EXHIBIT 1.8(d)(ii)
AMENDED PARTICIPATING CONTRACT AND POLICY AGREEMENT
Xxxxxxx Investor Services, Inc.
Two International Place
Boston, Massachusetts 02110
PARTICIPATING CONTRACT AND POLICY AGREEMENT
Ladies and Gentlemen:
We (sometimes hereinafter referred to as "Investor Services") are the
Principal Underwriter of shares of Xxxxxxx Variable Life Investment Fund (the
"Fund"), a no-load, open-end, diversified registered management investment
company established in 1985 as a Massachusetts business trust. The Fund is a
series fund consisting of the Balanced Portfolio, Bond Portfolio, Capital Growth
Portfolio, International Portfolio, Money Market Portfolio and Growth and Income
Portfolio (individually or collectively hereinafter referred to as the
"Portfolio" or the "Portfolios"). Additional Portfolios may be created from
time to time. The Fund is the funding vehicle for variable annuity contracts
and variable life insurance policies ("Participating Contracts and Policies") to
be offered to the separate accounts or sub-accounts (the "Accounts") of certain
life insurance companies ("Participating Insurance Companies"). Owners of
Participating Contracts and Policies will designate a portion of their premium
to be invested in Accounts which invest in, or represent an investment in,
directly or indirectly, shares of beneficial interest ("Shares") of the
Portfolios of the Fund. You are a registered broker-dealer which intends to
offer and sell Participating Contracts and Policies. In connection with such
offer and sale you will be obligated to deliver the prospectuses of such
Participating Contracts and Policies and, contemporaneously therewith, the
prospectus of the Fund. Sales of Shares to Participating Insurance
Companies or their affiliates or the separate accounts of either shall be
effected solely by us as principal underwriter of the Fund, and not by you;
provided, however, that you shall be our agent in connection with the receipt of
purchase orders for Fund Shares and not in connection with their offer and sale.
The relationship between us shall be further governed by the following terms and
conditions:
1. To the extent, if any, that your activities or the activities of the
Participating Insurance Companies in connection with the sale of
Participating Contracts and Policies may constitute the sale of
Shares, you and we agree that (i) we are the sole "principal
underwriter" of the Fund and the sole "underwriter" of the Shares as
those terms are defined in the Investment Company Act of 1940 (the
"1940 Act") and the Securities Act of 1933 (the "1933 Act"),
respectively, and (ii) neither you nor the Participating Insurance
Companies or the Accounts shall be deemed to be "principal
underwriters" of the Fund or "underwriters" of the Fund within the
meaning of the 1940 Act and the 1933 Act, respectively.
2. You hereby represent and warrant to us as follows:
(a) You are a corporation duly organized and validly existing in good
standing under the laws of the State of Delaware and have full
power and authority to enter into this Agreement.
(b) This Agreement has been duly authorized, executed and delivered
by you and is a valid and binding obligation enforceable against
you in accordance with its terms.
(c) Your compliance with the provisions of this Agreement will not
conflict with or result in a violation of the provisions of your
charter or by-laws, or any statute or any judgment, decree,
order, rule or regulation of any court or governmental agency or
body having jurisdiction.
3. We hereby represent and warrant to you as follows:
(a) A registration statement (File No. 2-96461) on Form N-1A with
respect to the Shares (x) has been prepared by the Fund in
conformity with the requirements of the 1940 Act and the 1933 Act
and all applicable published instructions, rules and regulations
(the "Rules and Regulations") of the Securities and Exchange
Commission (the
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"Commission"), (y) has been filed with the Commission, and (z) is
currently effective. The registration statement, including
financial statements and exhibits, and the final prospectus,
including the statement of additional information, as
subsequently amended and supplemented, are herein respectively
referred to as the "Registration Statement" and the "Prospectus".
