FUND PARTICIPATION AGREEMENT
THIS AGREEMENT made as of the 1st day of March, 2005, by and between
XXXXXXXXX XXXXXX ADVISERS MANAGEMENT TRUST ("TRUST"), a Delaware business trust,
XXXXXXXXX XXXXXX MANAGEMENT INC. ("NBMI"), a New York corporation, First
Great-West Life & Annuity Insurance Company, a life insurance company organized
under the laws of the State of New York ("First G-WL&A"), and GREAT-WEST LIFE &
ANNUITY INSURANCE COMPANY, a life insurance company organized under the laws of
the State of Colorado ("G-WL&A"), together with First G-WL&A, "LIFE COMPANY".
WHEREAS, TRUST is registered with the Securities and Exchange Commission
("SEC") under the Investment Company Act of 1940, as amended ("40 Act") as an
open-end, diversified management investment company; and
WHEREAS, TRUST is organized as a series fund comprised of several
portfolios ("Portfolios") the shares of which are registered under the
Securities Act of 1933, as amended (the "33 Act"), the currently available of
which are listed on Appendix A hereto; and
WHEREAS, TRUST was organized to act as the funding vehicle for certain
variable life insurance and/or variable annuity contracts ("Variable Contracts")
offered by life insurance companies through separate accounts of such life
insurance companies ("Participating Insurance Companies") and also offers its
shares to certain qualified pension and retirement plans; and
WHEREAS, TRUST has received an order from the SEC, dated May 5,1995
(File No. 812-9164), granting Participating Insurance Companies and their
separate accounts exemptions from the provisions of Sections 9(a), 13(a), 15(a)
and 15(b) of the '40 Act, and Rules 6e-2(b)(15) and 6e-3(T)(b)(15) thereunder,
to the extent necessary to permit shares of the Portfolios of the TRUST to be
sold to and held by variable annuity and variable life insurance separate
accounts of both affiliated and unaffiliated life insurance companies and
certain qualified pension and retirement plans (the "Order"); and
WHEREAS, LIFE COMPANY has established or will establish one or more
separate accounts ("Separate Accounts"), as listed in Appendix B, as may be
amended from time to time, to offer Variable Contracts and is desirous of having
TRUST as one of the underlying funding vehicles for such Variable Contracts; and
WHEREAS, LIFE COMPANY has certain unregistered Variable Contracts
supported wholly or partially by the Separate Account to be made available to
owners thereof, including any participants or employees of such owners as
applicable ("Contract owners"); and
WHEREAS, the Separate Account is a duly organized, validly existing
segregated asset account, established by resolution of the Board of Directors of
LIFE COMPANY, under the insurance laws of the State of Colorado, to set aside
and invest assets attributable to the Variable Contracts; and
WHEREAS, NBMI is registered with the SEC as an investment adviser under
the Investment Advisers Act of 1940 and as a broker-dealer under the Securities
Exchange Act of 1934, as amended, and is a member in good standing of the
National Association of Securities Dealers, Inc. ("NASD"); and
WHEREAS, NBMI is the administrator and distributor of the shares of each
Portfolio of TRUST; and
WHEREAS, to the extent permitted by applicable insurance laws and
regulations, LIFE COMPANY intends to purchase shares of TRUST to fund the
aforementioned Variable Contracts and TRUST is authorized to sell such shares to
LIFE COMPANY at net asset value; and
WHEREAS, to the extent permitted by applicable insurance laws and
regulations, the Separate Accounts also intend to purchase shares in other
open-end investment companies or series thereof not affiliated with the TRUST
("unaffiliated funds") on behalf of the Separate Accounts to fund the Variable
Contracts;
WHEREAS, LIFE COMPANY intends to utilize its NSCC member broker/dealer
affiliate, GWFS Equities, Inc. (formerly known as BenefitsCorp Equities, Inc.)
("GWFS") to transmit instructions for the purchase, redemption and transfer of
Portfolio shares on behalf of the Separate Account, and GWFS, alone, or with the
assistance of a recordkeeping affiliate, to perform certain recordkeeping
functions associated with the transfer of Portfolio shares into and out of the
Separate Account in order to recognize certain organizational economies; and
NOW, THEREFORE, in consideration of their mutual promises, LIFE COMPANY,
TRUST and NBMI agree as follows:
Article I. SALE OF TRUST SHARES
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1.1 TRUST agrees to make available to the Separate Accounts of LIFE
COMPANY listed in Appendix B shares of the selected Portfolios for investment of
proceeds from Variable Contracts allocated to the designated Separate Accounts,
such shares to be offered as provided in TRUST's Prospectus.
1.2 TRUST agrees to sell to LIFE COMPANY those shares of the selected
Portfolios of TRUST which LIFE COMPANY orders, executing such orders on a daily
basis at the net asset value next computed after receipt by TRUST or its
designee of the order for the shares of TRUST. For purposes of this Section 1.2,
LIFE COMPANY shall be the designee of TRUST for receipt of such orders from LIFE
COMPANY and receipt by such designee shall constitute receipt by TRUST; provided
that TRUST receives notice of such order by 10:00 a.m. New York time on the next
following Business Day. "Business Day" shall mean any day on which the New York
Stock Exchange is open for trading and on which TRUST calculates its net asset
value pursuant to the rules of the SEC.
1.3 TRUST agrees to redeem for cash, on LIFE COMPANY's request, any full
or fractional shares of TRUST held by LIFE COMPANY, executing such requests on a
daily basis at the net asset value next computed after receipt by TRUST or its
designee of the request for redemption. For purposes of this Section 1.3, LIFE
COMPANY shall be the designee of TRUST for receipt of requests for redemption
from LIFE COMPANY and receipt by such designee shall constitute receipt by
TRUST; provided that TRUST receives notice of such request for redemption by
10:00 a.m. New York time on the next following Business Day.
1.4 TRUST shall furnish, on or before the ex-dividend date, notice to
LIFE COMPANY of any income dividends or capital gain distributions payable on
the shares of any Portfolio of TRUST. LIFE COMPANY hereby elects to receive all
such income dividends and capital gain distributions as are payable on a
Portfolio's shares in additional shares of the Portfolio. LIFE COMPANY reserves
the right to revoke this election and to receive all such income dividends and
capital gain distributions in cash. TRUST shall notify LIFE COMPANY of the
number of shares so issued as payment of such dividends and distributions.
1.5 TRUST shall make the net asset value per share for the selected
Portfolio(s) available to LIFE COMPANY on a daily basis as soon as reasonably
practicable after the net asset value per share is calculated, but shall use its
best efforts to make such net asset value available by 6:00 p.m. New York time.
If TRUST provides LIFE COMPANY with materially incorrect share net asset value
information through no fault of LIFE COMPANY, the number of shares of the
applicable sub-account of such Variable Contract owners will be adjusted and the
amount of any underpayments shall be credited by the TRUST or NBMI to LIFE
COMPANY for crediting of such amounts to the applicable Variable Contract
owners' accounts. Upon notification by the TRUST or NBMI of any overpayment due
to a material error, LIFE COMPANY shall promptly remit to the TRUST or NBMI any
overpayment that has not been paid to Variable Contract owners; however, the
TRUST and NBMI acknowledge that LIFE COMPANY does not intend to seek additional
payments from any Variable Contract owner who, because of a pricing error, may
have underpaid for units of interest credited to his/her account. Any material
error in the calculation of net asset value per share, dividend or capital gain
information shall be reported promptly upon discovery to LIFE COMPANY. Such
notification may be verbal, but shall be confirmed promptly in writing in
accordance with Article IX of this Agreement. NBMI agrees to pay LIFE COMPANY a
flat reimbursement of the lesser of $2,000 or the actual expenses of LIFE
COMPANY of correcting a material pricing error for each material pricing error
(i.e., each day an incorrect net asset value or offering price is communicated
to LIFE COMPANY or is the basis on which TRUST shares are purchased or redeemed
by LIFE COMPANY). LIFE COMPANY shall use its best efforts to use the least
costly method to correct pricing errors. In defining materiality for purposes of
this Section, TRUST and LIFE COMPANY shall apply the standard set forth in
Appendix E hereto, which is consistent with applicable guidance of the staff of
the Securities and Exchange Commission. The Trustees of TRUST may amend such
materiality standard in good faith execution of their fiduciary duties, such
amendment to be effective upon written notice to LIFE COMPANY.
