Exhibit (8)(d)(i)
FUND PARTICIPATION AGREEMENT
Great American Reserve Insurance Company ("Insurance Company"), Xxx Xxx
Worldwide Insurance Trust ("Trust") and the Trust's investment adviser, Xxx Xxx
Associates Corporation ("Adviser") hereby agree that shares of the series of the
Trust as listed on Exhibit A, as it may, from time to time, be amended
("Portfolios"), shall be made available to serve as an underlying investment
medium for Individual and Group Deferred Variable Annuity and Variable Life
Contracts ("Contracts") to be offered by Insurance Company subject to the
following provisions:
1. Insurance Company represents that it has established the segregated asset
accounts listed in Exhibit B (the "Variable Account"), each a separate
account under Texas law, and has registered each as a unit investment trust
under the Investment Company Act of 1940 ("1940 Act") to serve as an
investment vehicle for the Contracts. The Contracts provide for the
allocation of net amounts received by Insurance Company to separate series
of the Variable Account for investment in the shares of specified
investment companies selected among those companies available through the
Variable Account to act as underlying investment media. Selection of a
particular investment company is made by the Contract owner who may change
such selection from time to time in accordance with the terms of the
applicable Contract.
2. Insurance Company agrees to make every reasonable effort to market its
Contracts. It will use its best efforts to give equal emphasis and
promotion to shares of the Trust as is given to other underlying
investments of the Variable Account. In marketing its Contracts, Insurance
Company will comply with all applicable state or Federal laws.
3. The Trust or the Adviser will provide closing net asset value, dividend and
capital gain information at the close of trading each business day to
Insurance Company. Insurance Company will use this data to calculate unit
values, which will in turn be used to process that same business day's
Variable Account unit value. The Variable Account processing will be done
the same evening, and orders will be placed the morning of the following
business day. Orders will be sent directly to the Trust or its specified
agent, and payment for purchases will be wired to a custodial account
designated by the Trust or the Adviser, so as to coincide with the order
for Trust shares. The Trust will execute the orders at the net asset value
as determined as of the close of trading on the prior day. Dividends and
capital gains distributions shall be reinvested in additional shares at the
ex-date net asset value.
4. All expenses incident to the performance by the Trust under this Agreement
shall be paid by the Trust. The Trust shall pay the cost of registration of
Trust shares with the Securities and Exchange Commission ("SEC"). The Trust
shall distribute, to the Variable Account, proxy material, periodic Trust
reports to shareholders and other material the Trust may require to be sent
to Contract owners. The Trust shall pay the cost of qualifying Trust shares
in states where required. The Trust will provide Insurance Company with a
reasonable quantity of the Trust's Prospectus and the reports to be used in
contemplation of this Agreement. The Trust will provide Insurance Company
with a copy of the Statement of Additional Information suitable for
duplication.
5. Insurance Company and its agents shall make no representations concerning
the Trust or Trust shares except those contained in the then current
prospectuses of the Trust and in current printed sales literature of the
Trust.
6. Administrative services to Contract owners shall be the responsibility of
Insurance Company, and shall not be the responsibility of the Trust or the
Adviser. The Trust and Adviser recognize that Insurance Company will be the
sole shareholder of Trust shares issued pursuant to the Contracts. Such
arrangement will result in multiple share orders.
7. The Trust shall comply with Sections 817(h) and 851 of the Internal Revenue
Code of 1986, if applicable, and the regulations thereunder, and the
applicable provisions of the 1940 Act relating to the diversification
requirements for variable annuity, endowment, and life insurance contracts.
Upon request, the Trust shall provide Insurance Company with a letter from
the appropriate Trust officer certifying the Trust's compliance with the
diversification requirements and qualification as a regulated investment
company.
8. Insurance Company agrees to inform the Board of Trustees of the Trust of
the existence of, or any potential for, any material irreconcilable
conflict of interest between the interests of the Contract owners of the
Variable Account investing in the Trust and/or any other separate account
of any other insurance company investing in the Trust.
