AMENDED AND RESTATED
PARTICIPATION AGREEMENT
By and Among
AMERICAN ENTERPRISE LIFE INSURANCE COMPANY
AMERICAN PARTNERS LIFE INSURANCE COMPANY
IDS LIFE INSURANCE COMPANY
And
CREDIT SUISSE TRUST
And
CREDIT SUISSE ASSET MANAGEMENT, LLC
And
CREDIT SUISSE ASSET MANAGEMENT SECURITIES, INC.
THIS AMENDED AND RESTATED AGREEMENT made and entered into as of this 1st day
of May, 2006, by and among the following parties:
o AMERICAN ENTERPRISE LIFE INSURANCE COMPANY ("American Enterprise
Life", organized under the laws of the State of Indiana on its own
behalf and on behalf of each of its separate accounts named in
Schedule A to this Agreement, as may be amended from time to time
(each account referred to as an "Account");
o AMERICAN PARTNERS LIFE INSURANCE COMPANY ("American Partners
Life"), organized under the laws of the State of Arizona on its
own behalf and on behalf of each of its separate accounts named in
Schedule A-1 to this Agreement, as may be amended from time to
time (each account referred to as an "Account");
o IDS LIFE INSURANCE COMPANY ("IDS Life"), organized under the laws
of the State of Minnesota, on its own behalf and on behalf of each
of its separate accounts named in Schedule A-2 to this Agreement,
as may be amended from (each account referred to as the
"Account");
o CREDIT SUISSE TRUST, an open-end management investment company and
business trust organized under the laws of the Commonwealth of
Massachusetts (the "Fund");
o CREDIT SUISSE ASSET MANAGEMENT, LLC, a limited liability company
organized under the laws of the State of Delaware (the "Adviser");
and
o CREDIT SUISSE ASSET MANAGEMENT SECURITIES, INC., a corporation
organized under the laws of the State of New York ("CSAMSI").
Each of American Enterprise Life, American Partners Life and IDS Life
hereinafter also referred to as "Company".
WHEREAS, the Fund engages in business as an open-end management investment
company and was established for the purpose of serving as the investment
vehicle for separate accounts established for variable life insurance
contracts and variable annuity contracts to be offered by insurance companies
that have entered into participation agreements similar to this Agreement (the
"Participating Insurance Companies"), and
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 has received an order from the Securities and Exchange
Commission (the "SEC") dated December 19, 1995 (File No. 812-8910), granting
Participating Insurance Companies and variable annuity separate accounts and
variable life insurance separate accounts relief from the provisions of
Sections 9(a), 13(a), 15(a), and 15(b) of the Investment Company Act of 1940,
as amended (the "l940 Act"), and Rules 6e-2(b)(1 5) and 6e-3(T)(b)(15)
thereunder, to the extent necessary to permit shares of the Fund to be sold to
and held by variable annuity separate accounts and variable life insurance
separate accounts of both affiliated and unaffiliated Participating Insurance
Companies and qualified pension and retirement plans outside of the separate
account context (the "Mixed and Shared Funding Exemptive Order"). The parties
to this Agreement agree that the conditions or undertakings specified in the
Mixed and Shared Funding Exemptive Order and that may be imposed on the
Company, the Fund, the Adviser and/or CSAMSI by virtue of such order are
incorporated herein by reference, and such parties agree to comply with such
conditions and undertakings to the extent applicable to each such party; and
WHEREAS, the Fund is registered as an open-end management investment company
under the 1940 Act and its shares are registered under the Securities Act of
1933, as amended (the "1933 Act"); and
WHEREAS, the Company has registered or will register certain variable annuity
and variable life insurance contracts (the "Contracts") under the 1933 Act;
and
WHEREAS, the Account is a duly organized, validly existing segregated asset
account, established by resolution of the Board of Directors of the Company
under the applicable insurance laws to set aside and invest assets
attributable to the Contracts; and
WHEREAS, the Company has registered or will register the Account as a unit
investment trust under the 1940 Act; and
WHEREAS, CSAMSI, the Fund's distributor, is registered as a broker-dealer with
the SEC under the Securities Exchange Act of 1934, as amended (the "1934
Act"), and is a member in good standing of the National Association of
Securities Dealers, Inc. (the "NASD"); and
WHEREAS, to the extent permitted by applicable insurance laws and regulations,
American Enterprise Life intends to purchase shares of the Portfolios named in
Schedule B, American
2
Partners Life intends to purchase shares of the Portfolios names in Schedule
B-1, and IDS Life intends to purchase shares of the Portfolios named in
Schedule B-2, as such schedules may be amended from time to time (the
"Designated Portfolios") on behalf of the Account to fund the Contracts, and
the Fund is authorized to sell such shares to unit investment trusts such as
the Account at net asset value;
NOW, THEREFORE, in consideration of their mutual promises, the Company, the
Fund, the Adviser and CSAMSI agree as follows:
ARTICLE A. AMENDMENT AND RESTATEMENT; FORM OF AGREEMENT
--------------------------------------------
A.1 The Fund, the Adviser and CSAMSI acknowledge the planned merger of both
American Enterprise Life and American Partners Life with and into IDS
Life (each merger is collectively, the "Merger") and the "intact
transfer" (the "Transfer") of the Accounts of American Enterprise Life
and American Partners Life to IDS Life by operation of law and incident
to the Merger, on December 31, 2006 at 10:59:59 p.m. Central Time (the
"Effective Time"), subject to all necessary regulatory approvals being
obtained in connection with the Merger and the Transfer, and the
re-naming of IDS Life to RiverSource Life Insurance Company
simultaneously with the Merger. On and after the Effective Time, all
references in this Agreement and its Schedules to American Enterprise
Life, American Partners Life and IDS Life shall mean and refer to
RiverSource Life Insurance Company. The Fund, the Adviser and CSAMSI
consent to the transfer of the rights and obligations of American
Enterprise Life and American Partners Life under this Agreement to IDS
Life at the Effective Time of the Merger.
A.2 This Agreement shall amend and supersede the following agreements as of
the date stated above among the Company, the Fund, the Advisor and
CSAMSI with respect to all investments by the Company or the Account
prior to the date of this Agreement, as though identical separate
agreements had been executed by the parties hereto on the dates as
indicated below:
A.2.1 Participation Agreement, dated September 1, 1999, by and among
American Enterprise Life, the Fund, the Adviser and CSAMSI, as
amended by the following documents: (a) Amendment to Participation
Agreement, dated December 10, 2001; and (b) Amendment to
Participation Agreement, dated April 1, 2003.
A.2.2 Participation Agreement, dated March 1, 1996, by and among
American Partners Life, the Fund, the Adviser and CSAMSI, as
amended by the following documents: (a) Amendment No. 1 to
Participation Agreement dated June 4, 1996; (b) Restatement of
Participation Agreement, dated June 10, 1999; (c) Amendment to
Participation Agreement, dated December 10, 2001; and (d)
Amendment to Participation Agreement, dated April 1, 2003.
A.2.3 Participation Agreement, dated March 1, 1996, by and among IDS
Life, the Fund, the Adviser and CSAMSI, as amended by the
following documents: (a)
3
Amendment 1 to Participation Agreement, dated April 30, 1999; (b)
Restatement of Participation Agreement, dated June 10, 1999; (c)
Amendment to Participation Agreement, dated December 10, 2001; and
(d) Amendment to Participation Agreement, dated April 1, 2003.
In addition, the foregoing parties hereby amend and restate their
agreements as set forth herein in contemplation of the Transfer of the
Accounts of American Enterprise Life and American Partners Life to IDS
Life on December 31, 2006, incident to the Merger. Although the parties
have executed this Agreement in this form for administrative
convenience, this Agreement shall create a separate participation
agreement with each Company until the Effective Time of the Merger.
