EXHIBIT 8(Z)
FUND PARTICIPATION AGREEMENT
This Agreement is entered into as of the 1st day of March, 2005, between Xxxxxxx
Xxxxx Life Insurance Company, a life insurance company organized under the laws
of the State of Arkansas ("Insurance Company"), and Dreyfus Variable Investment
Fund (the "Fund") and The Dreyfus Corporation ("TDC").
ARTICLE I
DEFINITIONS
1.1 "Act" shall mean the Investment Company Act of 1940, as amended.
1.2 "Board" shall mean the Board of Directors or Trustees, as the case may
be, of a Fund, which has the responsibility for management and control
of the Fund.
1.3 "Business Day" shall mean any day for which a Fund calculates net asset
value per Share (as defined below) as described in the Fund's
Prospectus.
1.4 "Commission" shall mean the Securities and Exchange Commission.
1.5 "Contract" shall mean a variable annuity or variable life insurance
contract that uses any Participating Fund (as defined below) as an
underlying investment medium. Individuals who participate under a group
Contract are "Participants."
1.6 "Contractholder" shall mean any entity that is a party to a Contract
with a Participating Company (as defined below).
1.7 "Disinterested Board Members" shall mean those members of the Board of
a Fund that are not deemed to be "interested persons" of the Fund, as
defined by the Act.
1.8 "Dreyfus" or "TDC" shall mean The Dreyfus Corporation and its
affiliates, including Dreyfus Service Corporation.
1.9 "Insurance Company's General Account(s)" shall mean the general
account(s) of Insurance Company and its affiliates that invest in
Shares (as defined below) of a Participating Fund.
1.10 "Participating Companies" shall mean any insurance company (including
Insurance Company) that offers variable annuity and/or variable life
insurance contracts to the public and that has entered into an
agreement with one or more of the Funds.
1.11 "Participating Fund" shall mean each Fund, including, as applicable,
any series thereof, specified in Exhibit A, as such Exhibit may be
amended from time to time by agreement of the parties hereto, the
Shares (as defined below) of which are available to serve as the
underlying investment medium for the aforesaid Contracts.
1.12 "Prospectus" shall mean the current prospectus and statement of
additional information of a Fund, relating to its Shares (as defined
below), as most recently filed with the Commission.
1.13 "Separate Account" shall mean Xxxxxxx Xxxxx Life Variable Annuity
Separate Account A, a separate account established by Insurance Company
in accordance with the laws of the State of Arkansas.
1.14 "Shares" shall mean (i) each class of shares of a Participating Fund
set forth on Exhibit A next to the name of such Participating Fund, as
such Exhibit may be revised from time to time, or (ii) if no class of
shares is set forth on Exhibit A next to the name of such Participating
Fund, the shares of the Participating Fund.
1.15 "Software Program" shall mean the software program used by a Fund for
providing Fund and account balance information including net asset
value per Share. Such Program may include the Lion System. In
situations where the Lion System or any other Software Program used by
a Fund is not available, such information may be provided by telephone.
The Lion System shall be provided to Insurance Company at no charge.
ARTICLE II
REPRESENTATIONS
2.1 Insurance Company represents and warrants that (a) it is an insurance
company duly organized and in good standing under applicable law; (b)
it has legally and validly established the Separate Account pursuant to
the insurance laws of the State of Arkansas and the regulations
thereunder for the purpose of offering to the public certain individual
and group variable annuity and variable life insurance contracts; (c)
it has registered the Separate Account as a unit investment trust under
the Act to serve as the segregated investment account for the
Contracts, or alternatively has not registered the Separate Account in
proper reliance upon an exclusion from registration under the Act; and
(d) subject to Sections 2.5 and 2.7, the Separate Account is eligible
to invest in Shares of each Participating Fund without such investment
disqualifying any Participating Fund as an investment medium for
insurance company separate accounts supporting variable annuity
contracts or variable life insurance contracts.
2.2 Insurance Company represents and warrants that (a) the Contracts will
be described in a registration statement filed under the Securities Act
of 1933, as
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amended ("1933 Act"), or alternatively not described in such a
registration statement because the Contracts are properly exempt from
registration under the 1933 Act or will be offered exclusively in
transactions that are properly exempt from registration under the 1933
Act; (b) the Contracts will be issued and sold in compliance in all
material respects with all applicable federal and state laws; and (c)
the sale of the Contracts shall comply in all material respects with
state insurance law requirements. Insurance Company shall register and
qualify the Contracts or interests therein as securities in accordance
with the laws of the various states to the extent required by state
laws, rules or regulations. Insurance Company agrees to notify each
Participating Fund promptly of any investment restrictions imposed by
state insurance law and applicable to the Participating Fund.
2.3 Insurance Company represents and warrants that the income, gains and
losses, whether or not realized, from assets allocated to the Separate
Account are, in accordance with the applicable Contracts, to be
credited to or charged against such Separate Account without regard to
other income, gains or losses from assets allocated to any other
accounts of Insurance Company. Insurance Company represents and
warrants that the assets of the Separate Account are and will be kept
separate from Insurance Company's General Account and any other
separate accounts Insurance Company may have, although Insurance
Company may transfer Separate Account assets to another separate
account pursuant to a combination or otherwise and, if Separate Account
assets exceed the required reserves and liabilities, Insurance Company
may transfer the excess to Insurance Company's General Account.
Insurance Company further represents and warrants that the assets of
the Separate Account, to the extent of its reserves and liabilities,
will not be charged with liabilities arising from any business that
Insurance Company may conduct or the liabilities of any companies
affiliated with Insurance Company.
