FUND PARTICIPATION AND SERVICE AGREEMENT
First Symetra National Life Insurance Company of New York
("Insurance Company"), for itself and on behalf of one or more separate
accounts of the Insurance Company ("Separate Accounts"), American Funds
Distributors, Inc. ("AFD"), American Funds Service Company ("Transfer Agent"),
Capital Research and Management Company ("CRMC"), and the American Funds
Insurance Series (the "Series"), an open-end investment company for which AFD,
CRMC and Transfer Agent provide services and which is divided into funds
(hereinafter collectively called the "Funds" and, individually, a "Fund"),
for good and valuable consideration, hereby agree on this 29th day of January
2013, that Class 1 and 2 shares of the Funds ("Class 1 and 2 Shares") (the
"shares") shall be made available to serve as underlying investment media for
certain variable annuity and variable life insurance contracts (hereinafter
called "Contract(s)"; holders of such Contracts hereinafter called
"Contractholder(s)") to be offered by the Insurance Company subject to the
following provisions:
1. Authorization; Services.
a. As distributor of the Series, AFD agrees to make shares of
the Funds listed on the attached Exhibit A available to the
Insurance Company for itself and on behalf of the Separate
Accounts on the attached Exhibit B pursuant to the terms of
this Agreement. The Insurance Company will offer shares of
the Funds in connection with the sale of Contracts to
Contractholders. Fund shares to be made available to
Separate Accounts for the Contracts shall be sold by the
Series and purchased by the Insurance Company for a given
account in accordance with the provisions of this Agreement
and at the net asset value of the respective class of the
respective Fund (without the imposition of a sales load)
computed in accordance with the provisions of the then current
Prospectus of the Series. This Agreement is in all respects
subject to statements regarding the sale and repurchase or
redemption of shares made in the offering prospectuses of the
Funds, and to the applicable Rules of FINRA, which shall
control and override any provision to the contrary in this
Agreement.
b. Transfer Agent hereby appoints Insurance Company as limited
agent and designee with respect to shares of the Funds
purchased, held, and redeemed by the Separate Accounts solely
for purposes of the provisions of this Agreement, and
Insurance Company accepts such appointment, on the terms set
forth herein.
c. The Insurance Company, directly or through subcontractors
(including a designated affiliate), shall provide the certain
services described in this Agreement on behalf of AFD,
Transfer Agent and the Funds in connection with the sale and
servicing of the Contracts. The services to be provided by
the Insurance Company to its Separate Accounts include,
(i) mailing and otherwise making available to Contractholders,
shareholder communications including, without limitation,
prospectuses, proxy materials, shareholder reports, unaudited
semi-annual and audited annual financial statements, and
other notices; (ii) handling general questions regarding the
Funds from Contractholders including, without limitation,
advising as to performance, yield being earned, dividends
declared, and providing assistance with other questions
concerning the Funds; (iii) preparing and mailing periodic
account statements showing the total number of Separate
Account units owned by the Contractholder in that account,
the value of such units, and purchases, redemptions, dividends,
and distributions in the account during the period covered by
the statement; and (iv) preparing and mailing IRS Form 1099-R,
IRS Form W-2 and/or other IRS forms as required by applicable
Internal Revenue Service rules and regulations. Administrative
services to Contractholders shall be the responsibility of
the Insurance Company and shall not be the responsibility of
AFD, Transfer Agent or any of their affiliates.
d. Subject to Section 25 of this Agreement, Insurance Company
shall transmit to Transfer Agent or the Funds (or to any
agent designated by either of them) such information in the
possession of Insurance Company concerning the Contractholders
as shall reasonably be necessary for Transfer Agent to provide
services as transfer agent for the Funds and as any Fund shall
reasonably conclude is necessary to enable that Fund to comply
with applicable state Blue Sky laws or regulations.
2. The Insurance Company will be entitled to a Rule 12b-1
distribution fee paid by the Series, to be accrued daily and
paid monthly at an annual rate of 0.25% of the average daily
net assets of the Class 2 shares of each Fund attributable to
the Contracts for as long as the Series' Plan of Distribution
pursuant to Rule 12b-1 under the 1940 Act remains in effect.
3. Compliance with Laws; Reliance on Instructions.
a. AFD, Transfer Agent, and CRMC acknowledge and agree that
Insurance Company is not responsible for: (i) any information
contained in any prospectus, registration statement, annual
report, proxy statement, or item of advertising or marketing
material prepared by AFD and/or CRMC, which relates to any
Fund; (ii) registration or qualification of any shares of any
Fund under any federal or state laws; or (iii) compliance by
AFD, CRMC and the Funds with all applicable federal and state
laws, rules and regulations, the rules and regulations of any
self-regulatory organization with jurisdiction (the foregoing
laws, rules and regulations are collectively referred to
herein as "Applicable Law") over AFD, CRMC or Funds, and the
provisions of the Funds' prospectus and statement of
additional information.
b. Insurance Company acknowledges and agrees that it is
responsible for (i) any representations concerning the Funds
made by Insurance Company or its agents that are not included
in the prospectuses, statements of additional information or
advertising or marketing material relating to the Funds and
prepared or approved in writing by AFD; (ii) satisfying
prospectus delivery requirements, to the extent required by
law; and (iii) in connection with the services performed in
connection with this Agreement, the compliance or failure to
comply with any Applicable Law with jurisdiction over
Insurance Company.
c. Insurance Company and its affiliates shall make no
representations concerning the Funds' shares except those
contained in the then current Prospectus of the Series, in
such printed information subsequently issued on behalf of the
Series or other funds managed by CRMC as supplemental to the
Series' Prospectus, in information published on the Series' or
CRMC's internet site, or in materials approved by AFD, as
provided in the Business Agreement in effect among Insurance
Company, Symetra Securities, Inc., AFD and CRMC dated even
date herewith (the "Business Agreement").
c. Each party is entitled to rely on any written records or
instructions provided to it by responsible persons of the
other party(ies).
d. AFD, Transfer Agent, and CRMC and its affiliates shall make
no representations concerning the Insurance Company's
Contracts except those contained in the then current
Prospectus of the Contracts, AFD, Transfer Agent, and CRMC
are not authorized to distribute or offer to sale the
Contracts under this Agreement.