ARTICLE I. SALE OF FUND SHARES
-------------------
1.1 The Fund agrees to sell to the Company those shares of the Designated
Portfolios that each Account orders, 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 the order for the shares of the Fund. For
purposes of this Section 1.1, the Company will be the designee of the
Fund for receipt of such orders from each Account and receipt by such
designee will constitute receipt by the Fund; provided that the Fund
receives notice of such order by 10:00 a.m. Eastern Time on the next
following business day (T+1"). "Business Day" will mean any day on which
the New York Stock Exchange is open for trading and on which the Fund
calculates its net asset value pursuant to the rules of the SEC.
1.2 The Company will pay for Fund shares on T+1 that an order to purchase
Fund shares is made in accordance with Section 1.1 above. Payment will
be in federal funds transmitted by wire. This wire transfer will be
initiated by 12:00 p.m. Eastern Time.
1.3 The Fund agrees to make shares of the Designated Portfolios available
for purchase at the applicable net asset value per share by
Participating Insurance Companies and their separate accounts on those
days on which the Fund calculates its Designated Portfolio net asset
value pursuant to rules of the SEC; provided, however, that the Board of
Trustees of the Fund (the "Fund Board") 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
Fund Board, acting in good faith and in light of its fiduciary duties
under federal and any applicable state laws, in the best interests of
the shareholders of such Portfolio.
1.4 On each Business Day on which the Fund calculates its net asset value,
the Company will aggregate and calculate the net purchase or redemption
orders for each Account maintained by the Fund in which contractowner
assets are invested. Net orders will only reflect orders that the
Company has received prior to the close of regular trading on the New
York Stock Exchange, Inc. (the "NYSE") (currently 4:00 p.m., Eastern
Time) on that Business Day. Orders that the Company has received after
the close of regular trading on the NYSE will be treated as though
received on the next Business Day. Each
4
communication of orders by the Company will constitute a representation
that such orders were received by it prior to the close of regular
trading on the NYSE on the Business Day on which the purchase or
redemption order is priced in accordance with Rule 22c-1 under the 1940
Act. Other procedures relating to the handling of orders will be in
accordance with the prospectus and statement of information of the
relevant Designated Portfolio or with oral or written instructions that
CSAMSI or the Fund will forward to the Company from time to time.
1.5 The Fund agrees that shares of the Fund will be sold only to
Participating Insurance Companies and their separate accounts, qualified
pension and retirement plans or such other persons as are permitted
under applicable provisions of the Internal Revenue Code of 1986, as
amended, (the "Internal Revenue Code"), and regulations promulgated
thereunder, the sale to which will not impair the tax treatment
currently afforded the Contracts. No shares of any Portfolio will be
sold to the general public except as set forth in this Section 1.5.
1.6 The Fund agrees to redeem for cash, upon the Company's request, any full
or fractional shares of the Fund held by the Company, executing such
requests on a daily basis at the net asset value next computed after
receipt and acceptance by the Fund or its agent of the request for
redemption. For purposes of this Section 1.6, the Company will be the
designee of the Fund for receipt of requests for redemption from each
Account and receipt by such designee will constitute receipt by the
Fund, provided the Fund receives notice of request for redemption by
10:00 a.m. Eastern Time on the next following Business Day. Payment will
be in federal funds transmitted by wire to the Company's account as
designated by the Company in writing from time to time, on the same
Business Day the Fund receives notice of the redemption order from the
Company. The Fund reserves the right to delay payment of redemption
proceeds, but in no event may such payment be delayed longer than the
period permitted by the 0000 Xxx. The Fund will not bear any
responsibility whatsoever for the proper disbursement or crediting of
redemption proceeds; the Company alone will be responsible for such
action. If notification of redemption is received after 10:00 a.m.
Eastern Time, payment for redeemed shares will be made on the next
following Business Day.
1.7 The Company agrees to purchase and redeem the shares of the Designated
Portfolios offered by the then current prospectus of the Fund in
accordance with the provisions of such prospectus.
1.8 Issuance and transfer of the Fund's shares will be by book entry only.
Stock certificates will not be issued to the Company or any Account.
Purchase and redemption orders for Fund shares will be recorded in an
appropriate title for each Account or the appropriate subaccount of each
Account.
1.9 The Fund will furnish same day notice (by telecopier, followed by
written confirmation) to the Company of the declaration of any income,
dividends or capital gain distributions payable on each Designated
Portfolio's shares. The Company hereby elects to receive all
5
such dividends and distributions as are payable on the Designated
Portfolio shares in the form of additional shares of that Designated
Portfolio. The Fund will notify the Company of the number of shares so
issued as payment of such dividends and distributions. The Company
reserves the right to revoke this election upon reasonable prior notice
to the Fund and to receive all such dividends and distributions in cash.
1.10 The Fund will make the net asset value per share for each Designated
Portfolio available to the Company on a daily basis as soon as
reasonably practical after the net asset value per share is calculated
and will use its best efforts to make such net asset value per share
available by 6:00 p.m. Eastern Time, but in no event later than 7:00
p.m. Eastern Time, each business day.
1.11 In the event adjustments are required to correct any error in the
computation of the net asset value of the Fund's shares, the Fund or
CSAMSI will notify the Company as soon as practicable after discovering
the need for those adjustments that result in an aggregate reimbursement
of $150 or more to any one Account maintained by a Designated Portfolio
(or, if greater, result in an adjustment of $10 or more to each
contractowner's account). Any such notice will state for each day for
which an error occurred the incorrect price, the correct price and, to
the extent communicated to the Fund's shareholders, the reason for the
price change. The Company may send this notice or a derivation thereof
(so long as such derivation is approved in advance by CSAMSI or the
Adviser) to contractowners whose accounts are affected by the price
change. The parties will negotiate in good faith to develop a reasonable
method for effecting such adjustments.
ARTICLE II. REPRESENTATIONS AND WARRANTIES
------------------------------
2.1 The Company represents and warrants that the Contracts are or will be
registered under the 1933 Act and that the Contracts will be issued and
sold in compliance with all applicable federal and state laws, including
state insurance suitability requirements. 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 Account as a separate account under applicable state
law and has registered the Account as a unit investment trust in
accordance with the provisions of the 1940 Act to serve as a segregated
investment account for the Contracts, and that it will maintain such
registration for so long as any Contracts are outstanding. The Company
will amend the registration statement under the 1933 Act for the
Contracts and the registration statement under the 1940 Act for the
Account from time to time as required in order to effect the continuous
offering of the Contracts or as may otherwise be required by applicable
law. The Company will register and qualify the Contracts for sale in
accordance with the securities laws of the various states only if and to
the extent deemed necessary by the Company.
2.2 The Company represents that the Contracts are currently and at the time
of issuance will be treated as annuity or life insurance contracts under
applicable provisions of the Internal Revenue Code, and that it will
make every effort to maintain such treatment and that it
6
will notify the Fund and the Adviser 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.
2.3 The Company represents and warrants that it will not purchase shares of
the Designated Portfolios with assets derived from tax-qualified
retirement plans except, indirectly, through Contracts purchased in
connection with such plans.
2.4 The Fund represents and warrants that Fund shares of the Designated
Portfolios sold pursuant to this Agreement will be registered under the
1933 Act and duly authorized for issuance in accordance with applicable
law and that the Fund is and will remain registered under the 1940 Act
for as long as such shares of the Designated Portfolios are sold. The
Fund will 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. The Fund will register and
qualify the shares of the Designated Portfolios for sale in accordance
with the laws of the various states only if and to the extent deemed
advisable by the Fund.
2.5 The Fund represents that it is currently qualified as a Regulated
Investment Company under Subchapter M of the Internal Revenue Code, and
that it will make every effort to maintain such qualification (under
Subchapter M or any successor or similar provision) and that it will
notify the Company immediately upon having a reasonable basis for
believing that it has ceased to so qualify or that it might not so
qualify in the future.