A material irreconcilable conflict may arise for a variety of reasons,
including:
(a) an action by any state insurance or other regulatory authority;
(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 any Portfolio are being
managed;
(e) a difference in voting instructions given by Contract owners and
variable annuity insurance contract owners or by variable annuity or
life insurance contract owners of different life insurance companies
utilizing the Trust; or
(f) a decision by Insurance Company to disregard the voting instructions
of contract owners.
Insurance Company will be responsible for assisting the Board of Trustees
of the Trust in carrying out its responsibilities by providing the Board
with all information reasonably necessary for the Board to consider any
issue raised, including information as to a decision by Insurance Company
to disregard voting instructions of Contract owners.
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It is agreed that if it is determined by a majority of the members of the
Board of Trustees of the Trust or a majority of its disinterested Trustees
that a material irreconcilable conflict exists affecting Insurance Company,
Insurance Company shall, at its own expense, take whatever steps are
necessary to remedy or eliminate the irreconcilable material conflict,
which steps may include, but are not limited to,
(a) withdrawing the assets allocable to some or all of the separate
accounts from the Trust or any Portfolio and reinvesting such assets
in a different investment medium, including another Portfolio of the
Trust or submitting the questions of whether such segregation should
be implemented to a vote of all affected Contract owners and, as
appropriate, segregating the assets of any particular group (i.e.,
annuity Contract owners, life insurance Contract owners or qualified
Contract owners) that votes in favor of such segregation, or offering
to the affected Contract owners the option of making such a change;
(b) establishing a new registered management investment company or managed
separate account.
If a material irreconcilable conflict arises because of Insurance Company's
decision to disregard Contract owner voting instructions and that decision
represents a minority position or would preclude a majority vote, Insurance
Company may be required, at the Trust's election, to withdraw the Variable
Account's investment in the Trust. No charge or penalty will be imposed
against the Variable Account as a result of such withdrawal. Insurance
Company agrees that any remedial action taken by it in resolving any
material conflicts of interest will be carried out with a view only to the
interests of Contract owners.
For purposes hereof, a majority of the disinterested members of the Board
of Trustees of the Trust shall determine whether any proposed action
adequately remedies any material irreconcilable conflict. In no event will
the Trust be required to establish a new funding medium for any Contracts.
Insurance Company shall not be required by the terms hereof to establish a
new funding medium for any Contracts if an offer to do so has been declined
by vote of a majority of affected Contract owners.
The Trust will undertake to promptly make known to Insurance Company the
Board of Trustees' determination of the existence of a material
irreconcilable conflict and its implications.
9. This Agreement shall terminate as to the sale and issuance of new
Contracts:
(a) at the option of Insurance Company, the Adviser or the Trust upon six
months' advance written notice to the other parties;
(b) at the option of Insurance Company, if Trust shares are not available
for any reason to meet the requirements of Contracts as determined by
Insurance
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Company. Reasonable advance notice of election to terminate shall be
furnished by Insurance Company;
(c) at the option of Insurance Company, the Adviser or the Trust, upon
institution of formal proceedings against the Broker-Dealer or
Broker-Dealers marketing the Contracts, the Variable Account,
Insurance Company or the Trust by the National Association of
Securities Dealers ("NASD"), the SEC or any other regulatory body;
(d) upon a decision by Insurance Company, in accordance with regulations
of the SEC, to substitute such Trust shares with the shares of another
investment company for Contracts for which the Trust shares have been
selected to serve as the underlying investment medium. Insurance
Company will give 60 days' written notice to the Trust and the Adviser
of any proposed vote to replace Trust shares;
(e) upon assignment of this Agreement unless made with the written consent
of each other party;
(f) in the event Trust shares are not registered, issued or sold in
conformance with Federal law or such law precludes the use of Trust
shares as an underlying investment medium of Contracts issued or to be
issued by Insurance Company. Prompt notice shall be given by either
party to the other in the event the conditions of this provision
occur.