4. Insurance Company Representations and Warranties.
a. The Insurance Company represents and warrants that:
(i) it has the corporate power and the authority to enter
into and perform all of its duties and obligations under this
Agreement;
(ii) this Agreement constitutes its legal, valid and
binding obligation, enforceable against each above-named
party in accordance with its terms;
(iii) no consent or authorization of, filing with, or other
act by or in respect of any governmental authority is required
in connection with the execution, delivery, performance,
validity or enforceability of this Agreement;
(iv) it will or has established the Separate Accounts as
separate accounts under New York Insurance law;
(v) it has registered the Separate Accounts as unit
investment trusts under the Investment Company Act of 1940,
as amended (the "1940 Act"), to serve as investment vehicles
for certain Contracts or, alternatively, has not registered
one or more of the Separate Accounts in proper reliance upon
an exclusion from registration under the 1940 Act;
(vi) the Contracts are or will be and at the time of
issuance will be treated as annuity contracts and life
insurance policies, as applicable, under applicable provisions
of the Internal Revenue Code of 1986, as amended, and the
regulations thereunder (the "Code"), that Insurance Company
will maintain such treatment and that it will notify the
Series immediately upon having a reasonable basis for
believing that the Contracts have ceased to be so treated or
that they might not be so treated in the future;
(vii) the offer of the Contracts has been registered with
the U.S. Securities and Exchange Commission (the "SEC") under
the Securities Act of 1933, as amended (the "1933 Act"), or
it is properly exempt from registration under the 1933 Act,
and each such registration statement and any further
amendments or supplements thereto will, when they become
effective, conform in all material respects to the
requirements of the 1933 Act, and the rules and regulations
of the SEC thereunder, and will not contain any untrue
statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the
statements therein not misleading; provided, however, that
this representation and warranty shall not apply to any
statement or omission made in reliance upon and in conformity
with the information furnished in writing to Insurance
Company by AFD, Transfer Agent, CRMC or the Series expressly
for use therein;
(viii) the Contracts provide for the allocation of net
amounts received by the Insurance Company to the Separate
Accounts, for investment in the shares of specified
investment companies selected among those companies available
through the Separate Accounts to act as underlying investment
media;
(ix) (a) its affiliate, Symetra Securities, Inc.
("Distributor"), is a properly registered or licensed broker
or dealer under applicable federal laws and regulations and
is complying with and will continue to comply with all
applicable federal laws, rules and regulations,
(b) Distributor is a member of FINRA, and (c) Distributor's
membership with FINRA is not currently suspended or
terminated. Insurance Company agrees to notify AFD
immediately in writing if any of the foregoing representations
ceases to be true to a material extent.
(x) any information furnished in writing by Insurance
Company for use in the registration statement or annual report
of the Series will not contain any untrue statement of a
material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein not
misleading, nor result in the Series' registration
statement's failing to materially conform in all respects to
the requirements of the 1933 Act and 1940 Act and the rules
and regulations thereunder;
(xi) investment by each Separate Account in a Fund is in
reliance on and consistent with the terms of the Series'
Mixed and Shared Funding Order; and
(xii) the Separate Accounts invest in the Funds in reliance
on the status of each Separate Account as a "Permitted
Investor" within the meaning of Section 817(h)(4)(A) of the
Internal Revenue Code of 1986, as amended.
5. Representations and Warranties of AFD, Transfer Agent, CRMC and the
Series.
a. AFD and Transfer Agent each represents and warrants
(as applicable) that:
(i) this Agreement constitutes its legal, valid and
binding obligation, and is enforceable against it in
accordance with its terms;
(ii) no consent or authorization of, filing with, or other
act by or in respect of any governmental authority is
required in connection with the execution, delivery,
performance, validity or enforceability of this Agreement;
(iii) the execution, performance and delivery of this
Agreement by it will not result in its violating any
Applicable Law or breaching or otherwise impairing any of its
contractual obligations;
(iv) AFD represents that the Funds are registered as
investment companies under the 1940 Act and Fund shares sold
by the Funds are, and will be, registered under the
Securities Act of 1933, as amended;
(v) AFD represents that it is registered as a broker-
dealer under the Securities Exchange Act of 1934, as amended,
and may properly cause Fund shares to be made available for
the purposes of this Agreement;
(vi) Shares of the Series may be offered to separate
accounts of various insurance companies in addition to
Insurance Company. AFD represents, warrants and covenants
that no shares of the Series shall be sold to the general
public in contravention of Section 817 of the Internal Revenue
Code of 1986, as amended, and the regulations thereunder
(the "Code").
(vii) it has the corporate power and the authority to enter
into and perform all of its duties and obligations under this
Agreement;
(viii) AFD and its affiliates are solely responsible for
information contained in any prospectus, registration
statement, annual report, proxy statement, or item of
advertising or marketing material prepared by AFD relating
to any Fund; and
(ix) AFD represents that prospectuses, other materials
concerning the Funds are complete and accurate in all
material respects and do not contain any material omission
or misstatement of a material fact necessary to make the
information not misleading or untrue.
b. CRMC and the Series each represents and warrants that:
(i) the Series is, and shall be at all times while this
Agreement is in force, lawfully organized, validly existing,
and properly qualified as an open-end management investment
company in accordance with the laws of the Commonwealth of
Massachusetts;
(ii) a registration statement under the 1933 Act and under
the 1940 Act with respect to the Series has been filed with
the SEC in the form previously delivered to Insurance Company
and the Series' registration statement and any further
amendments thereto will, when they become effective, and all
definitive prospectuses and statements of additional
information and any further supplements thereto (the
"Prospectus") shall, conform in all material respects to the
requirements of the 1933 Act and the 1940 Act and the rules
and regulations of the SEC thereunder, and will not contain
any untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to
make the statement therein not misleading; provided, however,
that this representation and warranty shall not apply to any
statements or omissions made in reliance upon and in
conformity with information furnished in writing to CRMC or
the Series by Insurance Company expressly for use therein.
