This is: EX.99-24(C)(8)(CC)
FUND PARTICIPATION AGREEMENT
THIS AGREEMENT, made as of the 1st day of July, 2007, by and between
XXXXXXXXX XXXXXX ADVISERS MANAGEMENT TRUST ("TRUST"), XXXXXXXXX XXXXXX
MANAGEMENT INC. ("NB MANAGEMENT"), a New York corporation, and MINNESOTA LIFE
INSURANCE COMPANY ("LIFE COMPANY"), a life insurance company organized under
the laws of the State of Minnesota.
WHEREAS, TRUST is registered with the Securities and Exchange Commission
("SEC") under the Investment Company Act of 1940, as amended ("40 Act") as an
open-end, diversified management investment company; and
WHEREAS, TRUST is organized as a series fund comprised of several
portfolios ("Portfolios"); and
WHEREAS, TRUST was organized to act as the funding vehicle for certain
variable life insurance and/or variable annuity contracts ("Variable
Contracts") offered by life insurance companies through separate accounts of
such life insurance companies ("Participating Insurance Companies") and also
offers its shares to certain qualified pension and retirement plans; and
WHEREAS, TRUST has received an order from the SEC, dated May 5,1995
(File No. 812-9164), granting Participating Insurance Companies and their
separate accounts exemptions from the provisions of Sections 9(a), 13(a),
15(a) and 15(b) of the '40 Act, and Rules 6e-2(b)(15) and 6e-3(T)(b)(15)
thereunder, to the extent necessary to permit shares of the Portfolios of the
TRUST to be sold to and held by variable annuity and variable life insurance
separate accounts of both affiliated and unaffiliated life insurance
companies and certain qualified pension and retirement plans (the "Order");
and
WHEREAS, LIFE COMPANY has established or will establish one or more
separate accounts ("Separate Accounts") to offer Variable Contracts and is
desirous of having TRUST as one of the underlying funding vehicles for such
Variable Contracts; and
WHEREAS, NB MANAGEMENT is registered with the SEC as an investment
adviser under the Investment Advisers Act of 1940 and as a broker-dealer
under the Securities Exchange Act of 1934, as amended; and
WHEREAS, NB MANAGEMENT is the investment manager and administrator of
the Portfolios of the Trust and distributor of the shares of each Portfolio
of TRUST; and
WHEREAS, to the extent permitted by applicable insurance laws and
regulations, LIFE COMPANY intends to purchase shares of TRUST to fund the
aforementioned Variable Contracts and TRUST is authorized to sell such shares
to LIFE COMPANY at net asset value;
NOW, THEREFORE, in consideration of their mutual promises, LIFE COMPANY,
TRUST, and NB MANAGEMENT agree as follows:
Article I. SALE OF TRUST SHARES
1.1 TRUST agrees to make available to the Separate Accounts of LIFE
COMPANY shares of the selected Portfolios as listed in Appendix A for
investment of proceeds from Variable Contracts allocated to the designated
Separate Accounts, such shares to be offered as provided in TRUST's
Prospectus.
1.2 TRUST agrees to sell to LIFE COMPANY those shares of the selected
Portfolios of TRUST which LIFE COMPANY orders, executing such orders on a
daily basis at the net asset value next computed after receipt by TRUST or
its designee of the order for the shares of TRUST. For purposes of this
Section 1.2, LIFE COMPANY shall be the designee of TRUST for receipt of such
orders from LIFE COMPANY and receipt by such designee shall constitute
receipt by TRUST; provided that TRUST receives notice of such order by 9:30
a.m. New York Time on the next following Business Day. "Business Day" shall
mean any day on which the New York Stock Exchange is open for trading and on
which TRUST calculates its net asset value pursuant to the rules of the SEC.
1.3 TRUST agrees to redeem for cash, on LIFE COMPANY's request, any
full or fractional shares of TRUST held by LIFE COMPANY, executing such
requests on a daily basis at the net asset value next computed after receipt
by TRUST or its designee of the request for redemption. For purposes of this
Section 1.3, LIFE COMPANY shall be the designee of TRUST for receipt of
requests for redemption from LIFE COMPANY and receipt by such designee shall
constitute receipt by TRUST; provided that TRUST receives notice of such
request for redemption by 9:30 a.m. New York time on the next following
Business Day.
1.4 TRUST shall furnish, on or before the ex-dividend date, notice to
LIFE COMPANY of any income dividends or capital gain distributions payable on
the shares of any Portfolio of TRUST. LIFE COMPANY hereby elects to receive
all such income dividends and capital gain distributions as are payable on a
Portfolio's shares in additional shares of the Portfolio. TRUST shall notify
LIFE COMPANY of the number of shares so issued as payment of such dividends
and distributions. LIFE COMPANY reserves the right to revoke this election
by written notice to the Trust.
1.5 TRUST shall make the net asset value per share for the selected
Portfolio(s) available to LIFE COMPANY on a daily basis as soon as reasonably
practicable after the net asset value per share is calculated but shall use
its best efforts to make such net asset value available by 6:30 p.m. New York
time. If TRUST provides LIFE COMPANY with materially incorrect share net
asset value information through no fault of LIFE COMPANY, LIFE COMPANY on
behalf of the Separate Accounts, shall be entitled to an adjustment to the
number of shares purchased or redeemed to reflect the correct share net asset
value. Any material error (determined in accordance with SEC guidelines) in
the calculation of net asset value per share, dividend or capital gain
information shall be reported promptly upon discovery to LIFE COMPANY. In
the event that such material error is the result of the Trust's (or its
designated agents) gross negligence, the Trust shall also be responsible for
any of LIFE COMPANY's administrative or other costs or losses incurred in
correcting Variable Contract Owner accounts.
