RETAIL FUND PARTICIPATION AGREEMENT
THIS AGREEMENT, made and entered into this 2nd of September, 2014, by and
among HARTFORD LIFE INSURANCE COMPANY, a stock life insurance company organized
under the laws of Connecticut (hereinafter the "COMPANY") acting through its
Administrator and attorney-in-fact, Massachusetts Mutual Life Insurance Company
("MassMutual"), on its own behalf and on behalf of each separate account of the
Company set forth in SCHEDULE A hereto, as may be amended from time to time
(each such account hereinafter referred to as a "SEPARATE ACCOUNT"), Highland
Funds II, an open-end management investment company organized under the laws of
the Commonwealth of Massachusetts (hereinafter the "FUND"), and Highland Capital
Fund Distributors, Inc., a Delaware corporation (hereinafter the "UNDERWRITER").
WITNESSETH:
WHEREAS, beneficial interests in the Fund are divided into several series
of shares, each representing the interest in a particular managed portfolio of
securities and other assets (the "PORTFOLIOS"); and
WHEREAS, the Fund is registered as an open-end management investment
company under the Investment Company Act of 1940, as amended (hereinafter the
"1940 ACT") and its shares are registered under the Securities Act of 1933, as
amended (hereinafter the "1933 ACT"); and
WHEREAS, the Company issues certain group variable annuity contracts and
group funding agreements (the "CONTRACTS") in connection with retirement plans
intended to meet the qualification requirements of Sections 401, 403(b) or 457
of the Internal Revenue Code of 1986, as amended (the "CODE"); and
WHEREAS, each Separate Account is a duly organized, validly existing
segregated asset account, established by resolution of the Board of Directors
of the Company under the insurance laws of the State of Connecticut to set aside
and invest assets attributable to the Contracts; and
WHEREAS, Highland Capital Management Fund Advisors, L.P. (the "ADVISER")
is the investment adviser of the Portfolios of the Fund and is duly registered
as an investment adviser under the Investment Advisers Act of 1940, as amended
(the "ADVISERS ACT"), and any applicable state securities laws; and
WHEREAS, the Underwriter is the principal underwriter for the Fund and is
registered as a broker-dealer with the Securities and Exchange Commission
(hereinafter the "SEC") under the Securities Exchange Act of 1934, as amended
(hereinafter the "1934 ACT"), and is a member in good standing of the Financial
Industry Regulatory Authority, (hereinafter "FINRA"); and
WHEREAS, to the extent permitted by applicable insurance laws and
regulations, the Company intends to purchase shares in the Portfolios set forth
in SCHEDULE A on behalf of each corresponding Separate Account set forth on
such SCHEDULE A to fund the Contracts and the Underwriter is authorized to
sell such shares to unit investment trusts such as the Separate Accounts at net
asset value.
NOW, THEREFORE, in consideration of their mutual promises, the Company,
the Fund and the Underwriter agree as follows:
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ARTICLE I. Purchase and Redemption of Fund Shares.
1.1 The Fund and the Underwriter agree to sell to the Company those
shares of the Portfolios which the Company orders on behalf of any Separate
Account, executing such orders on a daily basis at the net asset value next
computed after receipt and acceptance by the Fund or its designee of such
order. For purposes of this Section, the Company shall be the designee of the
Fund for receipt of such orders from each Separate Account. Receipt by such
designee shall constitute receipt by the Fund; provided that the Fund or the
Underwriter receives notice of such order via the National Securities Clearing
Corporation (the "NSCC") by 10:00 a.m. Eastern Time on the next following
Business Day. The Fund will receive all orders to purchase Portfolio shares
using the NSCC's Defined Contribution Clearance & Settlement ("DCC&S")
platform. The Fund will also provide the Company with account positions and
activity data using the NSCC's Networking platform. The Company shall pay for
Portfolio shares by the scheduled close of federal funds transmissions on the
same Business Day it places an order to purchase Portfolio shares in accordance
with this section using the NSCC's Fund/SERV System. Payment shall be in
federal funds transmitted by wire from the Fund's designated Settling Bank to
the NSCC. "BUSINESS DAY" shall mean any day on which the New York Stock Exchange
is open for trading and on which the Portfolio calculates it net asset value
pursuant to the rules of the SEC. "NETWORKING" shall mean the NSCC's product
that allows Fund's and Companies to exchange account level information
electronically. "SETTLING BANK" shall mean the entity appointed by the Fund to
perform such settlement services on behalf of the Fund and agrees to abide by
the NSCC's Rules and Procedures insofar as they relate to the same day funds
settlement.
If the Company is somehow prohibited from submitting purchase and
settlement instructions to the Fund for Portfolio shares via the NSCC's DCC&S
platform the following shall apply to this Section:
The Fund and the Underwriter agree to sell the Company those shares of
the Portfolios which the Company orders on behalf of any Separate Account,
executing such orders on a daily basis at the net asset value next computed
after receipt and acceptance by the Fund or its designee of such order. For
purposes of this Section, the Company shall be the designee of the Fund for the
receipt of such orders from the Separate Account and receipt by such designee
shall constitute receipt by the Fund; provided that the Fund or the Underwriter
receives written notice (via email and/or facsimile) of such order by 10:00 a.m.
Eastern Time on the next following Business Day. The Company shall pay for
Portfolio shares by 5:00 p.m. Eastern Time on the same Business Day it places
an order to purchase Portfolio shares in accordance with this section. Payment
shall be in federal funds transmitted by wire to the Fund's designated
custodian. "BUSINESS DAY" shall mean any day on which the New York Stock
Exchange is open for trading and on which the Portfolio calculates it net asset
value pursuant to the rules of the SEC.