10. Termination as the result of any cause listed in the preceding paragraph
shall not affect the Trust's obligation to furnish Trust shares for
Contracts then in force for which the shares of the Trust serve or may
serve as an underlying medium, unless such further sale of Trust shares is
proscribed by law or the SEC or other regulatory body.
11. Each notice required by this Agreement shall be given by wire and confirmed
in writing to:
Great American Reserve Insurance Company
00000 X. Xxxxxxxxxxxx Xxxxxx
Xxxxxx, Xxxxxxx 00000
Attn: Senior Vice President, Marketing
Van Eck Worldwide Insurance Trust
00 Xxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: President
Xxx Xxx Associates Corporation
00 Xxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
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Attn: President
12. Advertising and sales literature with respect to the Trust prepared by
Insurance Company or its agents for use in marketing its Contracts will be
submitted to the Trust for review before such material is submitted to the
SEC or NASD for review.
13. Insurance Company will distribute all proxy material furnished by the Trust
and will vote Trust shares in accordance with instructions received from
the Contract owners of such Trust shares. Insurance Company shall vote the
Trust shares for which no instructions have been received in the same
proportion as Trust shares for which said instructions have been received
from Contract owners. Insurance Company and its agents will in no way
recommend action in connection with or oppose or interfere with the
solicitation of proxies for the Trust shares held for such Contract owners.
14. (a) Insurance Company agrees to indemnify and hold harmless the Trust,
the Adviser, and each of its trustees, directors, officers, employees,
agents and each person, if any, who controls the Trust within the
meaning of the Securities Act of 1933 (the "Act") (the Trust and such
persons collectively, "Trust Indemnified Person") against any losses,
claims, damages or liabilities to which a Trust Indemnified Person may
become subject, under the Act or otherwise, insofar as such losses,
claims, damages or liabilities (or actions in respect thereof) arise
out of or are based upon any untrue statement or alleged untrue
statement of any material fact contained in information furnished by
Insurance Company for use in the Registration Statement or prospectus
of the Trust or in the Registration Statement or prospectus for the
Variable Account, or arise out of or are based upon the omission or
the alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not
misleading, or arise out of or as a result of conduct, statements or
representations (other than statements or representations contained in
the prospectus and Trust-prepared sales literature of the Trust) of
Insurance Company or its agents with respect to the sale and
distribution of contracts for which Trust shares are an underlying
investment or arise out of a breach of this Agreement; and Insurance
Company will reimburse any legal or other expenses reasonably incurred
by a Trust Indemnified Person in connection with investigating or
defending any such loss, claim, damage, liability or action. This
indemnity agreement will be in addition to any liability which
Insurance Company may otherwise have.
(b) The Trust agrees 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 Act
(Insurance Company and such persons collectively, "Insurance Company
Indemnified Person") against any losses, claims, damages or
liabilities to which an Insurance Company Indemnified Person may
become subject, under the Act or otherwise, insofar as such losses,
claims, damages or liabilities (or actions in respect thereof) arise
out of or are based upon any untrue statement or alleged untrue
statement of any material fact contained in the Registration Statement
or prospectus or Trust-prepared sales
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literature of the Trust, or arise out of or are based upon the
omission or the alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements
therein not misleading, or arise out of or are based upon the Trust's
failure to keep each of the Trust options fully diversified and
qualified as a regulated investment company as required by the
applicable provisions of the Internal Revenue Code, the Investment
Company Act of 1940, and any other law or regulation, or arise out of
a breach of this Agreement and the Trust will reimburse any legal or
other expenses reasonably incurred by an Insurance Company Indemnified
Person in connection with investigating or defending any such loss,
claim, damage, liability or action; provided, however, that the Trust
will not be liable in any such case to the extent that any such loss,
claim, damage or liability arises out of or is based upon an untrue
statement or omission or alleged omission made in such Registration
Statement or prospectus in conformity with written information
furnished to the Trust by Insurance Company specifically for use
therein or in Insurance Company-prepared sales literature. This
indemnity agreement will be in addition to any liability which the
Trust may otherwise have.