(iii) Each Fund will comply with the diversification
requirements of Section 817 and shall maintain its
qualification as a "regulated investment company" ("RIC")
under the Code.
(iv) The Series makes no representation or warranty as to
whether any aspect of its operations (including but not
limited to fees expenses and investment policies) complies or
will comply with the insurance laws or regulations of the
various states.
(v) CRMC, which serves as investment adviser to the
Series and each Fund, is duly registered as an investment
adviser under the Investment Advisers Act of 1940, amended.
6. Omnibus Accounts. The Funds recognize that the Insurance Company,
for itself or on behalf of the Separate Accounts, will be the sole
shareholder of shares of the Funds issued pursuant to the Contracts,
and that the Insurance Company intends to establish one or more
omnibus accounts per Fund. Such arrangement will result in aggregated
share orders. In the event that the aggregate Contractholder accounts
maintained by the Insurance Company do not balance with the omnibus
accounts maintained by the Transfer Agent, neither the Transfer Agent,
any of its affiliates nor the Funds shall be liable to the
Contractholders for any shortfall, provided that such shortfall is
not a result of an error or omission on the part of the Transfer
Agent, its affiliates or the Funds.
7. Pricing Information. The Series or the Transfer Agent will compute
the closing net asset value, and any distribution information
(including the applicable ex-date, record date, payable date,
distribution rate per share, income accrual and capital gains
information) for each Fund as of the close of regular trading on the
New York Stock Exchange (normally 4:00 p.m. Eastern Time) on each
day the New York Stock Exchange is open for business (a "Business
Day") or at such other time as the net asset value of a Fund is
calculated, as disclosed in the relevant Funds' current prospectuses.
The Series or the Transfer Agent will use their best efforts to
communicate to the Insurance Company such information by 6:30 p.m.
Eastern Time on each Business Day. Such information shall be
accurate and true in all respects and updated continuously.
8. Pricing Adjustments.
a. In the event an adjustment is made to the computation of the
net asset value of Fund shares as reported to Insurance
Company under paragraph 7, (1) the correction will be handled
in a manner consistent with SEC guidelines and the Investment
Company Act of 1940, as amended and (2) the Funds or Transfer
Agent shall notify Insurance Company as soon as practicable
after discovering the need for any such adjustment.
Notification may be made in the following manner:
Method of Communication
(i) Fund/SERV Transactions. The parties agree that they
will ordinarily choose to use the National Securities Clearing
Corporation's Mutual Fund Settlement, Entry and Registration
Verification ("Fund/SERV") system, and if Fund/SERV is used,
any corrections to the fund prices for the prior trade date
will be submitted through the Mutual Fund Profile with the
correct fund prices and applicable date.
(ii) Manual Transactions. If there are technical problems
with Fund/SERV, or if the parties are not able to transmit or
receive information through Fund/SERV, any corrections to the
fund prices should be communicated by facsimile or by
electronic transmission acceptable to Transfer Agent, and
will include for each day on which an adjustment has occurred
the incorrect Fund price, the correct price, and, to the
extent communicated to the applicable Fund's shareholders,
the reason for the adjustment. Funds and Transfer Agent
agree that the Insurance Company may send this notification
or a derivation thereof (so long as such derivation is
approved in advance by Funds or AFD, as applicable) to
Contractholders whose accounts are affected by the adjustment.
b. To the extent a price adjustment results in a deficiency or
excess to a Contractholder's account, Insurance Company and
Transfer Agent agree to evaluate the situation together on a
case-by-case basis with the goal towards pursuing an
appropriate course of action. To the extent the price
adjustment was due to Transfer Agent's error, Transfer Agent
shall reimburse Contractholder's account and those expenses
directly related to the preparation, printing and mailing of
Contractholder communications and statements arising from
such error. Any other administrative costs incurred for
correcting Contractholder accounts will be at Insurance
Company's expense.
9. Purchases and Redemption Orders; Settlement of Transactions
a. Manual Transactions. Manual transactions via facsimile shall
be used by Insurance Company only in the event that Insurance
Company is in receipt of orders for purchase or redemption of
shares and is unable to transmit the orders to the Transfer
Agent due to unforeseen circumstances such as system wide
computer failures experienced by Insurance Company or the
National Securities Clearing Corporation ("NSCC") or other
events beyond the Insurance Company's reasonable control.
In the event manual transactions are used, the following
provisions shall apply:
(i) Next Day Transmission of Orders. The Insurance
Company, or its designated agent, will notify the Transfer
Agent by 8:00 a.m. Eastern Time, on the next Business Day the
aggregate amounts of purchase orders and redemption orders,
that were placed by Contractholders in each Separate Account
by 4:00 p.m. Eastern time on the prior Business Day (the
"Trade Date"). Insurance Company represents that orders it
receives after 4:00 p.m. Eastern time on any given Business
Day will be transmitted to the Transfer Agent using the
following Business Day's net asset value. Transfer Agent may
process orders it receives after the 8:00 a.m. deadline using
the net asset value next determined.
(ii) Purchases. All orders received by Insurance Company
by 4:00 p.m. on a Business Day and communicated to the
Transfer Agent by the 8:00 a.m. deadline shall be treated by
the Transfer Agent as if received as of the close of trading
on the Trade Date and the Transfer Agent will therefore
execute orders at the net asset values determined as of the
close of trading on the Trade Date. Insurance Company will
initiate payment by wire transfer to a custodial account
designated by the Funds for the aggregate purchase amounts
prior to 4:00 p.m. Eastern time on the next Business Day
following Trade Date.
(iii) Redemptions. Aggregate orders for redemption of
shares of the Funds will be paid in cash and wired from the
Funds' custodial account to an account designated by the
Insurance Company. Transfer Agent will initiate payment by
wire to Insurance Company or its designee proceeds of such
redemptions two Business Days following the Trade Date (T+2).
b. Fund/SERV Transactions. The parties will ordinarily use the
Fund/SERV system, and if used, the following provisions shall
apply:
(i) Without limiting the generality of the following
provisions of this section, the Insurance Company and
Transfer Agent each will perform any and all duties,
functions, procedures and responsibilities assigned to it
and as otherwise established by the NSCC applicable to
Fund/SERV and the Networking Matrix Level utilized.
