Exhibit 99-B.8.3
PARTICIPATION AGREEMENT
among
AFD, ACML and ALIAC
Aetna Life Insurance and Annuity Company (the "Company"), Alliance Fund
Distributors, Inc. ("AFD") and Alliance Capital Management L.P. (the "Adviser")
hereby agree to an arrangement whereby AFD shall make available Class A shares
of Alliance Variable Products Series Fund, Inc. (the "Fund") to serve as
underlying investment media for Variable Annuity or Variable Life Contracts
("Contracts") to be issued by the Company.
1. Establishment of Accounts; Availability of Fund.
(a) The Company represents that it has established Variable Annuity
Accounts B, C, D and Variable Life Accounts B and C and may
establish such other accounts as may be set forth in Schedule A
attached hereto and as may be amended from time to time with the
mutual consent of the parties hereto (the "Accounts"), each of which
is a separate account under Connecticut Insurance law, and has
registered or will register each of the Accounts (except for such
Accounts for which no such registration is required) as a unit
investment trust under the Investment Company Act of 1940 (the "1940
Act"), to serve as an investment vehicle for the Contracts. Each
Contract provides for the allocation of net amounts received by the
Company to an Account for investment in the shares of one of more
specified open-end management investment companies available through
that Account as underlying investment media. Selection of a
particular investment management company and changes therein from
time to time are made by the participant or Contract owner, as
applicable under a particular Contract.
(b) AFD and the Adviser represent and warrant that the investments of
the series of the Fund (each designated a "Portfolio") specified in
Schedule B attached hereto (as may be amended from time to time with
the mutual consent of the parties hereto) will at all times be
adequately diversified within the meaning of Section 817(h) of the
Internal Revenue Service Code of 1986, as amended (the "Code"), and
the Regulations thereunder, and that at all times while this
agreement is in effect, all beneficial interests will be owned by
one or more insurance companies or by any other party permitted
under Section 1.817-5(f)(3) of the Regulations promulgated under the
Code or by the successor thereto, or by any other party permitted
under a Revenue Ruling or private letter ruling granted by the
Internal Revenue Service.
2. Pricing Information; Orders; Settlement.
(a) AFD will make Fund shares available to be purchased by the Company,
and will accept redemption orders from the Company, on behalf of
each Account at the net asset value applicable to each order on
those days on which the Fund calculates its net asset value (a
"Business Day"). Fund shares shall be purchased and redeemed in such
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quantity and at such time determined by the Company to be necessary
to meet the requirements of those Contracts for which the Fund serve
as underlying investment media, provided, however, that the Board of
Directors of the Fund (hereinafter the "Directors") may upon
reasonable notice to the Company, 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 Directors, acting in good faith and in the best
interests of the shareholders of any Portfolio and is acting in
compliance with their fiduciary obligations under federal and/or any
applicable state laws.
(b) AFD will provide to the Company the Fund's closing net asset value,
dividend and capital gain information at the close of trading each
day that the New York Stock Exchange (the "Exchange" is open (each
such day a "Business Day"), and in no event later than 7:00 p.m.
Eastern Standard time on such Business Day. The Company will send
via facsimile or electronic transmission to AFD or its specified
agent orders to purchase and/or redeem Fund shares by 10:00 a.m.
Eastern Standard Time the following business day. Payment for net
purchases will be wired by the Company to an account designated by
AFD to coincide with the order for shares of the Fund.
(c) AFD hereby appoints the Company as its agent for the limited purpose
of accepting purchase and redemption orders for Fund shares relating
to the Contracts from Contract owners or participants. Orders from
Contract owners or participants received from any distributor of the
Contracts (including affiliates of the Company) by the Company,
acting as agent for the Fund, prior to the close of the Exchange on
any given business day will be executed by the Fund at the net asset
value determined as of the close of the Exchange on such Business
Day, provided that AFD receives written (or facsimile) notice of
such order by 10 a.m. Eastern Standard Time on the next following
Business Day. Any orders received by the Company acting as agent on
such day but after the close of the Exchange will be executed by the
Fund at the net asset value determined as of the close of the
Exchange on the next business day following the day of receipt of
such order, provided that the Fund receives written (or facsimile)
notice of such order by 10 a.m. Eastern Standard Time within two
days following the day of receipt of such order.
(d) Payments for net redemptions of shares of the Fund will be wired by
AFD to an account designated by the Company. Payments for net
purchases of the Fund will be wired by the Company to an account
designated by AFD on the same Business Day the Company places an
order to purchase Fund shares. Payments shall be in federal funds
transmitted by wire.
