PARTICIPATION AGREEMENT
Among
METROPOLITAN SERIES FUND, INC.,
METLIFE ADVISERS, LLC,
METLIFE SECURITIES, INC.
and
METROPOLITAN LIFE INSURANCE COMPANY
AGREEMENT, made and entered into as of the 30th day of April, 2007 by and
among METROPOLITAN SERIES FUND, INC., a corporation organized under the laws of
the State of Maryland (the "Fund"), METROPOLITAN LIFE INSURANCE COMPANY, an
insurance company organized under the laws of the State of New York (the
"Company"), on its own behalf and on behalf of any current or future separate
accounts of the company that invest in the Fund (each an "Account"), METLIFE
ADVISERS, LLC, a limited liability company organized under the laws of the
State of Delaware (the "Adviser") and METLIFE SECURITIES, INC., a corporation
organized under the laws of the State of Delaware (the "Underwriter").
WHEREAS, the Fund is registered as an open-end management investment company
under the Investment Company Act of 1940, as amended (the "1940 Act"), and its
shares are registered under the Securities Act of 1933, as amended (hereinafter
the "1933 Act"); and
WHEREAS, the Fund serves as an investment vehicle underlying variable life
insurance policies and variable annuity contracts (collectively, "Variable
Insurance Products") offered by insurance companies ("Participating Insurance
Companies"); and
WHEREAS, the shares of common stock of the Fund are divided into several
series of shares, each representing the interest in a particular managed
portfolio of securities and other assets; and
WHEREAS, the Fund has obtained an order from the Securities and Exchange
Commission ("SEC") granting Participating Insurance Companies and variable
annuity and variable life insurance separate accounts exemptions from certain
provisions of the 1940 Act and certain rules and regulations thereunder, to the
extent necessary to permit shares of the Fund to be sold to and held by both
variable annuity and variable life insurance separate accounts of both
affiliated and unaffiliated life insurance companies (hereinafter the "Shared
Funding Exemptive Order"); and
WHEREAS, the Adviser acts as the investment adviser and/or administrator or
sub-administrator to each series of the Fund and is registered as an investment
adviser under the Investment Advisers Act of 1940, as amended; and
WHEREAS, the Company has registered or will register certain variable life
and/or variable annuity contracts under the 1933 Act, if required;
WHEREAS, the Company has registered or will register each Account as a unit
investment trust under the 1940 Act, if required;
WHEREAS, the Underwriter is registered as a broker dealer with the SEC under
the Securities Exchange Act of 1934, as amended (the "1934 Act"), and is a
member in good standing of the National Association of Securities Dealers, Inc.
(the "NASD"); and
WHEREAS, to the extent permitted by applicable insurance laws and
regulations, the Company intends to purchase shares of certain series of the
Fund (the "Series") on behalf of each Account to fund certain variable life and
variable annuity contracts (each, a "Contract") and the Underwriter is
authorized to sell such shares to each Account at net asset value;
NOW, THEREFORE, in consideration of their mutual promises, the Company, the
Fund and the Underwriter agree as follows:
1. Sale of Fund Shares.
1.1Subject to the terms of the Distribution Agreement in effect from time to
time between the Fund and the Underwriter, the Underwriter agrees to sell to
the Company those shares of each Series which each Account orders, executing
such orders on a daily basis at the net asset value next computed after
receipt by the Fund or its designee of the order for the shares of the Fund.
For purposes of this Section 1.1 and Section 1.4, the Company is the Fund's
designee. "Business Day" shall mean any day on which the New York Stock
Exchange is open for trading and on which the Fund calculates the net asset
value of shares of the Series. The Company shall use commercially reasonable
efforts to communicate notice of orders for the purchase of Shares of each
Series to the Fund's custodian by 10:00 a.m. Eastern time on the following
Business Day (the "Next Business Day"), and the Company and the Fund shall
each use commercially reasonable efforts to wire (or cause to be wired)
funds to the other, for the purpose of settling net purchase orders or
orders of redemption, by 3:00 p.m. of the Next Business Day.
