash values are held in policies investing in the Fund ("Policyowners")
and will promptly inform GENY if it determines that a material irreconcilable
conflict exists. GENY and OFI, as a matter of ongoing responsibility, will
undertake and shall promptly report to the Fund's Board any potential or
existing material irreconcilable conflict between the policyowners. GENY and OFI
will assist the Board in carrying out its responsibilities in monitoring such
conflicts, by providing the Board in a timely manner with all information
reasonably necessary for the Board to consider any issues raised, including
information as to a decision by GENY to disregard voting instructions of
policyowners. This includes, but is not limited to, reporting to the Board on
all matters referred to in the Order and in the application for the Order. The
responsibility to report such information and conflicts and to assist the Board
will be carried out with a view only to the interests of policyowners.
13.2 If it is determined by either a majority of the Board of Trustees of the
Fund or a majority of its disinterested trustees, that a material irreconcilable
conflict exists, GENY shall, at its expense and to the extent reasonably
practicable (as determined by the majority of the Fund's disinterested trustees)
take whatever steps are necessary to remedy or eliminate the material
irreconcilable conflict, up to and including:
(a) withdrawing the assets allocable to the policies from the Fund (or
any series of the Fund) and reinvesting such assets in a different
investment medium, including another series of the Fund, or submitting
the question whether such segregation should be implemented to a vote
of all affected policyowners and, as appropriate, segregating the
assets of any group voting in favor of segregation, or offering to
affected policyowners the option of making such a change; and
(b) establishing a new registered management investment company or
managed separate account.
These responsibilities will be carried out with a view only to the interest of
policyowners. No penalty will be imposed by the Fund on GENY for withdrawing
assets from the Fund (or any series of the Fund) in the event of a material
irreconcilable conflict.
For purposes of this Section 13.2 a majority of the disinterested trustees shall
determine whether any proposed action adequately remedies any material
irreconcilable conflict, but in no event will the Fund or OFI be required to
establish a new funding medium for any variable contract. GENY shall not be
required by this Section 13.2 to establish a new funding medium for any variable
contract if an offer to do so has been declined by vote of a majority of the
policyowners materially adversely affected by the material irreconcilable
conflict. GENY will recommend to its policyowners that they decline an offer to
establish a new funding medium only if the company believes it in the best
interest of the policyowners.
13.3 So long as, and to the extent that the Securities and Exchange Commission
interprets the Investment Company Act of 1940 to require pass-through voting
privileges for variable policyowners, GENY will provide pass-through voting
privileges to owners of policies whose cash values are invested, through a GENY
separate account, in shares of the Fund. GENY shall be responsible for assuring
that a GENY separate account calculates voting privileges in a manner consistent
with all other policies investing in the Fund. GENY will vote shares of the Fund
held in a GENY separate account for which no timely voting instructions from
policyowners are received, as well as shares it owns, in the same proportion as
those shares for which voting instructions are received.
13.4 The Fund and GENY shall comply with Rule 6e-2, 6e-3(T) or, if adopted, 6e-3
of the Securities and Exchange Commission, if and to the extent they are amended
to provide exemptive relief with respect to mixed or shared funding.
13.5 OFI and GENY shall at least annually submit to the Fund's Board of Trustees
such reports, materials or data as the Trustees may reasonably request so that
the Trustees may fully carry out the obligations imposed upon them by the Order,
and said reports, materials and data shall be submitted more frequently if
deemed appropriate by the Trustees.
13.6 The Fund hereby represents and warrants that it has not and will not sell
Fund shares to any insurance company or separate account unless an agreement
containing provisions substantially the same as Sections 13.1 through 13.5 of
this agreement is in effect to govern such sales.
13.7 Each of the undertakings in this Section 13 will survive termination of
this Agreement and will remain in effect for as long as shares of the Fund are
held by GENY for the account of its policyowners.