2.4 Each Participating Fund represents and warrants that it is and will
remain registered with the Commission under the Act as an open-end,
management investment company and possesses, and shall maintain, all
legal and regulatory licenses, approvals, consents and/or exemptions
required for the Participating Fund to operate and offer its Shares as
an underlying investment medium for Participating Companies. Each
Participating Fund represents and warrants that Shares sold pursuant to
this Agreement will be registered under the 1933 Act, duly authorized
for issuance, and sold in compliance with applicable state and federal
securities laws. Each Participating Fund shall amend the registration
statement for its Shares under the 1933 Act and the Act from time to
time as required in order to effect the continuous offering of its
Shares.
2.5 Each Participating Fund represents that it is currently qualified as a
regulated investment company under Subchapter M of the Internal Revenue
Code of 1986, as amended (the "Code"), and that it will maintain such
qualification (under Subchapter M or any successor or similar
provision) and that it will notify
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Insurance Company immediately upon having a reasonable basis for
believing that it has ceased to so qualify or that it might not so
qualify in the future.
2.6 Subject to Sections 2.5 and 2.7, Insurance Company represents and
agrees that the Contracts are currently, and at the time of issuance
will be, treated as life insurance policies or annuity contracts,
whichever is appropriate, under applicable provisions of the Code, and
that it will make every effort to maintain such treatment and that it
will notify each Participating Fund and Dreyfus immediately upon having
a reasonable basis for believing that the Contracts have ceased to be
so treated or that they might not be so treated in the future.
Insurance Company agrees that any prospectus offering a Contract that
is a "modified endowment contract," as that term is defined in Section
7702A of the Code, will identify such Contract as a modified endowment
contract (or policy).
2.7 Each Participating Fund represents and warrants that its assets shall
be managed and invested in a manner that complies with the requirements
of Section 817(h) of the Code and Treasury Regulation 1.817-5, and any
Treasury interpretations thereof. In the event of a breach of this
Section 2.7 by a Participating Fund, it will (a) take all reasonable
steps to notify Insurance Company of such breach and (b) immediately
take all necessary steps to adequately diversify the Participating Fund
so as to achieve compliance within the grace period afforded by
Regulation 1.817-5.
2.8 Insurance Company agrees that each Participating Fund shall be
permitted (subject to the other terms of this Agreement) to make its
shares available to other Participating Companies and Contractholders.
2.9 Each Participating Fund represents and warrants that any of its
directors, trustees, officers, employees, investment advisers, and
other individuals/entities who deal with the money and/or securities of
the Participating Fund are and shall continue to be at all times
covered by a blanket fidelity bond or similar coverage for the benefit
of the Participating Fund in an amount not less than that required by
Rule 17g-1 under the Act. The aforesaid Bond shall include coverage for
larceny and embezzlement and shall be issued by a reputable bonding
company.
2.10 Insurance Company represents and warrants that all of its employees and
agents who deal with the money and/or securities of each Participating
Fund are and shall continue to be at all times covered by a blanket
fidelity bond or similar coverage in an amount not less than the
coverage required to be maintained by the Participating Fund. The
aforesaid Bond shall include coverage for larceny and embezzlement and
shall be issued by a reputable bonding company.
2.11 Each Participating Fund represents that it will comply with any
applicable state insurance laws and regulations, as provided in writing
by Insurance Company to the Participating Fund, including the
furnishing of information not otherwise available to Insurance Company
which is required by state insurance law
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to enable Insurance Company to obtain the authority needed to issue the
Contracts in any applicable state and including cooperating with
Insurance Company in any filings of sales literature for the Contracts.
2.12 The Fund represents that it is lawfully organized and validly existing
under the laws of the State of New York and that it does and will
comply in all material respects with the Act.
ARTICLE III
FUND SHARES
3.1 The Contracts funded through the Separate Account will provide for the
investment of certain amounts in Shares of each Participating Fund.
3.2 Each Participating Fund agrees to make its Shares available for
purchase at the then applicable net asset value per Share by Insurance
Company and the Separate Account on each Business Day pursuant to rules
of the Commission. Notwithstanding the foregoing, each Participating
Fund may refuse to sell its Shares to any person, or suspend or
terminate the offering of its Shares, if such action is required by law
or by regulatory authorities having jurisdiction or is, in the sole
discretion of its Board, acting in good faith and in light of its
fiduciary duties under federal and any applicable state laws, necessary
and in the best interests of the Participating Fund's shareholders.
3.3 Each Participating Fund agrees that shares of the Participating Fund
will be sold only to (a) Participating Companies and their separate
accounts or (b) "qualified pension or retirement plans" as determined
under Section 817(h)(4) of the Code. Except as otherwise set forth in
this Section 3.3, no shares of any Participating Fund will be sold to
the general public.
3.4 Each Participating Fund shall use its best efforts to provide closing
net asset value, dividend and capital gain information on a per Share
basis to Insurance Company by 6:00 p.m. Eastern time on each Business
Day, and shall calculate such closing net asset value in accordance
with the Participating Fund's Prospectus. Any material errors in the
calculation or reporting of net asset value, dividend and capital gain
information shall be reported immediately upon discovery to Insurance
Company. In such event Insurance Company shall be entitled to an
adjustment to the number of Shares purchased or redeemed to reflect the
correct closing net asset value per Share and the Participating Fund
shall bear the cost of correcting such errors. Non-material errors will
be corrected in the next Business Day's net asset value per Share.
3.5 At the end of each Business Day, Insurance Company will use the
information described in Sections 3.2 and 3.4 to calculate the unit
values of the Separate Account for the day. Using this unit value,
Insurance Company will process the day's Separate Account transactions
received by it by the close of trading on the floor of the New York
Stock Exchange (currently 4:00 p.m. Eastern time) to
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determine the net dollar amount of the Shares of each Participating
Fund that will be purchased or redeemed at that day's closing net asset
value per Share. The net purchase or redemption orders will be
transmitted to each Participating Fund by Insurance Company by 11:00
a.m. Eastern time on the Business Day next following Insurance
Company's receipt of that information. Subject to Sections 3.6 and 3.8,
all purchase and redemption orders for Insurance Company's General
Accounts shall be effected at the net asset value per Share of each
Participating Fund next calculated after receipt of the order by the
Participating Fund or its Transfer Agent.
