Exhibit 99.(h)(8)
PARTICIPATION AGREEMENT
BY AND AMONG
SUMMIT MUTUAL FUNDS, INC.,
CARILLON INVESTMENTS, INC.,
COUNTRY INVESTORS LIFE ASSURANCE COMPANY,
ON BEHALF OF ITSELF AND
ITS SEPARATE ACCOUNTS,
AND
COUNTRY CAPITAL MANAGEMENT COMPANY
TABLE OF CONTENTS
DESCRIPTION PAGE
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Section 1. Available Funds 2
1.1 Availability 2
1.2 Addition, Deletion or Modification of Funds 2
1.3 No Sales to the General Public 2
Section 2. Processing Transactions 3
2.1 Timely Pricing and Orders 3
2.2 Timely Payments 3
2.3 Applicable Price 4
2.4 Dividends and Distributions 4
2.5 Book Entry 5
Section 3. Costs and Expenses 5
3.1 General 5
3.2 Parties To Cooperate 5
Section 4. Legal Compliance 5
4.1 Tax Laws 5
4.2 Insurance and Certain Other Laws 6
4.3 Securities Laws 7
4.4 Notice of Certain Proceedings and Other Circumstances 8
4.5 LIFE COMPANY To Provide Documents; Information About SMFI 9
4.6 SMFI To Provide Documents; Information About LIFE COMPANY 10
Section 5. Mixed and Shared Funding 12
5.1 General 12
5.2 Disinterested Directors 12
5.3 Monitoring for Material Irreconcilable Conflicts 12
5.4 Conflict Remedies 13
5.5 Notice to LIFE COMPANY 14
5.6 Information Requested by Board of Directors 14
5.7 Compliance with SEC Rules 15
5.8 Other Requirements 15
Section 6. Termination 15
6.1 Events of Termination 15
6.2 Notice Requirement for Termination 17
6.3 Funds To Remain Available 17
6.4 Continuance of Agreement 17
DESCRIPTION PAGE
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Section 7. Amendments 17
Section 8. Assignment 17
Section 9. Notices 18
Section 10. Voting Procedures 18
Section 11. Foreign Tax Credits 19
Section 12. Indemnification 19
12.1 Of SMFI and Carillon by LIFE COMPANY and UNDERWRITER 19
12.2 Of LIFE COMPANY and UNDERWRITER by SMFI and Carillon 21
12.3 Effect of Notice 24
12.4 Successors 24
Section 13. Applicable Law 24
Section 14. Execution in Counterparts 25
Section 15. Severability 25
Section 16. Rights Cumulative 25
Section 17. Headings 25
Section 18. Confidentiality 25
Section 19. Trademarks and Fund Names 26
Section 20. Parties to Cooperate 2
Schedule A
Schedule B
Schedule C
PARTICIPATION AGREEMENT
THIS AGREEMENT, made and entered into as of the 1st day of December,
2003 ("Agreement"), by and among Summit Mutual Funds, Inc., a Maryland
corporation ("SMFI"), Carillon Investments, Inc., an
Ohio Corporation
("Carillon"), COUNTRY Investors Life Assurance Company, an Illinois life
insurance company ("LIFE COMPANY"), on behalf of itself and each of its
segregated asset accounts listed in Schedule A hereto, as the parties hereto may
amend from time to time (each, an "Account," and collectively, the "Accounts");
and COUNTRY Capital Management Company, an Illinois corporation and an affiliate
of LIFE COMPANY and the principal underwriter of certain variable annuity and
variable life insurance contracts ("UNDERWRITER") (collectively, the "Parties").
WITNESSETH THAT:
WHEREAS, SMFI is registered with the Securities and Exchange Commission
("SEC") as an open-end management investment company under the Investment
Company Act of 1940, as amended (the "1940 Act"); and
WHEREAS, SMFI currently consists of seven separate series ("Series")
within its Pinnacle series of funds, shares ("Shares") of each of which are
registered under the Securities Act of 1933, as amended (the "1933 Act") and are
currently sold to one or more separate accounts of life insurance companies to
fund benefits under variable annuity contracts and variable life insurance
contracts; and
WHEREAS, SMFI will make Shares of each Series listed on Schedule A
hereto as the Parties hereto may amend from time to time (each a "Fund";
references herein to "SMFI" includes reference to each Fund, to the extent the
context requires) available for purchase by the Accounts; and
WHEREAS, LIFE COMPANY will be the issuer of certain variable annuity
contracts and variable life insurance contracts ("Contracts") as set forth on
Schedule A hereto, as the Parties hereto may amend from time to time, which
Contracts (hereinafter collectively, the "Contracts"), if required by applicable
law, will be registered under the 1933 Act; and
WHEREAS, LIFE COMPANY will fund the Contracts through the Accounts,
each of which may be divided into two or more subaccounts ("Subaccounts";
references herein to an "Account" includes reference to each Subaccount thereof
to the extent the context requires); and
WHEREAS, LIFE COMPANY will serve as the depositor of the Accounts, each
of which is registered as a unit investment trust investment company under the
1940 Act (or exempt therefrom), and the security interests deemed to be issued
by the Accounts
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under the Contracts will be registered as securities under the 1933 Act (or
exempt therefrom); and
WHEREAS, to the extent permitted by applicable insurance laws and
regulations, LIFE COMPANY intends to purchase Shares in one or more of the Funds
on behalf of the Accounts to fund the Contracts; and
WHEREAS, UNDERWRITER is a broker-dealer registered with the SEC under
the Securities Exchange Act of 1934 ("1934 Act") and a member in good standing
of the National Association of Securities Dealers, Inc. ("NASD");
WHEREAS, Carillon is a broker-dealer registered with the SEC under the
Securities Exchange Act of 1934 ("1934 Act") and a member in good standing of
the National Association of Securities Dealers, Inc. ("NASD");
NOW, THEREFORE, in consideration of the mutual benefits and promises
contained herein, the Parties hereto agree as follows:
SECTION 1. AVAILABLE FUNDS
1.1 AVAILABILITY.
SMFI will make Shares of each Fund available to LIFE COMPANY for
purchase and redemption at net asset value and with no sales charges, subject to
the terms and conditions of this Agreement. The Board of Directors of SMFI may
refuse to sell Shares of any Fund to any person, or suspend or terminate the
offering of Shares of any Fund if such action is required by law or by
regulatory authorities having jurisdiction . SMFI shall use its best efforts to
provide to the LIFE COMPANY as much advance notice of its election to suspend or
terminate as is reasonably practicable in order to give the LIFE COMPANY
sufficient time to take appropriate steps in response to such suspension or
termination.
1.2 ADDITION, DELETION OR MODIFICATION OF FUNDS.
The Parties hereto may agree, from time to time, to add other Funds to
provide additional funding media for the Contracts, or to delete, combine, or
modify existing Funds, by amending Schedule A hereto. Upon such amendment to
Schedule A, any applicable reference to a Fund, SMFI, or its Shares herein shall
include a reference to any such additional Fund. Schedule A, as amended from
time to time, is incorporated herein by reference and is a part hereof.
1.3 NO SALES TO THE GENERAL PUBLIC.
SMFI represents and warrants that no Shares of any Fund on Schedule A
have been or will be sold to the general public.
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SECTION 2 PROCESSING TRANSACTIONS
2.1 TIMELY PRICING AND ORDERS.
(a) SMFI or its designated agent will use its best efforts to
provide LIFE COMPANY with the net asset value per Share for each Fund by 6:30
p.m. Eastern Standard Time on each Business Day. As used herein, "Business Day"
shall mean any day on which (i) the New York Stock Exchange is open for regular
trading (ii) SMFI calculates the Fund's net asset value, and (iii) LIFE COMPANY
is open for business.
(b) LIFE COMPANY will use the data provided by SMFI each Business
Day pursuant to paragraph (a) immediately above to calculate Account unit values
and to process transactions that receive that same Business Day's Account unit
values. LIFE COMPANY will perform such Account processing the same Business Day,
and will place corresponding orders to purchase or redeem Shares with SMFI by
10:00 a.m. Eastern Time the following Business Day; provided, however, that SMFI
shall provide additional time to LIFE COMPANY in the event that SMFI is unable
to meet the 7:00 p.m. time stated in paragraph (a) immediately above. Such
additional time shall be equal to the additional time that SMFI takes to make
the net asset values available to LIFE COMPANY.
(c) With respect to payment of the purchase price by LIFE COMPANY
and of redemption proceeds by SMFI, LIFE COMPANY and SMFI shall net purchase and
redemption orders with respect to each Fund and shall transmit one net payment
per Fund in accordance with Section 2.2, below.
(d) If SMFI provides materially incorrect Share net asset value
information (as determined under SEC guidelines), LIFE COMPANY shall be entitled
to an adjustment to the number of Shares purchased or redeemed to reflect the
correct net asset value per Share. Any material error in the calculation or
reporting of net asset value per Share, dividend or capital gain information
shall be reported promptly upon discovery to LIFE COMPANY. In the event LIFE
COMPANY realizes any losses resulting from overpayments to Contract owners
attributable to the provision of materially incorrect Share net asset value
information by SMFI that is not subsequently corrected and communicated to LIFE
COMPANY in reasonably sufficient time to prevent the overpayment, SMFI and
Carillon agree to reimburse LIFE COMPANY for the amount of such losses, provided
the LIFE COMPANY has made reasonable efforts to recoup the overpayments.