14. GENY agrees to indemnify and hold harmless the Fund and OFI, each member of
their Board of Trustees or Board of Directors, each of their officers, and each
person who controls the Fund within the meaning of Section 15 of The Securities
Act of 1933 against any and all losses, claims, damages, liabilities (including
amounts paid in settlement with the written consent of GENY), or any expenses of
litigation (including court costs and reasonable attorney's fees), to which the
indemnified parties may become subject under any statute or regulation or at
common law or otherwise, insofar as such losses, claims, damages, liabilities or
expenses (or actions in respect thereof) or settlements are related to the sale
or acquisition of the Fund's shares and;
(a) arise out of any untrue or allegedly untrue statements of any
material fact contained in the registration statement or prospectus for
the policies, in the policies themselves or in sales literature created
or approved by GENY for the policies, or arise out of or are based upon
the omission or alleged omission to state therein any material fact
required to be stated therein or necessary to make the statements
therein not misleading, provided that such statements or omissions were
not made in reliance upon and in conformity with information furnished
by GENY by or on behalf of the Fund or OFI; or
(b) arise out of or as a result of statements or representations or
wrongful conduct of GENY or persons under its control, with respect to
sale or distribution of the policies, provided any such statement or
representation or wrongful conduct was not made in reliance upon and in
conformity with information furnished to GENY by or on behalf of the
Fund or OFI; or
(c) arise out of any untrue or allegedly untrue statement of a material
fact contained in the Fund's registration statement, prospectus or
sales literature 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 statement or omission was
made in reliance upon information furnished to the Fund or OFI by GENY,
or
(d) arise as a result of a breach of this agreement or a breach of any
misrepresentation and/or warranty made by GENY in this agreement.
15.1. The Fund agrees to indemnify and hold harmless GENY, each member of its
Board of Directors, each of its officers, and any person that controls GENY
within the meaning of Section 15 of The Securities Act of 1933 against any and
all losses, claims, damages, liabilities (including amounts paid in settlement
with the written consent of the Fund), or expenses of litigation (including
court costs and reasonable attorney's fees) to which the indemnified parties may
become subject under any statute or regulation or at common law or otherwise,
insofar as such losses, claims, damages, liabilities, or expenses (or actions in
respect thereof) or settlements are related to the sale or acquisition of the
Fund's shares or the policies and;
(a) arise out of any untrue or allegedly untrue statement of any
material fact contained in the registration statement or prospectus or
sales literature for the Fund, or arise out of or are based upon 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, provided that such statements or omissions were not made in
reliance upon and in conformity with information furnished to the Fund
by or on behalf of GENY; or
(b) arise out of or as a result of statements or representations or
wrongful conduct of the Fund, or persons under the control of the Fund,
with respect to sale or distribution of the policies, provided any such
statement or representation or wrongful conduct was not made in
reliance upon and in conformity with information furnished to the Fund
by or on behalf of GENY; or
(c) arise out of any untrue or allegedly untrue statement of any
material fact contained in the registration statement or prospectus for
the policies, or the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the
statement therein not misleading if such statement or omission was made
in reliance upon information furnished to GENY by the Fund; or
(d) arise as a result of a breach of this agreement or a breach of any
representation and/or warranty made by the Fund in this agreement.
15.2 OFI agrees to indemnify and hold harmless GENY, each member of its Board of
Directors, each of its officers and any person that controls GENY within the
meaning of Section 15 of The Securities Act of 1933 against any and all losses,
claims, damages, liabilities (including amounts paid in settlement with the
written consent of OFI), or expenses of litigation (including court costs and
reasonable attorney's fees) to which the indemnified parties may become subject
under any statute or regulation or at common law or otherwise, insofar as such
losses, claims, damages, liabilities, or expenses (or actions in respect
thereof) or settlements are related to the sale or acquisition of the Fund's
shares or the policies and;
(a) arise out of any untrue or allegedly untrue statement of any
material fact contained in the registration statement or prospectus or
sales literature for the Fund, or arise out of or are based upon 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, provided that such statements or omissions were not made in
reliance upon and in conformity with information furnished to OFI by or
on behalf of GENY; or
(b) arise out of or as a result of statements or representations or
wrongful conduct of OFI or persons under the control of OFI, with
respect to sale or distribution of the policies, provided any such
statement or representation or wrongful conduct was not made in
reliance upon and in conformity with information furnished to OFI by or
on behalf of GENY; or
(c) arise out of any untrue or allegedly untrue statement of any
material fact contained in the registration statement, prospectus or
sales literature for the policies, or the omission or alleged omission
to state therein a material fact required to be stated therein or
necessary to make the statement therein not misleading if such
statement or omission was made in reliance upon information furnished
to GENY by OFI; or
(d) arise as a result of a breach of this agreement or a breach of any
representation and/or warranty made by OFI in this agreement.