3.6 Each Participating Fund appoints Insurance Company as its agent for the
limited purpose of accepting orders for the purchase and redemption of
Shares of the Participating Fund for the Separate Account. Each
Participating Fund will execute orders at the applicable net asset
value per Share determined as of the close of trading on the day of
receipt of such orders by Insurance Company acting as agent ("effective
trade date"), provided that the Participating Fund receives notice of
such orders by 11:00 a.m. Eastern time on the next following Business
Day and, if such orders request the purchase of Shares of the
Participating Fund, the conditions specified in Section 3.8, as
applicable, are satisfied. A redemption or purchase request that does
not satisfy the conditions specified above and in Section 3.8, as
applicable, will be effected at the net asset value per Share computed
on the Business Day immediately preceding the next following Business
Day upon which such conditions have been satisfied in accordance with
the requirements of this Section and Section 3.8. Insurance Company
represents and warrants that all orders submitted by the Insurance
Company for execution on the effective trade date shall represent
purchase or redemption orders received from Contractholders prior to
the close of trading on the New York Stock Exchange on the effective
trade date.
3.7 Insurance Company will make its best efforts to notify each applicable
Participating Fund in advance of any purchase or redemption order in
excess of $1 million dollars.
3.8 If Insurance Company's order requests the purchase of Shares of a
Participating Fund, Insurance Company will pay for such purchases by
wiring Federal Funds to the Participating Fund or its designated
custodial account on the day the order is transmitted. Insurance
Company shall make all reasonable efforts to transmit to the applicable
Participating Fund payment in Federal Funds by 4:00 p.m. Eastern time
on the Business Day the Participating Fund receives the notice of the
order pursuant to Section 3.5 (unless the Participating Fund determines
and so advises Insurance Company that sufficient proceeds are available
from redemption of Shares effected pursuant to redemption requests
tendered by Insurance Company on behalf of the Separate Account). Upon
receipt of Federal Funds so wired, such funds shall cease to be the
responsibility of Insurance Company and shall become the responsibility
of the Participating Fund. Each applicable Participating Fund will
execute such orders at the applicable net asset value per Share
determined as
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of the close of trading on the effective trade date if the
Participating Fund receives payment in Federal Funds by 12:00 midnight
Eastern time on the Business Day the Participating Fund receives the
notice of the order pursuant to Section 3.5. If payment in Federal
Funds for any purchase is not received or is received by a
Participating Fund after midnight Eastern time on such Business Day,
Insurance Company shall promptly, upon each applicable Participating
Fund's request, reimburse the respective Participating Fund for any
charges, costs, fees, interest or other expenses incurred by the
Participating Fund in connection with any advances to, or borrowings or
overdrafts by, the Participating Fund, or any similar expenses incurred
by the Participating Fund, as a result of portfolio transactions
effected by the Participating Fund based upon such purchase request. If
Insurance Company's order requests the redemption of any Shares of a
Participating Fund valued at or greater than $1 million dollars, the
Participating Fund will wire such amount to Insurance Company within
seven days of the order.
3.9 If Insurance Company's order requests the redemption of Shares of a
Participating Fund, the Participating Fund will pay for such
redemptions by wiring Federal Funds to Insurance Company or its
designated custodial account on the day the order is transmitted. The
Participating Fund shall make all reasonable efforts to transmit to
Insurance Company payment in Federal Funds by 4:00 p.m. Eastern time on
the Business Day the Participating Fund receives the notice of the
order pursuant to Section 3.5. Upon receipt of Federal Funds so wired,
such funds shall cease to be the responsibility of the Participating
Fund and shall become the responsibility of Insurance Company.
3.10 Each Participating Fund has the obligation to ensure that its Shares
are registered with applicable federal agencies at all times.
3.11 Each Participating Fund will confirm each purchase or redemption order
made by Insurance Company. Issuance and transfers of Shares of a
Participating Fund will be by book entry only. No share certificates
will be issued to Insurance Company or the Separate Account. Insurance
Company will record Shares ordered from a Participating Fund in an
appropriate ledger for the Separate Account.
3.12 Each Participating Fund shall credit Insurance Company with the
appropriate number of Shares.
3.13 On each ex-dividend date of a Participating Fund or, if not a Business
Day, on the first Business Day thereafter, each Participating Fund
shall communicate to Insurance Company the amount of dividend and
capital gain, if any, per Share. All dividends and capital gains shall
be automatically reinvested in additional Shares of the applicable
Participating Fund at the net asset value per Share on the ex-dividend
date. Insurance Company reserves the right, on its behalf and on behalf
of the Separate Account, to instead receive all such dividends and
capital gain distributions in cash. Each Participating Fund shall, on
the day after the ex-dividend date or, if not a Business Day, on the
first Business Day thereafter,
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notify Insurance Company of the number of Shares so issued as payment
of such dividends and distributions.
3.14 To the extent that a Separate Account is properly exempt from
registration under the Act, at least once annually, at the request of a
Participating Fund, or its designee, Insurance Company will certify the
amount of purchases and redemptions of fund shares from such Separate
Account for the Participating Fund's most recent fiscal year end.
ARTICLE IV
STATEMENTS AND REPORTS
4.1 Each Participating Fund shall provide monthly statements of account as
of the end of each month for all of Insurance Company's accounts by the
fifteenth (15th) Business Day of the following month.