2.2 TIMELY PAYMENTS.
LIFE COMPANY will wire payment for net purchases to a custodial account
designated by SMFI by 2:00 p.m. Eastern Time on the same day as the order for
Shares is placed, to the extent practicable. SMFI will wire payment for net
redemptions to an account designated by LIFE COMPANY by 2:00 p.m. Eastern Time
on the same day as the Order is placed, to the extent practicable, but in any
event within five (5) calendar days after the date the order is placed in order
to enable LIFE COMPANY to pay
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redemption proceeds within the time specified in Section 22(e) of the 1940 Act
or such shorter period of time as may be required by law.
2.3 APPLICABLE PRICE.
(a) Share purchase payments and redemption orders that result from
purchase payments, premium payments, surrenders and other transactions under
Contracts (collectively, "Contract transactions") and that LIFE COMPANY receives
prior to the close of regular trading on the New York Stock Exchange on a
Business Day will be executed at the net asset values of the appropriate Funds
next computed after receipt by SMFI or its designated agent of the orders. For
purposes of this Section 2.3(a), LIFE COMPANY shall be the designated agent of
SMFI for receipt of orders relating to Contract transactions on each Business
Day and receipt by such designated agent shall constitute receipt by SMFI;
provided that SMFI receives notice of such orders by 10:00 a.m. Eastern Standard
Time on the next following Business Day or such later time as computed in
accordance with Section 2.1 (b) hereof.
(b) All other Share purchases and redemptions by LIFE COMPANY will
be effected at the net asset values of the appropriate Funds next computed after
receipt by SMFI or its designated agent of the order therefor, and such orders
will be irrevocable.
(c) Notwithstanding any provision of the Agreement to the
contrary, the Parties agree that SMFI shall determine the applicable price for
Share orders attributable to Contracts funded by unregistered Accounts in
accordance with Section 2.3(a) hereof, provided that LIFE COMPANY represents and
warrants that it is legally or contractually obligated to treat such orders in
the same manner as orders attributable to Contracts funded by registered
Accounts. Each Share order placed by LIFE COMPANY that is attributable, in whole
or in part, to Contracts funded by an unregistered Account, shall be deemed to
constitute such representation and warranty by LIFE COMPANY unless the order
specifically states to the contrary. Otherwise, SMFI shall determine the
applicable price for Share orders attributable to Contracts funded by
unregistered Accounts in accordance with Section 2.3(b) hereof. As used herein,
an Account is registered if it is registered under the 1940 Act.
2.4 DIVIDENDS AND DISTRIBUTIONS.
SMFI will furnish notice by wire or telephone (followed by written
confirmation) on or prior to the payment date to LIFE COMPANY of any income
dividends or capital gain distributions payable on the Shares of any Fund. LIFE
COMPANY hereby elects to reinvest all dividends and capital gains distributions
in additional Shares of the corresponding Fund at the ex-dividend date net asset
values until LIFE COMPANY otherwise notifies SMFI in writing, it being agreed by
the Parties that the ex-dividend date and the payment date with respect to any
dividend or distribution will be the same Business Day. LIFE COMPANY reserves
the right to revoke this election and to receive all such income dividends and
capital gain distributions in cash.
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2.5 BOOK ENTRY.
Issuance and transfer of SMFI Shares will be by book entry only. Stock
certificates will not be issued to LIFE COMPANY. Shares ordered from SMFI will
be recorded in an appropriate title for LIFE COMPANY, on behalf of its Account.
SECTION 3. COSTS AND EXPENSES
3.1 GENERAL.
Except as otherwise specifically provided in Schedule C, attached
hereto and made a part hereof, each Party will bear, or arrange for other to
bear, all expenses incident to its performance under this Agreement.
3.2 PARTIES TO COOPERATE.
Each Party agrees to cooperate with the others, as applicable, in
arranging to print, mail and/or deliver, in a timely manner, combined or
coordinated prospectuses or other materials of SMFI and the Accounts.
SECTION 4 LEGAL COMPLIANCE
4.1 TAX LAWS.
(a) SMFI represents and warrants that each Fund is currently
qualified as a regulated investment company ("RIC") under Subchapter M of the
Internal Revenue Code of 1986, as amended (the "Code"), and represents that it
will use its best efforts to qualify and to maintain qualification of each Fund
as a RIC. SMFI will notify LIFE COMPANY immediately upon having a reasonable
basis for believing that a Fund has ceased to so qualify or that it might not so
qualify in the future.
(b) SMFI represents that it currently complies and will continue
to comply with the diversification requirements set forth in Section 817(h) of
the Code and Section 1.817-5(b) of the regulations under the Code, and any
amendments or other modifications to such Section or Regulations. SMFI will
notify LIFE COMPANY immediately upon having a reasonable basis for believing
that a Fund has ceased to so comply or that a Fund might not so comply in the
future. In the event of a breach of this Section 4.1(b) by SMFI, it will use its
best efforts to adequately diversify the Fund so as to achieve compliance within
the grace period afforded by Section 1.817-5 of the regulations under the Code.
The representations and warranties of this Section 4.1(b) shall not apply with
respect to any Fund whose beneficial interests are held solely by owners of
"pension plan contracts" within the meaning of Section 818(a) of the Code and
other persons whose federal income tax treatment is not dependent on the Fund's
compliance with the requirements of Section 817(h) of the Code.
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(c) SMFI represents that, under the terms of its investment
advisory agreements with its investment adviser ("Adviser"), the Adviser is and
will be responsible for managing each Fund in compliance with that Fund's
investment objectives, policies and restrictions as set forth in the SMFI
Prospectus (as defined in Section 4.3(b) hereof). SMFI represents that these
objectives, policies and restrictions do and will include operating as a
regulated investment company ("RIC") in compliance with Subchapter M of the Code
("Subchapter M") and Section 817(h) of the Code ("Section 817(h)") and
regulations thereunder. SMFI has adopted and will maintain procedures for
ensuring that each Fund is managed in compliance with Subchapter M and Section
817(h) and regulations thereunder. On request, SMFI shall also provide LIFE
COMPANY with such materials, cooperation and assistance as may be reasonably
necessary for LIFE COMPANY or any appropriate person designated by LIFE COMPANY
to review from time to time the procedures and practices of the Adviser or each
sub-investment adviser to each Fund for ensuring that that Fund is managed in
compliance with Subchapter M and Section 817(h) and regulations thereunder.
In the event of any noncompliance regarding the status of any Fund as a
RIC in compliance with Subchapter M and/or noncompliance under Section 817(h),
SMFI will pursue those efforts necessary to enable that Fund to qualify once
again for treatment as a RIC in compliance with Subchapter M and/or to be in
compliance with Section 817(h), including cooperation in good faith with LIFE
COMPANY . If SMFI does not so cure the noncompliance regarding that Fund's
status as a RIC under Subchapter M and/or the noncompliance under Section
817(h), SMFI will cooperate in good faith with LIFE COMPANY 's efforts to obtain
a ruling and closing agreement, as provided in Revenue Procedure 92-25 issued by
the Internal Revenue Service (or any applicable ruling or procedure subsequently
issued by the Internal Revenue Service), that the Fund satisfies the
requirements of Subchapter M and/or compliance with Section 817(h), for the
period or periods of non-compliance.
(d) LIFE COMPANY agrees that if the Internal Revenue Service
("IRS") asserts in writing in connection with any governmental audit or review
of LIFE COMPANY or, to LIFE COMPANY's knowledge, of any Participant, that any
Fund has failed to comply with the diversification requirements of Section
817(h) of the Code or LIFE COMPANY otherwise becomes aware of any facts that
could give rise to any claim against SMFI or its affiliates as a result of such
a failure or alleged failure LIFE COMPANY will promptly notify SMFI of such
assertion or potential claim (subject to the Confidentiality provisions of
Section 18 as to any Participant);
(e) Upon the occurrence of any event contemplated under Section
4.1(d) to this Agreement, each party agrees to act in good faith to minimize any
liability to the other party that may arise as a result of such failure or
alleged failure to the extent practicable and except where a party's respective
interests are adverse to or in conflict with the other party's interests.
(f) LIFE COMPANY represents and warrants that for purposes other
than diversification under Section 817(h) of the Code, the Contracts currently
are and will be
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treated as annuity contracts or life insurance contracts under applicable
provisions of the Code and that it will use its best efforts to maintain such
treatment; LIFE COMPANY will notify SMFI immediately upon having a reasonable
basis for believing that any of the Contracts have ceased to be so treated or
that they might not be so treated in the future.
(g) LIFE COMPANY represents and warrants that each Account is a
"segregated asset account" and that interests in each Account are offered
exclusively through the purchase of or transfer into a "variable contract,"
within the meaning of such terms under Section 817 of the Code and the
regulations thereunder. LIFE COMPANY will use its best efforts to continue to
meet such definitional requirements, and it will notify SMFI immediately upon
having a reasonable basis for believing that such requirements have ceased to be
met or that they might not be met in the future.
4.2 INSURANCE AND CERTAIN OTHER LAWS.
(a) SMFI will use its best efforts to comply with any applicable
state insurance laws or regulations, to the extent specifically requested in
writing by LIFE COMPANY, including, the furnishing of information not otherwise
available to LIFE COMPANY which is required by state insurance law to enable
LIFE COMPANY to obtain the authority needed to issue the Contracts in any
applicable state.
(b) LIFE COMPANY represents and warrants that (i) it is an
insurance company duly organized, validly existing and in good standing under
the laws of the State of Illinois and has full corporate power, authority and
legal right to execute, deliver and perform its duties and comply with its
obligations under this Agreement, (ii) it has legally and validly established
and maintains each Account as a segregated asset account under Illinois
Insurance Law and the regulations thereunder, and (iii) the Contracts comply in
all material respects with all other applicable federal and state laws and
regulations.