16. The indemnification provided under Sections 14, 15.1 and 15.2 shall not be
available to an indemnified party if the loss, claim, damages, liability or
litigation for which indemnification is sought resulted from 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.
17. No indemnification shall be available under Sections 14, 15.1 or 15.2 unless
the indemnified party gave written notice of the nature of the claim for which
indemnification is sought to the party from whom indemnification is sought. Said
notice must be given within a reasonable time after the summons or other initial
legal process giving information as to the nature of the claim is served upon
the indemnified party. However, failure to notify the party against whom
indemnification is sought shall not relieve that party of any liability which it
might have in the absence of Sections 14, 15.1 and 15.2 of this agreement.
18. In the event that an action is brought against a party indemnified under
Sections 14, 15.1 or 15.2, the party owning the obligation to indemnify (the
"indemnifying party") may participate, at its own expense in the defense
thereof. The indemnifying party may also assume the defense of any such action,
with counsel satisfactory to the indemnified party. After the indemnifying party
notifies the indemnified 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 the
indemnified party for any legal or other expenses subsequently incurred by the
indemnified party independently in connection with the defense thereof.
19. Subject to the requirements of legal process and regulatory authorities,
each party to this agreement shall treat as confidential the names and addresses
of the owners of the policies.
20. Each party to this agreement shall cooperate with the other parties and with
all governmental authorities (including without limitation, the Securities and
Exchange Commission, the NASD and the state insurance and securities regulators)
and shall permit such authorities reasonable access to its books and records in
connection with any investigation or inquiry relating to this agreement or the
transactions contemplated hereby.
21. This agreement may be terminated by any party upon six month's advance
written notice to the other parties.
20.1. GENY shall have the right, at all reasonable times, to inspect, audit and
copy all records of the Fund and/or OFI that pertain to the Fund's or OFI's
performance of their obligations under this agreement.
22. OFI and GENY each understands that the obligations of the Fund under this
Agreement are not binding upon any shareholder or Trustee of the Fund
personally, but bind only the Fund and the Fund's property; OFI and GENY each
represent that it has notice of the provisions of the Declaration of Trust of
the Fund disclaiming shareholder and Trustee liability for acts or obligations
of the Fund.
IN WITNESS WHEREOF, GENY, the Fund and OFI has caused this agreement to be
duly executed as of the day and year first above written.
GE Capital Life Assurance Company of New York
By: __________________________________________
Title: President and Chief Executive Officer
Xxxxxxxxxxx Variable Account Funds
By: ___________________________________________
Title: Vice President and Secretary
OppenheimerFunds, Inc.
By: ____________________________________________
Title: Executive Vice President
SCHEDULE A
Portfolios of Xxxxxxxxxxx Variable Account Funds:
Xxxxxxxxxxx High Income Fund
Xxxxxxxxxxx Bond Fund
Xxxxxxxxxxx Aggressive Growth Fund
Xxxxxxxxxxx Growth Fund
Xxxxxxxxxxx Multiple Strategies Fund
A-1
SCHEDULE B
GE Capital Life Separate Account II
B-1
SCHEDULE C
Individual Deferred Variable Annuity Policy - Form NY 1066
C-1