1.2 The Fund and the Underwriter agree to make shares of the Portfolios
available for purchase at the applicable net asset value per share by the
Company on Business Days; provided, however, that the Board of Trustees or
Directors, as applicable, of the Fund (hereinafter the "TRUSTEES/DIRECTORS")
may refuse to sell shares of any Portfolio to any person, or suspend or
terminate the offering of 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 Trustees/Directors, acting in good faith and in compliance
with their fiduciary duties under federal and any applicable state laws,
necessary in the best interests of the shareholders of any Portfolio.
1.3 The Fund and the Underwriter agree to redeem, upon the Company's
request, any full or fractional shares of the Fund held by the Company on behalf
of a Separate Account, executing such requests on a daily basis at the net
asset value next computed after receipt and acceptance by the Fund or
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its designee of the request for redemption. For purposes of this Section, the
Company shall be the designee of the Fund for receipt of requests for redemption
from each Separate Account and receipt by such designee shall constitute
receipt by the Fund; provided the Fund or the Underwriter receives notice of
such request for redemption via the NSCC by 10:00 a.m. Eastern Time on the next
following Business Day. The Fund will receive all orders to redeem Portfolio
shares using the NSCC's DCC&S platform. The Fund will also provide the Company
with account positions and activity data using the NSCC's Networking platform.
Payment for Fund shares redeemed shall be made in accordance with this section
using the NSCC's Fund/SERV System. Payment shall be in federal funds
transmitted by 5:00 p.m. Eastern Time by the NSCC to the Separate Account's
Settling Bank as designated by the Company, on the same Business Day the Fund or
the Underwriter receives notice of the redemption order from the Company
provided that the Fund or the Underwriter receives notice by 10:00 a.m. Eastern
Time on such Business Day.
If the Company is somehow prohibited from submitting redemption and
settlement instructions to the Fund for Portfolio shares via the NSCC's DCC&S
platform the following shall apply to this Section:
The Fund and the Underwriter agree to redeem or cash, upon the Company's
request, any full or fractional shares of the Fund held by the Company on behalf
of a Separate Account, executing such requests on a daily basis at the net asset
value next computed after receipt and acceptance by the Fund or its designee of
the request for redemption. For purposes of this Section, the Company shall be
the designee of the Fund for receipt of requests for redemption from each
Separate Account and receipt by such designee shall constitute receipt by the
Fund; provided the Fund or the Underwriter receives notice of such request for
redemption by 10:00 a.m. Eastern Time on the next following Business Day.
Payment shall be in federal funds transmitted by wire by 5:00 p.m. Eastern Time
to the Separate Account as designated by the Company, on the same Business Day
the Fund or the Underwriter receives notice of the redemption order from the
Company provided that the Fund or the Underwriter receives notice by 10:00 a.m.
Eastern Time on such Business Day.
The Fund or the Underwriter agrees to provide the Company or its designee,
by 2:00 p.m. Eastern Time on each Business Day, the total number of Portfolio
shares held by each Separate Account as of the close of the immediately
preceding Business Day.
1.4 The Company will place separate orders to purchase or redeem shares
of each Portfolio.
1.5 Issuance and transfer of the Fund's shares will be by book entry
only. Share certificates will not be issued to the Company or any Separate
Account.
1.6 The Underwriter shall furnish prior day and same day notice to the
Company of any income, dividends or capital gain distributions payable on the
Fund's shares. The Company hereby elects to receive all such dividends and
distributions as are payable on a Portfolio's shares in the form of additional
shares of that Portfolio. The Fund shall notify the Company of the number of
shares so issued as payment of such dividends and distributions no later than
one Business Day after issuance. The Company reserves the right to revoke this
election and to receive in cash all such dividends and distributions declared
after receipt of notice of revocation by the Fund.
1.7 The Underwriter shall make the (i) net asset value per share of each
Series and (ii) income accrual factors, dividend, and capital gains information
available to the Company on a daily basis as soon as reasonably practical after
the close of trading each Business Day, but in no event later than 6:30 p.m.
Eastern time on such Business Day.
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1.8(a) If the Underwriter or the Fund provides materially incorrect share
net asset value information through no fault of the Company, the Separate
Accounts shall be entitled to an adjustment with respect to the Series shares
purchased or redeemed to reflect the correct net asset value per share.
l.8(b) The determination of the materiality of any net asset value pricing
error and its correction shall be based on the Fund's existing policies and
procedures. Any material error in the calculation or reporting of net asset
value per share, dividend or capital gain information shall be reported promptly
to the Company upon discovery.
l.8(c) In the event that the [Fund Party] or its designee provides
incorrect share net asset value information to the Company and said error causes
a material monetary loss (as defined in the Fund's pricing error correction
policy) to any plan participant that has selected a Portfolio as an investment
option ("Contract owners"), then the [Fund Party] or its designee shall be
responsible for compensating the account(s) so that any plan participant who has
incurred such a loss shall be made whole in accordance with Fund's pricing error
correction policy. The [Fund Party] agrees to compensate the Company for the
reasonable costs of any reprocessing activity necessary to adjust Company's
recordkeeping systems as a result of a material pricing error caused by the Fund
or its designee. In the event that any Account experiences a monetary gain from
incorrect share net asset value information supplied by the Fund or its
designee, the Company shall adjust such account in accordance with Fund's
pricing error correction policy. In the event that any account experiences a
monetary gain in excess of $10,000, the [Fund Party] shall be responsible for
all reasonable and demonstrable expenses incurred by the Company in attempting
to recover overpayments.