(b) The Registration Statement and the Prospectus and any amendment
or supplement thereto will contain all statements required to be
stated therein and will comply in all material respects with the
requirements of the 1940 Act, the 1933 Act and the Rules and
Regulations, and the Registration Statement and any post-
effective amendment thereto will not contain or incorporate by
reference any untrue statement of a material fact or omit to
state any material fact required to be stated therein or
necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading, and the
Prospectus and any amendment or supplement thereto will not
contain or incorporate by reference any untrue statement of a
material fact or omit to state a material fact required to be
stated therein or necessary in order to make the statements
therein, in light of the circumstances under which they were
made, not misleading.
(c) We are a corporation duly organized and validly existing in good
standing under the laws of The Commonwealth of Massachusetts and
have full power and authority to enter into this Agreement.
(d) This Agreement has been duly authorized, executed and delivered
by us and is a valid and binding obligation enforceable against
us in accordance with its terms.
(e) Our compliance with all of the provisions of this Agreement will
not conflict with or result in a violation of the provisions of
our charter or by-laws, or any statute or any judgment, decree,
order, rule or regulation of any court or governmental agency or
body having jurisdiction over us.
4. You hereby covenant and agree with us as follows:
(a) You shall be an independent contractor and neither you nor any of
your directors, officers or employees as such, is or shall be an
employee of us or of the Fund. You are responsible for your own
conduct and the employment, control and conduct of your agents
and employees and for injury to such agents or employees or to
others through your agents or employees.
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(b) You or one or more Participating Insurance Companies will be
responsible for insuring compliance with all applicable laws and
regulations of any regulatory body having jurisdiction over you
or Participating Contracts and Policies.
(c) No person is authorized to make any representations concerning
Shares except those contained in the Prospectus relating thereto
and in such printed information as issued by us for use as
information supplemental to the prospectus. In offering
Participating Contracts and Policies you shall, with respect to
the Fund and the Shares, rely solely on the representations
contained in the Prospectus and in the above-mentioned
supplemental information.
(d) You are not entitled to any compensation whatsoever from us or
the Fund with respect to offers of Participating Contracts and
Policies.
5. We hereby covenant and agree with you as follows:
(a) If, at any time when a Prospectus relating to the Shares is
required to be delivered under the 1940 Act, the 1933 Act or the
Rules and Regulations, we become aware of the occurrence of any
event as a result of which the Prospectus as then amended or
supplemented would include any untrue statement of a material
fact, or omit to state a material fact necessary to make the
statements therein, in light of the circumstances under which
made, not misleading, or if we become aware that it has become
necessary at any time to amend or supplement the Prospectus to
comply with the 1940 Act, the 1933 Act or the Rules and
Regulations, we will promptly notify you and promptly request the
Fund to prepare and to file with the Commission an amendment to
the Registration Statement or supplement to the Prospectus which
will correct such statement or omission or an amendment or
supplement which will effect such compliance, and deliver to you
copies of any such amendment or supplement.
(b) We will cooperate with you by taking such action as may be
necessary for the Fund to qualify the Shares for offer and sale
under the securities or Blue Sky laws of any state or
jurisdiction as you may request and as may be required by
applicable law, and will continue such qualification in effect so
long as is required by applicable law in connection with the
distribution of Shares.
6. We reserve the right in our discretion, without notice, to suspend
sales or withdraw the offering of Shares entirely, as to any person or
generally. We reserve the right to amend this Agreement at any time
and you agree
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that the sale of Participating Contracts and Policies, after notice of
any such amendment has been sent to you, shall constitute your
agreement to any such amendment.
7. If we elect to provide to you for the purpose of your offering
Participating Contracts and Policies copies of any Prospectus relating
to the Shares and printed information supplemental thereto, we shall
furnish you with such copies as you reasonably request upon the
payment of reasonable charges therefor by you or one or more
Participating Insurance Companies. If we elect not to provide such
copies of such documents, you or one or more Participating Insurance
Companies shall bear the entire cost of printing copies for your use.