1.6 At the end of each Business Day, LIFE COMPANY shall use the
information described in Section 1.5 to calculate Separate Account unit values
for the day. Using these unit values, LIFE COMPANY shall process each such
Business Day's Separate Account transactions based on requests and premiums
received by it by the close of trading on the floor of the New York Stock
Exchange (currently 4:00 p.m. New York time) to determine the net dollar amount
of TRUST shares which shall be purchased or redeemed at that day's closing net
asset value per share. The net purchase or redemption orders so determined shall
be transmitted to TRUST by LIFE COMPANY by 10:00 a.m. New York Time on the
Business Day next following LIFE COMPANY's receipt of such requests and premiums
in accordance with the terms of Sections 1.2 and 1.3 hereof.
1.7 If LIFE COMPANY's order requests the purchase of TRUST shares, LIFE
COMPANY shall pay for such purchase by wiring federal funds to TRUST or its
designated custodial account before the close of the federal wire transfers
system on the next Business Day after the order is transmitted by LIFE COMPANY.
If LIFE COMPANY's order requests a net redemption resulting in a payment of
redemption proceeds to LIFE COMPANY, TRUST shall wire the redemption proceeds to
LIFE COMPANY before the close of the federal wire transfers system on the next
Business Day; provided, however, that for net redemptions exceeding one (1)
million dollars that would require TRUST to dispose of portfolio securities or
otherwise incur additional costs, proceeds shall be wired to LIFE COMPANY within
seven days and TRUST shall notify the person designated in writing by LIFE
COMPANY as the recipient for such notice of such delay by 3:00 p.m. New York
time the same Business Day that LIFE COMPANY transmits the redemption order to
TRUST. If LIFE COMPANY's order requests the application of redemption proceeds
from the redemption of shares to the purchase of shares of another fund
administered or distributed by NBMI, TRUST shall so apply such proceeds the same
Business Day that LIFE COMPANY transmits such order to TRUST.
1.8 Notwithstanding Section 1.7, TRUST reserves the right to suspend the
right of redemption or postpone the date of payment or satisfaction upon
redemption consistent with Section 22(e) of the '40 Act and any rules
thereunder.
1.9 TRUST agrees that all shares of the Portfolios of TRUST will be sold
only to Participating Insurance Companies which have agreed to participate in
TRUST to fund their Separate Accounts and/or to certain qualified pension and
other retirement plans, all in accordance with the requirements of Section
817(h) of the Internal Revenue Code of 1986, as amended ("Code") and Treasury
Regulation 1.817-5 and Articles V and VI of this Agreement. Shares of the
Portfolios of TRUST will not be sold directly to the general public.
1.10 TRUST may refuse to sell shares of any Portfolio to any person, or
suspend or terminate the offering of the shares of any Portfolio if such action
is required by law or by regulatory authorities having jurisdiction or is, in
the sole discretion of the Board of Trustees of TRUST, acting in good faith and
in light of its fiduciary duties under federal and any applicable state laws,
deemed necessary and in the best interests of the shareholders of such
Portfolios.
1.11 Issuance and transfer of the TRUST's shares to LIFE COMPANY will be
by book entry only. Stock certificates will not be issued to LIFE COMPANY or the
Separate Accounts. Shares ordered from the TRUST will be recorded in an
appropriate title for the Separate Accounts or the appropriate sub-account of
the Separate Accounts.
1.12 The Parties hereto acknowledge that the arrangement contemplated by
this Agreement is not exclusive; the TRUST's shares may be sold to other
participating Insurance Companies (under agreements which contain language
substantially similar to this Agreement) and the cash value of the Variable
Contracts may be invested in other investment companies.
Article II. REPRESENTATIONS AND WARRANTIES
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2.1 G-WL&A represents and warrants that it is an insurance company duly
organized and in good standing under the laws of the State of Colorado and that
it has legally and validly established each Separate Account as a segregated
asset account under such laws, and that GWFS, the principal writer for the
Variable Contracts, is registered as a broker-dealer under the Securities
Exchange Act of 1934. First G-WL&A represents and warrants that it is an
insurance company duly organized and in good standing under the laws of the
State of New York and that it has legally and validly established each Separate
Account as a segregated asset account under such laws.
2.2 LIFE COMPANY represents and warrants that the Variable Contracts
will be registered under the `33 Act unless an exemption from registration is
available prior to any issuance or sale of the Variable Contracts and that the
Variable Contracts will be issued and sold in compliance in all material
respects with all applicable federal and state laws and further that the sale of
the Variable Contracts shall comply in all material respects with state
insurance law suitability requirements.
2.3 LIFE COMPANY represents and warrants that the Variable Contracts are
currently and at the time of issuance will be treated as life insurance,
endowment or annuity contracts under applicable provisions of the Code, that it
will maintain such treatment and that it will notify TRUST immediately upon
having a reasonable basis for believing that the Variable Contracts have ceased
to be so treated or that they might not be so treated in the future.
2.4 LIFE COMPANY represents and warrants that it shall deliver such
prospectuses, statements of additional information, proxy statements and
periodic reports of the TRUST as required to be delivered under applicable
federal or state law and interpretations of federal and state securities
regulators thereunder in connection with the offer, sale or acquisition of the
Variable Contracts.
2.5 TRUST represents and warrants that the Portfolio shares offered and
sold pursuant to this Agreement will be registered under the '33 Act and sold in
accordance with all applicable federal and state laws, and TRUST shall be
registered under the '40 Act prior to and at the time of any issuance or sale of
such shares. TRUST shall amend its registration statement under the '33 Act and
the '40 Act from time to time as required in order to effect the continuous
offering of its shares. TRUST shall register and qualify its shares for sale in
accordance with the laws of the various states only if and to the extent deemed
advisable by TRUST.
2.6 TRUST represents and warrants that the TRUST will at all times sell
its shares and invest its assets in such a manner as to ensure that the Variable
Contracts will be treated as annuity contracts under the Code, and the
regulations issued thereunder. Without limiting the foregoing. TRUST represents
and warrants that each Portfolio will comply with the diversification
requirements set forth in Section 817(h) of the Code, and the rules and
regulations thereunder, including without limitation Treasury Regulation
1.817-5, and will notify LIFE COMPANY immediately upon having a reasonable basis
for believing any Portfolio has ceased to comply or might not so comply and will
immediately take all reasonable steps to adequately diversify the Portfolio to
achieve compliance within the grace period afforded by Regulation 1.817-5.
2.7 TRUST represents and warrants that each Portfolio invested in by the
Separate Account is currently qualified as a "regulated investment company"
under Subchapter M of the Code, that it will make every effort to maintain such
qualification and will notify LIFE COMPANY immediately upon having a reasonable
basis for believing it has ceased to so qualify or might not so qualify in the
future.
2.8 TRUST, at its expense, will provide LIFE COMPANY or its designee
with reports certifying compliance with the aforesaid Section 817(h)
diversification and Subchapter M qualification requirements, at the times
provided for and substantially in the form attached hereto as Appendix C;
provided, however, that providing such reports does not relieve TRUST of its
responsibility for such compliance or its liability for any non-compliance.
2.9. TRUST represents and warrants that it is lawfully organized and
validly existing under the laws of the State of Delaware and that it does and
will comply in all material respects with the 1940 Act.