(c) SMFI represents and warrants that it is a corporation duly
organized, validly existing, and in good standing under the laws of the State of
Maryland and has full power, authority, and legal right to execute, deliver, and
perform its duties and comply with its obligations under this Agreement.
4.3 SECURITIES LAWS.
(a) LIFE COMPANY represents and warrants that (i) interests in
each Account pursuant to the Contracts will be registered under the 1933 Act to
the extent required by the 1933 Act, (ii) the Contracts will be duly authorized
for issuance and sold in compliance with all applicable federal and state laws,
including, without limitation, the 1933 Act, the 1934 Act, the 1940 Act and
Illinois law, (iii) each Account is and will remain registered under the 1940
Act, to the extent required by the 1940 Act, (iv) each Account does and will
comply in all material respects with the requirements of the 1940 Act and the
rules thereunder, to the extent required, (v) each Account's 1933 Act
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registration statement relating to the Contracts, together with any amendments
thereto, will at all times comply in all material respects with the requirements
of the 1933 Act and the rules thereunder, (vi) LIFE COMPANY will amend the
registration statement for its Contracts under the 1933 Act and for its Accounts
under the 1940 Act from time to time as required in order to effect the
continuous offering of its Contracts or as may otherwise be required by
applicable law, and (vii) each Account's prospectus, statement of additional
information, private placement memoranda and other documents pursuant to which
Contracts are offered, and any amendments or supplements thereto (collectively,
the "Account Prospectus"), will at all times comply in all material respects
with all applicable requirements of the 1933 Act and the rules thereunder.
(b) SMFI represents and warrants that (i) Shares sold pursuant to
this Agreement will be registered under the 1933 Act to the extent required by
the 1933 Act and duly authorized for issuance and sold in compliance with
Maryland law, (ii) SMFI is and will remain registered under the 1940 Act to the
extent required by the 1940 Act, (iii) SMFI will amend the registration
statement for its Shares under the 1933 Act and itself under the 1940 Act from
time to time as required in order to effect the continuous offering of its
Shares, (iv) SMFI does and will comply in all material respects with the
requirements of the 1940 Act and the rules thereunder, (v) SMFI's 1933 Act
registration statement, together with any amendments thereto, will at all times
comply in all material respects with the requirements of the 1933 Act and rules
thereunder, and (vi) SMFI's prospectus, statement of additional information and
any amendments or supplements thereto (collectively, the "SMFI Prospectus") will
at all times comply in all material respects with all applicable requirements of
the 1933 Act and the rules thereunder.
(c) SMFI will at its expense register and qualify its Shares for
sale in accordance with the laws of any state or other jurisdiction if and to
the extent reasonably deemed advisable by SMFI.
(d) SMFI currently does not intend to make any payments to finance
distribution expenses pursuant to Rule 12b-1 under the 1940 Act or otherwise,
although it reserves the right to make such payments in the future. To the
extent that it decides to finance distribution expenses pursuant to Rule 12b-1,
SMFI undertakes to have its Board of Directors, a majority of whom are not
"interested" persons of the Fund (as such term is defined in the 1940 Act),
formulate and approve any plan under Rule 12b-1 to finance distribution
expenses.
(e) SMFI represents and warrants that all of its directors,
officers, employees, investment advisers, and other individuals/entities having
access to the funds and/or securities of the Fund are and 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 minimal coverage as required currently
by Rule 17g-1 of the 1940 Act or related provisions as may be promulgated from
time to time. The aforesaid bond includes coverage for larceny and embezzlement
and is issued by a reputable bonding company.
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(f) Carillon represents and warrants that it is a member in good
standing of the NASD and is registered as a broker-dealer under the 1934 Act.
Carillon further represents that it will sell and distribute SMFI's shares in
accordance with all applicable federal and state securities laws, including
without limitation the 1933 Act, the 1934 Act, and the 1940 Act.
4.4 NOTICE OF CERTAIN PROCEEDINGS AND OTHER CIRCUMSTANCES.
(a) SMFI will immediately notify LIFE COMPANY of (i) the issuance
by any court or regulatory body of any stop order, cease and desist order, or
other similar order with respect to SMFI's registration statement under the 1933
Act or SMFI Prospectus, (ii) any request by the SEC for any amendment to such
registration statement or SMFI Prospectus that may affect the offering of Shares
of SMFI, (iii) the initiation of any proceedings for that purpose or for any
other purpose relating to the registration or offering of SMFI's Shares, or (iv)
any other action or circumstances that may prevent the lawful offer or sale of
Shares of any Fund in any state or jurisdiction, including, without limitation,
any circumstances in which (a) such Shares are not registered and, in all
material respects, issued and sold in accordance with applicable state and
federal law, or (b) such law precludes the use of such Shares as an underlying
investment medium of the Contracts issued or to be issued by LIFE COMPANY. SMFI
will make every reasonable effort to prevent the issuance, with respect to any
Fund, of any such stop order, cease and desist order or similar order and, if
any such order is issued, to obtain the lifting thereof at the earliest possible
time.
(b) LIFE COMPANY will immediately notify SMFI of (i) the issuance
by any court or regulatory body of any stop order, cease and desist order, or
other similar order with respect to each Account's registration statement under
the 1933 Act relating to the Contracts or each Account Prospectus, (ii) any
request by the SEC for any amendment to such registration statement or Account
Prospectus that may affect the offering of Shares of SMFI, (iii) the initiation
of any proceedings for that purpose or for any other purpose relating to the
registration or offering of each Account's interests pursuant to the Contracts,
or (iv) any other action or circumstances that may prevent the lawful offer or
sale of said interests in any state or jurisdiction, including, without
limitation, any circumstances in which said interests are not registered and, in
all material respects, issued and sold in accordance with applicable state and
federal law. LIFE COMPANY will make every reasonable effort to prevent the
issuance of any such stop order, cease and desist order or similar order and, if
any such order is issued, to obtain the lifting thereof at the earliest possible
time.
4.5 LIFE COMPANY TO PROVIDE DOCUMENTS; INFORMATION ABOUT SMFI.
(a) LIFE COMPANY will provide to SMFI or its designated agent at
least one (1) complete copy of all SEC registration statements, Account
Prospectuses, reports, any preliminary and final voting instruction solicitation
material, applications for exemptions, requests for no-action letters, and
notices, orders or responses relating thereto, and all amendments and
supplements to any of the above, that relate to each
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Account or the Contracts, contemporaneously with the filing of such document
with the SEC or NASD.
(b) LIFE COMPANY will provide to SMFI or its designated agent at
least one (1) complete copy of each piece of sales literature or other
promotional material in which SMFI or any of its affiliates is named, at least
five (5) Business Days prior to its use or such shorter period as the Parties
hereto may, from time to time, agree upon. No such material shall be used if
SMFI or its designated agent objects to such use within five (5) Business Days
after receipt of such material or such shorter period as the Parties hereto may,
from time to time, agree upon. SMFI hereby designates Summit Investment
Partners, Inc. as the entity to receive such sales literature, until such time
as SMFI appoints another designated agent by giving notice to LIFE COMPANY in
the manner required by Section 9 hereof. SMFI or its designee reserves the right
to reasonably object to the continued use of any such sales literature or other
promotional material in which SMFI or any of its affiliates is named, and no
such material shall be used if SMFI or its designee so object.
(c) Neither LIFE COMPANY nor any of its affiliates, will give any
information or make any representations or statements on behalf of or concerning
SMFI or its affiliates in connection with the sale of the Contracts other than
(i) the information or representations contained in the registration statement,
including the SMFI Prospectus contained therein, relating to Shares, as such
registration statement and SMFI Prospectus may be amended from time to time; or
(ii) in reports or proxy materials for SMFI; or (iii) in published reports for
SMFI that are in the public domain and approved by SMFI for distribution; or
(iv) in sales literature or other promotional material approved by SMFI, except
with the express written permission of SMFI.
(d) UNDERWRITER shall adopt and implement procedures reasonably
designed to ensure that information concerning SMFI and its affiliates that is
intended for use only by brokers or agents selling the Contracts (i.e.,
information that is not intended for distribution to Participants) ("broker only
materials") is so used, and neither SMFI nor any of its affiliates shall be
liable for any losses, damages or expenses relating to the improper use of such
broker only materials.
(e) For the purposes of this Section 4.5, the phrase "sales
literature or other promotional material" includes, but is not limited to,
advertisements (such as material published, or designed for use in, a newspaper,
magazine, or other periodical, radio, television, telephone or tape recording,
videotape display, signs or billboards, motion pictures, telephone directories
(other than routine listings), electronic media, computerized media, or other
public media, (e.g., on-line networks such as the Internet or other electronic
messages), sales literature (i.e., any written or electronic communication
distributed or made generally available to customers or the public, including,
but not limited to, brochures, circulars, research reports, market letters,
performance reports or summaries, form letters, telemarketing scripts, seminar
texts, reprints or excerpts of any other advertisement, sales literature, or
published article), educational or training materials or other communications
distributed or made generally available to some or all
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agents or employees, registration statements, prospectuses, statements of
additional information, shareholder reports, and proxy materials and any other
material constituting sales literature or advertising under the NASD rules, the
1933 Act or the 0000 Xxx.
4.6 SMFI TO PROVIDE DOCUMENTS; INFORMATION ABOUT LIFE COMPANY.
(a) SMFI will provide to LIFE COMPANY at least one (1) complete
copy of all SEC registration statements, SMFI Prospectuses, reports, any
preliminary and final proxy material, applications for exemptions, requests for
no-action letters, and notices, orders or responses relating thereto, and all
amendments and supplements to any of the above, that relate to SMFI or the
Shares of a Fund, contemporaneously with the filing of such document with the
SEC or NASD.