(ii) Any information transmitted through Networking by any
party to the other and pursuant to this Agreement will be
accurate, complete, and in the format prescribed by the NSCC.
Each party will adopt, implement and maintain procedures
reasonably designed to ensure the accuracy of all
transmissions through Networking and to limit the access to,
and the inputting of data into, Networking to persons
specifically authorized by such party.
(iii) Same Day Trades. On each Business Day, the Insurance
Company shall aggregate and calculate the purchase orders and
redemption orders for each Separate Account received by the
Insurance Company prior to 4:00 p.m. Eastern time. The
Insurance Company shall communicate to Transfer Agent for
that Trade Date, by Fund/SERV, the aggregate purchase orders
and redemption orders (if any) for each Separate Account
received by 4:00 p.m. Eastern time on such Trade Date by no
later than the NSCC's Defined Contribution Clearance &
Settlement ("DCC&S") Cycle 8 (generally, 6:30 a.m. Eastern
time) on the following Business Day. Transfer Agent shall
treat all trades communicated to Transfer Agent in accordance
with the foregoing as if received prior to 4:00 p.m. Eastern
time on the Trade Date. All orders received by the Insurance
Company after 4:00 p.m. Eastern time on a Business Day shall
not be transmitted to NSCC prior to the conclusion of the
DCC&S Cycle 8 on the following Business Day, and Insurance
Company represents that orders it receives after 4:00 p.m.
Eastern time on any given Business Day will be transmitted to
the Transfer Agent using the following Business Day's net
asset value. Transfer Agent may process orders it receives
after the DCC&S Cycle 8 deadline using the net asset value
next determined.
(iv) When transmitting instructions for the purchase
and/or redemption of shares of the Funds, Insurance Company
shall submit one order for all contractholder purchase
transactions and one order for all contractholder redemption
transactions, unless otherwise agreed to by the Insurance
Company and the Transfer Agent.
c. Contingencies. All orders are subject to acceptance by
Transfer Agent and become effective only upon confirmation by
Transfer Agent. Upon confirmation, the Transfer Agent will
verify total purchases and redemptions and the closing share
position for each fund/account. In the case of delayed
settlement, Transfer Agent and Insurance Company shall make
arrangements for the settlement of redemptions by wire no
later than the time permitted for settlement of redemption
orders by the Investment Company Act of 1940. Such wires for
Insurance Company should be sent to:
Bank: UMB Bank N.A.
FFC: Variable Annuity
ABA#: 000000000
Account #: 9872007794
NSCC#: 3618
Such wires for Transfer Agent should be sent to:
Xxxxx Fargo Bank
000 Xxxxxxxx Xxxx. 00xx Xxxxx
Xxx Xxxxxxx, XX 00000
ABA#: 000000000
AFS Account#: 4100-060532
For Credit to AFS acct. no. (account number and fund)
FBO First Symetra National Life Insurance Company
of New York
d. Processing Errors. Processing errors which result from any
delay or error caused by Insurance Company may be adjusted
through the NSCC System by Insurance Company by the necessary
transactions on a current basis.
e. Coding. If applicable, orders for the purchase of Fund
shares shall include the appropriate coding to enable Transfer
Agent to properly calculate commission payments to any broker-
dealer firm assigned to the Separate Account.
f. Reconciliation. Insurance Company shall reconcile share
positions with respect to each Fund for each Separate Account
as reflected on its records to those reflected on statements
from Transfer Agent and shall, on request, certify that each
Separate Account's share positions with respect to each Fund
reported by Transfer Agent reconcile with Insurance Company's
share positions for that Separate Account. Insurance Company
shall promptly inform Transfer Agent of any record
differences and shall identify and resolve all non-reconciling
items within five business days.
g. Verification. Within a reasonable period of time after
receipt of a confirmation relating to an instruction,
Insurance Company shall verify its accuracy in terms of such
instruction and shall notify Transfer Agent of any errors
appearing on such confirmation.
h. Order Processing. Any order by Insurance Company, or its
designated agent, for the purchase of shares of the
respective Funds through AFD shall be accepted at the time
when it is received by AFD/Transfer Agent (or any
clearinghouse agency that AFD/Transfer Agent may designate
from time to time), and at the offering and sale price
determined in accordance with this Agreement, unless rejected
by AFD, Transfer Agent or the respective Funds. In addition
to the right to reject any order, the Funds have reserved the
right to withhold shares from sale temporarily or permanently.
To the extent reasonably practical, AFD/Transfer Agent agree
to give Insurance Company advanced written notice if such
right is exercised. AFD/Transfer Agent will not accept any
order from Insurance Company that is placed on a conditional
basis or subject to any delay or contingency prior to
execution. The procedure relating to the handling of orders
shall be subject to instructions that the parties agree to
from time to time. The shares purchased will be issued by
the respective Funds only against receipt of the purchase
price, in collected New York or Los Angeles Clearing House
funds. If payment for the shares purchased is not received
within three days after the date of confirmation, the sale
may be cancelled by AFD or by the respective Funds without
any responsibility or liability on the part of AFD or the
Funds, and AFD and/or the respective Funds may hold the
Insurance Company responsible for any loss, expense,
liability or damage, including loss of profit suffered by
AFD and/or the respective Funds, resulting from Insurance
Company's delay or failure to make payment as aforesaid. If
payment for the shares redeemed is not received within three
days after the date of confirmation, Insurance Company may
hold AFD and/or the respective Funds responsible for any
loss, expense, liability or damage, including loss of profit
suffered by Insurance Company, resulting from AFD and/or the
respective Funds delay or failure to make payment as
aforesaid.
i. Dividends and Distributions. The Transfer Agent shall
furnish notice promptly to the Insurance Company of any
dividend or distribution payable on any Funds held by the
Separate Accounts. The Insurance Company hereby elects to
receive all such dividends and distributions as are payable
on shares of a Fund recorded in the title for the
corresponding Separate Account in additional shares of that
Fund. The Series shall notify the Insurance Company of the
number of shares so issued. All such dividends and
distributions shall be automatically reinvested at the
ex-dividend date net asset value. The Insurance Company
reserves the right to revoke this election and to receive all
such income dividends and capital gain distributions in cash.
j. Right to Suspend. The Series reserves the right to
temporarily suspend sales if the Board of Trustees of the
Series, acting in good faith and in light of its fiduciary
duties under federal and any applicable state laws, deems it
appropriate and in the best interests of shareholders or in
response to the order of an appropriate regulatory authority.