(e) In lieu of applicable provisions set forth in paragraphs 2(a)
through 2(d) above, the parties may agree to provide pricing
information, execute orders and wire payments for purchases and
redemptions through National Securities Clearing Corporation's
Fund/SERV system in which case such activities will be governed by
the provisions set forth in an Exhibit to this Agreement.
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(f) Each party has the right to rely on information or confirmations
provided by the other party (or by any affiliate of the other
party), and shall not be liable in the event that an error is a
result of any misinformation supplied by the other party.
(g) The Company agrees to purchase and redeem the shares of the
Portfolios named in Schedule B offered by the then current
prospectus and statement of additional information of the Fund in
accordance with the provisions of such prospectus and statement of
additional information. The Company shall not permit any person
other than a Contract owner or Participant to give instructions to
the Company which would require the Company to redeem or exchange
shares of the Fund. This provision shall not be construed to
prohibit the Company from substituting shares of another fund, as
permitted by law.
3. Expenses.
(a) Except as otherwise provided in this Agreement, all expenses
incident to the performance by AFD or the Adviser under this
Agreement shall be paid by AFD or the Adviser or, as appropriate, by
the Fund, including the cost of registration of Fund shares with the
Securities and Exchange Commission (the "SEC") and in states where
required. AFD and the Adviser, individually, and on behalf of the
Fund, shall pay no fee or other compensation to the Company under
this Agreement, and the Company shall pay no fee or other
compensation to AFD, the Fund or Adviser, except as provided herein
and in Schedule C 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. All expenses incident to performance by each party
of its respective duties under this Agreement shall be paid by that
party, unless otherwise specified in this Agreement.
(b) AFD or the Adviser shall provide to the Company Post Script files of
periodic fund reports to shareholders and other materials that are
required by law to be sent to Contract owners. In addition, AFD or
the Adviser shall provide the Company with a sufficient quantity of
its prospectuses, statements of additional information and any
supplements to any of these materials, to be used in connection with
the offerings and transactions contemplated by this Agreement. In
addition, AFD shall provide the Company with a sufficient quantity
of its proxy material that is required to be sent to Contract
owners. The Adviser shall be permitted to review and approve the
typeset form of such material prior to such printing provided such
material has been provided by the Adviser to the Company within a
reasonable period of time prior to typesetting.
(c) In lieu of AFD's or Adviser's providing printed copies of
prospectuses, statements of additional information and any
supplements to any of these materials, and periodic fund reports to
shareholders, the Company shall have the right to request that AFD
transmit a copy of such materials in an electronic format (Post
Script files), which the Company may use to have such materials
printed together with similar materials of other Account funding
media that the Company or any distributor will distribute to
existing or prospective Contract owners or participants.
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4. Representations.
(a) The Company agrees that it and its agents shall not, without the
written consent of AFD or the Adviser, make representations
concerning the Fund, or its shares except those contained in the
then current prospectuses and in current printed sales literature
approved by or deemed approved by AFD or the Adviser.
(b) AFD and Adviser represent and warrant that (i) they have examined
and tested their systems and made reasonable inquiry of their
business partners and other entities with whom they conduct business
with respect to Year 2000 problems and (ii) their ability to perform
their obligations under this Agreement will not be interrupted or
disrupted as a result of any business interruptions or other
business problems relating to specific dates or days before, during
and after the Year 2000.
5. Termination.
This agreement shall terminate as to the sale and issuance of new
Contracts:
(a) at the option of either the Company, the Adviser, AFD or the Fund,
upon sixty days advance written notice to the other parties;
(b) at the option of the Company, upon one week advance written notice
to the Adviser and AFD, if Fund shares are not available for any
reason to meet the requirement of Contracts as determined by the
Company. Reasonable advance notice of election to terminate shall be
furnished by Company;
(c) at the option of either the Company, the Adviser, AFD or the Fund,
immediately upon institution of formal proceedings against the
broker-dealer or broker-dealers marketing the Contracts, the
Account, the Company, AFD, the Fund or the Adviser by the National
Association of Securities Dealers, Inc. (the "NASD"), the SEC or any
other regulatory body;
(d) upon the determination of the Accounts to substitute for the Fund's
shares the shares of another investment company in accordance with
the terms of the applicable Contracts. The Company will give 60 days
written notice to AFD and the Adviser of any decision to replace the
Fund's shares;
(e) upon assignment of this Agreement, unless made with the written
consent of all other parties hereto;
(f) if Fund shares are not registered, issued or sold in conformance
with Federal law or such law precludes the use of Fund shares as an
underlying investment medium for
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Contracts issued or to be issued by the Company. Prompt notice shall
be given by the appropriate party should such situation occur.