(b) SMFI will provide to LIFE COMPANY camera ready copy or
electronic files of all SMFI prospectuses and printed copies, in an amount
specified by LIFE COMPANY, of SMFI statements of additional information, proxy
materials, periodic reports to shareholders and other materials required by law
to be sent to Participants who have allocated any Contract value to a Fund. SMFI
will provide such copies to LIFE COMPANY in a timely manner so as to enable LIFE
COMPANY, as the case may be, to print and distribute such materials within the
time required by law to be furnished to Participants.
(c) SMFI will provide to LIFE COMPANY or its designated agent at
least one (1) complete copy of each piece of sales literature or other
promotional material in which LIFE COMPANY, or any of its respective affiliates
is named, or that refers to the Contracts, at least five (5) Business Days prior
to its use or such shorter period as the Parties hereto may, from time to time,
agree upon. No such material shall be used if LIFE COMPANY or its designated
agent objects to such use within five (5) Business Days after receipt of such
material or such shorter period as the Parties hereto may, from time to time,
agree upon. LIFE COMPANY shall receive all such sales literature until such time
as it appoints a designated agent by giving notice to SMFI in the manner
required by Section 9 hereof. LIFE COMPANY or its designee reserves the right to
reasonably object to the continued use of any such sales literature or other
promotional material in which LIFE COMPANY or any of its affiliates is named,
and no such material shall be used if LIFE COMPANY or its designee so object.
(d) Neither SMFI nor any of its affiliates will give any
information or make any representations or statements on behalf of or concerning
LIFE COMPANY, each Account, or the Contracts other than (i) the information or
representations contained in the registration statement, including each Account
Prospectus contained therein, relating to the Contracts, as such registration
statement and Account Prospectus may be amended from time to time; or (ii) in
published reports for the Account or the Contracts that are in the public domain
and approved by LIFE COMPANY for distribution; or (iii) in sales literature or
other promotional material approved by LIFE COMPANY or its affiliates, except
with the express written permission of LIFE COMPANY.
11
(e) SMFI shall cause its principal underwriter to adopt and
implement procedures reasonably designed to ensure that information concerning
LIFE COMPANY, and its respective affiliates that is intended for use only by
brokers or agents selling the Contracts (i.e., information that is not intended
for distribution to Participants) ("broker only materials") is so used, and
neither LIFE COMPANY, nor any of its respective affiliates shall be liable for
any losses, damages or expenses relating to the improper use of such broker only
materials.
(f) For purposes of this Section 4.6, the phrase "sales literature
or other promotional material" includes, but is not limited to, advertisements
(such as material published, or designed for use in, a newspaper, magazine, or
other periodical, radio, television, telephone or tape recording, videotape
display, signs or billboards, motion pictures, telephone directories (other than
routine listings), electronic media, computerized media, or other public media,
(e.g., on-line networks such as the Internet or other electronic messages),
sales literature (i.e., any written or electronic communication distributed or
made generally available to customers or the public, including, but not limited
to, brochures, circulars, research reports, market letters, performance reports
or summaries, form letters, telemarketing scripts, seminar texts, reprints or
excerpts of any other advertisement, sales literature, or published article),
educational or training materials or other communications distributed or made
generally available to some or all agents or employees, registration statements,
prospectuses, statements of additional information, shareholder reports, and
proxy materials and any other material constituting sales literature or
advertising under the NASD rules, the 1933 Act or the 1940 Act.
(g) SMFI will provide the LIFE COMPANY with as much notice as is
reasonably practicable of any proxy solicitation for any Fund, and of any change
in the Fund's registration statement or prospectus, particularly any change
resulting in a change to the registration statement or prospectus for any
Account. SMFI will work with the LIFE COMPANY so as to enable the LIFE COMPANY
to solicit proxies from Contract owners, or to make changes to its registration
statement or prospectus, in an orderly manner. SMFI will make reasonable efforts
to attempt to have changes effecting Contract prospectuses become effective
simultaneously with the annual updates for such prospectuses.
SECTION 5. MIXED AND SHARED FUNDING
5.1 GENERAL.
SMFI has received an order from the SEC exempting it from certain
provisions of the 1940 Act and rules thereunder so that SMFI may be available
for investment by certain other entities, including, without limitation,
separate accounts funding variable annuity contracts or variable life insurance
contracts, separate accounts of insurance companies unaffiliated with LIFE
COMPANY, and trustees of qualified pension and retirement plans (collectively,
"Mixed and Shared Funding"). The Parties recognize that the SEC has imposed
terms and conditions for such orders that are substantially identical
12
to many of the provisions of this Section 5. Sections 5.2 through 5.8 below
shall apply pursuant to such an exemptive order granted to SMFI. SMFI hereby
notifies LIFE COMPANY that it may be appropriate to include in the prospectus
pursuant to which a Contract is offered disclosure regarding the potential risks
of Mixed and Shared Funding.
5.2 DISINTERESTED DIRECTORS.
SMFI agrees that its Board of Directors shall at all times consist of
directors a majority of whom (the "Disinterested Directors") are not interested
persons of SMFI within the meaning of Section 2(a)(19) of the 1940 Act and the
rules thereunder and as modified by any applicable orders of the SEC, except
that if this condition is not met by reason of the death, disqualification, or
bona fide resignation of any director, then the operation of this condition
shall be suspended (a) for a period of forty-five (45) days if the vacancy or
vacancies may be filled by the Board;(b) for a period of sixty (60) days if a
vote of shareholders is required to fill the vacancy or vacancies; or (c) for
such longer period as the SEC may prescribe by order upon application.
5.3 MONITORING FOR MATERIAL IRRECONCILABLE CONFLICTS.
SMFI agrees that its Board of Directors will monitor for the existence
of any material irreconcilable conflict between the interests of the
Participants in all separate accounts of life insurance companies utilizing SMFI
("Participating Insurance Companies"), including each Account, and participants
in all qualified retirement and pension plans investing in SMFI ("Participating
Plans"). LIFE COMPANY agrees to inform the Board of Directors of SMFI of the
existence of or any potential for any such material irreconcilable conflict of
which it is aware. The concept of a "material irreconcilable conflict" is not
defined by the 1940 Act or the rules thereunder, but the Parties recognize that
such a conflict may arise for a variety of reasons, including, without
limitation:
(a) an action by any state insurance or other regulatory
authority;
(b) a change in applicable federal or state insurance, tax or
securities laws or regulations, or a public ruling, private letter ruling,
no-action or interpretative letter, or any similar action by insurance, tax or
securities regulatory authorities;
(c) an administrative or judicial decision in any relevant
proceeding;
(d) the manner in which the investments of any Fund are being
managed;
(e) a difference in voting instructions given by variable annuity
contract and variable life insurance contract Participants or by Participants of
different Participating Insurance Companies;
13
(f) a decision by a Participating Insurance Company to disregard
the voting instructions of Participants; or
(g) a decision by a Participating Plan to disregard the voting
instructions of Plan participants.
Consistent with the SEC's requirements in connection with exemptive
orders of the type referred to in Section 5.1 hereof, LIFE COMPANY will assist
the Board of Directors in carrying out its responsibilities by providing the
Board of Directors with all information reasonably necessary for the Board of
Directors to consider any issue raised, including information as to a decision
by LIFE COMPANY to disregard voting instructions of Participants. LIFE COMPANY's
responsibilities in connection with the foregoing shall be carried out with a
view only to the interests of Participants.
5.4 CONFLICT REMEDIES.
(a) It is agreed that if it is determined by a majority of the
members of the Board of Directors or a majority of the Disinterested Directors
that a material irreconcilable conflict exists, LIFE COMPANY will, if it is a
Participating Insurance Company for which a material irreconcilable conflict is
relevant, at its own expense and to the extent reasonably practicable (as
determined by a majority of the Disinterested Directors), take whatever steps
are necessary to remedy or eliminate the material irreconcilable conflict, which
steps may include, but are not limited to:
(i) withdrawing the assets allocable to some or all of the
Accounts from SMFI or any Fund and reinvesting such assets in
a different investment medium, including another Fund of SMFI,
or submitting the question whether such segregation should be
implemented to a vote of all affected Participants and, as
appropriate, segregating the assets of any particular group
(e.g., annuity Participants, life insurance Participants or
all Participants) that votes in favor of such segregation, or
offering to the affected Participants the option of making
such a change; and
(ii) establishing a new registered investment company of the type
defined as a "management company" in Section 4(3) of the 1940
Act or a new separate account that is operated as a management
company.
(b) If the material irreconcilable conflict arises because of LIFE
COMPANY's decision to disregard Participant voting instructions and that
decision represents a minority position or would preclude a majority vote, LIFE
COMPANY may be required, at SMFI's election, to withdraw each Account's
investment in SMFI or any Fund. No charge or penalty will be imposed as a result
of such withdrawal. Any such withdrawal must take place within six (6) months
after SMFI gives notice to LIFE COMPANY that this provision is being
implemented, and until such withdrawal SMFI shall continue to accept and
implement orders by LIFE COMPANY for the purchase and redemption of Shares of
SMFI.
14
(c) If a material irreconcilable conflict arises because a
particular state insurance regulator's decision applicable to LIFE COMPANY
conflicts with the majority of other state regulators, then LIFE COMPANY will
withdraw each Account's investment in SMFI within six (6) months after SMFI's
Board of Directors informs LIFE COMPANY that it has determined that such
decision has created a material irreconcilable conflict, and until such
withdrawal SMFI shall continue to accept and implement orders by LIFE COMPANY
for the purchase and redemption of Shares of SMFI. No charge or penalty will be
imposed as a result of such withdrawal.