ARTICLE II. Representations and Warranties
2.1. The Company represents and warrants that the Contracts are or will be
registered unless exempt and that it will make every effort to maintain such
registration under the 1933 Act to the extent required by the 1933 Act; that the
Contracts are intended to be issued and sold in compliance in all material
respects with all applicable federal and state laws. The Company further
represents and warrants that it is an insurance company duly organized and in
good standing under applicable law and that it has legally and validly
established each Separate Account prior to any issuance or sale of Contracts,
shares or other interests therein, as a segregated asset account under the
insurance laws of the State of Connecticut and has registered or, prior to any
issuance or sale of the Contracts, will register and will maintain the
registration of each Separate Account as a unit investment trust in accordance
with and to the extent required by the provisions of the 1940 Act, unless exempt
therefrom, to serve as a segregated investment account for the Contracts. Unless
exempt, the Company shall amend its registration statement for its Contracts
under the 1933 Act and the 1940 Act from time to time as required in order to
effect the continuous offering of its Contracts. The Company shall register and
qualify the Contracts for sale in accordance with securities laws of the various
states only if and to the extent deemed necessary by the Company.
2.2 The Fund and the Underwriter represent and warrant that (i) Fund shares
sold pursuant to this Agreement shall be registered under the 1933 Act and duly
authorized for issuance in accordance with applicable law and that the Fund is
and shall remain registered under the 1940 Act for as long as the Fund shares
are sold; (ii) the Fund shall amend the registration statement for its shares
under the 1933 Act and the 1940 Act from time to time as required in order to
effect the continuous offering of its shares; and
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(iii) the Fund 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 the
Fund or the Underwriter.
2.3 The Fund represents that each Portfolio (a) is currently qualified as
a Regulated Investment Company under Subchapter M of the Code; (b) will make
every effort to maintain such qualification (under Subchapter M or any successor
or similar provision); and (c) will notify the Company promptly upon having a
reasonable basis for believing that such Portfolio has ceased to so qualify or
might not so qualify in the future.
2.4 The Fund makes no representation as to whether any aspect of its
operations (including, but not limited to, fees and expenses and investment
policies) complies with the insurance laws or insurance regulations of the
various states.
2.5 The Underwriter represents and warrants that it is a member in good
standing of the FINRA and is registered as a broker-dealer with the SEC. The
Underwriter further represents that it will sell and distribute the Fund shares
in accordance in all material respects with all applicable federal and state
securities laws, including without limitation the 1933 Act, the 1934 Act, and
the 0000 Xxx.
2.6 The Fund represents that it is lawfully organized and validly
existing under the laws of the Commonwealth of Massachusetts and that it does
and will comply in all material respects with applicable provisions of the 0000
Xxx.
2.7 The Fund represents and warrants that all of its Trustees/Directors,
officers, employees, investment advisers, and other individuals/entities having
access to the funds and/or securities of the Fund are and continue to be at all
times covered by a blanket fidelity bond or similar coverage for the benefit of
the Fund in an amount not less than the minimal coverage as required by Rule
17g-1 under the 1940 Act or related provisions as may be promulgated from time
to time.
2.8 The Company represents and warrants that all of its directors,
officers, employees, investment advisers, and other individuals/entities dealing
with the money and/or securities of the Fund are covered by a blanket fidelity
bond or similar coverage in an amount not less than $5 million. The aforesaid
includes coverage for larceny and embezzlement and is issued by a reputable
bonding company.
2.9 The foregoing representations and warranties shall be made, by the
party hereto that makes the representation or warranty as of the date first
written above and at the time of each purchase and each sale of the Fund's
shares pursuant to this Agreement.
2.10 The Company represents that it has adopted written policies and
procedures reasonably designed to detect and deter frequent and/or disruptive
trading in Shares. The Company and the Fund agree to reasonably cooperate for
the purpose of discouraging frequent or disruptive trading in shares of the
Funds and agree to negotiate a "shareholder information agreement" under Rule
22c-2.
ARTICLE III. Prospectuses; Reports and Proxy Statements; Voting
3.1 The Fund or Underwriter shall provide the Company at no charge with
as many printed copies of the Fund's current prospectus and statement of
additional information as the Company may reasonably request. If requested by
the Company, in lieu of providing printed copies of the Fund's current
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prospectus and statement of additional information, the Fund or Underwriter
shall provide camera-ready film, computer diskettes, e-mail transmissions or PDF
files containing the Fund's prospectus and statement of additional information,
and such other assistance as is reasonably necessary in order for the Company
once each year (or more frequently if the prospectus and/or statement of
additional information for the Fund are amended during the year) to have the
prospectus for the Contracts (if applicable) and the Fund's prospectus printed
together in one document or separately. The Company may elect to print the
Fund's prospectus and/or its statement of additional information in combination
with other fund companies' prospectuses and statements of additional
information.
3.2(a) The Fund or Underwriter shall provide the Company at no charge with
copies of the Fund's proxy statements, Fund reports to shareholders, and other
Fund communications to shareholders in such quantity as the Company shall
reasonably require for distributing to Contract owners.
3.2(b) The Fund or Underwriter shall pay for the cost of typesetting,
printing and distributing all Fund prospectuses, statements of additional
information, Fund reports to shareholders and other Fund communications to
Contract owners and prospective Contract owners with Contract value allocated to
the Fund. The Fund shall pay for all costs for typesetting, printing and
distributing proxy materials.
3.3 The Fund's statement of additional information shall be obtainable
by Contract owners from the Fund, the Underwriter, the Company or such other
person as the Fund may designate.
3.4 If and to the extent required by law the Company shall distribute all
proxy material furnished by the Fund to Contract owners to whom voting
privileges are required to be extended and shall:
A. solicit voting instructions from Contract owners;
B. vote the Fund shares held in the Separate Account in accordance
with instructions received from Contract owners; and
C. so long as and to the extent that the SEC continues to interpret
the 1940 Act to require pass through voting privileges for
variable annuity contract owners, vote Fund shares held in the
Separate Account for which no timely instructions have been
received, in the same proportion as Fund shares of such
Portfolio for which instructions have been received from the
Company's Contract owners. The Company reserves the right to vote
Fund shares held in any segregated asset account for its own
account, to the extent permitted by law. Notwithstanding the
foregoing, with respect to the Fund shares held by unregistered
Separate Accounts that issue Contracts issued in connection with
employee benefit plans subject to the provisions of the
Employee Retirement Income Security Act of 1974, as amended, the
Company shall vote such Fund shares allocated to such Contracts
only in accordance with the Company's agreements with such
Contract owners.