(c) The Adviser agrees to indemnify and hold harmless each Insurance
Company Indemnified Person against any losses, claims, damages or
liabilities to which an Insurance Company Indemnified Person may
become subject, under the Act or otherwise, insofar as such losses,
claims, damages or liabilities (or actions in respect thereof) arise
out of or are based upon any untrue statement or alleged untrue
statement of any material fact contained in the Registration Statement
or prospectus or Adviser-prepared sales literature of the Trust, or
arise out of or are based upon the omission or the alleged omission to
state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, or arise out
of or are based upon the Adviser's failure to keep each of the Trust
and its Portfolios fully diversified and qualified as a regulated
investment company as required by the applicable provisions of the
Internal Revenue Code, the 1940 Act, and any other law or regulation,
or arise out of a breach of this Agreement and the Adviser will
reimburse any legal or other expenses reasonably incurred by each
Insurance Company Indemnified Person in connection with investigating
or defending any such loss, claim, damage, liability or action;
provided, however, that the Adviser will not be liable in any such
case to the extent that any such loss, claim, damage or liability
arises out of or is based upon an untrue statement or omission or
alleged omission made in such Registration Statement or prospectus in
conformity with written information furnished to the Adviser by
Insurance Company specifically for use therein or Insurance
Company-prepared sales literature. This indemnity agreement will be in
addition to any liability which the Adviser may otherwise have.
(d) The Trust and the Adviser 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 directly due to the Trust's or Adviser's (or their designated
agent's) (1) incorrect calculation of the daily net asset value,
dividend rate or capital gain distribution rate; (2) incorrect
reporting
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of the daily net asset value, dividend rate or capital gain
distribution rate: or (3) untimely reporting of the net asset value,
dividend rate or capital gain distribution rate. Any gain to Insurance
Company attributable to the Trust's, or Adviser's (or their designated
agent's) incorrect calculation or reporting of the daily net asset
value shall be immediately returned to the Trust.
(e) Promptly after receipt by an indemnified party under this paragraph of
notice of the commencement of action, such indemnified party will, if
a claim in respect thereof is to be made against the indemnifying
party under this paragraph, notify the indemnifying party of the
commencement thereof; but the omission so to notify the indemnifying
party will not relieve it from any liability which it may have to any
indemnified party otherwise than under this paragraph. 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, after notice from the indemnifying party to
such indemnified party under this paragraph for any legal or other
expenses subsequently incurred by such indemnified party in connection
with the defense thereof other than reasonable costs of investigation.
(f) Nothing herein shall entitle an indemnified party to special,
consequential or exemplary damages or damages of like kind or nature
and with respect to section 14(d) hereof all liability, loss and
damages shall be limited to the amount required to correct the value
of the account as if there had been no incorrect calculation or
reporting or untimely reporting of net asset value, dividend rate or
capital gain distribution rate.
15. If, in the course of future marketing of the Contracts, Insurance Company
or its agents shall request the continued assistance of the Trust's sales
personnel, compensation (which will be negotiated by the Trust and
Insurance Company) shall be paid by Insurance Company to the Trust.
GREAT AMERICAN RESERVE INSURANCE
COMPANY
Date: March 1, 1995 By: Signature
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XXX XXX WORLDWIDE INSURANCE TRUST
Date: March 1, 1995 By: Signature
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XXX XXX ASSOCIATES CORPORATION
Date: March 1, 1995 By: Signature
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EXHIBIT A
Gold and Natural Resources Fund
Worldwide Income Fund
Worldwide Hard Assets Fund
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EXHIBIT B
Great American Reserve Variable Account C
Great American Reserve Variable Account E
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