1.6 At the end of each Business Day, LIFE COMPANY shall use the
information described in Section 1.5 to calculate Separate Account unit
values for the day. Using these unit values, LIFE COMPANY shall process each
such business day's Separate Account transactions based on requests and
premiums received by it by the time as of which the TRUST calculates its
share price as disclosed in the prospectus for the TRUST to determine the net
dollar amount of TRUST shares which shall be purchased or redeemed at that
day's closing net asset value per share. The net share purchase or redemption
orders so determined shall be transmitted to TRUST by LIFE COMPANY by 9:30
a.m. New York Time on the Business Day next following LIFE COMPANY's receipt
of such requests and premiums in accordance with the terms of Sections 1.2
and 1.3 hereof.
1.7 If LIFE COMPANY's order requests the net purchase of TRUST shares,
LIFE COMPANY shall pay for such purchase by wiring federal funds to TRUST or
its designated custodial account on the day the order is actually transmitted
by LIFE COMPANY by 3:00 p.m. New York Time. If LIFE COMPANY's order requests
a net redemption resulting in a payment of redemption proceeds to LIFE
COMPANY, TRUST shall wire the redemption proceeds to LIFE COMPANY on the day
the order is actually received by TRUST by 3:00 p.m. New York Time unless
doing so would require TRUST to dispose of portfolio securities or otherwise
incur additional costs, but in such event, proceeds shall be wired to LIFE
COMPANY within seven days and TRUST shall notify the person designated in
writing by LIFE COMPANY as the recipient for such notice of such delay by
3:00 p.m. New York Time the same business day that LIFE COMPANY transmits the
redemption order to TRUST. If LIFE COMPANY's order requests the application
of redemption proceeds from the redemption of shares to the purchase of
shares of another fund administered or distributed by NB MANAGEMENT, TRUST
shall so apply such proceeds on the same Business Day that LIFE COMPANY
transmits such order to TRUST.
1.8 Notwithstanding Section 1.7, TRUST reserves the right to suspend
the right of redemption or postpone the date of payment or satisfaction upon
redemption consistent with Section 22(e) of the 40 Act and any rules
thereunder.
1.9 TRUST agrees that all shares of the Portfolios of TRUST will be
sold only to Participating Insurance Companies which have agreed to
participate in TRUST to fund their Separate Accounts and/or to certain
qualified pension and other retirement plans, all in accordance with the
requirements of Section 817(h) of the Internal Revenue Code of 1986, as
amended ("Code") and Treasury Regulation 1.817-5. Shares of the Portfolios
of TRUST will not be sold directly to the general public.
1.10 TRUST may refuse to sell shares of any Portfolio to any person, or
suspend or terminate the offering of the 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 Board of Trustees of TRUST, acting in good
faith and in light of its fiduciary duties under federal and any applicable
state laws, deemed necessary and in the best interests of the shareholders of
such Portfolios.
Article II. REPRESENTATIONS AND WARRANTIES
2.1 LIFE COMPANY represents and warrants that it is an insurance
company duly organized and in good standing under the laws of Minnesota and
that it has legally and validly established each Separate Account as a
segregated asset account under such laws, and that Securian Financial
Services, Inc., the principal underwriter for the Variable Contracts, is
registered as a broker-dealer under the Securities Exchange Act of 1934.
2.2 LIFE COMPANY represents and warrants that it has registered or,
prior to any issuance or sale of the Variable Contracts, will register each
Separate Account as a unit investment trust ("UIT") in accordance with the
provisions of the '40 Act and cause each Separate Account to
remain so registered to serve as a segregated asset account for the Variable
Contracts, unless an exemption from registration is available.
2.3 LIFE COMPANY represents and warrants that the Variable Contracts
will be registered under the Securities Act of 1933 (the "`33 Act") unless an
exemption from registration is available prior to any issuance or sale of the
Variable Contracts and that the Variable Contracts will be issued and sold in
compliance in all material respects with all applicable federal and state
laws and further that the sale of the Variable Contracts shall comply in all
material respects with state insurance law suitability requirements.
2.4 LIFE COMPANY represents and warrants that the Variable Contracts
are currently and at the time of issuance will be treated as life insurance,
endowment or annuity contracts under applicable provisions of the Code, that
it will maintain such treatment and that it will notify TRUST immediately
upon having a reasonable basis for believing that the Variable Contracts have
ceased to be so treated or that they might not be so treated in the future.
2.5 LIFE COMPANY represents and warrants that it shall deliver such
prospectuses, statements of additional information, proxy statements and
periodic reports of the Trust as required to be delivered under applicable
federal or state law and interpretations of federal and state securities
regulators thereunder in connection with the offer, sale or acquisition of
the Variable Contracts.
2.6 TRUST represents and warrants that the Portfolio shares offered
and sold pursuant to this Agreement will be registered under the '33 Act and
sold in accordance with all applicable federal and state laws, and TRUST
shall be registered under the '40 Act prior to and at the time of any
issuance or sale of such shares. TRUST shall amend its registration
statement under the '33 Act and the '40 Act from time to time as required in
order to effect the continuous offering of its shares. TRUST shall register
and qualify its shares for sale in accordance with the laws of the various
states to the extent necessary to perform its obligations under this
Agreement.
2.7 TRUST represents and warrants that each Portfolio currently
complies, and will continue to comply with the diversification requirements
set forth in Section 817(h) of the Code, and the rules and regulations
thereunder, including without limitation Treasury Regulation 1.817-5 (or any
successor or similar provisions), and will notify LIFE COMPANY immediately
upon having a reasonable basis for believing any Portfolio has ceased to
comply or might not so comply and will immediately take all reasonable steps
to adequately diversify the Portfolio to achieve compliance within the grace
period afforded by Regulation 1.817-5.
2.8 TRUST represents and warrants that each Portfolio invested in by
the Separate Account is currently qualified as a "regulated investment
company" under Subchapter M of the Code, that it will maintain such
qualification under Subchapter M (or any successor or similar provisions) and
will notify LIFE COMPANY immediately upon having a reasonable basis for
believing any Portfolio has ceased to so qualify or might not so qualify in
the future.