ARTICLE IV. Sales Material and Information
4.1 The Company shall furnish, or shall cause to be furnished, to the
Fund, the Underwriter or their designee, each piece of sales literature or other
promotional material prepared by the Company or any person contracting with the
Company in which the Fund, the Adviser or the Underwriter is described,
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at least five calendar days prior to its use. No such literature or material
shall be used without prior approval from the Fund, the Underwriter or their
designee, however, the failure to object in writing within five (5) calendar
days will be deemed approval. Such approval process shall not apply to
subsequent usage of materials that are substantially similar to prior approved
materials.
4.2 Neither the Company nor any person contracting with the Company shall
give any information or make any representations or statements on behalf of the
Fund or concerning the Fund in connection with the sale of the Contracts other
than the information or representations contained in the registration statement
or prospectus for the Fund shares, as such registration statement and prospectus
may be amended or supplemented from time to time, or in reports to shareholders
or proxy statements for the Fund, or in sales literature or other promotional
material approved by the Fund or its designee, except with the permission of the
Fund or its designee.
4.3 The Fund shall furnish, or shall cause to be furnished, to the
Company or its designee, each piece of sales literature or other promotional
material in which the Company or any Separate Account is named, at least five
calendar days prior to its use. No such literature or material shall be used
without prior approval from the Company or its designee, however, the failure to
object in writing within five (5) calendar days will be deemed approval. Such
approval process shall not apply to subsequent usage of materials that are
substantially similar to prior approved materials.
4.4 Neither the Fund nor the Underwriter shall give any information or
make any representations on behalf of the Company or concerning the Company,
each Separate Account, or the Contracts other than the information or
representations contained in the Contracts, a disclosure document, registration
statement or prospectus for the Contracts (if applicable), as such registration
statement and prospectus may be amended or supplemented from time to time, or in
published reports for each Separate Account which are in the public domain or
approved by the Company for distribution to Contract owners or participants, or
in sales literature or other promotional material approved by the Company,
except with the permission of the Company.
4.5 The Fund will provide to the Company at least one complete copy of
all prospectuses, statements of additional information, reports to shareholders,
proxy statements, and all amendments to any of the above, that relate to the
Fund or its shares, promptly after the filing of such document with the SEC or
other regulatory authorities.
4.6 The Company will provide to the Fund at least one complete copy of
all prospectuses, statements of additional information, reports, solicitations
for voting instructions, and all amendments to any of the above, if applicable
to the investment in a Separate Account or Contract, promptly after the filing
of such document with the SEC or other regulatory authorities.
4.7 For purposes of this Article IV, the phrase "sales literature or
other promotional material" includes, but is not limited to, advertisements
(such as material published, or designed for use in, a newspaper, magazine, or
other periodical, radio, television, telephone or tape recording, videotape
display, signs or billboards, motion pictures, Internet, or other public media),
sales literature (i.e., any written communication distributed or made generally
available to customers or the public, including brochures, circulars, research
reports, market letters, form letters, electronic mail, seminar texts, reprints
or excerpts of any other advertisement, sales literature, or published article),
educational or training materials or other communications distributed or made
generally available to some or all agents or employees, registration statements,
disclosure documents, prospectuses, statements of additional information,
shareholder reports, and proxy materials.
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4.8 The Company agrees and acknowledges that the Company has no right,
title or interest in the names and marks of the Fund and that all use of any
designation comprised in whole or part or such names or marks under this
Agreement shall inure to the benefit of the Fund and the Underwriter. Except as
provided in Section 4.1, the Company shall not use any such names or marks on
its own behalf or on behalf of a Separate Account in connection with marketing
the Contracts without prior written consent of the Fund or the Underwriter. Upon
termination of this Agreement for any reason, the Company shall cease all use of
any such names or marks.
4.9 The Fund and Underwriter agree and acknowledge that each has no
right, title or interest in the names and marks of the Company, and that all use
of any designation comprised in whole or part or such names or marks under this
Agreement shall inure to the benefit of the Company. Except as provided in
Section 4.3, the Fund and Underwriter shall not use any such names or marks on
its own behalf or on behalf of a Fund in connection with marketing the Fund
without prior written consent of the Company. Upon termination of this Agreement
for any reason, the Fund and Underwriter shall cease all use of any such names
or marks.
ARTICLE V. Fees and Expenses
5.1 The Fund or the Underwriter, as applicable, shall pay the fees and
expenses provided for in the attached SCHEDULE B.