(d) LIFE COMPANY agrees that any remedial action taken by it in
resolving any material irreconcilable conflict will be carried out at its
expense and with a view only to the interests of Participants.
(e) For purposes hereof, a majority of the Disinterested Directors
will determine whether or not any proposed action adequately remedies any
material irreconcilable conflict. In no event, however, will SMFI or any of its
affiliates be required to establish a new funding medium for any Contracts. LIFE
COMPANY will not be required by the terms hereof to establish a new funding
medium for any Contracts if an offer to do so has been declined by vote of a
majority of Participants materially adversely affected by the material
irreconcilable conflict.
5.5 NOTICE TO LIFE COMPANY.
SMFI will promptly make known in writing to LIFE COMPANY the Board of
Directors' determination of the existence of a material irreconcilable conflict,
a description of the facts that give rise to such conflict and the implications
of such conflict.
5.6 INFORMATION REQUESTED BY BOARD OF DIRECTORS.
LIFE COMPANY and SMFI (or its investment adviser) will at least
annually submit to the Board of Directors of SMFI such reports, materials or
data as the Board of Directors may reasonably request so that the Board of
Directors may fully carry out the obligations imposed upon it by the provisions
hereof or any exemptive order granted by the SEC to permit Mixed and Shared
Funding, and said reports, materials and data will be submitted at any
reasonable time deemed appropriate by the Board of Directors. All reports
received by the Board of Directors of potential or existing conflicts, and all
Board of Directors actions with regard to determining the existence of a
conflict, notifying Participating Insurance Companies and Participating Plans of
a conflict, and determining whether any proposed action adequately remedies a
conflict, will be properly recorded in the minutes of the Board of Directors or
other appropriate records, and such minutes or other records will be made
available to the SEC upon request.
5.7 COMPLIANCE WITH SEC RULES.
15
If, at any time during which SMFI is serving as an investment medium
for variable life insurance Contracts, 1940 Act Rules 6e-3(T) or, if applicable,
6e-2 are amended or Rule 6e-3 is adopted to provide exemptive relief with
respect to Mixed and Shared Funding, SMFI agrees that it will comply with the
terms and conditions thereof and that the terms of this Section 5 shall be
deemed modified if and only to the extent required in order also to comply with
the terms and conditions of such exemptive relief that is afforded by any of
said rules that are applicable.
5.8 OTHER REQUIREMENTS.
SMFI will require that each Participating Insurance Company and
Participating Plan enter into an agreement with SMFI that contains in substance
the same provisions as are set forth in Sections 4.1(b), 4.1(d), 4.3(a), 4.4(b),
4.5(a), 5, and 10 of this Agreement.
SECTION 6. TERMINATION
6.1 EVENTS OF TERMINATION.
Subject to Section 6.4 below, this Agreement will terminate as to a
Fund:
(a) at the option of any party, with or without cause with respect
to the Fund, upon six (6) months advance written notice to the other parties,
or, if later, upon receipt of any required exemptive relief from the SEC, unless
otherwise agreed to in writing by the parties; or
(b) at the option of SMFI upon institution of formal proceedings
against LIFE COMPANY or its affiliates by the NASD, the SEC, any state insurance
regulator or any other regulatory body regarding LIFE COMPANY's obligations
under this Agreement or related to the sale of the Contracts, the operation of
each Account, or the purchase of Shares, if, in each case, SMFI reasonably
determines that such proceedings, or the facts on which such proceedings would
be based, have a material likelihood of imposing material adverse consequences
on the Fund with respect to which the Agreement is to be terminated; or
(c) at the option of LIFE COMPANY upon institution of formal
proceedings against SMFI, its principal underwriter, or its investment adviser
by the NASD, the SEC, or any state insurance regulator or any other regulatory
body regarding SMFI's obligations under this Agreement or related to the
operation or management of SMFI or the purchase of SMFI Shares, if, in each
case, LIFE COMPANY reasonably determines that such proceedings, or the facts on
which such proceedings would be based, have a material likelihood of imposing
material adverse consequences on LIFE COMPANY, or the Subaccount corresponding
to the Fund with respect to which the Agreement is to be terminated; or
16
(d) at the option of LIFE COMPANY, if Shares of that Fund are not
reasonably available to meet the requirements of the Contracts as determined by
LIFE COMPANY. Prompt notice of election to terminate shall be furnished by LIFE
COMPANY, said termination to be effective ten days after receipt of notice
unless SMFI makes available a sufficient number of Shares to meet the
requirements of the Contracts within said ten-day period;
(e) at the option of any Party in the event that (i) the Fund's
Shares are not registered, where required, and, in all material respects, issued
and sold in accordance with any applicable federal or state law, or (ii) such
law precludes the use of such Shares as an underlying investment medium of the
Contracts issued or to be issued by LIFE COMPANY; or
(f) upon termination of the corresponding Subaccount's investment
in the Fund pursuant to Section 5 hereof; or
(g) at the option of LIFE COMPANY if the Fund ceases to qualify as
a RIC under Subchapter M of the Code or under successor or similar provisions,
or if LIFE COMPANY reasonably believes that the Fund may fail to so qualify; or
(h) at the option of LIFE COMPANY if the Fund fails to comply with
Section 817(h) of the Code or with successor or similar provisions, as
applicable, or if LIFE COMPANY reasonably believes that the Fund may fail to so
comply; or
(i) at the option of SMFI if the Contracts issued by LIFE COMPANY
cease to qualify as annuity contracts or life insurance contracts under the Code
(other than by reason of the Fund's noncompliance with Section 817(h) or
Subchapter M of the Code) or if interests in an Account under the Contracts are
not registered, where required, and, in all material respects, are not issued or
sold in accordance with any applicable federal or state law; or
(j) upon another Party's material breach of any provision of this
Agreement; or
(k) by either SMFI or Carillon by written notice to the LIFE
COMPANY, if either one or both of SMFI or Carillon respectively, shall
determine, in their sole judgment exercised in good faith, that the LIFE COMPANY
has suffered a material adverse change in its business, operations, financial
condition or prospects since the date of this Agreement or is subject to
material adverse publicity; or
(l) by the LIFE COMPANY by written notice to the SMFI and
Carillon, if the LIFE COMPANY shall determine, in its sole judgment exercised in
good faith, that either SMFI or Carillon has suffered a material adverse change
in its business, operations, financial condition or prospects since the date of
this Agreement or is subject to material adverse publicity.
17
6.2 NOTICE REQUIREMENT FOR TERMINATION.
No termination of this Agreement will be effective unless and until the
Party terminating this Agreement gives prior written notice to the other Party
to this Agreement of its intent to terminate, and such notice shall set forth
the basis for such termination.
6.3 FUNDS TO REMAIN AVAILABLE.
Notwithstanding any termination of this Agreement, SMFI will, at the
option of LIFE COMPANY, continue to make available additional shares of the Fund
pursuant to the terms and conditions of this Agreement, for all Contracts in
effect on the effective date of termination of this Agreement (hereinafter
referred to as "Existing Contracts"). Specifically, without limitation, the
owners of the Existing Contracts will be permitted to reallocate investments in
the Fund (as in effect on such date), redeem investments in the Fund and/or
invest in the Fund upon the making of additional purchase payments under the
Existing Contracts. The Parties agree that this Section 6.3 will not apply to
any terminations under Section 5 and the effect of such terminations will be
governed by Section 5 of this Agreement.
6.4 CONTINUANCE OF AGREEMENT.
The provisions of Section 4 and Sections 12 through 20 shall survive
termination of this Agreement. In addition, all other applicable provisions of
this Agreement shall survive termination as long as shares of the Fund are held
on behalf of Contract owners in accordance with Section 6.3, except that SMFI
and Carillon shall have no further obligation to make Fund shares available in
Contracts issued after termination.
6.5 SUBSTITUTION OF NEW INVESTMENT MEDIUM UPON TERMINATION.
In the event that the Agreement is terminated pursuant to Sections
6.1(d), 6.1(g) or 6.1(h), SMFI and/or Carillon shall pay LIFE COMPANY for all
expenses that LIFE COMPANY reasonably incurs in connection with the substitution
of shares of another investment company or companies for the shares of the
Fund(s) as to which the Agreement has been terminated, including, without
limitations, all costs and expenses reasonably incurred in obtaining an order of
the SEC pursuant to Section 26(c) of the 1940 Act.
SECTION 7. AMENDMENTS
No provision of this Agreement may be amended or modified in any manner
except by a written agreement executed by all Parties hereto.
SECTION 8. ASSIGNMENT
This Agreement may not be assigned by any Party, except with the
written consent of each other Party.
18
SECTION 9. NOTICES
Notices and communications required or permitted by this Agreement will
be given by means mutually acceptable to the Parties concerned. Each other
notice or communication required or permitted by this Agreement will be given to
the following persons at the following addresses and facsimile numbers, or such
other persons, addresses or facsimile numbers as the Party receiving such
notices or communications may subsequently direct in writing:
COUNTRY INVESTORS LIFE ASSURANCE COMPANY
COUNTRY CAPITAL MANAGEMENT COMPANY
0000 Xxxxxxx Xxx.
XX Xxx 0000
Xxxxxxxxxxx, XX 00000-0000
Facsimile:(000)000-0000
Attn: Xxxxx X. Xxxxx, Vice President Life/Health Operations
SUMMIT MUTUAL FUNDS, INC.
CARILLON INVESTMENTS, INC.
0000 Xxxxxxxx Xxxx
Xxxxxxxxxx, Xxxx 00000
Facsimile: 000-000-0000
Attn: Xxxx X. Xxxxxxxx, Esq., Law Dept.