Insurance Company shall abide by requirements of the Funds'
frequent trading policy as described in the Series'
prospectus and statement of additional information.
k. Book Entry. Transfer of the Series' shares will be by book
entry only. No stock certificates will be issued to the
Separate Accounts. Shares ordered from a particular Fund
will be recorded by the Series as instructed by Insurance
Company in an appropriate title for the corresponding Separate
Account.
l. Limitations on Redemptions. The Insurance Company shall not
redeem Fund shares attributable to the Contracts (as opposed
to Fund shares attributable to the Insurance Company's assets
held in the Account) except (i) as necessary to implement
Contractholder-initiated transactions, or (ii) as required or
permitted by state and/or federal laws or regulations, SEC or
other regulatory order, or judicial or other legal precedent
of general application (a "Legally Required Redemption").
Upon request, the Insurance Company will promptly furnish to
the Series and AFD an opinion of counsel for the Insurance
Company (which counsel shall be reasonably satisfactory to
the Series and AFD) to the effect that any redemption
pursuant to clause (ii) above is a Legally Required
Redemption.
10. Account Activity. Upon request, the Transfer Agent shall send to the
Insurance Company, (i) confirmations of activity in each Separate
Account within five (5) Business Days after each Trade Date on which
a purchase or redemption of shares of a Fund is effected for a
Separate Account; (ii) statements detailing activity in each Separate
Account no less frequently than quarterly; and (iii) such other
information as may reasonably be requested by Insurance Company and
agreed upon by Transfer Agent.
11. Expenses. All expenses incident to each party's performance of this
Agreement shall be paid by the respective party.
The Funds shall pay the cost of registration of their shares with the
SEC, preparation of the Fund's prospectuses, proxy materials and
reports, or the preparation of other related statements and notices
required by Applicable Law. The Funds shall pay the cost of
qualifying Fund shares in states where required.
12. Proxy and Other Communication Materials. The Funds shall distribute
to the Insurance Company their proxy material and periodic Fund
reports to shareholders. AFD, Transfer Agent or the Funds shall
provide the Insurance Company with a reasonable quantity of the
Funds' prospectuses and sales literature upon request to be used for
the Separate Accounts in connection with the transactions
contemplated by this Agreement. AFD, Transfer Agent or the Funds
shall provide to Insurance Company, or its authorized representative,
at no expense to Insurance Company, the following Contractholder
communication materials prepared for circulation to Contractholders
in quantities reasonably requested by Insurance Company which are
sufficient to allow mailing thereof by Insurance Company, to the
extent required by Applicable Law, to all Contractholders in the
Separate Accounts: proxy or information statements, annual reports,
semi-annual reports, and all updated prospectuses, supplements and
amendments thereof. AFD, Transfer Agent or the Funds shall provide
Insurance Company with other documents and materials as Insurance
Company may reasonably request from time to time.
AFD will provide Insurance Company on a timely basis with investment
performance information for each Fund, including (a) the top ten
portfolio holdings on a quarterly basis; and (b) on a monthly basis,
average annual total return for the prior one-year, three year,
five-year, ten-year and life of the Fund. AFD will endeavor to
provide the information in clause (a) to Insurance Company within
twenty business days after the end of each quarter, and will endeavor
to provide the information in clause (b) to Insurance Company within
five business days after the end of each month.
13. [Reserved]
14. Proxy Materials/Voting. The Insurance Company will distribute all
proxy material furnished by the Funds to the extent required by
Applicable Law. For so long as the SEC interprets the 1940 Act to
require pass-through voting by insurance companies whose separate
accounts are registered as investment companies under the 1940 Act
("Registered Separate Accounts"), the Insurance Company shall vote
shares of the Funds held in Registered Separate Accounts at
shareholder meetings of the Funds in accordance with instructions
timely received by the Insurance Company (or its designated agent)
from owners of Contracts funded by such Registered Separate Accounts
having a voting interest in the Funds. The Insurance Company shall
vote shares of the Funds held in Registered Separate Accounts that
are attributable to the Contracts as to which no timely instructions
are received, as well as shares held in such Registered Separate
Account that are not attributable to the Contracts and owned
beneficially by the Insurance Company (resulting from charges against
the Contracts or otherwise), in the same proportion as the votes cast
by owners of the Contracts funded by the Registered Separate Account
having a voting interest in the Funds from whom instructions have
been timely received. The Insurance Company shall vote shares of the
Funds held in its general account or in any Separate Account that is
not registered under the 1940 Act, if any, in its discretion.
15. Future Registration of Separate Account(s). If Insurance Company
registers a Separate Account as a unit investment trust under the
1940 Act, Insurance Company will provide to each Fund, as appropriate,
at least one complete copy of all registration statements,
prospectuses, statements of additional information, reports,
solicitations for voting instructions, sales literature and other
promotional materials, applications for exemptions, requests for no
action letters, and all amendments to any of the above, that relate
to the Contracts or any Separate Account contemporaneously with the
filing of such document with the SEC, FINRA or other regulatory
authority.
16. Independent Contractor Status. The Insurance Company shall, for all
purposes herein, be deemed to be an independent contractor and shall
have, unless otherwise expressly provided or authorized, no authority
to act for or represent AFD or the Funds in any way or otherwise be
deemed an agent of AFD or the Funds.