ARTICLE VI. Indemnification
6.1 Indemnification By The Company
(a) The Company agrees to indemnify and hold harmless the Fund, the
Underwriter and each of their respective trustees, directors, officers,
employees or agents and each person, if any, who controls the Fund or the
Underwriter within the meaning of section 15 of the 1933 Act (collectively, the
"INDEMNIFIED PARTIES" for purposes of this Section 6.1) against any and all
losses, claims, damages, liabilities (including amounts paid in settlement with
the written consent of the Company) or litigation (including reasonable legal
and other expenses), to which the Indemnified Parties may become subject under
any statute, regulation, at common law or otherwise, insofar as such losses,
claims, damages, liabilities or expenses (or actions in respect thereof) or
settlements are related to the sale or acquisition of the Fund's shares or the
Contracts and:
(i) arise out of or are bases upon any untrue statement or alleged
untrue statement of any material fact contained in the disclosure statement,
registration statement, prospectus or statement of information for the Contracts
or contained in the Contracts or sales literature or other promotional material
for the Contracts (or any amendment or supplement to any of the foregoing), or
arise out of or are based upon the omission or the alleged omission to state
therein a material fact required to be stated therein or necessary to make the
statements herein not misleading; provided that this agreement to indemnify
shall not apply as to an Indemnified Party if such statement or omission or such
alleged statement or omission was made in reliance upon and in conformity with
information furnished in writing by such Indemnified Party or the Fund to the
Company on behalf of the Fund for use in the registration statement, prospectus
or statement of additional information for the Contracts or in the
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Contracts or sales literature (or any amendment or supplement) or otherwise for
use in connection with the sale of the Contracts or Fund shares; or
(ii) arise out of or as a result of (a) statements or
representations by or on behalf of the Company (other than statements or
representations contained in the Fund registration statement, Fund prospectus or
sales literature or other promotional material of the Fund not supplied by the
Company or persons under its control, and other than statements or
representations authorized by the Fund, the Underwriter or the Adviser); or (b)
the willful misfeasance, bad faith, gross negligence or reckless disregard of
duty of the Company or its agents or representatives, with respect to the sale
or distribution of the Contracts or Fund shares; or
(iii) arise out of or as a result of any untrue statement or
alleged untrue statement of a material fact contained in the Fund registration
statement, Fund prospectus, statement of additional information or sales
literature or other promotional material of the Fund (or any amendment thereof
or supplement thereto) or the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading, if such a statement or omission was made in reliance
upon and in conformity with information furnished in writing to the Fund or the
Underwriter by the Company or persons under its control; or
(iv) arise as a result of any material failure by the Company to
provide the services and furnish the materials under the terms of this
Agreement; or
(v) arise out of or result from any material breach of any
representation and/or warranty made by the Company in this Agreement or arise
out of or result from any other material breach by the Company of this
Agreement; except to the extent provided in Sections 6.l(b) and 6.4 hereof.
(b) No party shall be entitled to indemnification to the extent that
such loss, claim, damage, liability or litigation is due to the willful
misfeasance, bad faith, gross negligence or reckless disregard of duty by the
party seeking indemnification.
(c) In accordance with Section 6.4 hereof, the Indemnified Parties
will promptly notify the Company of the commencement of any litigation or
proceedings against them in connection with the issuance or sale of the Fund
shares or the Contracts or the operation of the Fund.
6.2 Indemnification By the Underwriter
(a) The Underwriter agrees, with respect to each Portfolio that it
distributes, to indemnify and hold harmless the Company and each of its
directors, officers, employees or agents and each person, if any, who controls
the Company within the meaning of section 15 of the 1933 Act (collectively, the
"INDEMNIFIED PARTIES" for purposes of this Section 6.2) against any and all
losses, claims, damages, liabilities (including amounts paid in settlement with
the written consent of the Underwriter) or litigation (including reasonable
legal and other expenses) to which the Indemnified Parties may become subject
under any statute, regulation, at common law or otherwise, insofar as such
losses, claims, damages, liabilities or expenses (or actions in respect thereof)
or settlements are related to the sale or acquisition of the shares of the
Portfolios that it distributes or the Contracts and:
(i) arise out of or are based upon any untrue statement or alleged
untrue statement of any material fact contained in the registration statement,
prospectus or statement of
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additional information for the Fund or sales literature or other promotional
material of the Fund (or any amendment or supplement to any of the foregoing),
or arise out of or are based upon the omission or the alleged omission to state
therein a material fact required to be stated therein or necessary to make the
statements therein not misleading; provided that this 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 in writing by such Indemnified Party or the Company
to the Fund or the Underwriter on behalf of the Company for use in the
registration statement, prospectus or statement of additional information for
the Fund or in sales literature of the Fund (or any amendment or supplement
thereto) or otherwise for use in connection with the sale of the Contracts or
the Portfolio shares; or
(ii) arise out of or as a result of (a) statements or
representations (other than statements or representations contained in the
registration statement, prospectus or sales literature for the Contracts not
supplied by the Fund or the Underwriter or persons under their respective
control and other than statements or representations authorized by the Company);
or (b) the willful misfeasance, bad faith, gross negligence or reckless
disregard of duty of the Fund or the Underwriter or their agents or
representatives with respect to the sale or distribution of the Contracts or
Portfolio shares; or
(iii) 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 with respect to the Contracts (or any amendment thereof or supplement
thereto), or the omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statement or statements
therein not misleading, if such statement or omission was made in reliance upon
and in conformity with information furnished in writing to the Company by the
Fund or the Underwriter or persons under the control of the Fund or the
Underwriter, respectively; or
(iv) arise as a result of any material failure by the Fund or the
Underwriter to provide the services and furnish the materials under the terms of
this Agreement; or
(v) arise out of or result from any material breach of any
representation and/or warranty made by the Underwriter or the Fund in this
Agreement or arise out of or result from any other material breach of this
Agreement by the Underwriter or the Fund; except to the extent provided in
Sections 6.2(b) and 6.4 hereof.
(b) No party shall be entitled to indemnification to the extent that
such loss, claim, damage, liability or litigation is due to the willful
misfeasance, bad faith, gross negligence or reckless disregard of duty by the
party seeking indemnification.
(c) In accordance with Section 6.4 hereof, the Indemnified Parties
will promptly notify the Underwriter of the commencement of any litigation or
proceedings against them in connection with the issuance or sale of the Fund
shares or the Contracts or the operation of the Separate Accounts.