6. Continuation of Agreement.
Termination as the result of any cause listed in Section 5 shall not
affect AFD's obligation to furnish Fund shares to Contracts then in force for
which Fund shares serve or may serve as the underlying medium unless such
further sale of Fund shares is prohibited by law or the SEC or other regulatory
body, or is determined by the Fund's Board to be necessary to remedy or
eliminate an irreconcilable conflict pursuant to Section 10 hereof.
7. Advertising Materials; Filed Documents.
(a) Advertising and sales literature with respect to the Fund prepared
by the Company or its agents for use in marketing its Contracts will
be submitted to AFD or its designee for review before such material
is submitted to any regulatory body for review. No such material
shall be used if AFD or its designee reasonably object to such use
in writing, transmitted by facsimile within two business days after
receipt of such material.
(b) AFD will provide additional copies of the Fund's financials as soon
as available to the Company and at least one complete copy of all
registration statements, prospectuses, statements of additional
information, annual and semi-annual reports, proxy statements and
all amendments or supplements to any of the above that relate to the
Fund promptly after the filing of such document with the SEC or
other regulatory authorities. At the Adviser's request, the Company
will provide to the Adviser at least one complete copy of all
registration statements, prospectuses, statements of additional
information, annual and semi-annual reports, proxy statements, and
all amendments or supplements to any of the above that relate to the
Account promptly after the filing of such document with the SEC or
other regulatory authority.
(c) AFD or the Adviser will provide via Excel spreadsheet diskette
format or in electronic transmission to the Company at least
quarterly portfolio information necessary to update Fund profiles
within seven business days following the end of each quarter.
(d) AFD will reimburse the Company for any incorrect information
provided to the Company under this Section as provided for in
Schedule C.
8. Proxy Voting.
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(a) The Company shall provide pass-through voting privileges on Fund
shares held by registered separate accounts to all Contract owners
and participants to the extent the SEC continues to interpret the
1940 Act as requiring such privileges. The Company shall provide
pass-through voting privileges on Fund shares held by unregistered
separate accounts to all Contract owners.
(b) The Company will distribute to Contract owners and participants, as
appropriate, all Fund proxy material furnished by AFD and will vote
Fund shares in accordance with instructions received from such
Contract owners and participants. If and to the extent required by
law, the Company, with respect to each group Contract and in each
Account, shall vote Fund shares for which no instructions have been
received in the same proportion as shares for which such
instructions have been received. The Company and its agents shall
not oppose or interfere with the solicitation of proxies for Fund
shares held for such Contract owners and participants.
9. Indemnification.
(a) The Company agrees to indemnify and hold harmless AFD and the
Adviser, and its directors, officers, employees, agents and each
person, if any, who controls AFD or the Adviser within the meaning
of the Securities Act of 1933 (the "1933 Act") against any losses,
claims, damages or liabilities to which AFD or the Adviser or any
such director, officer, employee, agent, or controlling person may
become subject, under the 1933 Act or otherwise, insofar as such
losses, claims, damages, or liabilities (or actions in respect
thereof) 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 sales literature of the
Company or arise out of or are based upon the omission or the
alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not
misleading, or arise out of or as a result of conduct, statements or
representations (other than statements or representations contained
in the prospectuses or sales literature of the Fund) of the Company
or its agents, with respect to the sale and distribution of
Contracts for which Fund shares are the underlying investment. The
Company will reimburse any legal or other expenses reasonably
incurred by AFD or the Adviser or any such director, officer,
employee, agent, investment adviser, or controlling person in
connection with investigating or defending any such loss, claim,
damage, liability or action; provided, however, that the Company
will not be liable in any such case to the extent that any such
loss, claim, damage or liability arises out of or is based upon (i)
an untrue statement or omission or alleged omission made in such
Registration Statement or prospectus in conformity with written
materials furnished to the Company by AFD or the Adviser
specifically for use therein or (ii) the willful misfeasance, bad
faith, or gross negligence by AFD or the Adviser in the performance
of its duties or AFD's or Adviser's reckless disregard of
obligations or duties under this Agreement or to the Company,
whichever is applicable. This indemnity agreement will be in
addition to any liability which Company may otherwise have.