2.9 LIFE COMPANY hereby consents to the use by TRUST of the name and
telephone number of LIFE COMPANY and to the reference by TRUST to the
relationship between LIFE COMPANY and TRUST as part of an informational page
on TRUST'S site on the World Wide Web portion of the Internet. The LIFE
COMPANY hereby further consents to TRUST'S establishing a link between
TRUST'S site and LIFE COMPANY's site from the same place that LIFE COMPANY
is listed on TRUST'S site as described in the preceding sentence.
2.10 The Trust represents that to the extent that it decides to finance
distribution expenses pursuant to Rule 12b-1 under the 1940 Act, it will have
a board of trustees, a majority of whom are not interested persons of the
Trust, to formulate and approve any plan under Rule 12b-1 to finance
distribution expenses.
2.11 The Trust represents that the Trust's investment policies, fees
and expenses are and shall at all times remain in compliance with the laws of
the State of Delaware and the Trust represents that its respective operations
are and shall at all times remain in material compliance with the laws of the
State of Delaware to the extent required to perform this Agreement.
2.12 The Trust represents that it is lawfully organized and validly
existing under the laws of the State of Delaware and that it does and will
comply in all material respects with the 1940 Act.
2.13 NB Management represents and warrants that it is a member in good
standing of the NASD and is registered as a broker-dealer with the SEC. NB
Management further represents that it will sell and distribute the Trust's
share in accordance with the laws of the State of Delaware and any applicable
state and federal securities law.
2.14 The Trust and NB Management represent and warrant that their
directors, officers, employees dealing with the money and/or securities of
the Trust are and shall continue to be at all times covered by a blanket
fidelity bond or similar coverage for the benefit of the Trust in an amount
not less than the minimum coverage as required by Rule 17g-(1) under the 1940
Act or related provisions as may be promulgated from time to time. The
aforesaid blanket fidelity bond shall include coverage for larceny and
embezzlement and shall be issued by a reputable bonding company.
2.15 NB Management represents and warrants that it is registered as an
investment adviser and shall remain duly registered under all applicable
federal and state securities laws and that it shall perform its obligations
for the Trust in compliance in all material respects with the laws of the
State of Delaware and any applicable state and federal securities laws.
2.16 Each party represents and warrants that the execution and delivery
of this Agreement and the consummation of the transactions contemplated
herein have been duly authorized by all necessary corporate, partnership or
trust action, as applicable, by such party, and, when so executed and
delivered, this Agreement will be the valid and binding obligation of such
party enforceable in accordance with its terms.
2.17 LIFE COMPANY represents and warrants that all orders for the
purchase and sale of TRUST shares submitted to the TRUST (or counted by LIFE
COMPANY in submitting a net order under Section 1.6 of the Agreement) for
execution at a price based on the net asset value per share ("NAV") of the
Trust's Portfolios next computed after receipt by LIFE COMPANY on a
particular Business day, will have been received in good order by LIFE
COMPANY prior to the time as of which the TRUST calculates its NAV on that
Business Day, as disclosed in the prospectus for the pertinent Portfolio (the
"trading deadline"), in accordance with Rule 22c-1 under the 1940 Act
(subject only to exceptions as permitted under Rule 22c-1(c) under the 1940
Act, respecting initial purchase payments on variable annuity contracts, and
to the established administrative procedures of LIFE COMPANY as described
under Rule 6e-3(T), paragraph (b)(12)(iii) under the 1940 Act respecting
premium processing for variable life insurance contracts).
2.18 In the prospectus for the Portfolios, the TRUST reserves the right
to reject an investment or exchange order or to withdraw the exchange
privilege from any investor that NB MANAGEMENT believes is trying to "time
the market" or is otherwise making exchanges that Xxxxxxxxx Xxxxxx Management
Inc. believes to be excessive (collectively, these practices are referred to
herein as "excessive short-term trading"). The Trust prospectus also
discloses, and NB MANAGEMENT and LIFE COMPANY acknowledge, that frequent
exchanges can interfere with fund management and affect costs and performance
for other shareholders. Accordingly, LIFE COMPANY agrees that it will
cooperate with NB MANAGEMENT and the TRUST, by taking steps acceptable to NB
MANAGEMENT and the TRUST to prevent its contract owners from excessive
short-term trading in any Portfolio of the TRUST, which may include any one
or more of the following measures: (i) by providing information, upon
reasonable request, to NB MANAGEMENT and the TRUST, about cash flows into and
out of any of the Portfolios from the separate accounts of LIFE COMPANY; (ii)
by providing information, upon reasonable request, to NB MANAGEMENT and the
TRUST, about any policies and procedures that LIFE COMPANY employs respecting
frequent transfers of contract value among sub-accounts of the Separate
Accounts, and about compliance with any such policies and procedures; (iii)
by providing information, upon reasonable request, to NB MANAGEMENT and the
TRUST respecting Variable Contract owner transactions, holdings and other
information pertinent to the prevention of excessive short-term trading
(although NB MANAGEMENT and TRUST acknowledge that such information need not
include information that would identify owners of the Variable Contracts);
(iv) by taking steps necessary, upon reasonable request of NB MANAGEMENT or
the TRUST, to eliminate or prevent excessive short-term trading, including,
but not limited to, restricting or withdrawing exchange privileges from
Variable Contract owners that engage in excessive short-term trading to the
extent permitted under applicable law and the terms of the Variable
Contracts, and/or restricting and/or withdrawing a Variable Contract owner's
ability to make exchanges through automated means such as telephone, fax, or
internet transmission; and (v) by assessing and collecting any redemption fee
that may be adopted by the TRUST with respect to any Portfolio, either to
comply with SEC rules or in accordance with any such determination made by
the TRUST's Board of Trustees.
2.19 LIFE COMPANY will, upon reasonable request, certify to the TRUST
and NB MANAGEMENT that LIFE COMPANY is in compliance with Items 2.17 and/or
2.18 above.