1.2The Fund agrees to make its shares available for purchase at the applicable
net asset value per share by the Company and its Accounts on those days on
which the Fund calculates its net asset value. The Fund agrees to use
reasonable efforts to calculate such net asset value on each day which the
New York Stock Exchange is open for trading. Notwithstanding the foregoing,
the Board of Directors of the Fund (hereinafter the "Board" or the
"Directors") may refuse to sell shares of any Series to any person, or
suspend or terminate the offering of shares of any Series, if such action is
required by law or by regulatory authorities having jurisdiction or is, in
the sole discretion of the Directors acting in good faith and in light of
their fiduciary duties under federal and any applicable state laws, in the
best interests of the shareholders of such Series.
1.3The Fund and the Underwriter agree that shares of the Fund will be sold only
to Participating Insurance Companies and their separate accounts, or to
other purchasers of the kind specified in Treas. Reg. Section 1.817-5(f)(3)
(or any successor regulation) as from time to time in effect.
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1.4The Fund agrees to redeem, on the Company's request, any full or fractional
shares of the Fund held by the Company, executing such requests on a daily
basis at the net asset value next computed after receipt by the Fund or its
designee of the request for redemption. The Company shall use commercially
reasonable efforts to communicate notice of orders for the redemption of
Shares of each Series to the Fund's custodian by 10:00 a.m. Eastern time on
the Next Business Day, and the Company and the Fund shall each use
commercially reasonable efforts to wire (or cause to be wired) funds to the
other, for the purpose of settling net purchase orders or orders of
redemption, by 3:00 p.m. of the Next Business Day.
1.5The Company agrees that all purchases and redemptions by it of the shares of
each Series will be in accordance with the provisions of the then current
prospectus and statement of additional information of the Fund for the
respective Series and in accordance with any procedures that the Fund, the
Underwriter or the Fund's transfer agent may have established governing
purchases and redemptions of shares of the Series generally.
1.6The Company shall pay for Fund shares on the next Business Day after an
order to purchase Fund shares is made in accordance with the provisions of
Section 1.1. hereof. Payment shall be in federal funds transmitted by wire
to the Fund's custodian.
1.7Issuance and transfer of the Fund's shares will be by book entry only. Share
certificates will not be issued. Shares ordered from the Fund will be
recorded on the transfer records of the Fund in an appropriate title for
each Account or the appropriate subaccount of each Account.
1.8The Fund shall furnish same day notice (by e-mail, fax or telephone,
followed by written confirmation) to the Company of any income, dividends or
capital gain distributions payable on the shares of any Series. The Company
hereby elects to receive all such income dividends and capital gain
distributions as are payable on the Series shares in additional shares of
that Series. The Company reserves the right to revoke this election and to
receive all such income dividends and capital gain distributions in cash.
The Fund shall notify the Company of the number of shares so issued as
payment of such dividends and distributions.
1.9The Fund shall make the net asset value per share for each Series available
to the Company on a daily basis as soon as reasonably practical after the
net asset value per share is calculated and shall use its best efforts to
make such net asset value per share available by 7:00 p.m. Eastern time. The
Fund shall furnish the Company's daily share balance to the Company as soon
as reasonably practicable.
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2. Representations and Warranties.
2.1The Company represents and warrants that each Contract shall be either
(i) registered, or prior to the purchase of shares of any Series in
connection with the funding of such Contract, will be registered under the
1933 Act or (ii) exempt from such registration; that the Contracts will be
issued and sold in compliance in all material respects with all applicable
federal and state laws, including all applicable customer suitability
requirements. The Company further represents and warrants that it is an
insurance company duly organized and in good standing under applicable law
and that it has legally and validly established each Account as a separate
account pursuant to relevant state insurance law prior to any issuance or
sale of any Contract by such Account and that each Account shall be either
(i) registered or, prior to any issuance or sale of the Contracts, will
register each Account as a unit investment trust in accordance with the
provisions of the 1940 Act; or (ii) exempt from such registration.
2.2The Fund represents and warrants that Fund shares sold pursuant to this
Agreement shall be registered under the 1933 Act, duly authorized for
issuance and sold in compliance with the laws of the State of Maryland and
all applicable federal and state securities laws and that the Fund is and
shall remain registered under the 1940 Act. The Fund agrees that it will
amend the registration statement for its shares under the 1933 Act and the
1940 Act from time to time as required in order to permit the continuous
public offering of its shares in accordance with the 1933 Act. The Fund
shall register and qualify the shares for sale in accordance with the laws
of the various states only if and to the extent deemed advisable by the Fund
or the Underwriter.