17. Termination. Subject to Section 30 of this Agreement, at the
terminating party's election, and the other party's concurrence,
termination of this Agreement may be limited solely as to new
Contracts. This Agreement shall terminate:
a. at the option of the Insurance Company, AFD, Transfer Agent,
CRMC or the Series upon 90 days advance written notice to the
other parties;
b. at any time by giving 30 days written notice to the other
party in the event of a material breach of this Agreement by
the other party that is not cured during such 30-day period;
c. at the option of the Insurance Company, AFD or the Series,
upon institution of formal proceedings relating to (i) the
marketing of the Contracts, (ii) the Separate Accounts,
(iii) the Insurance Company, (iv) AFD or (v) the Funds by
FINRA, the SEC or any other regulatory body;
d. at the option of Insurance Company immediately upon written
notice, if the Series or CRMC fails to meet the requirements
for either diversification under Section 817 or RIC status
under the Code;
e. at the option of any party upon termination of CRMC's
investment advisory agreement with the Series. Notice of
such termination shall be promptly furnished. This paragraph
(e) shall not be deemed to apply if, contemporaneously with
such termination, a new contract of substantially similar
terms is entered into between CRMC and the Series;
f. except for Insurance Company's delegation of its duties to a
subcontractor or to an affiliate, upon assignment of this
Agreement, at the option of any party not making the
assignment, unless made with the written consent of the other
parties;
g. in the event interests in the Separate Accounts, the
Contracts, or Fund shares are not registered, issued or sold
in conformity with Applicable Law or such Applicable Law
precludes the use of Fund shares as an underlying investment
medium of Contracts issued or to be issued by the Insurance
Company. Prompt notice shall be given by the terminating
party to the other parties in the event the conditions of
this provision occur;
h. for Registered Separate Accounts, they may terminate upon a
decision by the Insurance Company, in accordance with
regulations of the SEC for Registered Separate Accounts, to
substitute Fund shares with the shares of another investment
company for Contracts for which the Fund shares have been
selected to serve as the underlying investment medium for
Registered Separate Accounts, in which case the following
provisions shall apply:
(i) The Insurance Company will give 60 days written
notice to the applicable Fund and AFD upon the occurrence of
the earlier of the following actions taken for the purpose of
substituting shares of the Fund: (1) an application made to
the SEC, (2) a proposed Contractholder vote, or (3) the
Insurance Company's determination to substitute Fund shares
with the shares of another investment company; and
(ii) The Funds or AFD will in no way recommend action in
connection with, or oppose or interfere with any application
made to the SEC by the Insurance Company with regard to the
substitution of Fund shares with shares of another investment
company or seek in any manner to oppose or interfere with
a proposed Contractholder vote; or
i. upon such shorter notice as is required by law, order or
instruction by a court of competent jurisdiction or a
regulatory body or self-regulatory organization with
jurisdiction over the terminating party.
Upon termination and at the request of the requesting party, the
other party shall deliver to the requesting party, any records which
the requesting party may be required by law or regulations to have
access to or to maintain.
18. Notices. All notices under this Agreement, unless otherwise
specified in the Agreement shall be given in writing and delivered
via overnight delivery (postage prepaid, return receipt requested),
facsimile transmission or registered or certified mail, as follows:
If to the Insurance Company:
First Symetra National Life Insurance Company of New York
000 000xx Xxxxxx XX, Xxxxx 0000
Xxxxxxxx, XX 00000
Attn: Law Department SC-11
If to AFD, Transfer Agent, CRMC or to the Series:
Xxxxxxx X. Xxxxxxxxxx
Capital Research and Management Company
000 Xxxxx Xxxx Xxxxxx
00xx Xxxxx
Xxx Xxxxxxx, XX 00000
with a copy to:
Xxxx X. Xxxxx
American Funds Distributors, Inc.
000 Xxxxx Xxxx Xxxxxx
00xx Xxxxx
Xxx Xxxxxxx, XX 00000
And:
American Funds Service Company
Attn: HOST - Contract Administration
0000 Xxxxxxx Xxxx.
Xxx Xxxxxxx, XX 00000-0000
phone: 800/000-0000, ext. 8
facsimile: 210/474-4088
or to such other address or person as may be specified in a written
notice given to the other parties. The date of service of any notice
shall be the date it is received by the recipient.
19. Books and Records. Each party hereto shall cooperate with the other
parties and all appropriate governmental authorities and shall permit
authorities reasonable access to its books and records upon proper
notice in connection with any investigation or inquiry relating to
this Agreement or the transactions contemplated hereby. Each party
shall maintain and preserve all records in its possession as required
by law to be maintained and preserved in connection with the
provision of the services contemplated hereunder. Upon the request
of a party, the other party shall provide copies of all records as
may be necessary to (a) monitor and review the performance of either
party's activities, (b) assist either party in resolving disputes,
reconciling records or responding to auditor's inquiries, (c) comply
with any request of a governmental body or self-regulatory
organization, (d) verify compliance by a party with the terms of this
Agreement, (e) make required regulatory reports, or (f) perform
general customer service. The parties agree to cooperate in good
faith in providing records to one another under this provision.
20. Indemnification.
a. Insurance Company shall indemnify and hold harmless AFD,
Transfer Agent, CRMC, the Series, each of the Funds, and each
of their affiliates, directors, officers, employees and
agents and each person who controls them within the meaning
of the 1933 Act, from and against any and all losses, claims,
damages, liabilities and expenses, including reasonable
attorneys' fees ("Losses"), they may incur, insofar as such
Losses arise out of or are based upon (i) Insurance Company's
negligence or willful misconduct in the performance of its
duties and obligations under this Agreement, (ii) Insurance
Company's violation of any Applicable Law in connection with
the performance of its duties and obligations under this
Agreement, and (iii) any breach by Insurance Company of any
provision of this Agreement, including any representation,
warranty or covenant made in the Agreement. Insurance
Company shall also reimburse AFD, Transfer Agent, CRMC, the
Series, the Funds and their respective affiliates for any
legal or other expenses reasonably incurred by any of them in
connection with investigating or defending against such
Losses. This indemnity provision is in addition to any other
liability which Insurance Company may otherwise have to AFD,
the Transfer Agent, CRMC, the Series, the Funds or their
respective affiliates.