Article III. PROSPECTUS AND PROXY STATEMENTS
3.1 TRUST shall prepare and be responsible for filing with the SEC and
any state regulators requiring such filing all shareholder reports, notices,
proxy materials (or similar materials such as voting instruction solicitation
materials), prospectuses and statements of additional information of TRUST.
TRUST shall bear the costs of registration and qualification of shares of the
Portfolios, preparation and filing of the documents listed in this Section
3.1 and all taxes to which an issuer is subject on the issuance and transfer
of its shares.
3.2 TRUST will bear the printing costs (or duplicating costs with
respect to the statement of additional information) and mailing costs
associated with the delivery of the following TRUST (or individual Portfolio)
documents, and any supplements thereto, to existing Variable Contract owners
of LIFE COMPANY (regardless of whether such documents are printed together
with, or separate from, the documents for other trusts in the Variable
Contracts):
(i) prospectuses and statements of additional information;
(ii) annual and semi-annual reports; and
(iii) proxy materials (including, but not limited to, the proxy cards,
notice and statement, as well as the costs associated with tabulating
votes).
LIFE COMPANY will submit any bills for printing, duplicating and/or
mailing costs, relating to the TRUST documents described above, to TRUST for
reimbursement by TRUST. LIFE COMPANY shall monitor such costs and shall use
its best efforts to control these costs. LIFE COMPANY will provide TRUST on
a semi-annual basis, or more frequently as reasonably requested by TRUST,
with a current tabulation of the number of existing Variable Contract owners
of LIFE COMPANY whose Variable Contract values are invested in TRUST. This
tabulation will be sent to TRUST in the form of a letter signed by a duly
authorized officer of LIFE COMPANY attesting to the accuracy of the
information contained in the letter. If requested by LIFE COMPANY, the TRUST
shall provide such documentation (including a final copy of the TRUST's
prospectus as set in type or in camera-ready copy) and other assistance as is
reasonably necessary in order for LIFE COMPANY to print together in one
document the current prospectus for the Variable Contracts issued by LIFE
COMPANY and the current prospectus for the TRUST or other allowed
combination(s). Should LIFE COMPANY wish to print any of these documents in
a format different from that provided by TRUST, LIFE COMPANY shall provide
Trust with sixty (60) days' prior written notice and LIFE COMPANY shall bear
the cost associated with any format change.
3.3 TRUST will provide, at its expense, LIFE COMPANY with the following
TRUST (or individual Portfolio) documents, and any supplements thereto, with
respect to prospective Variable Contract owners of LIFE COMPANY:
(i) camera-ready copy of the current prospectus for printing by the
LIFE COMPANY;
(ii) a copy of the statement of additional information suitable for
duplication;
(iii) camera-ready copy of proxy material suitable for printing; and
(iv) camera-ready copy of the annual and semi-annual reports for
printing by the LIFE COMPANY.
3.4 TRUST will provide LIFE COMPANY with at least one complete copy of
all prospectuses, statements of additional information, annual and
semi-annual reports, proxy statements, exemptive applications and all
amendments or supplements to any of the above that relate to the Portfolios
promptly after the filing of each such document with the SEC or other
regulatory authority. LIFE COMPANY will provide TRUST with at least one
complete copy of all prospectuses, statements of additional information,
annual and semi-annual reports, proxy statements, exemptive applications and
all amendments or supplements to any of the above that relate to a Separate
Account promptly after the filing of each such document with the SEC or other
regulatory authority.
3.5 LIFE COMPANY agrees that it will cooperate with NB MANAGEMENT and
the TRUST by providing to NB MANAGEMENT and the TRUST, within thirty (30)
days prior to any deadline imposed by applicable laws, rules or regulations,
information regarding shares sold and redeemed and whether the Separate
Accounts are registered or unregistered under the '40 Act and any other
information pertinent to enabling NB MANAGEMENT and the TRUST to pay
registration or other fees with respect to the TRUST shares sold during the
fiscal year in accordance with Rule 24f-2 or to register and qualify TRUST
shares under any applicable laws, rules or regulations in a timely manner.
Article IV. SALES MATERIALS; PRIVACY
4.1 LIFE COMPANY will furnish, or will cause to be furnished, to TRUST
and NB MANAGEMENT, each piece of sales literature or other promotional
material in which TRUST or NB MANAGEMENT is named, at least five (5) Business
Days prior to its intended use. No such material will be used if TRUST or NB
MANAGEMENT objects to its use in writing within five (5) Business Days after
receipt of such material.
4.2 TRUST and NB MANAGEMENT will furnish, or will cause to be
furnished, to LIFE COMPANY, each piece of sales literature or other
promotional material in which LIFE COMPANY or its Separate Accounts are
named, at least five (5) Business Days prior to its intended use. No such
material will be used if LIFE COMPANY objects to its use in writing within
five (5) Business Days after receipt of such material.
4.3 TRUST and its affiliates and agents shall not give any information
or make any representations on behalf of LIFE COMPANY or concerning LIFE
COMPANY, the Separate Accounts, or the Variable Contracts issued by LIFE
COMPANY, other than the information or representations contained in a
registration statement or prospectus for such Variable Contracts, as such
registration statement and prospectus may be amended or supplemented from
time to time, or in reports of the Separate Accounts or reports prepared for
distribution to owners of such Variable Contracts, or in sales literature or
other promotional material approved by LIFE COMPANY or its designee, except
with the written permission of LIFE COMPANY.
4.4 LIFE COMPANY and its affiliates and agents shall not give any
information or make any representations on behalf of TRUST or concerning
TRUST other than the information or representations contained in a
registration statement or prospectus for TRUST, as such registration
statement and prospectus may be amended or supplemented from time to time, or
in sales literature or other promotional material approved by TRUST or its
designee, except with the written permission of TRUST.