(b) AFD and the Adviser agree to indemnify and hold harmless the Company
and its directors, officers, employees, agents and each person, if
any, who controls the
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Company within the meaning of the 1933 Act against any losses,
claims, damages or liabilities to which the Company or any such
director, officer, employee, agent or controlling person may become
subject, under the 1933 Act or otherwise, insofar as such losses,
claims, damages or liabilities (or actions in respect thereof) arise
out of or are based upon any untrue statement or alleged untrue
statement of any material fact contained in the Registration
Statement, prospectuses or sales literature of the Fund or arise out
of or are based upon the omission or the alleged omission to state
therein a material fact required to be stated therein or material
fact required to be stated therein or necessary to make the
statements therein not misleading. AFD or the Adviser will reimburse
any legal or other expenses reasonably incurred by the Company or
any such director, officer, employee, agent, or controlling person
in connection with investigating or defending any such loss, claim,
damage, liability or action; provided, however, that AFD and the
Adviser will not be liable in any such case to the extent that any
such loss, claim, damage or liability arises out of or is based upon
an untrue statement or omission or alleged omission made in such
Registration Statement or prospectuses which are in conformity with
written materials furnished to AFD or the Adviser by the Company
specifically for use therein.
(c) Promptly after receipt by an indemnified party hereunder of notice
of the commencement of action, such indemnified party will, if a
claim in respect thereof is to be made against the indemnifying
party hereunder, notify the indemnifying party of the commencement
thereof; but the omission so to notify the indemnifying party will
not relieve it from any liability which it may have to any
indemnified party otherwise than under this Section 10. In case any
such action is brought against any indemnified party, and it
notifies the indemnifying party of the commencement thereof, the
indemnifying party will be entitled to participate therein and, to
the extent that it may wish to, assume the defense thereof, with
counsel satisfactory to such indemnified party, and after notice
from the indemnifying party to such indemnified party of its
election to assume the defense thereof, the indemnifying party will
not be liable to such indemnified party under this Section 9 for any
legal or other expenses subsequently incurred by such indemnified
party in connection with the defense thereof other than reasonable
costs of investigation.
10. Potential Conflicts.
(a) The Fund has obtained an order exempting it from certain provisions
of the 1940 Act and rules thereunder so that the Fund is available
for investment by certain other entities, including, without
limitation, separate accounts funding variable life insurance
policies and variable annuity contracts and separate accounts of
insurance companies unaffiliated with the Company ("Mixed and Shared
Funding Order"). The Parties recognize that the SEC has imposed
terms and conditions for such orders that are substantially
identical to many of the provisions of this Section 10.
(b) The Fund agrees that its Board of Directors shall at all times
consist of directors a majority of whom (the "Disinterested
Directors") are not interested persons of Adviser or AFD within the
meaning of Section 2(a)(19) of the 1940 Act.
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(c) The Fund agrees that its Board of Directors will monitor for the
existence of any material irreconcilable conflict between the
interests of the contract owners or participants in all separate
accounts of life insurance companies utilizing the Fund, including
the Accounts. The Company agrees to inform the Board of Directors of
the Fund of the existence of or any potential for any such material
irreconcilable conflict of which it is aware. The concept of a
"material irreconcilable conflict" is not defined by the 1940 Act or
the rules thereunder, but the Parties recognize that such a conflict
may arise for a variety of reasons, including, without limitation:
(i) an action by any state insurance or other regulatory
authority;
(ii) 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;
(iii) an administrative or judicial decision in any relevant
proceeding;
(iv) the manner in which the investments of any Portfolio are being
managed;
(v) a difference in voting instructions given by variable annuity
and variable life insurance contract owners or participants or
by contract owners or participants of different life insurance
companies utilizing the Fund; or
(vi) a decision by a life insurance company utilizing the Fund to
disregard the voting instructions of Contract owners or
participants.
(d) The Company will assist the Board of Directors in carrying out its
responsibilities by providing the Board of Directors with all
information reasonably necessary for the Board of Directors to
consider any issue raised, including information as to a decision by
the Company to disregard voting instructions of Contract owners or
participants.