4.2 Each Participating Fund shall distribute to Insurance Company copies of
the Prospectuses, proxy materials, notices, periodic reports and other
printed materials (which the Participating Fund customarily provides to
the holders of its Shares) relating only to the Shares of the
Participating Fund(s) listed in Exhibit A in quantities as Insurance
Company may reasonably request for distribution to each Contractholder
and Participant. Insurance Company may elect to print the Participating
Fund's prospectus and/or its statement of additional information in
combination with the Contract's prospectus and statement of additional
information and/or with other fund companies' prospectuses and
statements of additional information, which are also offered in
Insurance Company's insurance product at its own cost. At Insurance
Company's request, the Participating Fund will provide, in lieu of
printed documents, camera-ready copy or diskette of prospectuses,
annual and semi-annual reports for printing by the Insurance Company.
4.3 Each Participating Fund will provide to Insurance Company at least one
complete copy of all registration statements, Prospectuses, reports,
proxy statements, sales literature and other promotional materials,
applications for exemptions, requests for no-action letters, and all
amendments to any of the above, that relate to the Participating Fund
or its Shares (except for such materials that are designed only for a
class of shares of a Participating Fund not offered to the Insurance
Company pursuant to this Agreement), promptly after the filing of such
document with the Commission or other regulatory authorities.
4.4 Insurance Company will provide to each Participating Fund at least one
copy of all registration statements, prospectuses, reports, proxy
statements, sales literature and other promotional materials,
applications for exemptions, requests for no-action letters, and all
amendments to any of the above, that relate to the Contracts
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or the Separate Account, promptly after the filing of such document
with the Commission or other regulatory authorities.
4.5 Each Participating Fund's Prospectus will state that the current
statement of additional information for the Participating Fund is
available, and the Participating Fund, at its expense, will provide a
reasonable number of copies of such statement free of charge to
Insurance Company for itself and for any owner of a Contract who
requests such statement.
4.6 Each Participating Fund will provide Insurance Company with as much
notice as is reasonably practicable of any material change in the
Participating Fund's registration statement, particularly any change
resulting in a change to the registration statement or prospectus for
the Separate Account. The Participating Fund will work with Insurance
Company so as to enable Insurance Company to make changes to its
prospectus or registration statement in an orderly manner. The
Participating Fund will make reasonable efforts to attempt to have
changes affecting Contract prospectuses become effective simultaneously
with the annual updates for such prospectuses.
ARTICLE V
EXPENSES
5.1 The charge to each Participating Fund for all expenses and costs of the
Participating Fund, including but not limited to management fees, Rule
12b-1 fees, if any, administrative expenses and legal and regulatory
costs, will be included in the determination of the Participating
Fund's daily net asset value per Share.
5.2 Except as provided in Article IV and V, in particular in the next
sentence, Insurance Company shall not be required to pay directly any
expenses of any Participating Fund or expenses relating to the
distribution of its Shares. Insurance Company shall pay the following
expenses or costs:
a. Such amount of the production expenses of any Participating
Fund materials, including the cost of printing a Participating
Fund's Prospectus, or marketing materials for prospective
Insurance Company Contractholders and Participants as Dreyfus
and Insurance Company shall agree from time to time.
b. Distribution expenses of any Participating Fund materials
or marketing materials for prospective Insurance Company
Contractholders and Participants.
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c. Distribution expenses of any Participating Fund materials
or marketing materials for Insurance Company Contractholders
and Participants.
A Participating Fund's principal underwriter may pay Insurance Company,
or the broker-dealer acting as principal underwriter for the Insurance
Company's Contracts, for distribution and other services related to the
Shares of the Participating Fund pursuant to any distribution plan
adopted by the Participating Fund in accordance with Rule 12b-1 under
the Act, subject to the terms and conditions of an agreement between
the Participating Fund's principal underwriter and Insurance Company or
the principal underwriter for the Insurance Company's Contracts, as
applicable, related to such plan.
Except as provided herein, all other expenses of each Participating
Fund shall not be borne by Insurance Company. Without limiting the
foregoing, each Participation Fund shall bear the expense of printing
copies of the current prospectus, annual, and semi-annual reports for
the Funds that will be distributed to existing Contractholders.
Furthermore, each Participating Fund shall bear the expenses for the
cost of registration and qualification of the Participating Fund's
shares, preparation and filing of the Participating Fund's Prospectus
and registration statement, setting the prospectus in type, setting in
type and printing the proxy materials and reports to shareholders,
preparation of all statements and notices required by any federal or
state law and all taxes on the issuance or transfer of the
Participating Fund's shares.
ARTICLE VI
EXEMPTIVE RELIEF
6.1 The Fund has provided to Insurance Company, and Insurance Company has
reviewed, a copy of the order dated February 5, 1998 of the Commission
under Section 6(c) of the Act with respect to Dreyfus Investment
Portfolios, and, in particular, has reviewed the conditions to the
relief set forth in the Notice. As set forth therein, if Dreyfus
Investment Portfolios is a Participating Fund, Insurance Company
agrees, as applicable, to report any potential or existing conflicts of
which it is aware promptly to the Board of Dreyfus Investment
Portfolios, and, in particular, whenever contract voting instructions
are disregarded, and recognizes that it will be responsible for
assisting the Board in carrying out its responsibilities under such
application. Insurance Company agrees to carry out such
responsibilities with a view to the interests of existing
Contractholders.
6.2 If a majority of the Board, or a majority of Disinterested Board
Members, determines that a material irreconcilable conflict exists with
regard to Contractholder investments in a Participating Fund, the Board
shall give prompt notice to all Participating Companies and any other
Participating Fund. If the Board determines that Insurance Company is
responsible for causing or creating
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said conflict, Insurance Company shall at its sole cost and expense,
and to the extent reasonably practicable (as determined by a majority
of the Disinterested Board Members), take such action as is necessary
to remedy or eliminate the irreconcilable material conflict. Such
necessary action may include, but shall not be limited to:
a. Withdrawing the assets allocable to the Separate Account
from the Participating Fund and reinvesting such assets in
another Participating Fund (if applicable) or a different
investment medium, or submitting the question of whether such
segregation should be implemented to a vote of all affected
Contractholders; and/or
b. Establishing a new registered management investment company
or managed separate account.