4.5 For purposes of this Agreement, the phrase "sales literature or
other promotional material" or words of similar import include, without
limitation, 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), sales literature (such as any written communication
distributed or made generally available to customers or the public, including
brochures, circulars, research reports, market letters, form letters, seminar
texts, or 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 National Association of Securities
Dealers, Inc. rules, the '40 Act or the '33 Act.
4.6 Subject to law and regulatory authority, each party hereto shall
treat as confidential all information pertaining to the owners of the
Variable Contracts and all information reasonably identified as confidential
in writing by any other party hereto and, except as permitted by this
Agreement, shall not disclose, disseminate or utilize such names and
addresses and other confidential information until such time as it may come
into the public domain without the express written consent of the affected
party. Each party hereto shall be solely responsible for the compliance of
their officers, directors, employees, agents, independent contractors, and
any affiliated and non-affiliated third parties with all applicable
privacy-related laws and regulations including but not limited to the
Xxxxx-Xxxxx-Xxxxxx Act and Regulation S-P. The provisions of this Section
4.6 shall survive the termination of this Agreement.
Article V. POTENTIAL CONFLICTS
5.1 The Board of Trustees of TRUST (the "Board") will monitor TRUST
for the existence of any material irreconcilable conflict between the
interests of the Variable Contract owners of Participating Insurance Company
Separate Accounts investing in the TRUST. A material irreconcilable conflict
may arise for a variety of reasons, including: (a) state insurance regulatory
authority action; (b) a change in applicable federal or state insurance, tax,
or securities laws or regulations, or a public ruling, private letter ruling,
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 the TRUST are being
managed; (e) a difference in voting instructions given by variable annuity
and variable life insurance contract owners or by contract owners of
different Participating Insurance Companies; or (f) a decision by a
Participating Insurance Company to disregard voting instructions of Variable
Contract owners.
5.2 LIFE COMPANY will report any potential or existing conflicts to
the Board. LIFE COMPANY will be responsible for assisting the Board in
carrying out its responsibilities under the Conditions set forth in the
notice issued by the SEC for the TRUST on April 12, 1995 (the "Notice")
(Investment Company Act Release No. 21003), , by providing the Board with all
information reasonably necessary for it to consider any issues raised. This
responsibility includes, but is not limited to, an obligation by LIFE COMPANY
to inform the Board whenever Variable Contract owner voting instructions are
disregarded by LIFE COMPANY. These responsibilities will be carried out with
a view only to the interests of the Variable Contract owners.
5.3 If a majority of the Board or a majority of its disinterested
trustees determines that a material irreconcilable conflict exists, affecting
the LIFE COMPANY, LIFE COMPANY, at its expense and to the extent reasonably
practicable (as determined by a majority of disinterested trustees), will
take any steps necessary to remedy or eliminate the irreconcilable material
conflict, including: (a) withdrawing the assets allocable to some or all of
the Separate Accounts from the TRUST or any Portfolio thereof and reinvesting
those assets in a different investment medium, which may include another
Portfolio of TRUST or another investment company or submitting the question
as to whether such segregation should be implemented to a vote of all
affected Variable Contract owners and, as appropriate, segregating the assets
of any appropriate group (i.e., Variable Contract owners of one or more
Participating Insurance Companies) that votes in favor of such segregation,
or offering to the affected Variable Contract owners the option of making
such a change; and (b) establishing a new registered management investment
company or managed separate account. If a material irreconcilable conflict
arises because of LIFE COMPANY's decision
to disregard Variable Contract owner voting instructions, and that decision
represents a minority position or would preclude a majority vote, LIFE
COMPANY may be required, at the election of the TRUST, to withdraw its
Separate Account's investment in the TRUST, and no charge or penalty will be
imposed as a result of such withdrawal. The responsibility to take such
remedial action shall be carried out with a view only to the interests of the
Variable Contract owners.
For the purposes of this Section 5.3, a majority of the disinterested
members of the Board shall determine whether or not any proposed action
adequately remedies any material irreconcilable conflict, but in no event
will the TRUST or NB MANAGEMENT (or any other investment adviser of the
TRUST) be required to establish a new funding medium for any Variable
Contract. Further, LIFE COMPANY shall not be required by this Section 5.3 to
establish a new funding medium for any Variable Contract if any offer to do
so has been declined by a vote of a majority of Variable Contract owners
materially affected by the irreconcilable material conflict.
5.4 The Board's determination of the existence of a material
irreconcilable conflict and its implications shall be made known promptly and
in writing to LIFE COMPANY.
5.5 No less than annually, LIFE COMPANY shall submit to the Board such
reports, materials or data as the Board may reasonably request so that the
Board may fully carry out the obligations imposed upon it by these
Conditions. Such reports, materials, and data shall be submitted more
frequently if deemed appropriate by the Board.
Article VI. VOTING
6.1 LIFE COMPANY will provide pass-through voting privileges to all
Variable Contract owners so long as the SEC continues to interpret the '40
Act as requiring pass-through voting privileges for Variable Contract owners.
Accordingly, LIFE COMPANY, where applicable, will vote shares of TRUST held
by its Separate Accounts in a manner consistent with voting instructions
timely received from its Variable Contract owners. LIFE COMPANY shall vote
shares for which it has not received timely voting instructions, as well as
shares it owns, in the same proportion as it votes those shares for which it
has received voting instructions.
6.2 If and to the extent 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
'40 Act or the rules thereunder with respect to mixed and shared funding on
terms and conditions materially different from any exemptions granted in the
Order, then TRUST and/or LIFE COMPANY, as appropriate, shall take such steps
as may be necessary to comply with Rule 6e-2 and Rule 6e-3(T), as amended,
and Rule 6e-3, as adopted, to the extent such Rules are applicable.