b. AFD, Transfer Agent or CRMC, as applicable, shall indemnify
and hold harmless, Insurance Company, and each of its
affliliates, directors, officers, employees and agents and
each person who controls them within the meaning of the 1933
Act, from and against any and all Losses they may incur,
insofar as such Losses arise out of or are based upon
(i) AFD's, Transfer Agent's or CRMC's negligence or willful
misconduct in the performance of its duties and obligations
under this Agreement, (ii) AFD's, Transfer Agent's or CRMC's
violation of Applicable Law in connection with the performance
of its duties and obligations under this Agreement, and
(iii) any breach by AFD, Transfer Agent or CRMC of any
provision of this Agreement, including any representation,
warranty or covenant made in the Agreement by AFD, Transfer
Agent or the Series. AFD, Transfer Agent or CRMC, as
applicable, shall also reimburse Insurance Company for any
legal or other expenses reasonably incurred in connection
with investigating or defending against such Losses. This
indemnity provision is in addition to any other liability
which AFD, Transfer Agent or CRMC may otherwise have to
Insurance Company.
c. Promptly after receipt by a party entitled to indemnification
under this paragraph 20 (an "Indemnified Party") of notice of
the commencement of an investigation, action, claim or
proceeding, such Indemnified Party will, if a claim in
respect thereof is to be made against the indemnifying party
under this paragraph 20, notify the indemnifying party of the
commencement thereof. The indemnifying party will be
entitled to assume the defense thereof, with counsel
satisfactory to the Indemnified Party. After notice from the
indemnifying party of its intention to assume the defense of
an action and the appointment of satisfactory counsel,
Indemnified Party shall bear the expenses of any additional
counsel obtained by it, and the indemnifying party shall not
be liable to such Indemnified Party under this paragraph for
any legal expenses subsequently incurred by such Indemnified
Party in connection with the defense thereof other than
reasonable costs of investigation. The indemnifying party
shall not, without the prior written consent of the
Indemnified Party, settle or compromise the liability of the
Indemnified Party; provided, however, that in the event that
the Indemnified Party fails to provide its written consent,
the indemnifying party shall thereafter be liable to provide
indemnification only to the extent of the amount for which
the action could otherwise have been settled or compromised.
21. Governing Law. This Agreement shall be governed by and interpreted
in accordance with the laws of the State of New York exclusive of
conflicts of laws.
22. Subchapter M. CRMC will endeavor to have each Fund comply with
Subchapter M of the Internal Revenue Code of 1986, as amended, and
the regulations thereunder and shall qualify as a regulated
investment company thereunder.
23. Entire Agreement/Amendments. This Agreement (together with the
Business Agreement) contains the entire understanding and agreement
among the parties with respect to the subject matter of this
Agreement and supersedes any and all prior agreements, understandings,
documents, projections, financial data, statements, representations
and warranties, oral or written, express or implied, between the
parties hereto and their respective affiliates, representatives and
agents in respect of the subject matter hereof. This agreement may
not be amended except by written agreement of the parties. If there
should be any conflict between the terms of this Agreement and those
of the Business Agreement, the terms of this Agreement shall govern.
24. Assignability. This Agreement shall extend to and be binding upon
the Insurance Company, the Series, AFD, CRMC and the Transfer Agent
and their respective successors and assigns. Nothing expressed or
mentioned in this Agreement is intended or shall be construed to give
any person or corporation, other than the parties hereto and their
respective successors and permitted assigns, any legal or equitable
right, remedy or claim in respect of this Agreement or any provision
herein contained. Neither this Agreement nor any rights, privileges,
duties or obligations of the parties hereto may be assigned by any
party without the prior written consent of the other parties or as
expressly contemplated by this Agreement; provided, however, that a
merger of, reinsurance arrangement by, or change of control of a
party shall not be deemed to be an assignment for purposes of this
Agreement.
25. Proprietary Information. AFD and the Funds agree that the names,
addresses, and other information relating to the Contractholders or
prospects for the sale of the Contracts developed by Insurance
Company are the exclusive property of the Insurance Company and may
not be used by AFD, Transfer Agent, CRMC or the Funds without the
written consent of the Insurance Company except for carrying out the
terms of this Agreement or as otherwise provided for in this
Agreement and any amendments thereto. Each party to this Agreement
agrees to maintain the confidentiality of all information (including
personal financial information of the customers of either party)
received from the other party pursuant to this Agreement. Each party
agrees not to use any such information for any purpose, or disclose
any such information to any person, except as permitted or required
by applicable laws, rules and regulations, including applicable state
privacy laws and the Xxxxx-Xxxxx-Xxxxxx Act and any regulations
promulgated thereunder. This provision, to the extent permissible
by applicable law, shall not be construed to limit the parties'
obligation to comply with paragraph 19, above.
AFD, the Transfer Agent, CRMC and the Series hereby consent to the
Insurance Company's use of the names of the Series, the Funds, AFD,
the Transfer Agent and CRMC in connection with marketing the Funds
and Contracts, subject to the terms of this Agreement and the Business
Agreement. Insurance Company acknowledges and agrees that AFD, CRMC
and/or their affiliates own all right, title and interest in and to
the names American Funds, American Funds Distributors, American Funds
Insurance Series, American Funds Service Company and Capital Research
and Management Company and covenants not, at any time, to challenge
the rights of AFD, CRMC and/or its affiliates to such name or design,
or the validity or distinctiveness thereof. AFD, the Transfer Agent,
CRMC and the Series hereby consent to the use of any trademark, trade
name, service xxxx or logo used by AFD, the Transfer Agent, CRMC and
the Series, subject to AFD, the Transfer Agent, CRMC or the Series
approval of such use and in accordance with reasonable requirements
of that party. Such consent will terminate with the termination of
this Agreement. The Insurance Company agrees and acknowledges that
all use of any designation comprised in whole or in part of the name,
trademark, trade name, service xxxx and logo under this Agreement
shall inure to the benefit of AFD, the Transfer Agent, CRMC and/or
the Series.