6.3 If a material irreconcilable conflict arises as a result of a decision
by Insurance Company to disregard Contractholder voting instructions
and said decision represents a minority position or would preclude a
majority vote by all Contractholders having an interest in a
Participating Fund, Insurance Company may be required, at the Board's
election, to withdraw the investments of the Separate Account in that
Participating Fund.
6.4 For the purpose of this Article, a majority of the Disinterested Board
Members shall determine whether or not any proposed action adequately
remedies any irreconcilable material conflict, but in no event will any
Participating Fund be required to bear the expense of establishing a
new funding medium for any Contract. Insurance Company shall not be
required by this Article to establish a new funding medium for any
Contract if an offer to do so has been declined by vote of a majority
of the Contractholders materially adversely affected by the
irreconcilable material conflict.
6.5 No action by either party taken or omitted pursuant to this Article VI
shall relieve that party of its obligations under, or otherwise affect
the operation of, Article V.
ARTICLE VII
VOTING SHARES OF PARTICIPATING FUND
7.1 Each Participating Fund shall provide Insurance Company with copies, at
no cost to Insurance Company, of the Participating Fund's proxy
materials, reports to shareholders and other communications to
shareholders (except for such materials that are designed only for a
class of shares of a Participating Fund not offered to the Insurance
Company pursuant to this Agreement) in such quantity as Insurance
Company shall reasonably require for distributing to Contractholders or
Participants. Each Participating Fund will provide Insurance Company
with as much notice as is reasonably practicable of any proxy
solicitation. The
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Participating Fund will work with Insurance Company so as to enable
Insurance Company to solicit proxies from Contractholders in an orderly
manner.
Insurance Company shall:
(a) solicit voting instructions from Contractholders or
Participants on a timely basis and in accordance with
applicable law;
(b) vote the Shares of the Participating Fund in accordance
with instructions received from Contractholders or
Participants; and
(c) vote the Shares of the Participating Fund for which no
instructions have been received in the same proportion as
Shares of the Participating Fund for which instructions have
been received so long as and to the extent that the Commission
continues to interpret the Act to require pass-through voting
privileges for variable contract owners or to the extent
otherwise required by law.
Insurance Company agrees at all times to vote Shares held by
Insurance Company's General Account in the same proportion as
Shares of the Participating Fund for which instructions have
been received from Contractholders or Participants.
7.2 Insurance Company agrees that it shall not, without prior written
notice to each applicable Participating Fund and Dreyfus, solicit,
induce or encourage Contractholders to (a) change or supplement the
Participating Fund's current investment adviser or (b) change, modify,
substitute, add to or delete from the current investment media for the
Contracts.
ARTICLE VIII
MARKETING AND REPRESENTATIONS
8.1 Each Participating Fund or its principal underwriter shall periodically
furnish Insurance Company with the following documents relating only to
the Shares of the Participating Fund(s) listed in Exhibit A, in
quantities as Insurance Company may reasonably request:
a. Current Prospectus and any supplements thereto; and
b. Other marketing materials.
Expenses for the production of such documents shall be borne by the
Insurance Company in accordance with Section 5.2 of this Agreement.
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8.2 Insurance Company shall designate certain persons or entities that
shall have the requisite licenses to solicit applications for the sale
of Contracts. No representation is made as to the number or amount of
Contracts that are to be sold by Insurance Company. Insurance Company
shall make reasonable efforts to market the Contracts and shall comply
with all applicable federal and state laws in connection therewith.
8.3 Insurance Company shall furnish, or shall cause to be furnished, to
each applicable Participating Fund or its designee, each piece of
Insurance Company's sales literature or other promotional material in
which the Participating Fund, its investment adviser or the
administrator is named, at least ten Business Days prior to its use. No
such material shall be used unless the Participating Fund or its
designee approves such material. Such approval (if given) must be in
writing and shall be presumed not given if not received within 10
Business Days after receipt of such material. Each Participating Fund
or its designee, as the case may be, shall use reasonable efforts to
respond within 5 Business Days of receipt.
8.4 Insurance Company shall not give any information or make any
representations or statements on behalf of a Participating Fund or
concerning a Participating Fund in connection with the sale of the
Contracts other than the information or representations contained in
the registration statement or Prospectus of, as may be amended or
supplemented from time to time, or in reports or proxy statements for,
the applicable Participating Fund, or in sales literature or other
promotional material approved by the applicable Participating Fund,
except with the permission of the Participating Fund or its designee in
writing.
8.5 Each Participating Fund shall furnish, or shall cause to be furnished,
to Insurance Company, each piece of the Participating Fund's sales
literature or other promotional material in which Insurance Company or
the Separate Account is named, at least fifteen Business Days prior to
its use. No such material shall be used unless Insurance Company or its
designee approves such material. Such approval (if given) must be in
writing and shall be presumed not given if not received within ten
Business Days after receipt of such material. Insurance Company shall
use all reasonable efforts to respond within ten days of receipt.
8.6 Each Participating Fund shall not, in connection with the sale of
Shares of the Participating Fund, give any information or make any
representations or statements on behalf of Insurance Company or
concerning Insurance Company, the Separate Account, or the Contracts
other than the information or representations contained in a
registration statement or prospectus for the Contracts, as may be
amended or supplemented from time to time, or in published reports for
the Separate Account that are in the public domain or approved by
Insurance Company for distribution to Contractholders or Participants,
or in sales literature or other promotional material approved by
Insurance Company, except with the permission of Insurance Company or
its designee.