Article VII. INDEMNIFICATION
7.1 INDEMNIFICATION BY LIFE COMPANY. LIFE COMPANY agrees to indemnify
and hold harmless TRUST and NB MANAGEMENT and each of their Trustees,
directors, officers, employees and agents and each person, if any, who
controls TRUST or NB MANAGEMENT within the meaning of Section 15 of the '33
Act (collectively, the "Indemnified Parties" for purposes of this Article
VII) against any and all losses, claims, damages, liabilities (including
amounts paid in settlement with the written consent of LIFE COMPANY, which
consent shall not be unreasonably withheld) or litigation (including 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:
(a) 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 sales literature for the Variable Contracts
or contained in the Variable Contracts (or any amendment or
supplement to any of the foregoing), or arise out of or are based
upon the omission or the alleged omission to state therein a material
fact required to be stated therein or necessary to make the
statements therein not misleading, provided that this agreement to
indemnify shall not apply as to any Indemnified Party if such
statement or omission or such alleged statement or omission was made
in reliance upon and in conformity with information furnished to LIFE
COMPANY by or on behalf of TRUST for use in the registration
statement, prospectus or sales literature for the Variable Contracts
or in the Variable Contracts (or any amendment or supplement) or
otherwise for use in connection with the sale of the Variable
Contracts or TRUST shares; or
(b) arise out of or as a result of statements or representations
(other than statements or representations contained in the
registration statement, prospectus or sales literature of TRUST not
supplied by LIFE COMPANY, or persons under its control) or wrongful
conduct of LIFE COMPANY or any of its directors, officers, employees
or agents, with respect to the sale or distribution of the Variable
Contracts or TRUST shares; or
(c) arise out of any untrue statement or alleged untrue statement of a
material fact contained in a registration statement, prospectus, or
sales literature of TRUST or any amendment thereof or supplement
thereto or the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the
statements therein not misleading if such statement or omission or
such alleged statement or omission was made in reliance upon and in
conformity with information furnished to TRUST for inclusion therein
by or on behalf of LIFE COMPANY; or
(d) arise as a result of any failure by LIFE COMPANY to substantially
provide the services and furnish the materials under the terms of
this Agreement; or
(e) arise out of or result from any material breach of any
representation and/or warranty made by LIFE COMPANY in this Agreement
or arise out of or result from any other material breach of this
Agreement by LIFE COMPANY.
7.2 LIFE COMPANY shall not be liable under this indemnification
provision with respect to any losses, claims, damages, liabilities or
litigation incurred or assessed against an Indemnified Party as such may
arise from such Indemnified Party's willful misfeasance, bad faith, or gross
negligence in the performance of such Indemnified Party's duties or by reason
of such Indemnified Party's reckless disregard of obligations or duties under
this Agreement or to TRUST, whichever is applicable.
7.3 LIFE COMPANY shall not be liable under this indemnification
provision with respect to any claim made against an Indemnified Party unless
such Indemnified Party shall have notified LIFE COMPANY in writing within a
reasonable time after the summons or other first legal
process giving information of the nature of the claim shall have been served
upon such Indemnified Party (or after such Indemnified Party shall have
received notice of such service on any designated agent), but failure to
notify LIFE COMPANY of any such claim shall not relieve LIFE COMPANY from any
liability which it may have to the Indemnified Party against whom such action
is brought otherwise than on account of this indemnification provision. In
case any such action is brought against an Indemnified Party, LIFE COMPANY
shall be entitled to participate at its own expense in the defense of such
action. LIFE COMPANY also shall be entitled to assume the defense thereof,
with counsel reasonably satisfactory to the party named in the action. After
notice from LIFE COMPANY to such party of LIFE COMPANY's election to assume
the defense thereof, the Indemnified Party shall bear the fees and expenses
of any additional counsel retained by it, and LIFE COMPANY 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.
7.4 INDEMNIFICATION BY NB MANAGEMENT. NB MANAGEMENT agrees to
indemnify and hold harmless LIFE COMPANY and each of its directors, officers,
employees, and agents and each person, if any, who controls LIFE COMPANY
within the meaning of Section 15 of the '33 Act (collectively, the
"Indemnified Parties" for the purposes of this Article VII) against any and
all losses, claims, damages, liabilities (including amounts paid in
settlement with the written consent of NB MANAGEMENT which consent shall not
be unreasonably withheld) or litigation (including legal and other expenses)
to which the Indemnified Parties may become subject under any statute, or
regulation, at common law or otherwise, insofar as such losses, claims,
damages, liabilities or expenses (or actions in respect thereof) or
settlements:
(a) 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 TRUST (or any amendment or
supplement to any of the foregoing), or arise out of or are based upon the
omission or the alleged omission to state therein a material fact required to
be stated therein or necessary to make the statements therein not misleading,
provided that this agreement to indemnify shall not apply as to any
Indemnified Party if such statement or omission or such alleged statement or
omission was made in reliance upon and in conformity with information
furnished to NB MANAGEMENT or TRUST by or on behalf of LIFE COMPANY for use
in the registration statement or prospectus for TRUST or in sales literature
(or any amendment or supplement) or otherwise for use in connection with the
sale of the Variable Contracts or TRUST shares; or
(b) arise out of or as a result of statements or representations
(other than statements or representations contained in the
registration statement, prospectus or sales literature for the
Variable Contracts not supplied by NB MANAGEMENT or persons under its
control) or wrongful conduct of TRUST or NB MANAGEMENT or persons
under their control, with respect to the sale or distribution of the
Variable Contracts or TRUST shares; or
(c) arise out of any untrue statement or alleged untrue statement of a
material fact contained in a registration statement, prospectus, or
sales literature covering the Variable Contracts, or any amendment
thereof or supplement thereto, or the omission or alleged omission to
state therein a material fact required to be stated therein or
necessary to make the statements therein not
misleading, if such statement or omission or such alleged statement
or omission was made in reliance upon and in conformity with
information furnished to LIFE COMPANY for inclusion therein by or on
behalf of TRUST; or
(d) arise as a result of (i) a failure by TRUST to substantially
provide the services and furnish the materials under the terms of
this Agreement; or (ii) a failure by a Portfolio(s) invested in by
the Separate Account to comply with the diversification requirements
of Section 817(h) of the Code; or (iii) a failure by a Portfolio(s)
invested in by the Separate Account to qualify as a "regulated
investment company" under Subchapter M of the Code; or
(e) arise out of or result from any material breach of any
representation and/or warranty made by NB MANAGEMENT or TRUST in this
Agreement or arise out of or result from any other material breach
of this Agreement by NB MANAGEMENT or TRUST.