2.10 NBMI represents and warrants that it is and shall remain duly
registered under the Investment Advisers Act of 1940 and that it shall perform
its obligations to TRUST in compliance in all material respects with applicable
federal and state law.
2.11 The TRUST represents and warrants that all of its respective
officers, employees, investment advisers, and other individuals or entities
dealing with the money and/or securities of TRUST are, and shall continue to be
at all times, covered by one or more blanket fidelity bonds or similar coverage
for the benefit of TRUST in an amount not less than the minimal coverage
required by Rule 17g-1 under the `40 Act or related provisions as may be
promulgated from time to time. The aforesaid bonds shall include coverage for
larceny and embezzlement and shall be issued by a reputable bonding company.
2.12 The TRUST will provide LIFE COMPANY with as much advance notice as
is reasonably practicable of any material change affecting the Portfolio(s)
(including, but not limited to, any material change in the registration
statement or prospectus affecting the Portfolio(s) and any proxy solicitation
affecting the Portfolio(s)) and consult with LIFE COMPANY in order to implement
any such change in an orderly manner, recognizing the expenses of changes and
attempting to minimize such expenses by implementing them in conjunction with
regular annual updates of the prospectus for the Variable Contracts. The TRUST
agrees to share in expenses incurred by LIFE COMPANY as a result of actions
taken by the TRUST, consistent with the allocation of expenses contained in
Schedule D attached hereto and incorporated herein by reference.
2.15 The TRUST shall register and qualify the shares for sale in
accordance with the laws of the various states if and to the extent required by
applicable law. LIFE COMPANY and the TRUST will endeavor to mutually cooperate
with respect to the implementation of any modifications necessitated by any
change in state insurance laws, regulations or interpretations of the foregoing
actually known to them that affect the Portfolio(s) (a "Law Change"), and to
keep each other informed of any Law Change that becomes known to either party.
In the event of a Law Change, the TRUST agrees that, except in those
circumstances where the TRUST has advised LIFE COMPANY that its Board of
Trustees has determined that implementation of a particular Law Change is not in
the best interests of all of the TRUST's shareholders, any action required by a
Law Change will be taken.
Article III. PROSPECTUS AND PROXY STATEMENTS
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3.1 TRUST shall prepare and be responsible for filing with the SEC and
any state 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 TRUST.
TRUST shall bear the costs of registration and qualification of shares of the
Portfolios, preparation and filing of the documents listed in this Section 3.1
and all taxes to which an issuer is subject on the issuance and transfer of its
shares.
3.2 TRUST, NBMI AND LIFE COMPANY shall allocate costs and expenses under
this Agreement in accordance with the Expense Schedule set forth in Appendix D.
LIFE COMPANY will submit any bills for printing, duplicating and/or mailing
costs, relating to TRUST documents with respect to which TRUST or NBMI is
responsible for under Appendix D to TRUST for reimbursement. LIFE COMPANY shall
monitor such costs and shall use its best efforts to control these costs. LIFE
COMPANY will provide TRUST on a semi-annual basis, or more frequently as
reasonably requested by TRUST, with a current tabulation of the number of
existing Variable Contract owners of LIFE COMPANY whose Variable Contract values
are invested in TRUST. This tabulation will be sent to TRUST in the form of a
letter signed by a duly authorized officer of LIFE COMPANY attesting to the
accuracy of the information contained in the letter. If requested by LIFE
COMPANY, the TRUST shall provide such documentation (including a final copy of
the TRUST's prospectus as set in type or in camera-ready copy) and other
assistance as is reasonably necessary in order for LIFE COMPANY to print
together in one document the current prospectus for the Variable Contracts
issued by LIFE COMPANY and the current prospectus for the TRUST. Should LIFE
COMPANY wish to print any of these documents in a format different from that
provided by TRUST, LIFE COMPANY shall provide TRUST with sixty (60) days' prior
written notice and LIFE COMPANY shall bear the cost associated with any format
change.
3.3 TRUST will provide, at its expense, LIFE COMPANY with the following
TRUST (or individual Portfolio) documents, and any supplements thereto, with
respect to prospective Variable Contract owners of LIFE COMPANY:
(i) camera-ready copy of the current prospectus for
printing by the LIFE COMPANY;
(ii) camera-ready copy of the individual Portfolio
prospectuses filed as part of TRUST's registration
statement;
(iii) a copy of the statement of additional information
suitable for duplication;
(iv) camera-ready copy of proxy material suitable for
printing; and
(v) camera-ready copy of the annual and semi-annual
reports for printing by the LIFE COMPANY.
3.4 TRUST will provide LIFE COMPANY with at least one complete copy of
all prospectuses, statements of additional information, annual and semi-annual
reports, proxy statements, exemptive applications and all amendments or
supplements to any of the above that relate to the Portfolios promptly after the
filing of each such document with the SEC or other regulatory authority. LIFE
COMPANY will provide TRUST with at least one complete copy of all prospectuses,
statements of additional information, annual and semi-annual reports, proxy
statements, exemptive applications and all amendments or supplements to any of
the above that relate to a Separate Account promptly after the filing of each
such document with the SEC or other regulatory authority.
3.5 It is understood and agreed that, except with respect to information
regarding LIFE COMPANY provided in writing by that party, LIFE COMPANY is not
responsible for the content of the prospectus or SAI for the Portfolio(s). It is
also understood and agreed that, except with respect to information regarding
the TRUST or the Portfolio(s) provided in writing by the TRUST or NBMI, neither
the TRUST nor NBMI is responsible for the content of the prospectus or SAI for
the Variable Contracts.
3.6 The TRUST will comply with all provisions of the 1940 Act requiring
voting by shareholders, and in particular the TRUST will either provide for
annual meetings (except insofar as the SEC may interpret Section 16 of the 1940
Act not to require such meetings) or, as the TRUST currently intends, comply
with Section 16(c) of the 1940 Act with respect to shareholder meetings to
consider the removal of a trustee (although the TRUST 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, the TRUST will act in accordance with the
SEC's interpretation of the requirements of Section 16(a) with respect to
periodic elections of trustees and with whatever rules the Commission may
promulgate with respect thereto.
Article IV. SALES MATERIALS
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4.1 LIFE COMPANY will furnish, or will cause to be furnished, to TRUST
and NBMI, each piece of sales literature or other promotional material in which
TRUST or NBMI is named, at least ten (10) Business Days prior to its intended
use. No such material will be used if TRUST or NBMI objects to its use in
writing within five (5) Business Days after receipt of such material.
4.2 TRUST and NBMI will furnish, or will cause to be furnished, to LIFE
COMPANY, each piece of sales literature or other promotional material in which
LIFE COMPANY or its Separate Accounts are named, at least ten (10) Business Days
prior to its intended use. No such material will be used if LIFE COMPANY objects
to its use in writing within five (5) Business Days after receipt of such
material.
4.3 TRUST and its affiliates and agents shall not give any information
or make any representations on behalf of LIFE COMPANY or concerning LIFE
COMPANY, the Separate Accounts, or the Variable Contracts issued by LIFE
COMPANY, other than the information or representations contained in a
registration statement or prospectus for such Variable Contracts, as such
registration statement and prospectus may be amended or supplemented from time
to time, or in reports of the Separate Accounts or reports prepared for
distribution to owners of such Variable Contracts, or in sales literature or
other promotional material approved by LIFE COMPANY or its designee, except with
the written permission of LIFE COMPANY.
4.4 LIFE COMPANY and its affiliates and agents shall not give any
information or make any representations on behalf of TRUST or concerning TRUST
other than the information or representations contained in a registration
statement or prospectus for TRUST, as such registration statement and prospectus
may be amended or supplemented from time to time, or in sales literature or
other promotional material approved by TRUST or its designee, except with the
written permission of TRUST.