6.3 Indemnification by the Fund
(a) The Fund agrees to indemnify and hold harmless the Company and
each of its directors, officers, employees or agents and each person, if any,
who controls the Company within the meaning of section 15 of the 1933 Act
(collectively, the "INDEMNIFIED PARTIES" for purposes of this Section 6.3)
against any and all losses, claims, damages, liabilities (including amounts paid
in settlement
10
with the written consent of the Fund) or litigation (including reasonable legal
and other expenses) to which the Indemnified Parties may become subject under
any statute, regulation, at common law or otherwise, insofar as such losses,
claims, damages, liabilities or expenses (or actions in respect thereof) or
settlements are related to the sale or acquisition of the shares of the
Portfolios or the Contracts and:
(i) arise out of or are based upon any untrue statement or alleged
untrue statement of any material fact contained in the registration statement,
prospectus or statement of additional information for the Fund or sales
literature or other promotional material of the Fund (or any amendment or
supplement to any of the foregoing), or arise out of or are based upon the
omission or the alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading;
provided that this 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 in writing by
such Indemnified Party or the Company to the Fund or the Underwriter on behalf
of the Company for use in the registration statement, prospectus or statement
of additional information for the Fund or in sales literature of the Fund (or
any amendment or supplement thereto) or otherwise for use in connection with the
sale of the Contracts or the Portfolio shares; or
(ii) arise out of or as a result of (a) statements or
representations (other than statements or representations contained in the
registration statement, prospectus or sales literature for the Contracts not
supplied by the Fund or the Underwriter or persons under their respective
control and other than statements or representations authorized by the Company);
or (b) the willful misfeasance, bad faith, gross negligence or reckless
disregard of duty of the Fund or its agents or representatives with respect to
the sale or distribution of the Contracts or Portfolio shares; or
(iii) 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 with respect to the Contracts (or any amendment thereof or supplement
thereto), or the omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statement or statements
therein not misleading, if such statement or omission was made in reliance upon
and in conformity with information furnished in writing to the Company by the
Fund or persons under its control, respectively; or
(iv) arise as a result of any material failure by the Fund to
provide the services and furnish the materials under the terms of this
Agreement; or
(v) arise out of or result from any material breach of any
representation and/or warranty made by the Fund in this Agreement or arise out
of or result from any other material breach of this Agreement by the Fund;
except to the extent provided in Sections 6.3(b) and 6.4 hereof.
(b) No party shall be entitled to indemnification to the extent that
such loss, claim, damage, liability or litigation is due to the willful
misfeasance, bad faith, gross negligence or reckless disregard of duty by the
party seeking indemnification.
(c) In accordance with Section 6.4 hereof, the Indemnified Parties
will promptly notify the Fund of the commencement of any litigation or
proceedings against them in connection with the issuance or sale of the Fund
shares or the Contracts or the operation of the Separate Accounts.
11
(d) The parties acknowledge that the Fund's indemnification
obligations under this Section 6.3 are subject to applicable law.
6.4 Indemnification Procedure
(a) Any person obligated to provide indemnification under this
Article VI ("INDEMNIFYING PARTY" for the purpose of this Section 6.4) shall not
be liable under the indemnification provisions of this Article VI with respect
to any claim made against a party entitled to indemnification under this Article
VI ("INDEMNIFIED PARTY" for the purpose of this Section 6.4) unless such
Indemnified Party shall have notified the Indemnifying Party 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 party shall have received notice of such
service on any designated agent), but failure to notify the Indemnifying Party
of any such claim shall not relieve the Indemnifying Party from any liability
which it may have to the Indemnified Party against whom such action is brought
otherwise than on account of the indemnification provision of this Article VI.
In case any such action is brought against the Indemnified Party, the
Indemnifying Party will be entitled to participate, at its own expense, in the
defense thereof. The Indemnifying Party also shall be entitled to assume the
defense thereof, with counsel satisfactory to the party named in the action.
After notice from the Indemnifying Party to the Indemnified Party of the
Indemnifying Party's election to assume the defense thereof, the Indemnified
Party shall bear the fees and expenses of any additional counsel retained by the
Indemnified Party, and the Indemnifying Party 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, unless:
(i) the Indemnifying Party and the Indemnified Party shall have
mutually agreed to the retention of such counsel or
(ii) the named parties to any such proceeding (including any
impleaded parties) conclude that representation of both parties by the same
counsel would be inappropriate due to actual or potential differing interests
between them.
A successor by law of the parties to this Agreement shall be entitled to the
benefits of the indemnification contained in this Article VI. The
indemnification provisions contained in this Article VI shall survive any
termination of this Agreement.
ARTICLE VII. Applicable Law
7.1 This Agreement shall be construed and the provisions hereof
interpreted under and in accordance with the laws of the State of Connecticut.
7.2 This Agreement shall be subject to the provisions of the 1933, 1934
and 1940 Acts, and the rules and regulations and rulings thereunder, including
such exemptions from those statutes, rules and regulations as the SEC may grant
and the terms hereof shall be interpreted and construed in accordance therewith.
ARTICLE VIII. Term & Termination
12
8.1 Term. Except as otherwise provided below, the term of this Agreement
shall be for one(l) year from the date hereof, unless terminated earlier by
reason of a breach of contract or by law, or pursuant to this section 8. At the
end of the initial term of this Agreement, this Agreement shall be automatically
renewed for successive one year periods, unless any party notifies the other no
later than thirty days before any anniversary of its intent to terminate this
Agreement.