Xxxxxxxxx X. Xxxxxxx
Xxxxxx X. Xxxxxxxxxxxx
SECTION 10. VOTING PROCEDURES
Subject to the cost allocation procedures set forth in Section 3
hereof, LIFE COMPANY will distribute all proxy material furnished by SMFI to
Participants and/or Policyholders to whom pass-through voting privileges are
required to be extended and will solicit voting instructions from Participants.
LIFE COMPANY will vote Shares in accordance with timely instructions received
from Participants. LIFE COMPANY will vote Shares that are (a) not attributable
to Participants to whom pass-through voting privileges are extended, or (b)
attributable to Participants, but for which no timely instructions have been
received, in the same proportion as Shares for which said instructions have been
received from Participants, so long as and to the extent that the SEC continues
to interpret the 1940 Act to require pass through voting privileges for
Participants. Neither LIFE COMPANY nor any of its affiliates will in any way
oppose or interfere with the solicitation of proxies for the Shares held for
such Participants. LIFE COMPANY reserves the right to vote shares held in any
Account in its own right, to the extent permitted by law. LIFE COMPANY shall be
responsible for assuring that each of its Accounts holding Shares calculates
voting privileges in a manner consistent with that of other Participating
Insurance Companies or in the manner required by the Mixed and Shared Funding
exemptive order obtained by SMFI. SMFI will notify LIFE COMPANY
19
of any changes of interpretations or amendments to Mixed and Shared Funding
exemptive order it obtains. SMFI will comply with all provisions of the 1940 Act
requiring voting by shareholders, and in particular, SMFI either will provide
for annual meetings (except insofar as the SEC may interpret Section 16 of the
1940 Act not to require such meetings) or will comply with Section 16(c) of the
1940 Act (although SMFI is not one of the trusts described in Section 16(c) of
that Act) as well as with Sections 16(a) and, if and when applicable, 16(b).
Further, SMFI will act in accordance with the SEC's interpretation of the
requirements of Section 16(a) with respect to periodic elections of directors
and with whatever rules the SEC may promulgate with respect thereto.
SECTION 11. FOREIGN TAX CREDITS
SMFI agrees to consult in advance with LIFE COMPANY concerning any
decision to elect or not to elect pursuant to Section 853 of the Code to pass
through the benefit of any foreign tax credits to its shareholders.
SECTION 12. INDEMNIFICATION
12.1 OF SMFI AND CARILLON BY LIFE COMPANY AND UNDERWRITER.
(a) Except to the extent provided in Sections 12.1(b) and 12.1(c),
below, LIFE COMPANY and UNDERWRITER agree to indemnify and hold harmless SMFI,
Carillon, their affiliates, and each person, if any, who controls SMFI,
Carillon, or their affiliates within the meaning of Section 15 of the 1933 Act
and each of their respective directors and officers (but not including any
Participating Insurance Company), (collectively, the "Indemnified Parties" for
purposes of this Section 12.1) against any and all losses, claims, damages,
liabilities (including amounts paid in settlement with the written consent of
LIFE COMPANY and UNDERWRITER) or actions in respect thereof (including, to the
extent reasonable, legal and other expenses), to which the Indemnified Parties
may become subject under any statute, regulation, at common law or otherwise,
insofar as such losses, claims, damages, liabilities or actions:
(i) arise out of or are based upon any untrue statement or
alleged untrue statement of any material fact contained
in any Account's 1933 Act registration statement, any
Account Prospectus, the Contracts, or sales literature
or advertising for the Contracts (or any amendment or
supplement to any of the foregoing), or arise out of or
are based upon the omission or the alleged omission to
state therein a material fact required to be stated
therein or necessary to make the statements therein not
misleading; provided, that this agreement to indemnify
shall not apply as to any Indemnified Party if such
statement or omission or such alleged statement or
omission was made in reliance upon and in conformity
with information furnished to LIFE COMPANY or
20
UNDERWRITER by or on behalf of SMFI or Carillon for use
in any Account's 1933 Act, registration statement, any
Account Prospectus, the Contracts, or sales literature
or advertising or otherwise for use in connection with
the sale of Contracts or Shares (or any amendment or
supplement to any of the foregoing); or
(ii) arise out of or as a result of any other statements or
representations (other than statements or
representations contained in SMFI's 1933 Act
registration statement, SMFI Prospectus, sales
literature or advertising of SMFI, or any amendment or
supplement to any of the foregoing, not supplied for
use therein by or on behalf of LIFE COMPANY,
UNDERWRITER or their respective affiliates and on which
such persons have reasonably relied) or the negligent,
illegal or fraudulent conduct of LIFE COMPANY,
UNDERWRITER or their respective affiliates or persons
under their control (including, without limitation,
their employees and "Associated Persons," as that term
is defined in paragraph (m) of Article I of the NASD's
By-Laws), in connection with the sale or distribution
of the Contracts or Shares; or
(iii) arise out of or are based upon any untrue statement or
alleged untrue statement of any material fact contained
in SMFI's 1933 Act registration statement, SMFI
Prospectus, sales literature or advertising of SMFI, or
any amendment or supplement to any of the foregoing, 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 and in conformity with information furnished to
SMFI, Carillon or their affiliates by or on behalf of
LIFE COMPANY, UNDERWRITER or their respective
affiliates for use in SMFI's 1933 Act registration
statement, SMFI Prospectus, sales literature or
advertising of SMFI, or any amendment or supplement to
any of the foregoing; or
(iv) arise as a result of any failure by LIFE COMPANY or
UNDERWRITER to perform the obligations, provide the
services and furnish the materials required of them
under the terms of this Agreement, or any material
breach of any representation and/or warranty made by
LIFE COMPANY or UNDERWRITER in this Agreement or arise
out of or result from any other material breach of this
Agreement by LIFE COMPANY or UNDERWRITER; or
(v) arise as a result of failure by the Contracts issued by
LIFE COMPANY to qualify as annuity contracts or life
insurance contracts under the Code, otherwise than by
reason of any Fund's
21
failure to comply with Subchapter M or Section 817(h)
of the Code.
(b) Neither LIFE COMPANY nor UNDERWRITER shall be liable under
this Section 12.1 with respect to any losses, claims, damages, liabilities or
actions to which an Indemnified Party would otherwise be subject by reason of
willful misfeasance, bad faith, or gross negligence in the performance by that
Indemnified Party of its duties or by reason of that Indemnified Party's
reckless disregard of obligations or duties (i) under this Agreement, or (ii) to
LIFE COMPANY, UNDERWRITER, each Account or Participants.
(c) Neither LIFE COMPANY nor UNDERWRITER shall be liable under
this Section 12.1 with respect to any action against an Indemnified Party unless
SMFI or Carillon shall have notified LIFE COMPANY and UNDERWRITER in writing
within a reasonable time after the summons or other first legal process giving
information of the nature of the action 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 LIFE COMPANY and
UNDERWRITER of any such action shall not relieve LIFE COMPANY and UNDERWRITER
from any liability which they may have to the Indemnified Party against whom
such action is brought otherwise than on account of this Section 12.1. Except as
otherwise provided herein, in case any such action is brought against an
Indemnified Party, LIFE COMPANY and UNDERWRITER shall be entitled to
participate, at their own expense, in the defense of such action and also shall
be entitled to assume the defense thereof, with counsel approved by the
Indemnified Party named in the action, which approval shall not be unreasonably
withheld. After notice from LIFE COMPANY or UNDERWRITER to such Indemnified
Party of LIFE COMPANY's or UNDERWRITER's election to assume the defense thereof,
the Indemnified Party will cooperate fully with LIFE COMPANY and UNDERWRITER and
shall bear the fees and expenses of any additional counsel retained by it, and
neither LIFE COMPANY nor UNDERWRITER will be liable to such Indemnified Party
under this Agreement for any legal or other expenses subsequently incurred by
such Indemnified Party independently in connection with the defense thereof,
other than reasonable costs of investigation.