4.5 For purposes of this Agreement, the phrase "sales literature or
other promotional material" or words of similar import include, without
limitation, advertisements (such as material published, or designed for use, in
a newspaper, magazine or other periodical, radio, television, telephone or tape
recording, videotape display, signs or billboards, motion pictures or other
public media), sales literature (such as any written communication distributed
or made generally available to customers or the public, including brochures,
circulars, research reports, market letters, form letters, seminar texts, or
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 National Association of Securities Dealers, Inc.
rules, the '40 Act or the '33 Act.
Article V. POTENTIAL CONFLICTS
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5.1 The Board of Trustees of TRUST (the "Board") will monitor TRUST for
the existence of any material irreconcilable conflict between the interests of
the Variable Contract owners of Participating Insurance Company Separate
Accounts investing in the TRUST. A material irreconcilable conflict may arise
for a variety of reasons, including: (a) state insurance regulatory authority
action; (b) a change in applicable federal or state insurance, tax or securities
laws or regulations or a public ruling, private letter ruling or any similar
action by insurance, tax or securities regulatory authorities; (c) an
administrative or judicial decision in any relevant proceeding; (d) the manner
in which the investments of the TRUST are being managed; (e) a difference in
voting instructions given by variable annuity and variable life insurance
contract owners or by contract owners of different Participating Insurance
Companies; or (f) a decision by a Participating Insurance Company to disregard
voting instructions of Variable Contract owners.
5.2 LIFE COMPANY will report any potential or existing conflicts to the
Boards. LIFE COMPANY will be responsible for assisting each appropriate Board in
carrying out its responsibilities under the Conditions set forth under the Order
and in the notice issued by the SEC for the Funds on April 12, 1995 (the
"Notice") (Investment Company Act Release No. 21003), which LIFE COMPANY has
reviewed, by providing each appropriate Board with all information reasonably
necessary for it to consider any issues raised. This responsibility includes,
but is not limited to, an obligation by LIFE COMPANY to inform each appropriate
Board whenever Variable Contract owner voting instructions are disregarded by
LIFE COMPANY. These responsibilities will be carried out by the LIFE COMPANY
with a view only to the interests of the Variable Contract owners.
5.3 If a majority of the Board of TRUST or a majority of its
disinterested trustees or directors, determines that a material irreconcilable
conflict exists, affecting the LIFE COMPANY, LIFE COMPANY, at its expense and to
the extent reasonably practicable (as determined by a majority of disinterested
trustees or directors), will take any steps necessary to remedy or eliminate the
irreconcilable material conflict, including: (a) withdrawing the assets
allocable to some or all of the Separate Accounts from the TRUST or any series
thereof and reinvesting those assets in a different investment medium, which may
include another series of TRUST or another investment company or submitting the
question as to whether such segregation should be implemented to a vote of all
affected Variable Contract owners and, as appropriate, segregating the assets of
any appropriate group (i.e., Variable Contract owners of one or more
Participating Insurance Companies) that votes in favor of such segregation or
offering to the affected Variable Contract owners the option of making such a
change; and (b) establishing a new registered management investment company or
managed separate account. If a material irreconcilable conflict arises because
of LIFE COMPANY's decision to disregard Variable Contract owner voting
instructions, and that decision represents a minority position or would preclude
a majority vote, LIFE COMPANY may be required, at the election of TRUST, to
withdraw its Separate Account's investment in TRUST and no charge or penalty
will be imposed as a result of such withdrawal. The responsibility to take such
remedial action shall be carried out with a view only to the interests of the
Variable Contract owners.
For the purposes of this Section 5.3, a majority of the disinterested
members of the applicable Board shall determine whether or not any proposed
action adequately remedies any material irreconcilable conflict, but in no event
will TRUST or NBMI (or any other investment adviser of TRUST) be required to
establish a new funding medium for any Variable Contract. Further, LIFE COMPANY
shall not be required by this Section 5.3 to establish a new funding medium for
any Variable Contract if any offer to do so has been declined by a vote of a
majority of Variable Contract owners materially affected by the material
irreconcilable conflict.
5.4 Any Board's determination of the existence of an material
irreconcilable conflict and its implications shall be made known promptly and in
writing to LIFE COMPANY.
5.5 No less than annually, LIFE COMPANY shall submit to the Boards such
reports, materials or data as such Boards may reasonably request so that the
Boards may fully carry out the obligations imposed upon them by these
Conditions. Such reports, materials, and data shall be submitted more frequently
if deemed appropriate by the applicable Boards.
Article VI. VOTING
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6.1 LIFE COMPANY will provide pass-through voting privileges to all
Variable Contract owners so long as the SEC continues to interpret the '40 Act
as requiring pass-through voting privileges for Variable Contract owners.
Accordingly, LIFE COMPANY, where applicable, will vote shares of a Portfolio
held in its Separate Accounts in a manner consistent with voting instructions
timely received from its Variable Contract owners. LIFE COMPANY will be
responsible for assuring that each of its Separate Accounts that participates in
any Fund calculates voting privileges in a manner consistent with other
participants as defined in the Conditions set forth in the Notice
("Participants"). The obligation to calculate voting privileges in a manner
consistent with all other Separate Accounts investing in a Fund will be a
contractual obligation of all Participants under the agreements governing
participation in the Funds. Each Participant will vote shares for which it has
not received timely voting instructions, as well as shares it owns, in the same
proportion as it votes those shares for which it has received voting
instructions. LIFE COMPANY reserves the right to vote TRUST shares held in any
segregated asset account in its own right, to the extent permitted by law.
6.2 If and to the extent Rule 6e-2 and Rule 6e-3(T) are amended, or Rule
6e-3 is adopted, to provide exemptive relief from any provision of the '40 Act
or the rules thereunder with respect to mixed and shared funding on terms and
conditions materially different from any exemptions granted in the Order, then
TRUST and/or the Participants, as appropriate, shall take such steps as may be
necessary to comply with Rule 6e-2 and Rule 6e-3(T), as amended, and Rule 6e-3,
as adopted, to the extent such Rules are applicable, and Sections of this
Agreement regarding voting, potential conflicts and compliance with the Order
shall continue in effect only to the extent that terms and conditions
substantially identical to those Sections are contained in such Rule(s) as so
amended or adopted.
Article VII. INDEMNIFICATION
7.1 Indemnification by LIFE COMPANY. LIFE COMPANY jointly and severally,
that is, G-WL&A and First G-WL&A will separately and not jointlyindemnify and
hold harmless TRUST, NBMI and each of their Trustees, directors, officers,
employees and agents and each person, if any, who controls TRUST or NBMI within
the meaning of Section 15 of the '33 Act (collectively, the "Indemnified
Parties" for purposes of Sections 7.1, 7.2 and 7.3) against any and all losses,
claims, damages, liabilities (including amounts paid in settlement with the
written consent of LIFE COMPANY, which consent shall not be unreasonably
withheld) or litigation (including 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
expenses (or actions in respect thereof) or settlements are related to the
offer, sale or acquisition of TRUST's shares or the Variable Contracts and:
(a) arise out of or are based upon any untrue statements or
alleged untrue statements of any material fact contained in
the registration statement, prospectus, statement of
additional information, sales literature or other
promotional material for the Variable Contracts or contained
in the Variable 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 by or
on behalf of TRUST for use in the registration statement or
prospectus for the Variable Contracts or in the Variable
Contracts or sales literature (or any amendment or
supplement) or otherwise for use in connection with the sale
of the Variable Contracts or TRUST shares; or
(b) arise out of or as a result of statements or representations
(other than statements or representations contained in the
registration statement, prospectus or sales literature of
TRUST not supplied by LIFE COMPANY, or persons under its
control) or wrongful conduct of LIFE COMPANY or persons
under its control, with respect to the sale or distribution
of the Variable Contracts or TRUST shares; or
(c) arise out of any untrue statement or alleged untrue
statement of a material fact contained in a registration
statement, prospectus, statement of additional information
or sales literature or other promotional material of TRUST
or any amendment thereof or supplement thereto or the
omission or alleged omission to state therein a material
fact required to be stated therein or necessary to make the
statements therein not misleading if such statement or
omission or such alleged statement or omission was made in
reliance upon and in conformity with information furnished
to TRUST by or on behalf of LIFE COMPANY; or
(d) arise as a result of any failure by LIFE COMPANY to
substantially provide the services and furnish the materials
under the terms of this Agreement; or
(e) arise out of or result from any material breach of any
representation and/or warranty made by LIFE COMPANY in this
Agreement or arise out of or result from any other material
breach of this Agreement by LIFE COMPANY.