2.6 The Fund represents and warrants that in performing the services
described in this Agreement, the Fund will comply with all applicable
laws, rules and regulations. The Fund makes no representation as to
whether any aspect of its operations (including, but not limited to,
fees and expenses and investment policies, objectives and restrictions)
complies with the insurance laws and regulations of any state. The Fund
and CSAMSI agree that upon request they will use their best efforts to
furnish the information required by state insurance laws so that the
Company can obtain the authority needed to issue the Contracts in the
various states.
2.7 The Fund currently does not intend to make any payments to finance
distribution expenses pursuant to Rule 12b-1 under the 1940 Act,
although it reserves the right to make such payments in the future. To
the extent that it decides to finance distribution expenses pursuant to
Rule 12b-1, the Fund undertakes to have its Fund Board, formulate and
approve any plan under Rule 12b-1 to finance distribution expenses in
accordance with the 1940 Act.
2.8 CSAMSI represents and warrants that it will distribute the Fund shares
of the Designated Portfolios in accordance with all applicable federal
and state securities laws including, without limitation, the 1933 Act,
the 1934 Act and the 1940 Act.
7
2.9 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
1940 Act.
2.10 CSAMSI represents and warrants that it is and will remain duly
registered under all applicable federal and state securities laws and
that it will perform its obligations for the Fund in accordance in all
material respects with any applicable state and federal securities laws.
2.11 The Fund and CSAMSI represent and warrant that all of their trustees,
officers, employees, investment advisers, and other individuals/entities
having access to the funds and/or securities of the Fund are and
continue to be at all times covered by a blanket fidelity bond or
similar coverage for the benefit of the Fund in an amount not less than
the minimal coverage as required currently by Rule 17g-(1) of the 1940
Act or related provisions as may be promulgated from time to time. The
aforesaid bond includes coverage for larceny and embezzlement and is
issued by a reputable bonding company.
2.12 The Company acknowledges that the Fund has adopted policies and
procedures reasonably designed to prevent frequent or excessive
purchases, exchanges and redemptions of the shares of the Designated
Portfolios. These policies are disclosed in the current prospectus for
each Designated Portfolio.
The Fund acknowledges that the Company, on behalf of its Account, has
adopted policies and procedures reasonably designed to detect and deter
frequent transfers of Contract value among the subaccounts of the
Account, including those investing in the Designated Portfolios which
are available as investment options under the Contracts. These policies
and procedures are described in the current prospectuses of the Accounts
through which the Contracts are offered.
The Fund, the Adviser and CSAMSI may consider the Company's policies and
procedures pertaining to frequent transfers of Contract value among the
subaccounts of its Account, including those investing in the Designated
Portfolios, when the Fund periodically reviews or amends its disruptive
trading policies and procedures. The Fund may invite comment from and
confer with the Company regarding any proposed policy or procedure of
the Fund pertaining to disruptive trading to determine, prior to
adopting such proposed policy or procedure, the Company's then-present
ability to apply such proposed policy or procedure to owners of
Contracts who allocate Contract value to subaccounts investing in the
Designated Portfolios which are available under the Contracts, including
without limitation whether the Company can apply such proposed policy or
procedure without the need to modify its automated data processing
systems or to develop and staff manual systems to accommodate the
implementation of the Fund's proposed policy or procedure.
The Company will cooperate with the Fund's reasonable requests in taking
steps to deter and detect frequent or excessive transfers by
Contractholders. Subject to applicable law
8
and the terms of each Contract, the Company will furnish other
information the Fund, directly or through its agent, reasonably requests
regarding frequent transfers by owners of Contracts among the
subaccounts investing in the Designated Portfolios which are available
under the Contracts. In compliance with Rule 22c-2 under the 1940 Act,
the Company hereby agrees to (i) provide, promptly upon request by Fund,
directly or through its agent, the taxpayer identification number of all
owners of Contracts that purchased, redeemed, transferred, or exchanged
Shares of a Designated Portfolio held under a Contract, and the amount
and dates of such Contractowner's purchases, redemptions, transfers, and
exchanges involving such Designated Portfolios; and (ii) execute any
instructions from the Fund, directly or through its agent, to restrict
or prohibit further purchases or exchanges of shares of the Designated
Portfolios by an owner of a Contract who has been identified by the
Fund, directly or through its agent, as having engaged in transactions
in shares of a Designated Portfolio that violate the policies adopted by
the Fund for the purpose of eliminating or reducing any dilution of the
value of the outstanding shares of the Designated Portfolios. The
Company further agrees to either assess any applicable redemption fee
that the Fund has adopted to curtail frequent trading, or communicate to
the Fund or its agent any information necessary for the Fund or its
agent to assess such redemption fees directly against payment of
redemption proceeds. If the Company is required under Rule 22c-2 under
the 1940 Act to implement transaction procedures for its Account in
order to effectuate the Fund's procedures for preventing disruptive
trading in the shares of the Designated Portfolios, and such
implementation will require the Company to modify its automated data
processing systems or to develop and staff manual systems to accommodate
the Fund's requirements, the parties shall in good faith negotiate a
mutually agreed-upon implementation schedule.
2.13 The parties to this Agreement represent and warrant that they shall
comply with all the applicable laws and regulations designed to prevent
money laundering including without limitation the International Money
Laundering Abatement and Anti-Terrorist Financing Act of 2001 (Title III
of the USA PATRIOT ACT), and if required by such laws or regulations
will share information with each other about individuals, entities,
organizations and countries suspected of possible terrorist or money
laundering activities in accordance with Section 314(b) of the USA
PATRIOT ACT.
ARTICLE III. PROSPECTUSES AND PROXY STATEMENTS; VOTING
-----------------------------------------
3.1 The Fund or CSAMSI will provide the Company or its mailing agent, at the
Fund's or its affiliate's expense, with as many copies of the current
Fund prospectus for the Designated Portfolios as the Company may
reasonably request for distribution, at the Company's expense, to
prospective contractowners and applicants. The Fund or CSAMSI will
provide the Company or its mailing agent, at the Fund's or its
affiliate's expense, as many copies of said prospectus as necessary for
distribution, at the Fund's or its affiliate's expense, to existing
contractowners. If requested by the Company in lieu thereof, the Fund or
CSAMSI will provide such documentation, by computer diskette or other
electronic transmission, a final copy of such current prospectus set in
type at the Fund's
9
or its affiliate's expense, in which case the Fund or its affiliate
shall reimburse the Company for the reasonable cost incurred in the
printing and said prospectus.
3.2 The Fund or CSAMSI will provide the Company or its mailing agent, at the
Fund's or its affiliate's expense, with as many copies of the current
Fund statement of additional information for the Designated Portfolios
as the Company may reasonably request for distribution, at the Company's
expense, to prospective contractowners and applicants. The Fund or
CSAMSI will provide the Company or its mailing agent, at the Fund's or
its affiliate's expense, as many copies of said statement of additional
information as necessary for distribution, at the Fund's or its
affiliate's expense, to any existing contractowner who requests such
statement of additional information or whenever state or federal law
otherwise requires that such statement be provided. If requested by the
Company in lieu thereof, the Fund or CSAMSI will provide such
documentation, by computer diskette or other electronic transmission, a
final copy of such current statement of additional information set in
type at the Fund's or its affiliate's expense, in which case the Fund or
its affiliate shall reimburse the Company for the reasonable cost
incurred in the printing of said statement of additional information.
3.3 The Fund will provide written instructions to Participating Insurance
Companies each time the Fund amends or supplements a Designated
Portfolio's current prospectus or statement of additional information
directing the Participating Insurance Companies as to whether the
amendment or supplement is to be provided (a) immediately to Contract
owners who have Contract value allocated to a Designated Portfolios or
(b) is to be held and combined with another Fund or Contract related
mailing as permitted by applicable federal securities laws. The Fund
agrees that the instruction it gives the Company in each instance will
be identical to the instruction it provides other Participating
Insurance Companies.