7.5 INDEMNIFICATION BY TRUST. TRUST agrees to indemnify and hold
harmless LIFE COMPANY and each of its directors, officers, employees, and
agents and each person, if any, who controls LIFE COMPANY within the meaning
of Section 15 of the '33 Act (collectively, the "Indemnified Parties" for the
purposes of this Article VII) against any and all losses, claims, damages,
liabilities (including amounts paid in settlement with the written consent of
TRUST which consent shall not be unreasonably withheld) or litigation
(including legal and other expenses) to which the Indemnified Parties may
become subject under any statute, or regulation, at common law or otherwise,
insofar as such losses, claims, damages, liabilities or expenses (or actions
in respect thereof) or settlements:
(a) arise as a result of (i) a failure by TRUST to substantially
provide the services and furnish the materials under the terms of
this Agreement; or (ii) a failure by a Portfolio(s) invested in by
the Separate Account to comply with the diversification requirements
of Section 817(h) of the Code; or (iii) a failure by a Portfolio(s)
invested in by the Separate Account to qualify as a "regulated
investment company" under Subchapter M of the Code; or
(b) arise out of or result from any material breach of any
representation and/or warranty made by TRUST in this Agreement or
arise out of or result from any other material breach of this
Agreement by TRUST.
7.6 TRUST shall not be liable under this indemnification provision
with respect to any losses, claims, damages, liabilities or litigation to
which an Indemnified Party would otherwise be subject by reason of such
Indemnified Party's willful misfeasance, bad faith, or gross negligence in
the performance of such Indemnified Party's duties or by reason of such
Indemnified Party's reckless disregard of obligations and duties under this
Agreement or to LIFE COMPANY.
7.7 TRUST shall not be liable under this indemnification provision
with respect to any claim made against an Indemnified Party unless such
Indemnified Party shall have notified TRUST in writing within a reasonable
time after the summons or other first legal process giving information of the
nature of the claim shall have been served upon such Indemnified Party (or
after such Indemnified Party shall have received notice of such service on
any designated agent), but failure to notify TRUST of any such claim shall
not relieve TRUST from any liability which it may have to
the Indemnified Party against whom such action is brought otherwise than on
account of this indemnification provision. In case any such action is
brought against the Indemnified Parties, TRUST shall be entitled to
participate at its own expense in the defense thereof. TRUST also shall be
entitled to assume the defense thereof, with counsel reasonably satisfactory
to the party named in the action. After notice from TRUST to such party of
TRUST Selection to assume the defense thereof, the Indemnified Party shall
bear the fees and expenses of any additional counsel retained by it, and
TRUST 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.
7.8 The provision of this Article VII shall survive the termination of
this Agreement.
Article VIII. TERM; TERMINATION
8.1 This Agreement shall be effective as of the date hereof and shall
continue in force until terminated in accordance with the provisions herein.
8.2 This Agreement shall terminate in accordance with the following
provisions:
(a) At the option of LIFE COMPANY or TRUST at any time from the date
hereof upon 180 days' notice, unless a shorter time is agreed to by
the parties;
(b) At the option of LIFE COMPANY, if TRUST shares are not reasonably
available to meet the requirements of the Variable Contracts as
determined by LIFE COMPANY. Prompt notice of election to terminate
shall be furnished by LIFE COMPANY, said termination to be effective
ten days after receipt of notice unless TRUST makes available a
sufficient number of shares to reasonably meet the requirements of
the Variable Contracts within said ten-day period;
(c) At the option of LIFE COMPANY, upon the institution of formal
proceedings against TRUST or NB MANAGEMENT by the SEC, the National
Association of Securities Dealers, Inc., or any other regulatory
body, the expected or anticipated ruling, judgment or outcome of
which would, in LIFE COMPANY's reasonable judgment, materially impair
TRUST's or NB MANAGEMENT's ability to meet and perform their
respective obligations and duties hereunder. Prompt notice of
election to terminate shall be furnished by LIFE COMPANY with said
termination to be effective upon receipt of notice;
(d) At the option of TRUST, upon the institution of formal proceedings
against LIFE COMPANY by the SEC, the National Association of
Securities Dealers, Inc., or any other regulatory body, the expected
or anticipated ruling, judgment or outcome of which would, in TRUST's
reasonable judgment, materially impair LIFE COMPANY's ability to meet
and perform its obligations and duties hereunder. Prompt notice of
election to terminate shall be furnished by TRUST with said
termination to be effective upon receipt of notice;
(e) At the option of LIFE COMPANY, in the event TRUST's shares are not
registered, issued or sold in accordance with applicable state or
federal law, or such law precludes the use of such shares as the
underlying investment medium of Variable Contracts issued or to be
issued by LIFE COMPANY. Termination shall be effective immediately
upon notice to TRUST;
(f) At the option of TRUST if the Variable Contracts cease to qualify
as annuity contracts or life insurance contracts, as applicable,
under the Code, or if TRUST reasonably believes that the Variable
Contracts may fail to so qualify. Termination shall be effective
upon receipt of notice by LIFE COMPANY;
(g) At the option of LIFE COMPANY, upon TRUST's breach of any material
provision of this Agreement, which breach has not been cured to the
satisfaction of LIFE COMPANY within ten days after written notice
of such breach is delivered to TRUST;
(h) At the option of TRUST, upon LIFE COMPANY's breach of any material
provision of this Agreement, which breach has not been cured to the
satisfaction of TRUST within ten days after written notice of such
breach is delivered to LIFE COMPANY;
(i) At the option of TRUST, if the Variable Contracts are not
registered, issued or sold in accordance with applicable federal
and/or state law.