As limited by and in accordance with the provisions of Sections 7.2 and
7.3 hereof.
7.2 LIFE COMPANY shall not be liable under this indemnification
provision with respect to any losses, claims, damages, liabilities or litigation
incurred or assessed against an Indemnified Party as such may arise 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 or duties under this Agreement or to
TRUST, whichever is applicable.
7.3 LIFE COMPANY shall not be liable under this indemnification
provision with respect to any claim made against an Indemnified Party unless
such Indemnified Party shall have notified LIFE COMPANY in writing within a
reasonable time after the summons or other first legal process giving
information of the nature of the claim shall have been served upon such
Indemnified Party (or after such Indemnified Party shall have received notice of
such service on any designated agent), but failure to notify LIFE COMPANY of any
such claim shall not relieve LIFE COMPANY from any liability which it may have
to the Indemnified Party against whom such action is brought otherwise than on
account of this indemnification provision except to the extent that LIFE COMPANY
has been prejudiced by such failure to give notice. In case any such action is
brought against an Indemnified Party, LIFE COMPANY shall be entitled to
participate at its own expense in the defense of such action. LIFE COMPANY also
shall be entitled to assume the defense thereof, with counsel satisfactory to
the party named in the action. After notice from LIFE COMPANY to such party of
LIFE COMPANY's election to assume the defense thereof, the Indemnified Party
shall bear the fees and expenses of any additional counsel retained by it, and
LIFE COMPANY will not be liable to such party under this Agreement for any legal
or other expenses subsequently incurred by such party independently in
connection with the defense thereof other than reasonable costs of
investigation.
7.4 Indemnification by NBMI. NBMI agrees to indemnify and hold harmless
LIFE COMPANY and each of its directors, officers, employees, and agents and each
person, if any, who controls LIFE COMPANY within the meaning of Section 15 of
the '33 Act (collectively, the "Indemnified Parties" for the purposes of
Sections 7.4, 7.5, and 7.6), against any and all losses, claims, damages,
liabilities (including amounts paid in settlement with the written consent of
NBMI which consent shall not be unreasonably withheld) or litigation (including
legal and other expenses) to which the Indemnified Parties may become subject
under any statute, or regulation, at common law or otherwise, insofar as such
losses, claims, damages, liabilities or expenses (or actions in respect thereof)
or settlements are related to the offer, sale or acquisition of TRUST's shares
or the Variable Contracts and:
(a) arise out of or are based upon any untrue statement or
alleged untrue statement of any material fact contained in
the registration statement, prospectus, statement of
additional information, sales literature or other
promotional material of TRUST (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 NBMI or
TRUST by or on behalf of LIFE COMPANY for use in the
registration statement, prospectus, or statement of
additional information for TRUST or in sales literature (or
any amendment or supplement) or otherwise for use in
connection with the sale of the Variable Contracts or TRUST
shares; or
(b) arise out of or as a result of statements or representations
(other than statements or representations contained in the
registration statement, prospectus, statement of additional
information or sales literature for the Variable Contracts
not supplied by NBMI or persons under its control) or
wrongful conduct of TRUST or NBMI or persons under their
control, with respect to the sale or distribution of the
Variable Contracts or TRUST shares; or
(c) arise out of any untrue statement or alleged untrue
statement of a material fact contained in a registration
statement, prospectus, statement of additional information,
sales literature or other promotional material covering the
Variable Contracts, or any amendment thereof or supplement
thereto or the omission or alleged omission to state therein
a material fact required to be stated therein or necessary
to make the statements therein not misleading, 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 for inclusion therein by or on
behalf of TRUST; or
(d) arise as a result of (i) a failure by NBMI or TRUST to
substantially provide the services and furnish the materials
under the terms of this Agreement; or (ii) a failure by a
Portfolio(s) invested in the Separate Account to comply with
the diversification requirements of Section 817(h) of the
Code; or (iii) a failure by a Portfolio(s) invested in by
the Separate Account to qualify as a "regulated investment
company" under Subchapter M of the Code; or
(e) arise out of or result from any material breach of any
representation and/or warranty made by NBMI in this
Agreement or arise out of or result from any other material
breach of this Agreement by NBMI.
(f) arise out of or result from the incorrect or untimely
calculation or reporting by the TRUST, MANAGER TRUST or NBMI
of the daily net asset value per share or dividend or
capital gain distribution rate due to negligent conduct of
TRUST or NBMI.
Without limiting the effect of the foregoing, NBMI will pay all costs
associated with or arising out of any failure or any anticipated or reasonably
foreseeable failure of the TRUST or any Portfolio to comply with Sections 1.9,
2.7 and 2.8 hereof, including all costs associated with reasonable and
appropriate corrections or responses to any such failure; such costs may
include, but are not limited to, the costs of obtaining whatever regulatory
authorizations are required to substitute shares of another investment company
for those of the failed Portfolio (including but not limited to an order
pursuant to Section 26(b) of the 1940 Act). Such costs are to include but are
not limited to, reasonable fees and expenses of legal counsel and other advisors
to LIFE COMPANY and any federal income taxes or tax penalties and interest
thereon (or "toll charges" or exactments or amounts paid in settlement) incurred
by LIFE COMPANY with respect to itself or owners of its Variable Contracts in
connection with any such failure or anticipated or reasonably foreseeable
failure.
7.5 NBMI shall not be liable under this indemnification provision with
respect to any losses, claims, damages, liabilities or litigation to which an
Indemnified Party would otherwise be subject by reason of such Indemnified
Party's willful misfeasance, bad faith, or 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 or to LIFE
COMPANY.
7.6 NBMI shall not be liable under this indemnification provision with
respect to any claim made against an Indemnified Party unless such Indemnified
Party shall have notified NBMI in writing within a reasonable time after the
summons or other first legal process giving information of the nature of the
claim shall have been served upon such Indemnified Party (or after such
Indemnified Party shall have received notice of such service on any designated
agent), but failure to notify NBMI of any such claim shall not relieve NBMI from
any liability which it may have to the Indemnified Party against whom such
action is brought otherwise than on account of this indemnification provision
except to the extent that NBMI has been prejudiced by such failure to give
notice. In case any such action is brought against the Indemnified Parties, NBMI
shall be entitled to participate at its own expense in the defense thereof. NBMI
also shall be entitled to assume the defense thereof, with counsel satisfactory
to the party named in the action. After notice from NBMI to such party of NBMI's
election to assume the defense thereof, the Indemnified Party shall bear the
fees and expenses of any additional counsel retained by it, and NBMI will not be
liable to such party under this Agreement for any legal or other expenses
subsequently incurred by such party independently in connection with the defense
thereof other than reasonable costs of investigation.
Article VIII. TERM; TERMINATION
-----------------
8.1 This Agreement shall be effective as of the date hereof and shall
continue in force until terminated in accordance with the provisions herein.