3.4 The Fund or CSAMSI will provide the Company or its mailing agent, at the
Fund's or its affiliate's expense, with as many copies of the Fund proxy
material, if any, reports to shareholders and other communications to
shareholders for the Designated Portfolios in such quantities as the
Company may reasonably require. If requested by the Company in lieu
thereof, the Fund or CSAMSI will provide such documentation, by computer
diskette or other electronic transmission, a final copy of such proxy
material, if any, reports to shareholders and other communications to
shareholders set in type at the Fund's or its affiliate's expense, in
which case the Fund or its affiliate shall reimburse the Company for the
reasonable cost incurred in the printing of said proxy material, reports
and other communications. The Company will distribute, at the Fund's or
its affiliate's expense, proxy materials, reports and other
communications to existing contractowners and tabulate the votes.
3.5 If and to the extent required by law the Company will:
(a) solicit voting instructions from contractowners;
10
(b) vote the shares of the Designated Portfolios held in the Account
in accordance with instructions received from contractowners; and
(c) vote shares of the Designated Portfolios held in the Account for
which no timely instructions have been received, as well as shares
it owns, in the same proportion as shares of such Designated
Portfolio for which instructions have been received from the
Company's contractowners;
so long as and to the extent that the SEC continues to interpret the
1940 Act to require pass-through voting privileges for variable
contractowners. Except as set forth above, the Company reserves the
right to vote Fund shares held in any segregated asset account in its
own right, to the extent permitted by law. The Company will be
responsible for assuring that each of its separate accounts
participating in the Fund calculates voting privileges in a manner
consistent with all legal requirements, including the Mixed and Shared
Funding Exemptive Order.
3.6 The Fund will comply with all provisions of the 1940 Act requiring
voting by shareholders, and in particular, the Fund either will provide
for annual meetings (except insofar as the SEC may interpret Section 16
of the 1940 Act not to require such meetings) or, as the Fund currently
intends, to comply with Section 16(c) of the 1940 Act (although the Fund
is not one of the trusts described in Section 16(c) of that Act) as well
as with Sections 16(a) and, if and when applicable, 16(b). Further, the
Fund will act in accordance with the SEC's interpretation of the
requirements of Section 16(a) with respect to periodic elections of
trustees and with whatever rules the SEC may promulgate with respect
thereto.
3.7 In the event the Fund initiates (i) a reorganization of the Fund as
defined by Section 2 of the 1940 Act or (ii) a change in the name of the
Fund or a Designated Portfolio, the Fund, the Adviser or CSAMSI, as they
shall determine among themselves, shall reimburse Company for Company's
reasonable internal and out-of-pocket costs associated with the
aforementioned actions. Company agrees to use its best efforts to
minimize any costs incurred under this Section and shall provide the
Fund or its designated agent with acceptable documentation of any such
costs incurred.
ARTICLE IV. SALES MATERIAL AND INFORMATION
------------------------------
4.1 CSAMSI will provide the Company on a timely basis with investment
performance information for each Designated Portfolio in which the
Company maintains an Account, including total return for the preceding
calendar month and calendar quarter, the calendar year to date, and the
prior one-year, five-year, and ten-year (or life of the Fund) periods.
The Company may, based on the SEC-mandated information supplied by
CSAMSI, prepare communications for contractowners ("Contractowner
Materials"). The Company will provide copies of all Contractowner
Materials concurrently with their first use for CSAMSI's internal
recordkeeping purposes. It is understood that neither CSAMSI nor any
Designated Portfolio will be responsible for errors or omissions in, or
the content of,
11
Contractowner Materials except to the extent that the error or omission
resulted from information provided by or on behalf of CSAMSI or the
Designated Portfolio. Any printed information that is furnished to the
Company other than each Designated Portfolio's prospectus or statement
of additional information (or information supplemental thereto),
periodic reports and proxy solicitation materials is CSAMSI's sole
responsibility and not the responsibility of any Designated Portfolio or
the Fund. The Company agrees that the Portfolios, the shareholders of
the Portfolios and the officers and governing Board of the Fund will
have no liability or responsibility to the Company in these respects.
4.2 The Company will not 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, prospectus or
statement of additional information for Fund shares, as such
registration statement, prospectus and statement of additional
information may be amended or supplemented from time to time, or in
reports or proxy statements for the Fund, or in published reports for
the Fund which are in the public domain or approved by the Fund or
CSAMSI for distribution, or in sales literature or other material
provided by the Fund or by CSAMSI, except with permission of the Fund or
CSAMSI. The Fund and CSAMSI agree to respond to any request for approval
on a prompt and timely basis. Nothing in this Section 4.2 will be
construed as preventing the Company or its employees or agents from
giving advice on investment in the Fund.
4.3 The Fund, the Adviser or CSAMSI will furnish, or will cause to be
furnished, to the Company or its designee, each piece of sales
literature or other promotional material in which the Company or its
Account is named, at least ten (10) business days prior to its use. No
such material will be used if the Company reasonably objects to such use
within five (5) business days after receipt of such material.
4.4 The Fund, the Adviser and CSAMSI will not give any information or make
any representations or statements on behalf of the Company or concerning
the Company, each Account, or the Contracts other than the information
or representations contained in a registration statement, prospectus or
statement of additional information for the Contracts, as such
registration statement, prospectus and statement of additional
information may be amended or supplemented from time to time, or in
published reports for each Account or the Contracts which are in the
public domain or approved by the Company for distribution to
contractowners, or in sales literature or other material provided by the
Company, except with permission of the Company. The Company agrees to
respond to any request for approval on a prompt and timely basis.
4.5 The Fund will provide to the Company at least one complete copy of all
registration statements, prospectuses, statements of additional
information, reports, proxy statements, 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 Fund or its
12
shares, contemporaneously with the filing of such document with the SEC,
the NASD or other regulatory authority.
4.6 The Company will provide to the Fund 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 each Account, contemporaneously with the
filing of such document with the SEC, the NASD or other regulatory
authority.
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, or
other public media, (e.g., on-line networks such as the Internet or
other electronic messages), 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, seminar texts, reprints or excerpts of any other
advertisement, sales literature, or published article), educational or
training materials or other communications distributed or made generally
available to some or all agents or employees, registration statements,
prospectuses, statements of additional information, shareholder reports,
and proxy materials and any other material constituting sales literature
or advertising under the NASD rules, the 1933 Art or the 0000 Xxx.
4.8 The Fund and CSAMSI hereby consent to the Company's use of the names
Credit Suisse Trust - (followed by the names of the Designated
Portfolios listed on Schedule B, Schedule B-1 or B-2, as applicable, as
may be amended from time to time) and the name Credit Suisse Asset
Management, LLC in connection with the marketing of the Contracts,
subject to the terms of Sections 4.1 and 4.2 of this Agreement. Such
consent will terminate with the termination of this Agreement.
ARTICLE V. FEES AND EXPENSES
-----------------
5.1 The Fund, the Adviser and CSAMSI will pay no fee or other compensation
to the Company under this Agreement except if the Fund or any Designated
Portfolio adopts and implements a plan pursuant to Rule 12b-1 under the
1940 Act to finance distribution expenses, then, subject to obtaining
any required exemptive orders or other regulatory approvals, the Fund
may make payments to the Company if and in such amounts agreed to by the
Fund in writing.
5.2 All expenses incident to performance by the Fund of this Agreement will
be paid by the Fund to the extent permitted by law. The Fund will bear
the expenses for the cost of registration and qualification of the
Fund's shares; preparation and filing of the Fund's prospectus,
statement of additional information and registration statement, proxy
materials and reports; setting in type and printing the Fund's
prospectus; setting in type
13
and printing proxy materials and reports by it to contractowners
(including the costs of printing a Fund prospectus that constitutes an
annual report); the preparation of all statements and notices required
by any federal or state law; all taxes on the issuance or transfer of
the Fund's shares; any expenses permitted to be paid or assumed by the
Fund pursuant to a plan, if any, under Rule 12b-1 under the 1940 Act;
and all other expenses set forth in Article III of this Agreement.