You shall not use such copies of such documents printed by you or one
or more Participating Insurance Companies until you shall have
furnished us with a copy thereof and we either have given you written
approval for use or twenty days shall have elapsed following our
receipt thereof and we have not objected thereto in writing.
8. (a) You will indemnify and hold harmless Investor Services and
each of its directors and officers and each person, if any, who
controls Investor Services within the meaning of Section 15 of
the 1933 Act, against any loss, liability, damages, claim or
expense (including the reasonable cost of investigating or
defending any alleged loss, liability, damages, claim or expense
and reasonable counsel fees incurred in connection therewith),
arising by reason of any person's acquiring any Shares, which may
be based upon the 1933 Act or any other statute or common law,
and which (i) may be based upon any wrongful act by you, any of
your employees or representatives, or (ii) may be based upon any
untrue statement or alleged untrue statement of a material fact
contained in a registration statement or prospectus covering
Shares 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 information furnished to us or the Fund by you,
or (iii) may be based on any untrue statement or alleged untrue
statement of a material fact contained in a registration
statement or prospectus covering insurance products sold by you,
or any amendments 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, unless such statement or omission was
made in reliance upon information furnished to you or a
Participating Insurance Company by or on behalf of Investor
Services or the Fund; provided, however, that in no case (i) is
the
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indemnity by you in favor of any person indemnified to be
deemed to protect Investor Services or any such person against
any liability to which Investor Services or any such person would
otherwise be subject by reason of willful misfeasance, bad faith
or gross negligence in the performance of its or his duties or by
reason of its or his reckless disregard of its obligations and
duties under this Agreement, or (ii) are you to be liable under
your indemnity agreement contained in this paragraph with respect
to any claim made against Investor Services or any person
indemnified unless Investor Services or such person, as the case
may be, shall have notified you 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 Investor Services or upon such person (or after Investor
Services or such person shall have received notice of such
service on any designated agent), but failure to notify you of
any such claim shall not relieve you from any liability which you
may have to Investor Services or any person against whom such
action is brought otherwise than on account of your indemnity
agreement contained in this paragraph. You shall be entitled to
participate, at your own expense, in the defense, or, if you so
elect, to assume the defense of any suit brought to enforce any
such liability, but, if you elect to assume the defense, such
defense shall be conducted by counsel chosen by you and
satisfactory to Investor Services, or to its officers or
directors, or to any controlling person or persons, defendant or
defendants in the suit. In the event that you assume the defense
of any such suit and retain such counsel, Investor Services or
such officers or directors or controlling person or persons,
defendant or defendants in the suit, shall bear the fees and
expenses of any additional counsel retained by them, but, in case
you do not elect to assume the defense or any such suit, you
shall reimburse Investor Services and such officers, directors or
controlling person or persons, defendant of defendants in such
suit, for the reasonable fees and expenses of any counsel
retained by them. You agree promptly to notify Investor Services
of the commencement of any litigation or proceedings against it
in connection with the offer, issue and sale of any shares.