8.2 This Agreement shall terminate in accordance with the following
provisions:
(a) At the option of LIFE COMPANY, TRUST or NBMI at any time
from the date hereof upon 180 days' notice, unless a shorter
time is agreed to by the parties;
(b) At the option of LIFE COMPANY, if TRUST shares are not
reasonably available to meet the requirements of the
Variable 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 TRUST or makes available a
sufficient number of shares to reasonably meet the
requirements of the Variable Contracts within said ten-day
period;
(c) At the option of LIFE COMPANY, upon the institution of
formal proceedings against TRUST or NBMI by the SEC or the
NASD, or any other regulatory body, the expected or
anticipated ruling, judgment or outcome of which would, in
LIFE COMPANY's reasonable judgment, materially impair
TRUST's ability to meet and perform TRUST's obligations and
duties hereunder. Prompt notice of election to terminate
shall be furnished by LIFE COMPANY with said termination to
be effective upon receipt of notice;
(d) At the option of TRUST or NBMI, upon the institution of
formal proceedings against LIFE COMPANY by the SEC, the
NASD, or any other regulatory body, the expected or
anticipated ruling, judgment or outcome of which would, in
TRUST's reasonable judgment, materially impair LIFE
COMPANY's ability to meet and perform its obligations and
duties hereunder. Prompt notice of election to terminate
shall be furnished by TRUST with said termination to be
effective upon receipt of notice;
(e) At the option of LIFE COMPANY in the event TRUST's shares
are not registered, issued or sold in accordance with
applicable state or federal law, or such law precludes the
use of such shares as the underlying investment medium of
Variable Contracts issued or to be issued by LIFE COMPANY.
Termination shall be effective upon such occurrence without
notice;
(f) At the option of TRUST or NBMI if the Variable Contracts
cease to qualify as annuity contracts or life insurance
contracts, as applicable, under the Code, or if TRUST
reasonably believes that the Variable Contracts may fail to
so qualify. Termination shall be effective upon receipt of
notice by LIFE COMPANY;
(g) At the option of LIFE COMPANY, upon TRUST's breach of any
material provision of this Agreement, which breach has not
been cured to the satisfaction of LIFE COMPANY within ten
days after written notice of such breach is delivered to
TRUST;
(h) At the option of TRUST or NBMI, upon LIFE COMPANY's breach
of any material provision of this Agreement, which breach
has not been cured to the satisfaction of TRUST or NBMI, as
appropriate, within thirty days after written notice of such
breach is delivered to LIFE COMPANY;
(i) At the option of TRUST or NBMI, if the Variable Contracts
are not registered, issued or sold in accordance with
applicable federal and/or state law. Termination shall be
effective immediately upon such occurrence without notice;
(j) In the event this Agreement is assigned without the prior
written consent of LIFE COMPANY, TRUST and NBMI, termination
shall be effective immediately upon such occurrence without
notice;
(k) At the option of LIFE COMPANY if a Portfolio fails to
satisfy the diversification requirements set forth in
Section 2.7 hereof and such failure is not cured within the
grace period afforded by Regulation 1.817-5, or if a
Portfolio fails to qualify as a "regulated investment
company" pursuant to the requirements set forth in Section
2.8. Termination shall be effective immediately upon notice;
(l) At the option of LIFE COMPANY if (i) LIFE COMPANY shall
determine, in its sole judgment reasonably exercised in good
faith, that NBMI or TRUST has suffered a material adverse
change in its business or financial condition or is the
subject of material adverse publicity and that material
adverse change or publicity will have a material adverse
impact on NBMI's or TRUST's ability to perform its
obligations under this Agreement, (ii) LIFE COMPANY notifies
NBMI or TRUST, as appropriate, of that determination and its
intent to terminate this Agreement, and (iii) after
considering the circumstances since the --- giving of such a
notice, the determination of LIFE COMPANY shall continue to
apply on the sixtieth (60th) day following the giving of
that notice, which sixtieth day shall be the effective date
of termination;
(m) At the option of TRUST or NBMI if
(i) TRUST or NBMI shall determine, in its sole judgment
reasonably exercised in good faith, that LIFE COMPANY
has suffered a material adverse change in its business
or financial condition or is the subject of material
adverse publicity and that material adverse change or
publicity will have a material adverse impact on LIFE
COMPANY's ability to perform its obligations under this
Agreement,
(ii) TRUST or NBMI, as appropriate, notifies LIFE COMPANY of
that determination and its intent to terminate this
Agreement, and
(iii) after considering the circumstances since the giving
of such a notice, the determination of TRUST or NBMI,
as appropriate, shall continue to apply on the sixtieth
(60th) day following the giving of that notice, which
sixtieth day shall be the effective date of
termination.
8.3 Notwithstanding any termination of this Agreement pursuant to
Section 8.2 hereof, TRUST will continue to make available additional TRUST
shares (limited to shares of the Portfolios designated in Appendix B), as
provided below, at the option of LIFE COMPANY for so long as LIFE COMPANY
desires pursuant to the terms and conditions of this Agreement, for all Variable
Contracts in effect on the effective date of termination of this Agreement
(hereinafter referred to as "Existing Contracts"). Specifically, without
limitation, if LIFE COMPANY so elects for TRUST to make additional TRUST shares
available, the owners of the Existing Contracts or LIFE COMPANY, whichever shall
have legal authority to do so, shall be permitted to reallocate investments in
TRUST, redeem investments in TRUST and/or invest in TRUST upon the payment of
additional premiums under the Existing Contracts. In the event of a termination
of this Agreement pursuant to Section 8.2 hereof, LIFE COMPANY, as promptly as
is practicable under the circumstances, shall notify TRUST and NBMI whether LIFE
COMPANY elects for TRUST to continue to make TRUST shares available after such
termination. If TRUST shares continue to be made available after such
termination, the provisions of this Agreement shall remain in effect. The
parties agree that this Section 8.3 shall not apply to any terminations of this
Agreement by the TRUST or NBMI pursuant to Sections 8.2(f),(h),(i), (j) or (m)
hereof.
8.4 Except as necessary to implement Variable Contract owner initiated
transactions, or as required by state insurance laws or regulations, LIFE
COMPANY shall not redeem the shares attributable to the Variable Contracts (as
opposed to the shares attributable to LIFE COMPANY's assets held in the Separate
Accounts), and LIFE COMPANY shall not prevent Variable Contract owners from
allocating payments to a Portfolio that was otherwise available under the
Variable Contracts, until thirty (30) days after the LIFE COMPANY shall have
notified TRUST of its intention to do so.
8.5 Notwithstanding any termination of this Agreement, each party's
obligations under Article VII to indemnify other parties shall survive and not
be affected by any termination of this Agreement. In addition, with respect to
existing Variable Contracts, all provisions of this Agreement shall also survive
and not be affected by any termination of this Agreement.
Article IX. NOTICES
-------
Any notice hereunder shall be given by registered or certified mail
return receipt requested to the other party at the address of such party set
forth below or at such other address as such party may from time to time specify
in writing to the other party.
If to TRUST or NBMI:
Xxxxxxxxx Xxxxxx Management Inc.
000 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000-0000
Attention: Xxxxx Xxxxxxxxx
If to LIFE COMPANY:
Great-West Life & Annuity Insurance Company
0000 Xxxx Xxxxxxx Xxxx
Xxxxxxxxx Xxxxxxx, XX 00000
Attention: Xxx Xxxxxxxxxxxx, Vice President
with a copy to the Legal Department, attention: Xxxxxxx Xxxxx
Notice shall be deemed given on the date of receipt by the addressee as
evidenced by the return receipt.
Article X. MISCELLANEOUS
10.1 The captions in this Agreement are included for convenience of
reference only and in no way define or delineate any of the provisions hereof or
otherwise affect their construction or effect.
10.2 This Agreement may be executed simultaneously in two or more
counterparts, each of which taken together shall constitute one and the same
instrument.
10.3 If any provision of this Agreement shall be held or made invalid by
a court decision, statute, rule or otherwise, the remainder of the Agreement
shall not be affected thereby.