ARTICLE VI. DIVERSIFICATION
---------------
6.1 The Fund will at all times invest money from the Contracts in such a
manner as to ensure that the Contracts will be treated as variable
annuity or variable life insurance contracts under the Internal Revenue
Code and the regulations issued thereunder. Without limiting the scope
of the foregoing, the Fund will comply with Section 817(h) of the
Internal Revenue Code and Treasury Regulation 1.817-5, as amended from
time to time, relating to the diversification requirements for variable
annuity, endowment, or life insurance contracts and any amendments or
other modifications to such Section or Regulation. In the event of a
breach of this Article VI by the Fund, it will take all reasonable
steps: (a) to notify the Company of such breach; and (b) to adequately
diversify the Fund so as to achieve compliance within the grace period
afforded by Treasury Regulation 1.817-5.
ARTICLE VII. POTENTIAL CONFLICTS
-------------------
7.1 The Fund Board will monitor the Fund for the existence of any
irreconcilable material conflict among the interests of the
contractowners of all separate accounts investing in the Fund. An
irreconcilable material conflict may arise for a variety of reasons,
including: (a) an action by any state insurance regulatory authority;
(b) a change in applicable federal or state insurance, tax, or
securities laws or regulations, or a public ruling, private letter
ruling, no-action or interpretative letter, or any similar action by
insurance, tax, or securities regulatory authorities; (c) an
administrative or judicial decision in any relevant proceeding; (d) the
manner in which the investments of any Portfolio are being managed; (e)
a difference in voting instructions given by Participating Insurance
Companies or by variable annuity and variable life insurance
contractowners; or (f) a decision by an insurer to disregard the voting
instructions of contractowners. The Fund Board will promptly inform the
Company if it determines that an irreconcilable material conflict exists
and the implications thereof.
7.2 The Company will report any potential or existing conflicts of which it
is aware to the Fund Board. The Company agrees to assist the Fund Board
in carrying out its responsibilities, as delineated in the Mixed and
Shared Funding Exemptive Order, by providing the Fund Board with all
information reasonably necessary for the Fund Board to consider any
issues raised. This includes, but is not limited to, an obligation by
the Company to inform the Fund Board whenever contractowner voting
instructions are to be disregarded. The Company's responsibilities
hereunder will be carried out with a view only to the interest of
contractowners.
14
7.3 If it is determined by a majority of the Fund Board, or a majority of
its disinterested directors, that an irreconcilable material conflict
exists, the Company will, at its expense and to the extent reasonably
practicable (as determined by a majority of the disinterested
directors), take whatever steps are necessary to remedy or eliminate the
irreconcilable material conflict, up to and including: (a) withdrawing
the assets allocable to some or all of the Accounts from the Fund or any
Portfolio and reinvesting such assets in a different investment medium,
including (but not limited to) another Portfolio of the Fund, or
submitting the question whether such segregation should be implemented
to a vote of all affected contractowners and, as appropriate,
segregating the assets of any appropriate group (i.e., variable annuity
contractowners or variable life-insurance contractowners of one or more
Participating Insurance Companies) that votes in favor of such
segregation, or offering to the affected contractowners the option of
making such a change; and (b) establishing a new registered management
investment company or managed separate account.
7.4 If a material irreconcilable conflict arises because of a decision by
the Company to disregard contractowner voting instructions, and the
Company's judgment represents a minority position or would preclude a
majority vote, the Company may be required, at the Fund's election, to
withdraw the affected subaccount of the Account's investment in the Fund
and terminate this Agreement with respect to such subaccount; provided,
however, that such withdrawal and termination will be limited to the
extent required by the foregoing irreconcilable material conflict as
determined by a majority of the disinterested directors of the Fund
Board. No charge or penalty will be imposed as a result of such
withdrawal.
7.5 If a material irreconcilable conflict arises because a particular state
insurance regulators decision applicable to the Company conflicts with
the majority of other state insurance regulators, then the Company will
withdraw the affected subaccount of the Account's investment in the Fund
and terminate this Agreement with respect to such subaccount; provided,
however, that such withdrawal and termination will be limited to the
extent required by the foregoing irreconcilable material conflict as
determined by a majority of the disinterested directors of the Fund
Board. No charge or penalty will be imposed as a result of such
withdrawal.
7.6 For purposes of Sections 7.3 through 7.6 of this Agreement, a majority
of the disinterested members of the Fund Board will determine whether
any proposed action adequately remedies any irreconcilable material
conflict, but in no event will the Fund or the Adviser (or any other
investment adviser to the Fund) be required to establish a new funding
medium for the Contracts. The Company will not be required by Section
7.3 to establish a new funding medium for the Contracts if an offer to
do so has been declined by vote of a majority of contractowners
materially affected by the irreconcilable material conflict.
7.7 The Company will at least annually submit to the Fund Board such
reports, materials or data as the Fund Board may reasonably request so
that the Fund Board may fully carry out
15
the duties imposed upon it as delineated in the Mixed and Shared Funding
Exemptive Order, and said reports, materials and data will be submitted
more frequently if deemed appropriate by the Fund Board.
7.8 If and to the extent that Rule 6e-2 and Rule 6e-3(T) are amended, or
Rule 6e-3 is adopted, to provide exemptive relief from any provision of
the 1940 Act or the rules promulgated thereunder with respect to mixed
or shared funding (as defined in the Mixed and Shared Funding Exemptive
Order) on terms and conditions materially different from those contained
in the Mixed and Shared Funding Exemptive Order, then: (a) the Fund
and/or the Participating Insurance Companies, as appropriate, will take
such steps as may be necessary to comply with Rules 6e-2 and 6e-3(T), as
amended, and Rule 6e-3, as adopted, to the extent such rules are
applicable; and (b) Sections 3.4, 3.5, 7.1. 7.2, 7.3, 7.4, and 7.5 of
this Agreement will continue in effect only to the extent that terms and
conditions substantially identical to such Sections are contained in
such Rule(s) as so amended or adopted.
ARTICLE VIII. INDEMNIFICATION
---------------
8.1 Indemnification By The Company
------------------------------
(a) The Company agrees to indemnify and hold harmless the Fund, the
Adviser, CSAMSI, and each person, if any, who controls or is
associated with the Fund, the Adviser or CSAMSI within the meaning
of such terms under the federal securities laws and any director,
trustee, officer, partner., employee or agent of the foregoing
(collectively, the "Indemnified Parties" for purposes of this
Section 8.1) against any and all losses, claims, expenses,
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:
(1) arise out of or are based upon any untrue statements or
alleged untrue statements of any material fact contained in
the registration statement, prospectus or statement of
additional 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 or necessary to make such
statements not misleading in light of the circumstances in
which they were made; provided that this agreement to
indemnify will 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 written
information furnished to the Company by the Fund, the
Adviser or CSAMSI for use in the registration statement,
16
prospectus or statement of additional information for the
Contracts or in the 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
(2) arise out of or as a result of statements or representations
by or on behalf of the Company or wrongful conduct of the
Company or persons under its control, with respect to the
sale or distribution of the Contracts or Fund shares; or
(3) arise out of any untrue statement or alleged untrue
statement of a material fact contained in the Fund
registration statement, prospectus, statement of additional
information or sales literature or other promotional
material of the Fund (or amendment or supplement) or the
omission or alleged omission to state therein a material
fact required to be stated therein or necessary to make such
statements not misleading in light of the circumstances in
which they were made, if such a statement or omission was
made in reliance upon and in conformity with information
furnished to the Fund by or on behalf of the Company or
persons under its control; or
(4) arise as a result of any failure by the Company to provide
the services and furnish the materials under the terms of
this Agreement; or
(5) arise out of 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 8.1 (b) and 8.3 hereof.