(b) Investor Services will indemnify and hold harmless you and each
of your directors and officers and each person, if any, who
controls you within the meaning of Section 15 of the 1933 Act,
against any loss, liability, damages, claim or expense (including
the reasonable cost of investigating or defending any alleged
loss, liability, damages, claim or expense and reasonable counsel
fees incurred in connection
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therewith), arising by reason of any person's acquiring any
Shares, which may be based upon the 1933 Act or any other statute
or common law, and which (i) may be based upon any wrongful act
by Investor Services, any of its employees or representatives, or
(ii) may be based upon any untrue statement or alleged untrue
statement of a material fact contained in a registration
statement or prospectus covering Shares 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 unless
such statement or omission was made in reliance upon information
furnished to Investor Services or the Fund by you or (iii) may be
based on any untrue statement or alleged untrue statement of a
material fact contained in a registration statement or prospectus
covering insurance products sold by you, or any amendment 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 information furnished to you by or on behalf of Investor
Services or the Fund; provided, however, that in no case (i) is
the indemnity by Investor Services in favor of any person
indemnified to be deemed to protect you or any such person
against any liability to which you or any such person would
otherwise be subject by reason of willful misfeasance, bad faith
or gross negligence in the performance of your or his duties by
reason of your or his reckless disregard of your or his
obligations and duties under this Agreement, or (ii) is Investor
Services to be liable under its indemnity agreement contained in
this paragraph with respect to any claim made against you or any
person indemnified unless you or such person, as the case may be,
shall have notified Investor Services 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 you or upon such person (or after you or such person
shall have received notice of such service on any designated
agent), but failure to notify Investor Services of any such claim
shall not relieve Investor Services from any liability to which
Investor Services may have to you or any person against whom such
action is brought otherwise than on account of its indemnity
agreement contained in this paragraph. Investor Services shall be
entitled to participate, at its own expense, in the defense, or,
if it so elects, to assume the defense of any suit brought to
enforce any such liability, but, if it elects to assume the
defense, such defense shall be conducted by counsel
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chosen by Investor Services and satisfactory to you, or to your
officers or directors, or to any controlling person or persons,
defendant or defendants in the suit. In the event that Investor
Services assumes the defense of any such suit and retains such
counsel, you or such officers or directors or controlling person
or persons, defendant or defendants in the suit, shall bear the
fees and expenses of any additional counsel retained by you, but,
in case Investor Services does not elect to assume the defense of
any such suit, Investor Services shall reimburse you and such
officers, directors or controlling person or persons, defendant
or defendants in such suit, for the reasonable fees and expenses
of any counsel retained by you. Investor Services agrees promptly
to notify you of the commencement of any litigation or
proceedings against it in connection with the offer, issue and
sale of any Shares.
9. The indemnities, representations, warranties, covenants and agreements
of each party to this Agreement as set forth in this Agreement will
remain in full force and effect regardless of any investigation made
by or on behalf of either of such parties or any of their respective
officers, directors, partners or any controlling person, and will
survive delivery of and payment for the Shares.
10. Any provision of this Agreement which may be determined by competent
authority to be prohibited or unenforceable in any jurisdiction shall,
as to such jurisdiction, be ineffective to the extent of such
prohibition or unenforceability without invalidating the remaining
provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such
provision in any other jurisdiction. To the extent permitted by
applicable law, each party hereto waives any provision of law which
renders any provision hereof prohibited or unenforceable in any
respect.
11. This Agreement, as amended by the letter agreement dated February 3,
1995, as amended, together constitutes the entire agreement among the
parties concerning the subject matter hereof, and supersede any and
all prior understandings.
12. This Agreement shall automatically terminate in the event of its
assignment. This Agreement may be terminated at any time by either
party by written notice given to the other party, provided that the
obligation of each party to indemnify the other party pursuant to
paragraph 8 hereof shall apply with respect to any Shares sold before
or after such termination.
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13. Any notice hereunder shall be duly given if mailed or telegraphed to
the other party hereto at the address specified below. This Agreement
shall be governed by and construed in accordance with the laws of The
Commonwealth of Massachusetts.
14. This Agreement may be executed in any number of counterparts which,
taken together shall constitute one and the same instrument. This
Agreement shall become effective upon receipt by us of your acceptance
hereof.
15. This Agreement may not be modified or amended except by a written
instrument duly executed by the parties hereto.
XXXXXXX INVESTOR SERVICES, INC.
By: /s/ Xxxx X. Xxxxxx
------------------
Xxxx X. Xxxxxx
President
Two International Place
Boston, Massachusetts 02110
The undersigned hereby accepts the offer set forth
in the above letter.
USAA INVESTMENT MANAGEMENT COMPANY
Dated: 4/29/98 By: /s/ Xxxx X. Xxxxxxxx
--------------------
Xxxx X. Xxxxxxxx
Senior Vice President,
Investments Services
Authorized Representative
10750 Xxxxxx X. XxXxxxxxx Freeway
San Antonio, Texas 78288
47111
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