8.2 This Agreement shall terminate:
(a) at the option of any party upon sixty (60) days' advance written
notice to the other parties unless otherwise agreed in a separate written
agreement among the parties; or
(b) at the option of the Fund, the Underwriter or the Adviser upon
institution of formal proceedings against the Company by the FINRA, the SEC, the
insurance commission of any state or any other regulatory body regarding the
Company's duties under this Agreement or related to the sale of the Contracts,
the administration of the Contracts, the operation of the Separate Accounts, or
the purchase of the Fund shares, which in the judgment of the Fund, the
Underwriter or the Adviser are reasonably likely to have a material adverse
effect on the Company's ability to perform its obligations under this Agreement;
or
(c) at the option of the Company upon institution of formal
proceedings against the Fund, the Underwriter or the Adviser by the FINRA, the
SEC, or any state securities or insurance department or any other regulatory
body, related to the purchase or sale of the Fund shares or the operation of the
Fund which in the judgment of the Company are reasonably likely to have a
material adverse effect on the Underwriter's, the Fund's or the Adviser's
ability to perform its obligations under this Agreement; or
(d) at the option of the Company if a Portfolio delineated in
SCHEDULE A ceases to qualify as a Regulated Investment Company under Subchapter
M of the Code (a "RIC"), or under any successor or similar provision, and the
disqualification is not cured within the period permitted for such cure, or if
the Company reasonably believes that any such Portfolio may fail to so qualify
and be unable to cure such disqualification within the period permitted for such
cure; or
(e) at the option of any party to this Agreement, upon another
party's material breach of any provision of this Agreement; provided that the
party not in breach shall give the party in breach notice of the breach and the
party in breach does not cure such breach within 30 days of receipt of such
notice of breach; or
(f) at the option of the Company, if the Company determines in its
sole judgment exercised in good faith, that either the Fund, the Underwriter or
the Adviser has suffered a material adverse change in its business, operations
or financial condition since the date of this Agreement or is the subject of
material adverse publicity which is likely to have a material adverse impact
upon the business and operations of the Company; or
(g) at the option of the Fund or the Underwriter if the Fund or the
Underwriter respectively, shall determine in its sole judgment exercised in good
faith, that the Company has suffered a material adverse change in its business,
operations or financial condition since the date of this Agreement or is the
subject of material adverse publicity which is likely to have a material adverse
impact upon the business and operations of the Fund or Underwriter.
13
8.3 Notice Requirement
(a) In the event that any termination of this Agreement is based upon
the provisions of Sections 8.2(b), 8.2(c) or 8.2(d), prompt written notice of
the election to terminate this Agreement for cause shall be furnished by the
party terminating the Agreement to the non-terminating parties, with said
termination to be effective upon receipt of such notice by the non-terminating
parties; provided that for any termination of this Agreement based on the
provisions of Section 8.2(d), said termination shall be effective upon the
Portfolio's failure to qualify as a RIC and to cure such disqualification within
the period permitted for such cure.
(b) In the event that any termination of this Agreement is based upon
the provisions of Sections 8.2(f) or 8.2(g), prior written notice of the
election to terminate this Agreement for cause shall be furnished by the party
terminating this Agreement to the non-terminating parties. Such prior written
notice shall be given by the party terminating this Agreement to the
non-terminating parties at least 60 days before the effective date of
termination.
8.4 It is understood and agreed that the right to terminate this
Agreement pursuant to Section 8.2(a) may be exercised for any reason or for no
reason.
8.5 Effect of Termination
(a) Notwithstanding any termination of this Agreement pursuant to
Section 8.2(a) through 8.2(g) of this Agreement and subject to Section 1.2 of
this Agreement, the Company may require the Fund and the Underwriter to continue
to make available additional shares of the Fund for up to one (1) year after the
termination of this Agreement as the Company desires pursuant to the terms and
conditions of this Agreement as provided in paragraph (b) below, for all
Contracts in effect on the effective date of termination of this Agreement
(hereinafter referred to as "EXISTING CONTRACTS"), unless such further sale of
Fund shares is proscribed by law, regulation or an applicable regulatory body.
Specifically, without limitation, the owners of the Existing Contracts shall be
permitted to direct reallocation of investments in the Fund, redeem investments
in the Fund and/or invest in the Fund upon the making of additional purchase
payments under the Existing Contracts unless such further sale of Fund shares is
proscribed by law, regulation or an applicable regulatory body.
(b) Fund and/or Underwriter shall remain obligated to pay Company the
fee in effect as of the date of termination for so long as shares are held by
the Accounts and Company continues to provide services to the Accounts. Such fee
shall apply to shares purchased both prior to and subsequent to the date of
termination. This Agreement, or any provision thereof, shall survive the
termination to the extent necessary for each party to perform its obligations
with respect to shares for which a fee continues to be due subsequent to such
termination.
(c) In the event of the insolvency or liquidation of the Company,
fees shall continue to be payable directly to the Company or its liquidator,
receiver, conservator or statutory successor, without diminution and reasonable
provision for verification by the Company or its liquidator, receiver,
conservator or statutory successor.
ARTICLE IX. Notices
14
9.1 (a) Any notice shall be deemed duly given only if sent by hand or
overnight express delivery, evidenced by written receipt or by 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. All notices shall be deemed given the date
received or rejected by the addressee.
If to the Company:
Massachusetts Mutual Life Insurance Company
As Administrator for Hartford Life Insurance Company
000 Xxxxxx Xxxxxx Xxxx.
Xxxxxxx, Xxxxxxxxxxx 00000
Attention: RS Fund Operations, MIP M200-INVST
Telephone (000) 000-0000
Facsimile: (000) 000-0000
with a copy to:
Law Department, Retirement Services
Massachusetts Mutual Life Insurance Company
000 Xxxxxx Xxxxxx Xxxx.
Xxxxxxx, Xxxxxxxxxxx 00000
If to the Fund:
Highland Funds II
000 Xxxxxxxx Xxxxx
Xxxxx 000
Xxxxxx, Xxxxx 00000
Attention: Xxxxx Xxxxx
If to the Underwriter:
Highland Capital Fund Distributors, Inc.
000 Xxxxxxxx Xxxxx
Xxxxx 000
Xxxxxx, Xxxxx 00000
Attention: Xxxxx Xxxxx
ARTICLE X. Miscellaneous
10.1 Subject to law and regulatory authority, each party hereto shall
treat as confidential the names and addresses of the owners of the Contracts and
all other information reasonably identified as such in writing by any other
party hereto, and, except as contemplated by this Agreement, shall not disclose,
disseminate or utilize such confidential information without the express prior
written consent of the affected party until such time as it may come into the
public domain. In addition, the parties hereby
15
represent that they will use and disclose Personal Information (as defined
below) only to carry out the purposes for which it was disclosed to them and
will not use or disclose Personal information if prohibited by applicable law,
including, without limitation, statutes and regulations enacted pursuant to the
Xxxxx-Xxxxx-Xxxxxx Act (Public Law 106-102). "PERSONAL INFORMATION" means
financial and medical information that identifies an individual personally and
is not available to the public, including, but not limited to, credit history,
income, financial benefits, policy or claim information and medical records. If
either party outsources services to a third party, such third party will agree
in writing to maintain the security and confidentiality of any information
shared with them.