10.4 This Agreement shall be construed and the provisions hereof
interpreted under and in accordance with the laws of the State of New York. It
shall also be subject to the provisions of the federal securities laws and the
rules and regulations thereunder and to any orders of the SEC granting exemptive
relief therefrom and the conditions of such orders.
10.5 The parties agree that the assets and liabilities of each Series
are separate and distinct from the assets and liabilities of each other Series.
No Series shall be liable or shall be charged for any debt, obligation or
liability of any other Series. No Trustee, officer or agent shall be personally
liable for such debt, obligation or liability of any Series or Portfolio and no
Portfolio or other investor, other than the Portfolio or other investors
investing in the Series which incurs a debt, obligation or liability, shall be
liable therefor.
10.6 Each party shall cooperate with each other party and all
appropriate governmental authorities (including without limitation the SEC, the
NASD and state insurance regulators) and shall permit such authorities
reasonable access to its books, records and operating procedures in connection
with any investigation or inquiry relating to this Agreement or the transactions
contemplated hereby.
10.7 The rights, remedies and obligations contained in this Agreement
are cumulative and are in addition to any and all rights, remedies and
obligations, at law or in equity, which the parties hereto are entitled to under
state and federal laws.
10.8 No provision of this Agreement may be amended or modified in any
manner except by a written agreement properly authorized and executed by TRUST,
NBMI and the LIFE COMPANY.
10.9 The parties hereto acknowledge that any nonpublic personal
information (as defined by applicable law or regulation promulgated under Title
V of the Xxxxx-Xxxxx-Xxxxxx Act of 1999 (the "Act") of Contract owners (and any
participants thereof, as applicable) will be disclosed or utilized solely to
carry out the terms of this Agreement or pursuant to an exception contained in
any applicable law or regulation promulgated under the Act. Further, TRUST and
NBMI agree to maintain and enforce procedures for the safeguarding and
protection of such nonpublic personal information at least as rigorous as those
required to be used by LIFE COMPANY under applicable law. Without limiting the
foregoing, no party hereto shall disclose any information that another party has
designated as proprietary.
10.10 Neither this Agreement nor any of the rights and obligations
hereunder may be assigned by any party without the prior written consent of all
parties hereto.
10.11 Neither party shall be liable for any delay or failure to perform
its obligations hereunder if such delay or failure is caused by an unforeseeable
event beyond the reasonable control of a party, including without limitation:
act of God; fire; flood; earthquake; labor strike; sabotage; fiber cut;
embargoes; power failure, e.g., rolling blackouts, electrical surges or current
fluctuations; lightning; supplier's failures; act or omissions of
telecommunications common carriers; material shortages or unavailability or
other delay in delivery not resulting from the responsible party's failure to
timely place orders therefore; lack of or delay in transportation; government
codes, ordinances, laws, rules, regulations or restrictions; war or civil
disorder, or act of terrorism.
IN WITNESS WHEREOF, the parties have caused their duly authorized
officers to
execute this Fund Participation Agreement as of the date and year first above
written.
XXXXXXXXX XXXXXX XXXXXXXXX XXXXXX GREAT-WEST LIFE & ANNUITY
ADVISERS MANAGEMENT TRUST MANAGEMENT INC. INSURANCE COMPANY
By: _____________________
Name: By: _________________ By: ________________
Title: Name: Name:
Title: Title: Vice President
FIRST GREAT-WEST LIFE &
ANNUITY INSURANCE COMPANY
By: ________________
Name:
Title: Vice President
Appendix A
The currently available Portfolios of the TRUST are:
AMT Xxxxxxxx Portfolio - S Class Shares AMT Focus Portfolio - S Class Shares AMT
Growth Portfolio AMT Guardian Portfolio - I Class Shares AMT Guardian Portfolio
- S Class Shares AMT International Portfolio AMT Mid-Cap Growth Portfolio - I
Class Shares AMT Mid-Cap Growth Portfolio - S Class Shares AMT Partners
Portfolio AMT Regency Portfolio AMT Socially Responsive Portfolio AMT Balanced
Portfolio AMT Limited Maturity Bond Portfolio
Appendix B
SEPARATE ACCOUNTS UTILIZING THE FUNDS
CONTRACTS FORM NUMBERS
Great-West Life & Annuity Insurance Company
Variable Annuity Contract Signature GROUP: J444MMF and J444SA
INDIVIDUAL: J444INDMMF and
J444INDSA
Variable Annuity Contract Select INDIVIDUAL: J434
First Great-West Life & Annuity Insurance Company
Variable Annuity Contract Select J464NY1
Appendix C
Report Pursuant to Section 2.9
With regard to the reports relating to the quarterly testing of compliance with
the requirements of Section 817(h) and Subchapter M under the Internal Revenue
Code of 1986, as amended (the "Code") and the regulations thereunder, TRUST
shall provide within twenty (20) Business Days of the close of the calendar
quarter a report to LIFE COMPANY on Form C attached hereto, regarding the status
under such sections of the Code of the Portfolios identified in Appendix B
(provided that no such reports need be supplied with respect to a Portfolio that
had not commenced investment operations during the relevant quarter), and if
necessary, identification of any remedial action to be taken to remedy
non-compliance.
With regard to the reports relating to the year-end testing of compliance with
the requirements of Subchapter M of the Code, referred to hereinafter as "RIC
status," TRUST will provide the reports on the following basis: (i) the last
quarter's quarterly reports can be supplied within the 20-day period, and (ii) a
year-end report will be provided 45 days after the end of the calendar year.
However, if a problem with regard to RIC status, as defined below, is identified
in the third quarter report, on a weekly basis, starting the first week of
December, additional interim reports will be provided specially addressing the
problems identified in the third quarter report. If any interim report
memorializes the cure of the problem, subsequent interim reports will not be
required.
A problem with regard to RIC status is defined as any violation of the following
standards, as referenced to the applicable sections of the Code:
(a) Less than ninety percent of gross income is derived from sources of
income specified in Section 851(b)(2);
(b) At least fifty percent of the value of total assets consists of
assets specified in Section 851(b)(3)(A); and
(c) No more than twenty-five percent of the value of total assets is
invested in the securities of one issuer, as that requirement is set
forth in Section 851(b)(3)(B).
FORM C
CERTIFICATE OF COMPLIANCE
For the quarter ended:
---------------------------
I, , a duly authorized officer, director or agent of Xxxxxxxxx Xxxxxx
Advisers Management Trust hereby swear and affirm that the Portfolio is in
compliance with all requirements of Section 817(h) and Subchapter M of the
Internal Revenue Code of 1986, as amended (the "Code") and the regulations
thereunder, as required in the Fund Participation Agreement among Great-West
Life & Annuity Insurance Company, Xxxxxxxxx Xxxxxx Advisers Management Trust and
Xxxxxxxxx Xxxxxx Management Inc. other than the exceptions discussed below:
Exceptions Remedial Action
------------------------------ --------------------------------------------
------------------------------ --------------------------------------------
------------------------------ --------------------------------------------
------------------------------ --------------------------------------------
------------------------------ --------------------------------------------
------------------------------ --------------------------------------------
------------------------------ --------------------------------------------
------------------------------ --------------------------------------------
------------------------------ --------------------------------------------
------------------------------ --------------------------------------------
------------------------------ --------------------------------------------
------------------------------ --------------------------------------------
------------------------------ --------------------------------------------
------------------------------ --------------------------------------------
If no exception to report, please indicate "None."
Signed this day of , .
---- ------- -------
(Signature)
By:
Name:
---------------------------------------
Title:
Appendix D
EXPENSE SCHEDULE
The TRUST and LIFE COMPANY will coordinate the functions and pay the costs of
completing these functions based upon an allocation of costs in the tables
below. Costs shall be allocated to reflect the TRUST 's share of the total costs
determined according to the number of pages of the TRUST 's respective portions
of the documents.