(e) It is agreed that if it is determined by a majority of the members
of the Board of Directors or a majority of the Disinterested
Directors that a material irreconcilable conflict exists, and if the
Board of Directors determines that the Company is responsible for
causing or creating said conflict, the Company will, at its own
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 material irreconcilable
conflict, which steps may include, but are not limited to:
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(i) withdrawing the assets allocable to some or all of the
separate accounts from the Fund or any Portfolio and
reinvesting such assets in a different investment medium,
including another Portfolio of the Fund, or submitting the
question whether such segregation should be implemented to a
vote of all affected contract owners and participants and, as
appropriate, segregating the assets of any particular group
(e.g., annuity contract owners or participants, life insurance
contract owners or participants or all contract owners and
participants of one or more life insurance companies utilizing
the Fund) that votes in favor of such segregation, or offering
to the affected contract owners or participants the option of
making such a change; and
(ii) establishing a new registered investment company of the type
defined as a "Management Company" in Section 4(3) of the 1940
Act or a new separate account that is operated as a Management
Company.
(f) If the material irreconcilable conflict arises because of the
Company's decision to disregard Contract owners' or participants'
voting instructions and that decision represents a minority position
or would preclude a majority vote, the Company may be required, at
the Fund's election, to withdraw the Account's investment in the
Fund. No charge or penalty will be imposed as a result of such
withdrawal. Any such withdrawal must take place within six months
after the Fund gives notice to the Company that this provision is
being implemented, and until such withdrawal AFD and the Fund shall
continue to accept and implement orders by the Company for the
purchase and redemption of shares of the Fund.
(g) If a material irreconcilable conflict arises because a particular
state insurance regulator's decision applicable to the Company
conflicts with the majority of other state regulators, then the
Company will withdraw the Account's investment in the Fund within
six months after the Fund's Board of Directors informs the Company
that it has determined that such decision has created a material
irreconcilable conflict, and until such withdrawal AFD and Fund
shall continue to accept and implement orders by the Company for the
purchase and redemption of shares of the Fund.
(h) The Company agrees that any remedial action taken by it in resolving
any material irreconcilable conflict will be carried out at its
expense and with a view only to the interests of Contract owners and
participants.
(i) For purposes hereof, a majority of the Disinterested Directors will
determine whether or not any proposed action adequately remedies any
material irreconcilable conflict. In no event, however, will the
Fund or AFD be required to establish a new funding medium for any
Contracts. The Company will not be required by the terms hereof to
establish a new funding medium for any Contracts if an offer to do
so has been declined by vote of a majority of the Contract owners
and participants materially adversely affected by the material
irreconcilable conflict.
(j) The Fund will promptly make known in writing to the Company the
Board of Directors' determination of the existence of a material
irreconcilable conflict, a
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description of the facts that give rise to such conflict and the
implications of such conflict.
(k) The Company and AFD will at least annually submit to the Board of
Directors of the Fund such reports, materials or data as the Board
of Directors may reasonably request so that the Board of Directors
may fully carry out the obligations imposed upon it by the
provisions hereof, and said reports, materials and data will be
submitted at any reasonable time deemed appropriate by the Board of
Directors. All reports received by the Board of Directors of
potential or existing conflicts, and all Board of Directors actions
with regard to determining the existence of a conflict, notifying
life insurance companies utilizing the Fund of a conflict, and
determining whether any proposed action adequately remedies a
conflict, will be properly recorded in the minutes of the Board of
Directors or other appropriate records, and such minutes or other
records will be made available to the SEC upon request.
(l) If, at any time during which the Fund is serving an investment
medium for variable life insurance policies or variable annuity
contracts, 1940 Act Rules 6e-3(T) or, if applicable, 6e-2 are
amended or Rule 6e-3 is adopted to provide exemptive relief with
respect to mixed and shared funding, the Parties agree that they
will comply with the terms and conditions thereof and that the terms
of this Section 10 shall be deemed modified if and only to the
extent required in order also to comply with the terms and
conditions of such exemptive relief that is afforded by any of said
rules that are applicable.
11. Miscellaneous.
(a) Amendment and Waiver. Neither this Agreement, nor any provision
hereof, may be amended, waived, discharged or terminated orally, but
only by an instrument in writing signed by all parties hereto.
(b) Notices. 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, or recognized overnight courier
service to the party or parties to whom they are directed at the
following addresses, or at such other addresses as may be designated
by notice from such party to all other parties.
To the Company:
Aetna Life Insurance and Annuity Company
000 Xxxxxxxxxx Xxxxxx
Xxxxxxxx, Xxxxxxxxxxx 00000
Attention: Xxxxx X. Xxxxxxxx, Counsel
To AFD or the Adviser:
Alliance Fund Distributors, Inc.
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, XX 00000-0000
Attention: Xxxxxx X. Xxxxxx, Xx., General Counsel
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Any notice, demand or other communication given in a manner prescribed in
this subsection (b) shall be deemed to have been delivered on receipt.