AFD, the Transfer Agent, CRMC and the Series acknowledge and agree
that there is no grant of authority under this Agreement to use
Insurance Company's name or other intellectual property for marketing
or promotional purposes without Insurance Company's written consent.
26. Severability. 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.
27. No Waiver. No waiver of any provision of this Agreement will be
binding unless in writing and executed by the party granting such
waiver. Any valid waiver of a provision set forth herein shall not
constitute a waiver of any other provision of this Agreement. In
addition, any such waiver shall constitute a present waiver of such
provision and shall not constitute a permanent future waiver of such
provision.
28. No Joint Venture, Etc. Neither the execution nor performance of this
Agreement shall be deemed to create a partnership or joint venture by
and among Insurance Company, Transfer Agent, AFD, CRMC and the Funds.
29. Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same Agreement. Neither
this Agreement nor any amendment shall become effective until all
counterparts have been fully executed and delivered.
30. Survival. The provisions of paragraphs 4, 5, 20 and 25 survive
termination of this Agreement. If this Agreement terminates, the
Series, at Insurance Company's option, will continue to make
additional shares of the Funds available for all existing Contracts
as of the effective date of termination (under the same terms and
conditions as were in effect prior to termination of this Agreement
with respect to existing Contractholders), unless the applicable Fund
liquidates or applicable laws prohibit further sales.
31. Non-exclusivity. Each of the parties acknowledges and agrees that
this Agreement and the arrangements described herein are intended to
be non-exclusive and that each of the parties is free to enter into
similar agreements and arrangements with other entities.
32. Insurance. Each of the parties to this Agreement shall maintain
insurance coverage that is reasonable and customary in light of all
its responsibilities hereunder. Such coverage shall insure for
losses resulting from the criminal acts or errors and omissions of
each party's employees and agents.
33. Oversight of Insurance Company. Insurance Company will permit
Transfer Agent or its representative to have reasonable access to
Insurance Company's personnel and records pertaining to this Agreement
in order to facilitate the monitoring of the quality of the services
performed by Insurance Company under this Agreement.
34. Independent Audit. In the event Transfer Agent determines in good
faith, based on a review of complaints received by Transfer Agent
related to the services provided by Insurance Company pursuant to
this Agreement, that Insurance Company is not processing
Contractholder transactions accurately such that a material
deficiency may exist in Insurance Company's internal controls,
Transfer Agent reserves the right to require that Insurance Company's
data processing activities as they relate to this Agreement be
subject to an audit, upon reasonable advanced written notice, by an
independent accounting firm to ensure the existence of, and adherence
to, proper operational controls. Insurance Company shall make
available upon Transfer Agent's request a copy of any report by such
accounting firm as it relates to said audit. Insurance Company shall
immediately notify Transfer Agent in the event of a material breach
of operational controls.
35. Arbitration. In the event of a dispute between the parties with
respect to this Agreement, and in the event the parties are unable to
resolve the dispute between them, such dispute shall be settled by
arbitration; one arbitrator to be named by each party to the
disagreement and a third arbitrator to be selected by the two
arbitrators named by the parties. The decision of a majority of the
arbitrators shall be final and binding on all parties to the
arbitration. The expenses of such arbitration shall be paid by the
non-prevailing party.
36. No Recourse. The obligations of the Series under this Agreement are
not binding upon any of the Trustees, officers, employees or
shareholders (except CRMC if it is a shareholder) of the Series
individually, but bind only the Series' assets. When seeking
satisfaction for any liability of the Series in respect of this
Agreement, Insurance Company and the Account agree not to seek
recourse against said Trustees, officers, employees or shareholders,
or any of them, or any of their personal assets for such satisfaction.
37. Conflicts. The parties to this Agreement recognize that due to
differences in tax treatment or other considerations, the interests
of various Contractholders participating in one or more Funds might,
at some time, be in conflict. Each party shall report to the other
party any potential or existing conflict of which it becomes aware.
The Board of Trustees of the Series shall promptly notify Insurance
Company of the existence of irreconcilable material conflict and its
implications. If such a conflict exists, Insurance Company will, at
its own expense, take whatever action it deems necessary to remedy
such conflict; in any case, Contractholders will not be required to
bear such expenses.
38. Mixed and Shared Funding. The Series hereby notifies Insurance
Company that it may be appropriate to include in the Prospectus
pursuant to which a Contract is offered disclosure regarding the
risks of mixed and shared funding.
39. Shareholder Information Agreement. The Insurance Company has
executed or will execute an agreement with Transfer Agent pursuant to
Rule 22c-2 under the Investment Company Act of 1940, under which the
Insurance Company is required, upon request, to provide the Funds
with certain account information and to prohibit transactions that
violate the policies established by the Funds for the purpose of
eliminating or reducing any dilution of the value of the outstanding
shares issued by the Funds.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed as of the date first above written.
FIRST SYMETRA NATIONAL LIFE INSURANCE
COMPANY OF NEW YORK
for itself and on behalf of the
Separate Accounts
By: __________________________________
Name: Xxxxxx X. Xxxxxxxx
Title: Executive Vice President
AMERICAN FUNDS DISTRIBUTORS, INC.
By: __________________________________
Name: Xxxxxxx X. XxXxxx
Title: Secretary
AMERICAN FUNDS INSURANCE SERIES
By: __________________________________
Name: Xxxxxx X. Xxxxxxxx
Title: Secretary
AMERICAN FUNDS SERVICE COMPANY
By: __________________________________
Name: Xxxxxx X. Xxxxxxxx
Title: Secretary
CAPITAL RESEARCH AND MANAGEMENT COMPANY
By: ___________________________________
Name: Xxxxxx X. Xxxxxxx
Title: Senior Vice President
EXHIBIT A
American Funds Insurance Series Funds
Class 1 and 2
---------------
American Funds Insurance Series Growth-Income Fund
American Funds Insurance Series Growth Fund
American Funds Insurance Series International Fund
American Funds Insurance Series New World Fund
American Funds Insurance Series Global Growth & Income Fund
EXHIBIT B
Insurance Company Accounts
First Symetra Separate Account S