This indemnification will be in addition to any liability that the
Company otherwise may have.
(b) No party will be entitled to indemnification under Section 8. 1
(a) to the extent such loss, claim, damage, liability or
litigation is due to the willful misfeasance, bad faith, or gross
negligence in the performance of such party's duties under this
Agreement, or by reason of such party's reckless disregard of its
obligations or duties under this Agreement by the party seeking
indemnification.
(c) The Indemnified Parties promptly will notify the Company of the
commencement of any litigation, proceedings, complaints or actions
by regulatory authorities against them in connection with the
issuance or sale of the Fund shares or the Contracts or the
operation of the Fund.
8.2 Indemnification By The Adviser, the Fund and CSAMSI
---------------------------------------------------
17
(a) The Adviser, the Fund and CSAMSI, in each case solely to the
extent relating to such party's responsibilities hereunder, agree
to indemnify and hold harmless the Company and each person, if
any, who controls or is associated with the Company within the
meaning of such terms under the federal securities laws and any
director, trustee, officer, partner, employee or agent of the
foregoing (collectively, the "Indemnified Parties" for purposes of
this Section 8.2) against any and all losses, claims, expenses,
damages, liabilities (including amounts paid in settlement with
the written consent of the Adviser) 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:
(1) 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 or necessary
to make such statements not misleading in light of the
circumstances in which they were made; provided that this
agreement to indemnify will not apply as to any Indemnified
Party if such statement or omission or such alleged
statement or omission was made in reliance upon and in
conformity with information furnished to the Adviser, CSAMSI
or the Fund by or 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 Fund shares; or
(2) arise out of or as a result of statements or representations
or wrongful conduct of the Adviser, the Fund or CSAMSI or
persons under the control of the Adviser, the Fund or CSAMSI
respectively, with respect to the sale of the Fund shares;
or
(3) 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 covering
the Contracts (or any amendment or supplement thereto), or
the omission or alleged omission to state therein a material
fact required to be stated or necessary to make such
statement or statements not misleading in light of the
circumstances in which they were made, if such statement or
omission was made in reliance upon and in conformity with
written information furnished to the Company by the Adviser,
the Fund or
18
CSAMSI or persons under the control of the Adviser, the Fund
or CSAMSI; or
(4) arise as a result of any failure by the Fund, the Adviser or
CSAMSI to provide the services and furnish the materials
under the terms of this Agreement (including a failure,
whether unintentional or in good faith or otherwise, to
comply with the diversification requirements and procedures
related thereto specified in Article VI of this Agreement):
or
(5) arise out of or result from any material breach of any
representation and/or warranty made by the Adviser, the Fund
or CSAMSI in this Agreement, or arise out of or result from
any other material breach of this Agreement by the Adviser,
the Fund or CSAMSI;
except to the extent provided in Sections 8.2(b) and 8.3 hereof.
(b) No party will be entitled to indemnification under Section 8.2(a)
to the extent such loss, claim, damage, liability or litigation is
due to the willful misfeasance, bad faith, or gross negligence in
the performance of such party's duties under this Agreement, or by
reason of such party's reckless disregard of its obligations or
duties under this Agreement by the party seeking indemnification.
(c) The Indemnified Parties will promptly notify the Adviser, the Fund
and CSAMSI of the commencement of any litigation, proceedings,
complaints or actions by regulatory authorities against them in
connection with the issuance or sale of the Contracts or the
operation of the Account.
8.3 Indemnification Procedure
-------------------------
Any person obligated to provide indemnification under this Article VIII
("Indemnifying Party" for the purpose of this Section 8.4) will not be liable
under the indemnification provisions of this Article VIII with respect to any
claim made against a party entitled to indemnification under this Article VIII
("Indemnified Party" for the purpose of this Section 8.3) unless such
Indemnified Party will 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 will have been served upon such
Indemnified Party (or after such party will have received notice of such
service on any designated agent), but failure to notify the Indemnifying Party
of any such claim will 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
VIII, except to the extent that the failure to notify results in the failure
of actual notice to the Indemnifying Party and such Indemnifying Party is
damaged solely as a result of failure to give such notice, 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 will 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
19
Party of the Indemnifying Party's election to assume the defense thereof, the
Indemnified Party will bear the fees and expenses of any additional counsel
retained by it, 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: (a) the Indemnifying Party and the
Indemnified Party will have mutually agreed to the retention of such counsel;
or (b) the named parties to any such proceeding (including any impleaded
parties) include both the Indemnifying Party and the Indemnified Party and
representation of both parties by the same counsel would be inappropriate due
to actual or potential differing interests between them. The Indemnifying
Party will not be liable for any settlement of any proceeding effected without
its written consent but if settled with such consent or if there is a final
judgment for the plaintiff, the Indemnifying Party agrees to indemnify the
Indemnified Party from and against any loss or liability by reason of such
settlement or judgment. A successor by law of the parties to this Agreement
will be entitled to the benefits of the indemnification contained in this
Article VIII. The indemnification provisions contained in this Article VIII
will survive any termination of this Agreement.
ARTICLE IX APPLICABLE LAW
--------------
9.1 This Agreement will be construed and the provisions hereof interpreted
under and in accordance with the laws of the State of Minnesota.
9.2 This Agreement will be subject to the provisions of the 1933 Act, the
1934 Act and the 1940 Act, and the rules and regulations and rulings
thereunder, including such exemptions from those statutes, rules and
regulations as the SEC may grant (including, but not limited to, the
Mixed and Shared Funding Exemptive Order) and the terms hereof will be
interpreted and construed in accordance therewith.
ARTICLE X. TERMINATION
-----------
10.1 This Agreement will terminate:
(a) at the option of any party, with or without cause, with respect to
some or all of the Designated Portfolios, upon ninety (90) days'
advance written notice to the other parties or, if later, upon
receipt of any required exemptive relief or orders from the SEC,
unless otherwise agreed in a separate written agreement among the
parties; or
(b) at the option of the Company, upon receipt of the Company's
written notice by the other parties, with respect to any
Designated Portfolio if shares of the Designated Portfolio are not
reasonably available to meet the requirements of the Contracts as
determined in good faith by the Company; or
(c) at the option of the Company, upon receipt of the Company's
written notice by the other parties, with respect to any
Designated Portfolio in the event any of the Designated
Portfolio's shares are not registered, issued or sold in
accordance with
20
applicable state and/or federal law or such law precludes the use
of such shares as the underlying investment media of the Contracts
issued or to be issued by Company; or
(d) at the option of the Fund, upon receipt of the Fund's written
notice by the other parties, upon institution of formal
proceedings against the Company by the NASD, 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 Account, or the purchase of the Fund shares,
provided that the Fund determines in its sole judgment, exercised
in good faith, that any such proceeding would have a material
adverse effect on the Company's ability to perform its obligations
under this Agreement; or
(e) at the option of the Company, upon receipt of the Company's
written notice by the other parties, upon institution of formal
proceedings against the Fund or CSAMSI by the NASD, the SEC, or
any state securities or insurance department or any other
regulatory body, provided that the Company determines in its sole
judgment, exercised in good faith, that any such proceeding would
have a material adverse effect on the Fund's or CSAMSI's ability
to perform its obligations under this Agreement; or
(f) at the option of the Company, upon receipt of the Company's
written notice by the other parties, if the Fund ceases to qualify
as a Regulated Investment Company under Subchapter M of the
Internal Revenue Code, or under any successor or similar
provision, or if the Company reasonably and in good faith believes
that the Fund may fail to so qualify; or
(g) at the option of the Company, upon receipt of the Company's
written notice by the other parties, with respect to any
Designated Portfolio if the Fund fails to meet the diversification
requirements specified in Article V1 hereof or if the Company
reasonably and in good faith believes the Fund may fail to meet
such requirements; or
(h) at the option of any party to this Agreement, upon written notice
to the other parties, upon another party's material breach of any
provision of this Agreement; or
(i) at the option of the Company, if the Company determines in its
sole judgment exercised in good faith, that either the Fund, the
Adviser or CSAMSI 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, such termination to be effective sixty
(60) days' after receipt by the other parties of written notice of
the election to terminate; or
21
(j) at the option of the Fund or CSAMSI, if the Fund or CSAMSI
respectively, determines 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 the Adviser, such
termination to be effective sixty (60) days' after receipt by the
other parties of written notice of the election to terminate; or
(k) at the option of the Company or the Fund upon receipt of any
necessary regulatory approvals and/or the vote of the
contractowners having an interest in the Account (or any
subaccount) to substitute the shares of another investment company
for the corresponding Designated Portfolio shares of the Fund in
accordance with the terms of the Contracts for which those
Designated Portfolio shares had been selected to serve as the
underlying investment media. The Company will give sixty (60)
days' prior written notice to the Fund of the date of any proposed
vote or other action taken to replace the Fund's shares; or
(l) at the option of the Company or the Fund upon a determination by a
majority of the Fund Board, or a majority of the disinterested
Fund Board members, that an irreconcilable material conflict
exists among the interests of: (1) all contractowners of variable
insurance products of all separate accounts; or (2) the interests
of the Participating Insurance Companies investing in the Fund as
set forth in Article VII of this Agreement; or
(m) at the option of the Fund in the event any of the Contracts are
not issued or sold in accordance with applicable federal and/or
state law. Termination will be effective immediately upon such
occurrence without notice.