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8.7 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
NASD rules, the Act or the 1933 Act.
ARTICLE IX
INDEMNIFICATION
9.1 Insurance Company agrees to indemnify and hold harmless each
Participating Fund, Dreyfus, and their respective affiliates, and each
of their directors, trustees, officers, employees, agents and each
person, if any, who controls or is associated with any of the foregoing
entities or persons within the meaning of the 1933 Act (collectively,
the "Indemnified Parties" for purposes of Section 9.1), against any and
all losses, claims, damages or liabilities joint or several (including
any investigative, legal and other expenses reasonably incurred in
connection with, and any amounts paid in settlement of, any action,
suit or proceeding or any claim asserted) to which the Indemnified
Parties may become subject, under the 1933 Act or otherwise, insofar as
such losses, claims, damages or liabilities (or actions in respect
thereof) (i) arise out of or are based upon any untrue statement or
alleged untrue statement of any material fact contained in the
registration statement or prospectus or sales literature or
advertisements of the Separate Account or Contracts or contained in
information furnished in writing by Insurance Company for use in the
registration statement or Prospectus or sales literature or
advertisements of the respective Participating 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 necessary to make the
statements therein not misleading; (ii) arise out of or as a result of
conduct, statements or representations (other than statements or
representations contained in the Prospectus and sales literature or
advertisements of the respective Participating Fund) of Insurance
Company or its agents, with respect to the sale and distribution of
Contracts for which the Shares of the respective Participating Fund are
an underlying investment; (iii) arise out of the wrongful conduct of
Insurance Company or persons under its control with respect to the sale
or distribution of the Contracts or the Shares of the respective
Participating Fund; (iv) arise out of Insurance Company's incorrect
calculation and/or untimely reporting of net purchase or redemption
orders; or (v) arise out of any breach by Insurance Company of a
14
material term of this Agreement or as a result of any failure by
Insurance Company to provide the services and furnish the materials or
to make any payments provided for in this Agreement. Insurance Company
will reimburse any legal or other expenses reasonably incurred by any
Indemnified Party in connection with investigating or defending any
such loss, claim, damage, liability or action; provided, however, that
with respect to clauses (i) and (ii) above Insurance 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 any untrue statement
or omission or alleged omission made in such registration statement,
prospectus, sales literature, or advertisement in conformity with
written information furnished to Insurance Company by the respective
Participating Fund specifically for use therein. This indemnity
agreement will be in addition to any liability which Insurance Company
may otherwise have.
9.2 Each Participating Fund and TDC severally agree to indemnify and hold
harmless Insurance Company and each of its directors, officers,
employees, agents and each person, if any, who controls Insurance
Company within the meaning of the 1933 Act against any losses, claims,
damages or liabilities (including any investigative, legal and other
expenses reasonably incurred in connection with, and any amounts paid
in settlement of, any action, suit or proceeding or any claim asserted)
to which Insurance 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) (i) arise out of or are based upon any
untrue statement or alleged untrue statement of any material fact
contained in the registration statement or Prospectus or sales
literature or advertisements of the respective Participating Fund or
contained in information furnished in writing by the respective
Participating Fund for use in the registration statement or prospectus
or sales literature or advertisements of the Contracts, 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; (ii) arise out of the wrongful
conduct of the respective Participating Fund or persons under its
control with respect to the sale or distribution of the Contracts or
the Shares of the respective Participating Fund; or (iii) arise out of
any breach by a Participating Fund of a material term of this Agreement
or as a result of any failure by a Participating Fund to provide the
services and furnish the materials or to make any payments provided for
in this Agreement (including a failure of a Participating Fund, whether
unintentional or in good faith or otherwise, to comply with the
diversification and other qualification requirements specified in
Sections 2.5 and 2.7 of this Agreement). The respective Participating
Fund will reimburse any legal or other expenses reasonably incurred by
Insurance 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
with respect to clauses (i) and (ii) above the respective Participating
Fund 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
15
alleged omission made in such registration statement, prospectus, sales
literature or advertisements in conformity with written information
furnished to the respective Participating Fund by Insurance Company
specifically for use therein. This indemnity agreement will be in
addition to any liability which the respective Participating Fund may
otherwise have.
9.3 Each Participating Fund and TDC severally shall indemnify and hold
Insurance Company harmless against any and all liability, loss,
damages, costs or expenses which Insurance Company may incur, suffer or
be required to pay due to the respective Participating Fund's (i)
incorrect calculation of the daily net asset value, dividend rate or
capital gain distribution rate; (ii) incorrect reporting of the daily
net asset value, dividend rate or capital gain distribution rate; (iii)
untimely calculation of the net asset value, dividend rate or capital
gain distribution rate; and (iv) untimely reporting of the net asset
value, dividend rate or capital gain distribution rate; provided that
the respective Participating Fund shall have no obligation to indemnify
and hold harmless Insurance Company if the incorrect calculation or
incorrect or untimely reporting was the result of incorrect information
furnished by Insurance Company or information furnished untimely by
Insurance Company or otherwise as a result of or relating to a breach
of this Agreement by Insurance Company.
9.4 Promptly after receipt by an indemnified party under this Article of
notice of the commencement of any action, such indemnified party will,
if a claim in respect thereof is to be made against the indemnifying
party under this Article, notify the indemnifying party of the
commencement thereof. The omission to so notify the indemnifying party
will not relieve the indemnifying party from any liability under this
Article IX, except to the extent that the omission results in a failure
of actual notice to the indemnifying party and such indemnifying party
is damaged solely as a result of the failure to give such notice. In
case any such action is brought against any indemnified party, and it
notified the indemnifying party of the commencement thereof, the
indemnifying party will be entitled to participate therein and, to the
extent that it may wish, assume the defense thereof, with counsel
satisfactory to such indemnified party, and to the extent that the
indemnifying party has given notice to such effect to the indemnified
party and is performing its obligations under this Article, the
indemnifying party shall not be liable for any legal or other expenses
subsequently incurred by such indemnified party in connection with the
defense thereof, other than reasonable costs of investigation.