------------------------- ---------------------- ---------------------- ------------------
Item Function Party Responsible Party
for Coordination Responsible for
Expense
------------------------- ---------------------- ---------------------- ------------------
------------------------- ---------------------- ---------------------- ------------------
Trust Prospectus Printing of combined Life Company Trust or NBMI,
prospectuses as applicable
------------------------- ---------------------- ---------------------- ------------------
------------------------- ---------------------- ---------------------- ------------------
Trust shall supply Life Company Trust or NBMI,
Life Company with as applicable
such numbers of the
prospectuses of the
Portfolios
designated in
Appendix B as Life
Company shall
reasonably request
for distribution to
Inforce Clients
provided such
prospectuses are
included in the
Trust's currently
effective
registration
statement
------------------------- ---------------------- ---------------------- ------------------
------------------------- ---------------------- ---------------------- ------------------
Distribution to New Life Company Life Company
and Inforce Clients
------------------------- ---------------------- ---------------------- ------------------
------------------------- ---------------------- ---------------------- ------------------
Distribution to Life Company Life Company
Prospective Clients
------------------------- ---------------------- ---------------------- ------------------
------------------------- ---------------------- ---------------------- ------------------
Product Prospectus Printing for Inforce Life Company Life Company
Clients
------------------------- ---------------------- ---------------------- ------------------
------------------------- ---------------------- ---------------------- ------------------
Printing for Life Company Life Company
Prospective Clients
------------------------- ---------------------- ---------------------- ------------------
------------------------- ---------------------- ---------------------- ------------------
Distribution to New Life Company Life Company
and Inforce Clients
------------------------- ---------------------- ---------------------- ------------------
------------------------- ---------------------- ---------------------- ------------------
Distribution to Life Company Life Company
Prospective Clients
------------------------- ---------------------- ---------------------- ------------------
------------------------- ---------------------- ---------------------- ------------------
Item Function Party Responsible Party
for Coordination Responsible for
Expense
------------------------- ---------------------- ---------------------- ------------------
------------------------- ---------------------- ---------------------- ------------------
------------------------- ---------------------- ---------------------- ------------------
------------------------- ---------------------- ---------------------- ------------------
Trust Prospectus Update If Required by Trust Trust or NBMI, as Trust or NBMI,
& Distribution applicable as applicable
------------------------- ---------------------- ---------------------- ------------------
------------------------- ---------------------- ---------------------- ------------------
If Required by Life Life Company Life Company
Company
------------------------- ---------------------- ---------------------- ------------------
------------------------- ---------------------- ---------------------- ------------------
Product Prospectus If Required by Trust Life Company Trust or NBMI,
Update & Distribution as applicable
------------------------- ---------------------- ---------------------- ------------------
If Required by Life Life Company Life Company
Company
------------------------- ---------------------- ---------------------- ------------------
Trust SAI Printing Trust or NBMI, as Trust or NBMI,
applicable as applicable
------------------------- ---------------------- ---------------------- ------------------
Distribution Life Company Life Company
------------------------- ---------------------- ---------------------- ------------------
Product SAI Printing Life Company Life Company
------------------------- ---------------------- ---------------------- ------------------
Distribution Life Company Life Company
------------------------- ---------------------- ---------------------- ------------------
------------------------- ---------------------- ---------------------- ------------------
Proxy Material for Printing if proxy Trust or NBMI, as Trust or NBMI,
Trust: required by Law applicable as applicable
------------------------- ---------------------- ---------------------- ------------------
Distribution Life Company Trust or NBMI,
(including labor) if as applicable
proxy required by Law
------------------------- ---------------------- ---------------------- ------------------
Printing & Life Company Life Company
distribution if
required by Life
Company
------------------------- ---------------------- ---------------------- ------------------
Trust Annual & Printing of combined Life Company Trust or NBMI,
Semi-Annual Report reports as applicable
------------------------- ---------------------- ---------------------- ------------------
Distribution Life Company Life Company
------------------------- ---------------------- ---------------------- ------------------
Other communication to If Required by the Life Company Trust or NBMI,
New and Prospective Trust as applicable
clients
------------------------- ---------------------- ---------------------- ------------------
------------------------- ---------------------- ---------------------- ------------------
Item Function Party Responsible Party
for Coordination Responsible for
Expense
------------------------- ---------------------- ---------------------- ------------------
------------------------- ---------------------- ---------------------- ------------------
------------------------- ---------------------- ---------------------- ------------------
If Required by Life Life Company Life Company
Company
------------------------- ---------------------- ---------------------- ------------------
Other communication to Distribution Life Company Trust or NBMI,
Inforce (including labor and as applicable
printing) if required by the Trust
------------------------- ---------------------- ---------------------- ------------------
Distribution Life Company Life Company
(including labor and
printing)if required
by Life Company
------------------------- ---------------------- ---------------------- ------------------
Errors in Share Price Cost of error to Life Company Trust or NBMI,
calculation pursuant to participants as applicable
Section 1.5
------------------------- ---------------------- ---------------------- ------------------
Cost of Life Company Trust or NBMI,
administrative work as applicable
to correct error,
subject to the
limitations set
forth in Section 1.5
------------------------- ---------------------- ---------------------- ------------------
Operations of the Trust All operations and Trust Trust or NBMI,
related expenses, as applicable
including the cost
of registration and
qualification of
shares, taxes on the
issuance or transfer
of shares, cost of
management of the
business affairs of
the Trust, and
expenses paid or
assumed by the Trust
pursuant to any Rule
12b-1 plan
------------------------- ---------------------- ---------------------- ------------------
Operations of the Federal registration Life Company Life Company
Account of units of separate
account (24f-2 fees)
------------------------- ---------------------- ---------------------- ------------------
Appendix E
PRICING PROCEDURES--ERROR CORRECTIONS
When a Portfolio's net asset value per share ("NAV") is determined to be
incorrect, the following analysis must be done separately for each day the error
existed to determine whether such error is material.
1) Review the error to determine if such error represents the amount that
would be necessary to change the NAV per share by more than a full xxxxx
or not.
A) If no then no further action is necessary.
B) If yes then go on to step 2.
2) THE CAPITAL TEST: For each day the error per share exceeded a full
xxxxx, calculate the dollar amount of impact on that day's net capital
share activity. Accumulate such amount with amounts calculated for all
other days impacted by this error (this process nets out amounts which
increase and decrease capital). Situations causing a decrease to the
Portfolio's capital would be: (a) if the Portfolio had net redemptions
for the day and the errant NAV was too high or (b) if the Portfolio has
net sales when the errant NAV was to high.
3) THE SHAREHOLDER TEST: Test to see if the error per share on any day was
greater than 1/2 of 1% of that day's NAV (for example, for a Portfolio
with a $10.00 NAV this would equal 5 cents). If so, all shareholders
whose transactions were negatively impacted by more than $10.00 must be
adjusted by reprocessing or reimbursing such shareholders. If not, no
adjustments for the shareholder test will be required and no shareholder
transactions are adjusted.
4) The amounts accumulated in steps 2 and 3 (step 3 may be zero) need to be
combined to determine the cumulative effect of the error. The amounts
calculated in step 3 are all reductions to the Portfolio's capital while
step 2's results can net out to be a decrease or increase to the
Portfolio's capital. The final net impact to the Portfolio's capital
will be calculated as follows: (a) take any net decrease to capital in
step 2 and add the decrease in capital from step 3 to it. This amount
must be paid to the Portfolio; or (b) take any net increase to capital
in step 2 and decrease it by the amount in step 3. If the result is a
net increase to capital, then no reimbursement is required, but, if the
result is a net decrease to capital, then the Portfolio must be
reimbursed for this amount.