10.2 Notice Requirement
------------------
No termination of this Agreement will be effective unless and until the party
terminating this Agreement gives prior written notice to all other parties of
its intent to terminate, which notice will set forth the basis for the
termination.
10.3 Effect of Termination
---------------------
Notwithstanding any termination of this Agreement, the Fund and CSAMSI will,
at the option of the Company, continue to make available additional shares of
the Fund pursuant to the terms and conditions of this Agreement, for all
Contracts in effect on the effective date of termination of this Agreement
(hereinafter referred to as "Existing Contracts."). Specifically, without
limitation, the owners of the Existing Contracts will be permitted to
reallocate investments in the Portfolios (as in effect on such date), redeem
investments in the Portfolios and/or invest in the Portfolios upon the making
of additional purchase payments under the Existing Contracts.
22
10.4 Surviving Provisions
--------------------
Notwithstanding any termination of this Agreement, each party's obligations
under Article VIII to indemnify other parties will survive and not be affected
by any termination of this Agreement. In addition, each party's obligations
under Section 12.7 will survive and not be affected by any termination of this
Agreement. Finally, with respect to Existing Contracts, all provisions of this
Agreement also will survive and not be affected by any termination of this
Agreement.
ARTICLE XI. NOTICES
-------
11.1 Any notice will be deemed duly given when sent by registered or
certified mail 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 parties.
If to the Company:
American Enterprise Life Insurance Company
American Partners Life Insurance Company
IDS Life Insurance Company
0000 Xxxxxxxxxx Xxxxxxxxx Xxxxxx
Xxxxxxxxxxx, Xxxxxxxxx 00000
Attention: Xxxxx X. Xxxxxx, Executive Vice President - Annuities
With a simultaneous copy to:
IDS Life Insurance Company
50607 Ameriprise Financial Center
Xxxxxxxxxxx, Xxxxxxxxx 00000
Attention: Vice President and Group Counsel
If to the Fund, the Adviser and/or CSAMSI:
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attn: General Counsel
ARTICLE XII. MISCELLANEOUS
-------------
12.1 All persons dealing with the Fund must look solely to the property of
the Fund for the enforcement of any claims against the Fund as neither
the directors, trustees, officers, partners, employees, agents or
shareholders assume any personal liability for obligations entered into
on behalf of the Fund. No Portfolio or series of the Fund will be liable
for the obligations or liabilities of any other Portfolio or series.
23
12.2 Notwithstanding anything to the contrary contained in this Agreement, in
addition to and not in lieu of other provisions in this Agreement:
(a) The Fund, the Adviser and CSAMSI acknowledge that the identities
of the customers of the Company or any of its affiliates
(collectively the "Company Protected Parties" for purposes of this
Section 12.2), information maintained regarding those customers,
and all computer programs and procedures or any other information
developed or used by the Company Protected Parties or any of their
employees or agents in connection with the Company's performance
of its duties under this Agreement (such information referred to
herein as "Company Information") are the valuable property of the
Company Protected Parties. The Fund, the Adviser and CSAMSI agree
that if they come into possession of any Company Information,
other than such information as is publicly available or as may be
independently developed or compiled by the Fund, the Adviser or
CSAMSI from information supplied to them by the Company Protected
Parties' customers who also maintain accounts directly with the
Fund, the Adviser or CSAMSI, the Fund, the Adviser and CSAMSI will
hold such Company Information in confidence and refrain from
using, disclosing or distributing any of the Company Information
except: (a) with the Company's prior written consent; (b) as
required by law or judicial process; or (c) to carry out the
Fund's, the Advisor's or CSAMSI's duties and obligations pursuant
to this Agreement. The Company acknowledges that the identities of
the customers of the Fund, the Adviser, CSAMSI or any of their
affiliates (collectively the "Adviser Protected Parties" for
purposes of this Section 12.2), information maintained regarding
those customers, and all computer programs and procedures or other
information developed or used by the Adviser Protected Parties or
any of their employees or agents in connection with the Funds',
the Adviser's or CSAMSI's performance of their respective duties
under this Agreement (such information referred to herein as the
"Advisor Information") are the valuable property of the Adviser
Protected Parties. The Company agrees that if it comes into
possession of any of the Advisor Information, other than such
information as is publicly available or as may be independently
developed or compiled by the Company from information supplied to
it by the Adviser Protected Parties' customers who also maintain
accounts directly with the Company, the Company will hold the
Advisor Information or property in confidence and refrain from
using, disclosing or distributing any of the Advisor Information
except: (a) with the Fund's, the Adviser's or CSAMSI's prior
written consent; (b) as required by law or judicial process; or
(c) to carry out the Company's duties and obligations pursuant to
this Agreement. Each party acknowledges that any breach of the
agreements in this Section 12.2 would result in immediate and
irreparable harm to the other parties for which there would be no
adequate remedy at law and agree that in the event of such a
breach, the other parties will be entitled to equitable relief by
way of temporary and permanent injunctions, as well as such other
relief as any court of competent jurisdiction deems appropriate.
24
(b) The Fund, the Advisor and CSAMSI agree to cause all their
employees, agents and representatives, or any other party to whom
the Fund, the Advisor or CSAMSI may provide access to or disclose
the Company Information to limit the use and disclosure of the
Company Information to that purpose. The Company agrees to cause
all its employees, agents and representatives, or any other party
to whom the Company may provide access to or disclose the Advisor
Information, to limit the use and disclosure of the Advisor
Information to that purpose.
(c) Each party hereto agrees to implement appropriate measures
designed to ensure the security and confidentiality of the Company
Information and the Advisor Information, as may be applicable, to
protect such information against any anticipated threat or hazard
to the security or integrity of such information, and to protect
against unauthorized access to, or use of, such information that
could result in substantial harm or inconvenience to any customer
of the respective parties; each party further agrees to cause all
its agents, representatives or subcontractors or implement
appropriate measures designed to meet the objectives set forth in
this paragraph.
(d) Each party acknowledges that any breach of the agreements in this
Section 12.2 would result in immediate and irreparable harm to the
other parties for which there would be no adequate remedy at law
and agree in the event of such a breach, the other parties will be
entitled to equitable relief by way of temporary and permanent
injunctions, as well as such other relief as any court of
competent jurisdiction deems appropriate. This Section 12.2 shall
survive the termination of this Agreement.