12.2 OF LIFE COMPANY AND UNDERWRITER BY SMFI AND CARILLON.
(a) Except to the extent provided in Sections 12.2(c), 12.2(d) and
12.2(e), below, SMFI and Carillon agree to indemnify and hold harmless LIFE
COMPANY, UNDERWRITER, their respective affiliates, and each person, if any, who
controls LIFE COMPANY, UNDERWRITER or their respective affiliates within the
meaning of Section 15 of the 1933 Act and each of their respective directors and
officers, (collectively, the "Indemnified Parties" for purposes of this Section
12.2) against any and all losses, claims, damages, liabilities (including
amounts paid in settlement with the written consent of SMFI and/or Carillon) or
actions in respect thereof (including, to the extent reasonable, legal and other
expenses), to which the Indemnified Parties may become subject under any
statute, regulation, at common law, or otherwise, insofar as such losses,
claims, damages, liabilities or actions:
22
(i) arise out of or are based upon any untrue statement or
alleged untrue statement of any material fact contained
in SMFI's 1933 Act registration statement, SMFI
Prospectus or sales literature or advertising of SMFI
(or any amendment or supplement to any of the
foregoing), or arise out of or are based upon the
omission or the alleged omission to state therein a
material fact required to be stated therein or
necessary to make the statements therein not
misleading; provided, that this agreement to indemnify
shall not apply as to any Indemnified Party if such
statement or omission or such alleged statement or
omission was made in reliance upon and in conformity
with information furnished to SMFI or its affiliates by
or on behalf of LIFE COMPANY, UNDERWRITER or their
respective affiliates for use in SMFI's 1933 Act
registration statement, SMFI Prospectus, or in sales
literature or advertising or otherwise for use in
connection with the sale of Contracts or Shares (or any
amendment or supplement to any of the foregoing); or
(ii) arise out of or as a result of any other statements or
representations (other than statements or
representations contained in any Account's 1933 Act
registration statement, any Account Prospectus, sales
literature or advertising for the Contracts, or any
amendment or supplement to any of the foregoing, not
supplied for use therein by or on behalf of SMFI,
Carillon or their affiliates and on which such persons
have reasonably relied) or the negligent, illegal or
fraudulent conduct of SMFI, Carillon or their
affiliates or persons under their control (including,
without limitation, their employees and "Associated
Persons" as that term is defined in Section (m) of
Article I of the NASD By-Laws), in connection with the
sale or distribution of SMFI Shares; or
(iii) arise out of or are based upon any untrue statement or
alleged untrue statement of any material fact contained
in any Account's 1933 Act registration statement, any
Account Prospectus, sales literature or advertising
covering the Contracts, or any amendment or supplement
to any of the foregoing, 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 and in conformity with
information furnished to LIFE COMPANY, UNDERWRITER or
their respective affiliates by or on behalf of SMFI,
Carillon or their affiliates for use in any Account's
1933 Act registration statement, any Account
Prospectus, sales literature or advertising covering
the Contracts, or any amendment or supplement to any of
the foregoing; or
23
(iv) arise as a result of any failure by SMFI to perform the
obligations, provide the services and furnish the
materials required of it under the terms of this
Agreement, or any material breach of any representation
and/or warranty made by SMFI in this Agreement or arise
out of or result from any other material breach of this
Agreement by SMFI; or
(iv) arise as a result of SMFI's or Adviser's (or their
designated agent's) (i) incorrect calculation of the
daily net asset value, dividend rate or capital gain
distribution rate of any Fund; (ii) incorrect reporting
of the daily net asset value, dividend rate or capital
gain distribution rate of any Fund; or (iii) untimely
reporting of the net asset value, dividend rate or
capital gain distribution rate of any Fund; or
(vi) arise as a result of any failure by Carillon to perform
the obligations, provide the services and furnish the
materials required of it under the terms of this
Agreement, or any material breach of any representation
and/or warranty made by Carillon in this Agreement or
arise out of or result from any other material breach
of this Agreement by Carillon, it being expressly
understood by the parties hereto that only Carillon and
not SMFI shall be responsible for any indemnification
arising from this subsection (vi).
(b) Except to the extent provided in Sections 12.2(c), 12.2(d) and
12.2(e) hereof, SMFI and Carillon agree to indemnify and hold harmless the
Indemnified Parties from and against any and all losses, claims, damages,
liabilities (including amounts paid in settlement thereof) or actions in respect
thereof (including, to the extent reasonable, legal and other expenses) to which
the Indemnified Parties may become subject directly or indirectly under any
statute, at common law or otherwise, insofar as such losses, claims, damages,
liabilities or actions directly or indirectly result from or arise out of the
failure of any Fund to operate as a regulated investment company in compliance
with (i) Subchapter M of the Code and regulations thereunder, or (ii) Section
817(h) of the Code and regulations thereunder, including, without limitation,
any income taxes and related penalties, rescission charges, liability under
state law to Participants asserting liability against LIFE COMPANY pursuant to
the Contracts, the costs of any ruling and closing agreement or other settlement
with the IRS, and the cost of any substitution by LIFE COMPANY of Shares of
another investment company or portfolio for those of any adversely affected Fund
as a funding medium for each Account that LIFE COMPANY reasonably deems
necessary or appropriate as a result of the noncompliance.
(c) Neither SMFI nor Carillon shall be liable under this Section
12.2 with respect to any losses, claims, damages, liabilities or actions to
which an Indemnified Party would otherwise be subject by reason of willful
misfeasance, bad faith, or gross negligence in the performance by that
Indemnified Party of its duties or by reason of such
24
Indemnified Party's reckless disregard of its obligations and duties (i) under
this Agreement, or (ii) to SMFI or Carillon.
(d) Neither SMFI nor Carillon shall be liable under this Section
12.2 with respect to any action against an Indemnified Party unless the
Indemnified Party shall have notified SMFI and/or Carillon in writing within a
reasonable time after the summons or other first legal process giving
information of the nature of the action 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 SMFI or Carillon of
any such action shall not relieve SMFI or Carillon from any liability which it
may have to the Indemnified Party against whom such action is brought otherwise
than on account of this Section 12.2. Except as otherwise provided herein, in
case any such action is brought against an Indemnified Party, SMFI and/or
Carillon will be entitled to participate, at its own expense, in the defense of
such action and also shall be entitled to assume the defense thereof, with
counsel approved by the Indemnified Party named in the action, which approval
shall not be unreasonably withheld. After notice from SMFI and/or Carillon to
such Indemnified Party of SMFI's or Carillon's election to assume the defense
thereof, the Indemnified Party will cooperate fully with SMFI and Carillon and
shall bear the fees and expenses of any additional counsel retained by it, and
SMFI and Carillon will not be liable to such Indemnified Party under this
Agreement for any legal or other expenses subsequently incurred by such
Indemnified Party independently in connection with the defense thereof, other
than reasonable costs of investigation.
(e) In no event shall SMFI or Carillon be liable under the
indemnification provisions contained in this Agreement to LIFE COMPANY or
UNDERWRITER with respect to any losses, claims, damages, liabilities or expenses
that arise out of or result from (i) a breach of any representation, warranty,
and/or covenant made by LIFE COMPANY or UNDERWRITER hereunder; (ii) the failure
by LIFE COMPANY to maintain its segregated asset account (which invests in any
Fund) as a legally and validly established segregated asset account under
applicable state law and as a duly registered unit investment trust under the
provisions of the 1940 Act (unless exempt therefrom); or (iii) the failure by
LIFE COMPANY to maintain its variable annuity or life insurance contracts (with
respect to which any Fund serves as an underlying funding vehicle) as annuity
contracts or life insurance contracts under applicable provisions of the Code.
12.3 EFFECT OF NOTICE.
Any notice given by the indemnifying Party to an Indemnified Party
referred to in Sections 12.1 (c) or 12.2(d) above of participation in or control
of any action by the indemnifying Party will in no event be deemed to be an
admission by the indemnifying Party of liability, culpability or responsibility,
and the indemnifying Party will remain free to contest liability with respect to
the claim among the Parties or otherwise.
12.4 SUCCESSORS.
25
A successor by law of any Party shall be entitled to the benefits of
the indemnification contained in this Section 12.
SECTION 13. APPLICABLE LAW
This Agreement will be construed and the provisions hereof interpreted
under and in accordance with
Ohio law, without regard for that state's
principles of conflict of laws.
SECTION 14. EXECUTION IN COUNTERPARTS
This Agreement may be executed simultaneously in two or more
counterparts, each of which taken together will constitute one and the same
instrument.
SECTION 15. SEVERABILITY
If any provision of this Agreement is held or made invalid by a court
decision, statute, rule or otherwise, the remainder of this Agreement will not
be affected thereby.
SECTION 16. RIGHTS CUMULATIVE
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, that the Parties are entitled to under federal and state
laws.
SECTION 17. HEADINGS
The Table of Contents and headings used in this Agreement are for
purposes of reference only and shall not limit or define the meaning of the
provisions of this Agreement.
SECTION 18. CONFIDENTIALITY
SMFI acknowledges that the identities of the customers of LIFE COMPANY
or any of its affiliates (collectively, the "LIFE COMPANY Protected Parties" for
proposes of this Section 18), information maintained regarding those customers,
and all computer programs and procedures or other information developed by the
LIFE COMPANY Protected Parties or any of their employees or agents in connection
with LIFE COMPANY's performance of its duties under this Agreement are the
valuable property of the LIFE COMPANY Protected Parties. SMFI agrees that if it
comes into possession of any list or compilation of the identities of or other
information about the LIFE COMPANY Protected Parties' customers, or any other
information or property of the LIFE COMPANY Protected Parties, other than such
information as may be independently developed or compiled by SMFI from
information supplied to it by the LIFE COMPANY Protected Parties' customers who
also maintain accounts directly with SMFI, SMFI will hold such information or
property in confidence and refrain from using,
26
disclosing or distributing any of such information or other property except: (a)
with LIFE COMPANY'S prior written consent; or (b) as required by law or judicial
process. LIFE COMPANY acknowledges that the identities of the customers of SMFI
or any of its affiliates (collectively, the "SMFI Protected Parties" for
purposes of this Section 18), information maintained regarding those customers,
and all computer programs and procedures or other information developed by the
SMFI Protected Parties or any of their employees or agents in connection with
SMFI's performance of its duties under this Agreement are the valuable property
of the SMFI Protected Parties. LIFE COMPANY agrees that if it comes into
possession of any list or compilation of the identities of or other information
about the SMFI Protected Parties' customers or any other information or property
of the SMFI Protected Parties, other than such information as may be
independently developed or compiled by LIFE COMPANY from information supplied to
it by the SMFI Protected Parties' customers who also maintain accounts directly
with LIFE COMPANY, LIFE COMPANY will hold such information or property in
confidence and refrain from using, disclosing or distributing any of such
information or other property except: (a) with SMFI's prior written consent; or
(b) as required by law or judicial process. Each party acknowledges that any
breach of the agreements in this Section 18 would result in immediate and
irreparable harm to the other parties for which there would be no adequate
remedy at law and agree that in the event of such a breach, the other parties
will be entitled to equitable relief by way of temporary and permanent
injunctions, as well as such other relief as any court of competent jurisdiction
deems appropriate.