Notwithstanding the foregoing, in any such proceeding, any indemnified
party shall have the right to retain its own counsel, but the fees and
expenses of such counsel shall be at the expense of such indemnified
party unless (i) the indemnifying party and the indemnified party shall
have mutually agreed to the retention of such counsel or (ii) the named
parties to any such proceeding (including any impleaded parties)
include both the indemnifying party and the indemnified party and
representation of both parties by the same counsel would be
inappropriate due to actual or potential differing interests between
them. The
16
indemnifying party shall not be liable for any settlement of any
proceeding effected without its written consent.
A successor by law of the parties to this Agreement shall be entitled
to the benefits of the indemnification contained in this Article IX.
The provisions of this Article IX shall survive termination of this
Agreement.
9.5 The Indemnified Parties will promptly notify Insurance Company of the
commencement of any litigation or proceedings against them or any of
their officers or directors in connection with the issuance or sale of
the Fund Shares or the Contract or the operation of the Fund. Insurance
Company agrees promptly to notify the Fund of the commencement of any
litigation or proceedings against them or any of their officers or
directors in connection with the issuance or sale of the Funds or
Contracts or the operation of the Separate Account.
9.6 No party shall be liable under this Article IX with respect to any
losses, claims, damages or liabilities to which an indemnified party
would otherwise be subject by reason of such party's willful
misfeasance, bad faith, or gross negligence in the performance of such
party's duties or by reason of such party's reckless disregard of its
obligations or duties under this Agreement.
ARTICLE X
COMMENCEMENT AND TERMINATION
10.1 This Agreement shall be effective as of the date hereof and shall
continue in force until terminated in accordance with the provisions
herein.
10.2 This Agreement shall terminate without penalty:
a. As to any Participating Fund, at the option of Insurance
Company or the Participating Fund at any time from the date
hereof upon 180 days' notice, unless a shorter time is agreed
to by the respective Participating Fund and Insurance Company;
b. As to any Participating Fund, at the option of Insurance
Company, if Shares of that Participating Fund are not
reasonably available to meet the requirements of the Contracts
as determined by Insurance Company. Prompt notice of election
to terminate shall be furnished by Insurance Company, said
termination to be effective ten days after receipt of notice
unless the Participating Fund makes available a sufficient
number of Shares to meet the requirements of the Contracts
within said ten-day period;
c. As to a Participating Fund, at the option of Insurance
Company, upon the institution of formal proceedings against
that Participating Fund by the
17
Commission, NASD or any other regulatory body, the expected or
anticipated ruling, judgment or outcome of which would, in
Insurance Company's reasonable judgment, materially impair
that Participating Fund's ability to meet and perform the
Participating Fund's obligations and duties hereunder. Prompt
notice of election to terminate shall be furnished by
Insurance Company with said termination to be effective upon
receipt of notice;
d. As to a Participating Fund, at the option of each
Participating Fund, upon the institution of formal proceedings
against Insurance Company by the Commission, NASD or any other
regulatory body, the expected or anticipated ruling, judgment
or outcome of which would, in the Participating Fund's
reasonable judgment, materially impair Insurance Company's
ability to meet and perform Insurance Company's obligations
and duties hereunder. Prompt notice of election to terminate
shall be furnished by such Participating Fund with said
termination to be effective upon receipt of notice;
e. As to a Participating Fund, at the option of that
Participating Fund, if the Participating Fund shall determine,
in its sole judgment reasonably exercised in good faith, that
Insurance Company has suffered a material adverse change in
its business or financial condition or is the subject of
material adverse publicity and such material adverse change or
material adverse publicity is likely to have a material
adverse impact upon the business and operation of that
Participating Fund or Dreyfus, such Participating Fund shall
notify Insurance Company in writing of such determination and
its intent to terminate this Agreement, and after considering
the actions taken by Insurance Company and any other changes
in circumstances since the giving of such notice, such
determination of the Participating Fund shall continue to
apply on the sixtieth (60th) day following the giving of such
notice, which sixtieth day shall be the effective date of
termination;
f. As to a Participating Fund, at the option of Insurance
Company, if Insurance Company shall determine, in its sole
judgment reasonably exercised in good faith that the
Participating Fund has suffered a material adverse change in
its business or financial condition or is the subject of
material adverse publicity and such material adverse change or
material adverse publicity is likely to have a material
adverse impact upon the business and operations of Insurance
Company or its Separate Account, the Insurance Company shall
notify the Participating Fund in writing of such determination
and its intent to terminate this Agreement, and after
considering the actions taken by the Participating Fund and
any other changes in circumstances since the giving of such
notice, such determination of Insurance Company shall continue
to apply to the sixtieth
18
(60th) day following the giving of such notice, which sixtieth
day shall be the effective date of termination;
g. As to a Participating Fund, upon termination of the Investment
Advisory Agreement between that Participating Fund and Dreyfus
or its successors unless Insurance Company specifically
approves the selection of a new Participating Fund investment
adviser. Such Participating Fund shall promptly furnish notice
of such termination to Insurance Company;
h. As to a Participating Fund, in the event that Shares of the
Participating Fund are not registered, issued or sold in
accordance with applicable federal or state law, or such law
precludes the use of such Shares as the underlying investment
medium of Contracts issued or to be issued by Insurance
Company. Termination shall be effective immediately as to that
Participating Fund only upon such occurrence without notice;
i. At the option of a Participating Fund upon a determination by
its Board in good faith that it is no longer advisable and in
the best interests of shareholders of that Participating Fund
to continue to operate pursuant to this Agreement. Termination
pursuant to this Subsection (i) shall be effective upon notice
by such Participating Fund to Insurance Company of such
termination;
j. At the option of a Participating Fund if the Contracts cease
to qualify as annuity contracts or life insurance policies, as
applicable, under the Code (subject to Sections 2.5 and 2.7),
or if such Participating Fund reasonably believes that the
Contracts may fail to so qualify;
k. At the option of any party to this Agreement, upon another
party's breach of (and failure to cure) any material provision
of this Agreement;
l. At the option of a Participating Fund, if the Contracts are
not registered, issued or sold in accordance with applicable
federal and/or state law;
m. At the option of Insurance Company in the event a
Participating Fund ceases to qualify as a regulated investment
company under Subchapter M or fails to comply with Section
817(h) diversification requirements, or if Insurance Company
reasonably believes that such Participating Fund may fail to
so qualify or comply; or
n. Upon assignment of this Agreement, unless made with the
written consent of every other non-assigning party.