(c) Successors and Assigns. This agreement shall be binding upon and
inure to the benefit of the parties hereto and their respective
permitted successors and assigns.
(d) Counterparts. This Agreement may be executed in any number of
counterparts, all of which taken together shall constitute one
agreement, and any party hereto may execute this Agreement by
signing any such counterpart.
(e) Severability. In case any one or more of the provisions contained in
this Agreement should be invalid, illegal or unenforceable in any
respect, the validity, legality and enforceability of the remaining
provisions contained herein shall not in any way be affected or
impaired thereby.
(f) Entire Agreement. This Agreement constitutes the entire agreement
and understanding between the parties hereto and supersedes all
prior agreement and understandings relating to the subject matter
hereof.
(g) Governing Law. This Agreement shall be governed and interpreted in
accordance with the laws of the State of Connecticut.
(h) It is understood by the parties that this Agreement is not an
exclusive arrangement in any respect.
(i) The terms of this Agreement and the Schedules thereto will be held
confidential by each party except to the extent that either party or
its counsel may deem it necessary to disclose such terms.
IN WITNESS WHEREOF, the undersigned have executed this Agreement by their
duly authorized officers effective as of the 1st day of March, 2000.
AETNA LIFE INSURANCE AND ANNUITY COMPANY
By: /s/ Xxxxxx X. XxXxxxx
-------------------------------
Name: Xxxxxx X. XxXxxxx
Title: Vice President
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ALLIANCE CAPITAL MANAGEMENT L.P.
By: /s/ Xxxxxxx X. Xxxxx
-------------------------------
Name: Xxxxxxx X. Xxxxx
Title: Senior Vice President
Managing Director
ALLIANCE FUND DISTRIBUTORS, INC.
By: /s/ Xxxxxx X. Xxxxxx, Xx.
-------------------------------
Name: Xxxxxx X. Xxxxxx, Xx.
Title: Vice President &
Assistant General Counsel
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Schedule A
(For any future separate accounts - See Section 1(a)
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Schedule B
For list of Portfolios available - See Section 1(b)
Alliance Variable Products Series Fund, Inc.--
Alliance Quasar Portfolio
Alliance Premier Growth Portfolio
Alliance Growth and Income Portfolio
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Schedule C
The following costs, expenses and reimbursements will be paid by the party
indicated:
1. For purposes of Sections 2 and 7, AFD or the Adviser shall be liable to
the Company for systems and out of pocket costs incurred by the Company in
making a Contract owner's or a participant's account whole, if such costs
or expenses are a result of AFD's failure to provide timely or correct net
asset values, dividend and capital gains or financial information and if
such information is not corrected by 4pm EST of the next business day
after releasing such incorrect information provided the incorrect NAV as
well as the correct NAV for each day that the error occurred is provided.
If a mistake is caused in supplying such information or confirmations,
which results in a reconciliation with incorrect information, the amount
required to make a Contract owner's or a Participant's account whole shall
be borne by the party providing the incorrect information, regardless of
when the error is corrected.
2. For purposes of Section 3, AFD and the Adviser acknowledge that they or
the Fund shall pay for the cost of typesetting and printing periodic fund
reports to shareholders, prospectuses, prospectus supplements, statements
of additional information and other materials that are required by law to
be sent to Contract owners or participants, as well as the cost of
distributing such materials. The Company shall pay for the cost of
prospectuses and statements of additional information and the distribution
thereof for prospective Contract owners or participants. Each party shall
be provided with such supporting data as may reasonably be requested for
determining expenses under Section 3.
3. AFD shall pay all expenses in connection with the provision to the Company
of a sufficient quantity of its proxy material under Section 3. The cost
associated with proxy preparation, group authorization letters,
programming for tabulation and necessary materials (including postage)
will be paid by AFD.
Dated this first day of March, 2000.
AETNA LIFE INSURANCE AND ANNUITY COMPANY
By: /s/ Xxxxxx X. XxXxxxx
-------------------------------
Name: Xxxxxx X. XxXxxxx
Title: Vice President
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ALLIANCE CAPITAL MANAGEMENT L.P.
By: /s/ Xxxxxxx X. Xxxxx
-------------------------------
Name: Xxxxxxx X. Xxxxx
Title: Senior Vice President
Managing Director
ALLIANCE FUND DISTRIBUTORS, INC.
By: /s/ Xxxxxx X. Xxxxxx, Xx.
-------------------------------
Name: Xxxxxx X. Xxxxxx, Xx.
Title: Vice President &
Assistant General Counsel
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