SECTION 19. TRADEMARKS AND FUND NAMES
(a) Summit Investment Partners, Inc. ("Summit" or "licensor"), an
affiliate of SMFI, owns all right, title and interest in and to the name,
trademark and service xxxx "Summit Pinnacle" and such other tradenames,
trademarks and service marks as may be set forth on Schedule B, as amended from
time to time by written notice from Summit to LIFE COMPANY (the "Summit licensed
marks" or the "licensor's licensed marks") and is authorized to use and to
license other persons to use such marks. LIFE COMPANY and its affiliates are
hereby granted a non-exclusive, non-transferable and non-sublicensable license
to use the Summit licensed marks in connection with LIFE COMPANY's performance
of the services contemplated under this Agreement, subject to the terms and
conditions set forth in this Section 19.
(b) The grant of license to LIFE COMPANY and its affiliates ( the
"licensee") shall terminate automatically upon termination of this Agreement.
Upon automatic termination, the licensee shall cease to use the licensor's
licensed marks, except that LIFE COMPANY shall have the right to continue to
service any outstanding Contracts bearing any of the Summit licensed marks. Upon
Summit's elective termination of this license, LIFE COMPANY and its affiliates
shall immediately cease to issue any new annuity or life insurance contracts
bearing any of the Summit licensed marks and shall likewise cease any activity
which suggests that it has any right under any of the Summit licensed marks or
that it has any association with Summit, except that LIFE COMPANY shall have the
right to continue to service outstanding Contracts bearing any of the Summit
27
licensed marks. Should Summit electively terminate this license, Summit shall
assume the reasonable expenses incurred by the licensee as to its printed
materials in changing to a new name.
(c) The licensee shall obtain the prior written approval of the
licensor for the public release by such licensee of any materials bearing the
licensor's licensed marks. The licensor's approvals shall not be unreasonably
withheld. Any disapproval shall likewise be in writing and indicate the reasons
therefor. Notwithstanding the foregoing, should licensor fail to provide a
written response to a request for an approval within five business days of its
receipt, such request shall be deemed approved.
(d) During the term of this grant of license, a licensor may
request that a licensee submit samples of any materials bearing any of the
licensor's licensed marks which were previously approved by the licensor but,
due to changed circumstances, the licensor may wish to reconsider. If, on
reconsideration, or on initial review, respectively, any such samples fail to
meet with the written approval of the licensor, then the licensee shall
immediately cease distributing such disapproved materials. The licensor's
approval shall not be unreasonably withheld, and the licensor, when requesting
reconsideration of a prior approval, shall assume the reasonable expenses of
withdrawing and replacing such disapproved materials. The licensee shall obtain
the prior written approval of the licensor for the use of any new materials
developed to replace the disapproved materials, in the manner set forth above.
(e) The licensee hereunder: (i) acknowledges and stipulates that,
to the best of the knowledge of the licensee, the licensor's licensed marks are
valid and enforceable trademarks and/or service marks and that such licensee
does not own the licensor's licensed marks and claims no rights therein other
than as a licensee under this Agreement; (ii) agrees never to contend otherwise
in legal proceedings or in other circumstances; and (iii) acknowledges and
agrees that the use of the licensor's licensed marks pursuant to this grant of
license shall inure to the benefit of the licensor.
(f) LIFE COMPANY and UNDERWRITER understand that (i) the S&P
MidCap 400(R) Index is a trademark of The XxXxxx-Xxxx Companies, Inc., and the
Xxxxxxx 2000(R) Index is a trademark of the Xxxxx Xxxxxxx Company (collectively,
the "Third-Party Marks"); (ii) these Third-Party Marks have been licensed by
Summit or its affiliate for use by SMFI; and (iii) the Funds are not sponsored,
endorsed, sold or promoted by any of the licensing organizations, and they make
no representation or warranty regarding the Funds, and bear no liability with
respect to the Funds. LIFE COMPANY and UNDERWRITER agree to comply with any
reasonable requirements of the licensing organizations disclosed to LIFE COMPANY
and UNDERWRITER regarding the use of Third-Party Marks in any prospectuses,
sales literature or other promotional material, including without limitation the
approval process for, and the required use of certain notices and disclaimers
in, all materials referencing the Third-Party Marks. Summit or its affiliate
shall use its reasonable commercial efforts to continue in full force and effect
those separate agreements with the respective licensing
28
organizations for continued use of the Third-Party Marks for the duration of the
term of the license granted under this Section 19.
(g) During the term of the license granted under this Section 19,
the licensor shall use its best efforts to maintain in effect and protect the
value of the licensor's licensed marks as authorized herein. The licensor shall
at its own expense exercise licensor's common law and statutory rights against
infringement of the licensed marks as authorized herein, provided, however,
nothing herein shall obligate the licensor to undertake an action or settlement,
or refrain from an action or settlement with respect to any particular
potential, threatened or actual infringement of such licensed marks. LIFE
COMPANY and UNDERWRITER shall cooperate with the licensor in the maintenance,
registration (if any) and policing of licensor's rights in such licensed marks,
and in any action, settlement or undertaking with respect to any particular
potential, threatened or actual infringement of such licensed marks. Such
cooperation is not a waiver of nor shall it require violation of LIFE COMPANY'S,
UNDERWRITER'S or their affiliates' attorney/client, work product or other
privilege.
SECTION 20. PARTIES TO COOPERATE
Each Party to this Agreement will cooperate with each other Party and
all appropriate governmental authorities (including, without limitation, the
SEC, the NASD and state insurance regulators) and will permit each other and
such authorities reasonable access to its books and records (including copies
thereof) in connection with any investigation or inquiry relating to this
Agreement or the transactions contemplated hereby to the extent practicable and
except where a Party's respective interests are adverse to or in conflict with
another Party's interests.
IN WITNESS WHEREOF, the Parties have caused this Agreement to be
executed in their names and on their behalf by and through their duly authorized
officers signing below.
SUMMIT MUTUAL FUNDS, INC.
Attest: /s/ Xxxx X. Xxxxx By: /s/ Xxxx X. Xxxxxxxx
Name: Xxxx X. Xxxxx Name: Xxxx X. Xxxxxxxx
Title: Assistant Secretary Title: Vice President
CARILLON INVESTMENTS, INC.
Attest: /s/ Xxxx X. Xxxxx By: /s/ Xxxx X. Xxxxxxxx
Name: Xxxx X. Xxxxx Name: Xxxx X. Xxxxxxxx
Title: Assistant Secretary Title: Vice President
29
COUNTRY INVESTORS LIFE
ASSURANCE COMPANY, on behalf of
itself and its separate accounts
Attest: /s/ Xxxx X. Xxxxxx By: /s/ Xxxxx X. Xxxxx
Name: Xxxx X. Xxxxxx Name: Xxxxx X. Xxxxx
Title: General Counsel & Secretary Title: VP - Life/Health Operations
COUNTRY CAPITAL MANAGEMENT
COMPANY
Attest: /s/ Xxxx X. Xxxxxx By: /s/ Xxxxxx X. Xxxxxxx
Name: Xxxx X. Xxxxxx Name: Xxxxxx X. Xxxxxxx
Title: General Counsel & Secretary Title: Director/Financial Planning
[ / /02]
30
SCHEDULE A
FUNDS AVAILABLE UNDER THE CONTRACTS
Summit Mutual Funds, Inc. Pinnacle Series:
S&P MidCap 400 Index Portfolio
Xxxxxxx 2000 Small Cap Index Portfolio
SEPARATE ACCOUNTS UTILIZING THE FUNDS
COUNTRY Investors Variable Annuity Account
COUNTRY Investors Variable Life Account
CONTRACTS FUNDED BY THE SEPARATE ACCOUNTS
Individual Flexible Premium Deferred Variable Annuity Contract
Flexible Premium Variable Life Insurance Policy
SCHEDULE B
SUMMIT MUTUAL FUNDS, INC.
Summit Pinnacle Series:
S&P MidCap 400 Index Portfolio
Xxxxxxx 2000 Small Cap Index Portfolio
Summit and Design
SCHEDULE C
EXPENSE ALLOCATIONS
LIFE COMPANY SMFI /CARILLON
---------------------------------------------------------------------------------------------------------
preparing and filing the Account's registration preparing and filing the Fund's registration
statement statement
text composition for Account prospectuses and text composition for Fund prospectuses and
supplements supplements
text alterations of prospectuses (Account) and text alterations of prospectuses (Fund) and
supplements (Account) supplements (Fund)
printing Account and Fund prospectuses and a camera ready Fund prospectus
supplements
text composition and printing Account SAIs text composition and printing Fund SAIs
mailing and distributing Account SAIs to policy mailing and distributing Fund SAIs to policy
owners and prospective purchasers upon request owners and prospective purchasers upon
request
mailing and distributing prospectuses (Account and
Fund) and supplements (Account and Fund) to policy
owners of record as required by Federal Securities
Laws and to prospective purchasers; mailing and
distributing Fund prospectuses and supplements to
prospective purchasers text composition (Account),
printing, mailing, and distributing annual and text composition of annual and semi-annual
semi-annual reports for Account (Fund and Account as, reports (Fund)
applicable)
text composition, printing, mailing, distributing, text composition, printing, mailing,
and tabulation of proxy statements and voting distributing and tabulation of proxy
instruction solicitation materials to policy owners statements and voting instruction
with respect to proxies related to the Account solicitation materials to policy owners with
respect to proxies related to the Fund
preparation, printing and distributing sales
material and advertising relating to the Funds,
insofar as such materials relate to the Contracts
and filing such materials with and obtaining
approval from, the SEC, the NASD, any state
insurance regulatory authority, and any other
appropriate regulatory authority, to the extent
required