Any termination of this Agreement shall not affect the operation of
Articles V and IX of this Agreement.
19
10.3 Notwithstanding any termination of this Agreement pursuant to Section
10.2 hereof, each Participating Fund and Dreyfus may, at the option of
Insurance Company, continue to make available additional Shares of that
Participating Fund pursuant to the terms and conditions of this
Agreement as provided below, for all Contracts in effect on the
effective date of termination of this Agreement (hereinafter referred
to as "Existing Contracts"). Specifically, without limitation, the
owners of the Existing Contracts or Insurance Company, whichever shall
have legal authority to do so, shall be permitted to reallocate
investments in that Participating Fund, redeem investments in that
Participating Fund and/or invest in that Participating Fund upon the
making of additional purchase payments under the Existing Contracts. If
such Shares of the Participating Fund continue to be made available
after such termination, the provisions of this Agreement shall remain
in effect.
10.4 Termination of this Agreement as to any one Participating Fund shall
not be deemed a termination as to any other Participating Fund unless
Insurance Company or such other Participating Fund, as the case may be,
terminates this Agreement as to such other Participating Fund in
accordance with this Article X.
ARTICLE XI
AMENDMENTS
11.1 Any other changes in the terms of this Agreement, except for the
addition or deletion of any Participating Fund or class of Shares of a
Participating Fund as specified in Exhibit A, shall be made by
agreement in writing between Insurance Company and each respective
Participating Fund.
ARTICLE XII
NOTICE
12.1 Each notice required by this Agreement shall be given by certified
mail, return receipt requested, to the appropriate parties at the
following addresses or at such other address as such party may from
time to time specify in writing to the other party:
Insurance Company: Xxxxxxx Xxxxx Life Insurance Company
0000 Xxxxxxx Xxxxx Xxxxx, 0xx Xxxxx
Xxxxxxxxxx, XX 00000
Attn: Xxxxxx X. Xxxxxx, Xx.
Participating Funds: Dreyfus Variable Investment Fund
c/o The Dreyfus Corporation
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: General Counsel
20
with copies to: Stroock & Stroock & Xxxxx LLP
000 Xxxxxx Xxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Attn: Xxxxx X. Xxxx, Esq.
Xxxxxx X. Xxxxxxx, Esq.
Notice shall be deemed to be given on the date of receipt by the
addresses as evidenced by the return receipt.
ARTICLE XIII
MISCELLANEOUS
13.1 This Agreement has been executed on behalf of each Fund by the
undersigned officer of the Fund in his capacity as an officer of the
Fund. The obligations of this Agreement shall only be binding upon the
assets and property of the Fund and shall not be binding upon any
director, trustee, officer or shareholder of the Fund individually. It
is agreed that the obligations of the Funds are several and not joint,
that no Fund shall be liable for any amount owing by another Fund and
that the Funds have executed one instrument for convenience only.
13.2 Subject to the requirements of legal process and regulatory authority,
each party hereto shall treat as confidential the names and addresses
of Contractholders and Participants 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
without the express written consent of the affected party until such
time as such information has come into the public domain.
13.3 Each party hereto shall cooperate with each other party and all
appropriate governmental authorities (including without limitation the
Commission, the NASD, 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. Notwithstanding the generality
of the foregoing, each party hereto further agrees to furnish the
Arkansas Insurance Commissioner with any information or reports in
connection with services provided under this Agreement which such
Commissioner may request in order to ascertain whether the variable
contract operations of Insurance Company are being conducted in a
manner consistent with the Arkansas variable contract laws and
regulations and any other applicable law or regulations.
ARTICLE XIV
LAW
14.1 This Agreement shall be construed in accordance with the internal laws
of the State of New York, without giving effect to principles of
conflict of laws.
21
ARTICLE XV
FOREIGN TAX CREDITS
15.1 Each Participating Fund agrees to consult in advance with Insurance
Company concerning any decision to elect or not to pass through the
benefit of any foreign tax credits to the Participating Fund's
shareholders pursuant to Section 853 of the Code.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement to be duly
executed and attested as of the date first above written.
XXXXXXX XXXXX LIFE INSURANCE COMPANY
By: ____________________________
Name: Xxxxxx X. Xxxxxx, Xx.
Its: Vice President & Senior Counsel
Attest:_____________________
DREYFUS VARIABLE INVESTMENT FUND
By: ____________________________
Name: ____________________________
Its: ____________________________
Attest:_____________________
THE DREYFUS CORPORATION
By:________________________________
Name:______________________________
Its:_________________________________
Attest:______________________
22
EXHIBIT A
LIST OF PARTICIPATING FUNDS
Fund Name Share Class
--------- -----------
Dreyfus Variable Investment Fund
- Appreciation Portfolio Service Shares
23