10.2 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.
10.3 This Agreement may be executed simultaneously in two or more
counterparts, each of which taken together shall constitute one and the same
instrument.
10.4 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.
10.5 This Agreement shall not be assigned by any party hereto without
the prior written consent of all the parties.
10.6 Each party hereto shall cooperate with each other party and all
appropriate governmental authorities (including without limitation the SEC, the
FINRA, and state insurance regulators) and shall permit each other and such
authorities (and the parties hereto) reasonable access to its books and records
in connection with any investigation or inquiry relating to this Agreement or
the transactions contemplated hereby.
10.7 Each party represents that (a) the execution and delivery of this
Agreement and the consummation of the transactions contemplated herein have
been duly authorized by all necessary corporate or trust action, as applicable,
by such party and when so executed and delivered this Agreement will be the
valid and binding obligation of such party enforceable in accordance with its
terms subject to bankruptcy, insolvency, reorganization, moratorium and similar
laws of general applicability relating to or affecting creditors' rights and to
general equity principles; (b) the party has obtained, and during the term of
this Agreement will maintain, all authorizations, licenses, qualifications or
registrations required to be maintained in connection with the performance of
its duties under this Agreement; and (c) the party will comply in all material
respects with all applicable laws, rules and regulations.
10.8 The parties to this Agreement may amend by written agreement the
Schedules to this Agreement from time to time to reflect changes in or relating
to the Contracts, the Separate Accounts or the Portfolios of the Fund.
16
IN WITNESS WHEREOF, each of the parties hereto has caused this Agreement to
be executed in its name and behalf by its duly authorized representative as of
the date first written above.
HARTFORD LIFE INSURANCE COMPANY Highland Funds II
By Massachusetts Mutual Life Insurance Company
Its Administrator
By: /s/ Xxxxx Xxxxxxxxx By: /s/ Xxxxx Xxxxx
------------------------------- --------------------------
Name: Xxxxx Xxxxxxxxx Name: Xxxxx Xxxxx
------------------------------- --------------------------
Title: Senior Vice President Title: Treasurer
------------------------------- --------------------------
Highland Capital Fund Distributors, Inc.
By: /s/ Xxxxx Xxxxx
-------------------------------
Name: Xxxxx Xxxxx
-------------------------------
Title: Treasurer
-------------------------------
17
SCHEDULE A
SEPARATE ACCOUNTS
Each Separate Account established by resolution of the Board of Directors of the
Company under the insurance laws of the State of Connecticut to set aside and
invest assets attributable to the Contracts.
PORTFOLIOS
All Class A Shares of Highland Premier Growth Equity Fund.
18
SCHEDULE B
The Company shall provide shareholder and administrative services to the
Contract Owners and their participants with respect to the shares of the
Portfolios, including, but not limited to, providing explanations to plan
participants of their investment options including one or more of the
Portfolios; providing recordkeeping and other administrative services to plan
participants; maintaining records of the contributions made by participants in
the plans to purchase shares of the Portfolios through the Contracts; providing
periodic statements to the plans and to participants in the plans of their
account balances allocated to the Portfolios held for the benefit of each
participant in the Plans; processing distributions from the plans, including
facilitating any necessary redemptions of shares of the Portfolios for
participants in the plans; answering inquiries regarding the Portfolios (but not
involving the rendering of investment advice); providing account designations
and addresses of the plans to the Fund; performance of sub-accounting;
assistance in the establishment and maintenance of shareholder accounts and
records; providing recordkeeping services related to purchase any redemption
transactions; providing periodic statements showing a participant's beneficial
interest in the accounts and the integration of such statements with those of
other transactions and balances in a participant's other accounts serviced by
Company; and providing such other information and services as the Fund
reasonably may request, to the extent Company is permitted, by applicable
statute, rule, or regulation to provide such information or services without
obtaining any additional consents, licenses, registrations or memberships from
any governmental, regulatory or self-regulatory body. The Company shall provide
such facilities and personnel (which may be all or any part of the facilities
currently used in the Company's business or all or any of Company's employees)
as are necessary or beneficial for providing information and services to the
plans maintaining accounts with the Fund and to assist in servicing the
sub-accounts of the participants in the plans
In consideration of the services provided by the Company, THE UNDERWRITER agrees
to pay the Company an amount equal to the following basis points per annum on
the average aggregate amount invested by the Company's Separate Account(s) in
each Portfolio under the Fund Participation Agreement, such amounts to be paid
via wire or ACH, to the instructions below within 30 days of the end of each
calendar quarter. The Fund or its designee shall calculate the compensation to
be paid to the Company for the fees below and send the Company a statement
showing the amount of the compensation to be allocated to each fee.
Wire or ACH instructions are subject to change without necessitating an
amendment and any such change will be communicated to the Fund by the Company.
19
Wire & ACH Instructions for Hartford Life 12b-1 and Service Fees:
Bank of America
Hartford, CT
Acct Name: Hartford Life Insurance Company
ABA 000000000
Acct# 50213808
ACH instructions are the same EXCEPT the ABA number is 000000000
Please ensure the Fund Company name, fee type and quarter incurred are included
on the wire or ACH
SERVICE
PORTFOLIO FEES 12b-1 FEES
------------------------------------------------------
All Class _A_ Shares 15 bps 25 bps
20