12.3 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.
12.4 This Agreement may be executed simultaneously in two or more
counterparts, each of which taken together will constitute one and the
same instrument.
12.5 If any provision of this Agreement will be held or made invalid by a
court decision, statute, rule or otherwise, the remainder of the
Agreement will not be affected thereby.
12.6 This Agreement will not be assigned by any party hereto without the
prior written consent of all the parties except that CSAMSI may assign,
in whole or in part, its responsibilities hereunder, as distributor, to
a third party which replaces CSAMSI as distributor.
12.7 Each party to this Agreement will maintain all records required by law,
including records detailing the services it provides. Such records will
be preserved, maintained and made available to the extent required by
law and in accordance with the 1940 Act and the rules thereunder. Each
party to this Agreement will cooperate with each other party and all
appropriate governmental authorities (including without limitation the
SEC, the NASD
25
and state insurance regulators) and will permit each other and such
authorities reasonable access to its books and records in connection
with any investigation or inquiry relating to this Agreement or the
transactions contemplated hereby. Upon request by the Fund or CSAMSI,
the Company agrees to promptly make copies or, if required, originals of
all records pertaining to the performance of services under this
Agreement available to the Fund or CSAMSI, as the case may be. The Fund
agrees that the Company will have the right to inspect, audit and copy
ail records pertaining to the performance of services under this
Agreement pursuant to the requirements of any state insurance
department. Each party also agrees to promptly notify the other parties
if it experiences any difficulty in maintaining the records in an
accurate and complete manner. This provision will survive termination of
this Agreement.
12.8 Each party represents that the execution and delivery of this Agreement
and the consummation of the transactions contemplated herein have been
duly authorized by all necessary corporate or board 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.
12.9 The parties to this Agreement acknowledge and agree that all liabilities
of the Fund arising, directly or indirectly, under this agreement, will
be satisfied solely out of the assets of the Fund and that no trustee,
officer, agent or holder of shares of beneficial interest of the Fund
will be personally liable for any such liabilities.
12.10 The parties to this Agreement may amend the schedules to this Agreement
from time to time to reflect changes in or relating to the Contracts,
the Accounts or the Designated Portfolios of the Fund or other
applicable terms of this Agreement.
26
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 specified above.
AMERICAN ENTERPRISE LIFE ATTEST:
INSURANCE COMPANY
AMERICAN PARTNERS LIFE
INSURANCE COMPANY By: /s/ Xxxxx Xxxxxx
IDS LIFE INSURANCE COMPANY -----------------------------
Name: Xxxxx Xxxxxx
Title: Assistant Secretary
By: /s/ Xxxxx X. Xxxxxx
----------------------------------------
Name: Xxxxx X. Xxxxxx
Title: President, American Enterprise Life
Insurance Company
President, American Partners Life
Insurance Company
Executive Vice President - Annuities,
IDS Life Insurance Company
CREDIT SUISSE TRUST
By: /s/ Xxxxxx X. Plump
----------------------------------------
Name: Xxxxxx X. Plump
Title: CEO/President
CREDIT SUISSE ASSET MANAGEMENT, LLC
By: /s/ Xxxxxx X. Plump
----------------------------------------
Name: Xxxxxx X. Plump
Title: Managing Director
CREDIT SUISSE ASSET MANAGEMENT SECURITIES, INC.
By: /s/ Xxxxxx X. Plump
----------------------------------------
Name: Xxxxxx X. Plump
Title: President
27
SCHEDULE A
AMENDED AND RESTATED
PARTICIPATION AGREEMENT
By and Among
AMERICAN ENTERPRISE LIFE INSURANCE COMPANY
AMERICAN PARTNERS LIFE INSURANCE COMPANY
IDS LIFE INSURANCE COMPANY
And
CREDIT SUISSE TRUST
And
CREDIT SUISSE ASSET MANAGEMENT, LLC
And
CREDIT SUISSE ASSET MANAGEMENT SECURITIES, INC.
The following separate accounts of American Enterprise Life Insurance Company
are permitted in accordance with the provisions of this Agreement to invest in
Designated Portfolios of the Fund shown in Schedule B:
American Enterprise Variable Annuity Account established July 15, 1987
American Enterprise Variable Life Account established July 15, 1987
28
SCHEDULE A-1
AMENDED AND RESTATED
PARTICIPATION AGREEMENT
By and Among
AMERICAN ENTERPRISE LIFE INSURANCE COMPANY
AMERICAN PARTNERS LIFE INSURANCE COMPANY
IDS LIFE INSURANCE COMPANY
And
CREDIT SUISSE TRUST
And
CREDIT SUISSE ASSET MANAGEMENT, LLC
And
CREDIT SUISSE ASSET MANAGEMENT SECURITIES, INC.
The following separate accounts of American Partners Life Insurance Company
are permitted in accordance with the provisions of this Agreement to invest in
Designated Portfolios of the Fund shown in Schedule B-1:
APL Variable Annuity Account 1 established February 9, 1995.
29
SCHEDULE A-2
AMENDED AND RESTATED
PARTICIPATION AGREEMENT
By and Among
AMERICAN ENTERPRISE LIFE INSURANCE COMPANY
AMERICAN PARTNERS LIFE INSURANCE COMPANY
IDS LIFE INSURANCE COMPANY
And
CREDIT SUISSE TRUST
And
CREDIT SUISSE ASSET MANAGEMENT, LLC
And
CREDIT SUISSE ASSET MANAGEMENT SECURITIES, INC.
The following separate accounts of IDS Life Insurance Company are permitted in
accordance with the provisions of this Agreement to invest in Designated
Portfolios of the Fund show in Schedule B-2:
IDS Life Variable Account 10 established August 23, 1995.
30
SCHEDULE B
AMENDED AND RESTATED
PARTICIPATION AGREEMENT
By and Among
AMERICAN ENTERPRISE LIFE INSURANCE COMPANY
AMERICAN PARTNERS LIFE INSURANCE COMPANY
IDS LIFE INSURANCE COMPANY
And
CREDIT SUISSE TRUST
And
CREDIT SUISSE ASSET MANAGEMENT, LLC
And
CREDIT SUISSE ASSET MANAGEMENT SECURITIES, INC.
The Separate Accounts shown on Schedule A may invest in the following
Designated Portfolios of the Credit Suisse Trust:
Mid-Cap Growth Portfolio
31
SCHEDULE B-1
AMENDED AND RESTATED
PARTICIPATION AGREEMENT
By and Among
AMERICAN ENTERPRISE LIFE INSURANCE COMPANY
AMERICAN PARTNERS LIFE INSURANCE COMPANY
IDS LIFE INSURANCE COMPANY
And
CREDIT SUISSE TRUST
And
CREDIT SUISSE ASSET MANAGEMENT, LLC
And
CREDIT SUISSE ASSET MANAGEMENT SECURITIES, INC.
The Separate Accounts shown on Schedule A-1 may invest in the following
Designated Portfolios of the Credit Suisse Trust:
Global Small Cap Portfolio
32
SCHEDULE B-2
AMENDED AND RESTATED
PARTICIPATION AGREEMENT
By and Among
AMERICAN ENTERPRISE LIFE INSURANCE COMPANY
AMERICAN PARTNERS LIFE INSURANCE COMPANY
IDS LIFE INSURANCE COMPANY
And
CREDIT SUISSE TRUST
And
CREDIT SUISSE ASSET MANAGEMENT, LLC
And
CREDIT SUISSE ASSET MANAGEMENT SECURITIES, INC.
The Separate Accounts shown on Schedule A-2 may invest in the following
Designated Portfolios of the Credit Suisse Trust:
Commodity Return Strategy Portfolio
Mid-Cap Growth Portfolio
Small Cap Growth Portfolio
33