(j) At the option of LIFE COMPANY in the event that any Portfolio
ceases to qualify as a Regulated Investment Company under Subchapter
M of the Code or under any successor or similar provision, or if LIFE
COMPANY reasonably believes that any Portfolio may fail to so
qualify. Termination shall be effective immediately upon notice to
the TRUST;
(k) At the option of LIFE COMPANY in the event that any Portfolio
fails to meet the diversification requirements specified in Article
II hereof or if LIFE COMPANY reasonably believes that any Portfolio
may fail to meet such diversification requirements. Termination
shall be effective immediately upon notice to the TRUST;
(l) In the event this Agreement is assigned without the prior written
consent of LIFE COMPANY, TRUST, and NB MANAGEMENT, termination shall
be effective immediately upon such occurrence without notice.
8.3 Notwithstanding any termination of this Agreement pursuant to
Section 8.2 hereof, TRUST shall, at the option of the LIFE COMPANY, continue
to make available additional TRUST shares, as provided below, for so long as
LIFE COMPANY desires pursuant to the terms and conditions of this Agreement,
for all Variable Contracts in effect on the effective date of termination of
this Agreement (hereinafter referred to as "Existing Contracts").
Specifically, without limitation, if LIFE COMPANY so elects to make
additional TRUST shares available, the owners of the Existing Contracts or
LIFE COMPANY, whichever shall have legal authority to do so, shall be
permitted to reallocate investments in TRUST, redeem investments in TRUST
and/or invest in TRUST upon the payment of additional premiums under the
Existing Contracts. In the event of a
termination of this Agreement pursuant to Section 8.2 hereof, LIFE COMPANY,
as promptly as is practicable under the circumstances, shall notify TRUST and
NB MANAGEMENT whether LIFE COMPANY elects to continue to make TRUST shares
available after such termination. If TRUST shares continue to be made
available after such termination, the provisions of this Agreement shall
remain in effect.
8.4 Except as necessary to implement Variable Contract owner initiated
transactions, or as required by state insurance laws or regulations, LIFE
COMPANY shall not redeem the shares attributable to the Variable Contracts
(as opposed to the shares attributable to LIFE COMPANY's assets held in the
Separate Accounts or invested directly), and LIFE COMPANY shall not prevent
Variable Contract owners from allocating payments to a Portfolio that was
otherwise available under the Variable Contracts, until thirty (30) days
after the LIFE COMPANY shall have notified TRUST of its intention to do so.
Article IX. NOTICES
Any notice hereunder shall be given by registered or certified mail
return receipt requested to the other party at the address of such party set
forth below or at such other address as such party may from time to time
specify in writing to the other party.
If to TRUST or NB MANAGEMENT:
Xxxxxxxxx Xxxxxx Management Inc.
000 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000-0000
Attention: Xxxxx Xxxxxxx, General Counsel
If to LIFE COMPANY:
Minnesota Life Insurance Company
Attention: Vice President - Law
000 Xxxxxx Xxxxxx Xxxxx
Xx. Xxxx, XX 00000
Notice shall be deemed given on the date of receipt by the addressee as
evidenced by the return receipt.
Article X. MISCELLANEOUS
10.1 The captions in this Agreement are included for convenience of
reference only and in no way define or delineate any of the provisions hereof
or otherwise affect their construction or effect.
10.2 This Agreement may be executed simultaneously in two or more
counterparts, each of which taken together shall constitute one and the same
instrument.
10.3 If any provision of this Agreement shall be held or made invalid
by a court decision, statute, rule or otherwise, the remainder of the
Agreement shall not be affected thereby.
10.4 This Agreement shall be construed and the provisions hereof
interpreted under and in accordance with the laws of the State of Delaware.
It shall also be subject to the provisions of the federal securities laws and
the rules and regulations thereunder and to any orders of the SEC granting
exemptive relief therefrom and the conditions of such orders.
10.5 The parties agree that the assets and liabilities of each
Portfolio are separate and distinct from the assets and liabilities of each
other Portfolio. No Portfolio shall be liable or shall be charged for any
debt, obligation or liability of any other Portfolio. No Trustee, officer or
agent shall be personally liable for such debt, obligation or liability of
any Portfolio.
10.6 Each party shall cooperate with each other party and all
appropriate governmental authorities (including without limitation the SEC,
the National Association of Securities Dealers, Inc. and state insurance
regulators) and shall permit 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.
10.7 The rights, remedies and obligations contained in this Agreement
are cumulative and are in addition to any and all rights, remedies and
obligations, at law or in equity, which the parties hereto are entitled to
under state and federal laws.
10.8 No provision of this Agreement may be amended or modified in any
manner except by a written agreement properly authorized and executed by
TRUST, NB MANAGEMENT and the LIFE COMPANY.
IN WITNESS WHEREOF, the parties have caused their duly authorized
officers to execute this Fund Participation Agreement as of the date and year
first above written.
XXXXXXXXX XXXXXX XXXXXXXXX XXXXXX
ADVISERS MANAGEMENT TRUST MANAGEMENT INC.
By: /s/ Xxxxx X. Xxxxxxx By: /s/ Xxxxx X. Xxxxxxx
------------------------ ------------------------
Name: Xxxxx X. Xxxxxxx Name: Xxxxx X. Xxxxxxx
Title: Chairman and CEO Title: President
MINNESOTA LIFE INSURANCE COMPANY]
By: /s/ Xxxxx X. Xxxx
---------------------
Name: Xxxxx X. Xxxx
Title: Senior Vice President
Appendix A
The currently available Portfolios of the TRUST are:
AMT Socially Responsive Portfolio - S Class
