SERVICE AGREEMENT
WITH
INVESTMENT ADVISER
AGREEMENT, effective as of December 8, 1997, between Janus Capital
Corporation (the "Adviser"), a Colorado corporation, and Aetna Life Insurance
and Annuity Company (the "Company"), a Connecticut corporation, for the
provision of described administrative services by the Company in connection with
the sale of shares of the Janus Aspen Series (the "Fund") as described in the
Fund Participation Agreement dated December 8, 1997 between the Company, the
Fund and the Adviser (the "Fund Participation Agreement").
In consideration of their mutual promises, the Adviser and the Company agree as
follows:
1. The Company agrees to provide the following services to the Adviser and the
Fund:
a. responding to inquiries from owners of or Participants in the
Company variable annuity contracts and variable life insurance
policies using the Funds as an investment vehicle ("Contract
Owners") regarding the services performed by the Company that
relate to the Funds;
b. providing information to Adviser and Contract Owners with respect
to Fund shares attributable to Contract Owner accounts;
c. communicating directly with Contract Owners concerning the Funds'
operations;
d. providing such other similar services as Adviser may reasonably
request pursuant to Adviser's agreement with the Funds to the
extent permitted under applicable federal and state requirements.
2. (a) Administrative services to Contract Owners and Participants
shall be the responsibility of the Company and shall not be the
responsibility of the Fund or the Adviser. The Adviser recognizes
the Company as the sole shareholder of Fund shares issued under
the Fund Participation Agreement, and that substantial savings
will be derived in administrative expenses, such as significant
reductions in postage expense and shareholder communications, by
virtue of having a sole shareholder for each of the Accounts
rather than multiple shareholders. In consideration of the
savings resulting from such arrangement, and to compensate the
Company for its costs, the Adviser agrees to pay to the Company
and the Company agrees to accept as full compensation for all
services rendered hereunder an amount described in Schedule A
attached hereto and made a part of this
Agreement as may be amended from time to time with the mutual
consent of the parties hereto.
(b) The Company represents and warrants that the Adviser's payments
to the Company are for administrative services only and do not
constitute payment in any manner for investment advisory services
or for costs of distribution.
(c) For the purposes of computing the administrative fee
reimbursement contemplated by this Section 2, the average
aggregate amount invested by the Company over a one month period
shall be computed by totaling the Company's aggregate investment
(share net asset value multiplied by total number of shares held
by the Company) on each business day during the month and
dividing by the total number of business days during each month.
(d) The Adviser will calculate the reimbursement of administrative
expenses at the end of each month and will make such
reimbursement to the Company within 30 days thereafter. The
reimbursement payment will be accompanied by a statement showing
the calculation of the monthly amounts payable by the Adviser and
such other supporting data as may be reasonably requested by the
Company. Payment will be wired by the Adviser to an account
designated by the Company.
3. (a) The Company represents and warrants that: (1) it and its
employees meet and it will use its best efforts to assure that
its agents meet the requirements of applicable law, including but
not limited to federal and state securities law and state
insurance law, for the performance of services contemplated
herein; (2) the fee provided herein does not include any payment
to the Company that is prohibited under the Employee Retirement
Income Securities Act of 1974 ("ERISA") with respect to any
assets of a Contract Owner invested in a Contract using the Funds
as investment vehicles; and (3) the Company is (i) registered as
a broker-dealer (ii) has entered into arrangements with an
affiliate to act as its broker-dealer, or (iii) is not required
to be registered a s a broker-dealer pursuant to the Securities
Exchange Act of 1934 (the "Exchange Act") or any applicable state
securities laws in order to enter into and perform the services
set forth in this Agreement.
(b) The Company represents, warrants and agrees that, if required by
applicable law, as determined solely in discretion of the
Company, the Company will disclose to each Contract Owner the
existence of the fee received by the Company pursuant to this
Agreement in a form consistent with the requirements of
applicable law.
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4. The Company agrees to indemnify and hold harmless the Adviser and its
directors, officers, and employees from any and all loss, liability and
expense resulting from any gross negligence or willful wrongful act of
the Company or its employees or agents under this Agreement or a breach
of a material provision of this Agreement, except to the extent such
loss, liability or expense is the result of the Adviser's misfeasance,
bad faith or gross negligence in the performance of its duties.
5. The Adviser agrees to indemnify and hold harmless the Company and its
directors, officers, and employees from any and all loss, liability and
expense resulting from any gross negligence or willful wrongful act of
the Adviser or its employees or agents under this Agreement or a breach
of a material provision under this Agreement, except to the extent such
loss, liability or expense is the result of the Company's own
misfeasance, bad faith or gross negligence in the performance of its
duties.
6. Either party may terminate this Agreement, without penalty, (i) on
sixty (60) days written notice to the other party, for any cause or
without cause, or (ii) on reasonable notice to the other party, if it
is not permissible to continue the arrangement described herein under
laws, rules or regulations applicable to either party or the Fund, or
if the Participation Agreement is terminated.
This Agreement may not be assigned (as that term is defined in the 0000
Xxx) by either party without the prior written approval of the other
party, which approval will not be unreasonably withheld, except that
the Adviser may assign its obligations under this Agreement, including
the payment of all or any portion of the fee, to the Fund upon one
hundred and twenty (120) days' written notice to the Company if legally
permissible to do so and provided Fund and/or Adviser agree to pay for
any costs or expenses incurred with such charge (e.g. prospectuses,
etc.) unless such change is able to be made in the ordinary course of
updating the prospectus for its annual update.)
7. The terms of this arrangement will be held confidential by each party
except to the extent that either party or its counsel may deem it
necessary under applicable law to disclose this arrangement.
8. This Agreement together with the Fund Participation Agreement
represents the entire Agreement of the parties on the subject matter
hereof and it cannot be amended or modified except in writing, signed
by the parties. This Agreement may be executed in one or more separate
counterparts, all of which, when taken together, shall constitute one
and the same Agreement.
9. All notices and other communications hereunder shall be given or made
in writing and shall be delivered personally, or sent by telex,
telecopier or registered or certified mail, postage prepaid, return
receipt requested, to the party to whom they
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are directed at the following addresses, or at such other addresses as
may be designated by notice from such party to the other party.
To Aetna:
Aetna Life Insurance and Annuity Company
000 Xxxxxxxxxx Xxxxxx
Xxxxxxxx, Xxxxxxxxxxx 00000
Attention: Xxxxx X. Xxxxxxxx, Counsel
To Adviser:
Janus Capital Corporation
000 Xxxxxxxx Xxxxxx
Xxxxxx, Xxxxxxxx 00000
Attention: General Counsel
Any notice, demand or other communication given in a manner prescribed in this
Section 8 shall be deemed to have been delivered on receipt.
IN WITNESS WHEREOF, the parties to this Agreement have caused this
Agreement to be executed by their authorized officers as of the day and year
first above written.
JANUS CAPITAL CORPORATION
By: /s/ Xxxxxxx X. Xxxxxxxxx
--------------------------------------
Date: 12/2/97
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AETNA LIFE INSURANCE AND ANNUITY COMPANY
By: /s/ Xxxxxx X. XxXxxxx
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Date: 12/8/97
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Schedule A
Dated this 8th day of December, 1997.
JANUS CAPITAL CORPORATION
By: /s/ Xxxxxxx X. Xxxxxxxxx
-------------------------------------
Date: 12/2/97
-------------------------------------
AETNA LIFE INSURANCE AND ANNUITY COMPANY
By: /s/ Xxxxxx X. XxXxxxx
-------------------------------------
Date: 12/8/97
-------------------------------------
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