2.3The Fund represents that each Series is currently qualified as a "regulated
investment company" under subchapter M of the Internal Revenue Code of 1986,
as amended, (the "Code") and agrees that it will make every effort to
maintain such qualification (under Subchapter M or any successor or similar
provision) and that it will notify the Company promptly upon having a
reasonable basis for believing that it has ceased to so qualify or that it
might not so qualify in the future.
2.4Subject to Section 6.1, the Company represents that the Contracts are
currently treated as endowment, annuity or life insurance contracts under
applicable provisions of the Code and agrees that it will make every effort
to maintain such treatment and that it will notify the Fund and the
Underwriter 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.
2.5The Fund makes no representation as to whether any aspect of its operations
(including, but not limited to, fees and expenses and investment policies)
complies with the insurance laws or regulations of the various states.
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2.6The Underwriter represents and warrants that it is a member in good standing
of the NASD and is registered as a broker-dealer with the SEC.
2.7The Underwriter further represents that it will sell and distribute the Fund
shares in accordance with all applicable state and federal securities laws,
including without limitation the 1933 Act, the 1934 Act and the 1940 Act.
2.8The Fund represents that it is lawfully organized and validly existing under
the laws of the State of Maryland and that it does and will comply in all
material respects with the 1940 Act.
2.9Each of the Fund, the Adviser and the Underwriter represent and warrant that
all of their directors, officers and employees dealing with the money and/or
securities of the Fund are and shall continue to be at all times covered by
a blanket fidelity bond or similar coverage in an amount, in the case of the
Adviser and the Underwriter, of not less than $5,000,000 and, in the case of
the Fund, not less than the minimal coverage as required by Rule 17g-1 under
the 1940 Act or any successor regulations as may be promulgated from time to
time. Each aforesaid bond shall include coverage for larceny and
embezzlement and shall be issued by a reputable bonding company.
2.10The Company represents and warrants that all of its directors, officers,
employees and other individuals/entities dealing with the money and/or
securities representing amounts intended for the purchase of shares of the
Fund or proceeds of the redemption of shares of the 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 $5,000,000. The aforesaid Bond shall
include coverage for larceny and embezzlement and shall be issued by a
reputable bonding company.
2.11The Company represents and warrants that it will not, without the prior
written consent of the Fund and the Adviser, purchase Fund shares with
Account assets derived from the sale of Contracts to individuals or
entities which would cause the investment policies of any Series to be
subject to any limitations not in the Fund's then current prospectus or
statement of additional information with respect to any Series.
3. Prospectuses and Proxy Statements; Voting.
3.1The Underwriter (or the Fund) shall provide the Company with as many copies
of the Fund's current prospectus as the Company may reasonably request (at
the Company's expense with respect to other than existing Contract owners).
If requested by the Company in lieu thereof, the Underwriter (or the Fund)
shall provide such documentation (including a final copy of the new
prospectus as set in type at the Fund's expense) and other assistance as is
reasonably necessary in order for the Company once each year (or more
frequently if the prospectus for the Fund is amended) to have the prospectus
for the Contracts and the Fund's prospectus printed together in one document
(such printing to be at the Company's expense with respect to other than
existing Contract owners).
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3.2The Underwriter (or the Fund), at its expense, shall print and provide the
Fund's then current statement of additional information free of charge to
the Company and to any owner of a Contract or prospective owner who requests
such statement.
3.3The Fund, at its expense, shall provide the Company with copies of its proxy
material, reports to shareholders and other communications to shareholders
in such quantity as the Company shall reasonably require for distribution
(at the Fund's expense) to Contract owners.
3.4So long as and to the extent that the SEC or its staff continues to
interpret the 1940 Act to require pass-through voting privileges for
variable contract owners, or if and to the extent required by law, the
Company shall: (i) solicit voting instructions from Contract owners;
(ii) vote the Fund shares in accordance with instructions received from
Contract owners; and (iii) vote Fund shares for which no instructions have
been received in the same proportion as Fund shares of such Series for which
instructions have been received. The Company reserves the right to vote Fund
shares held in any Account in its own right, to the extent permitted by law.
The Company shall be responsible for assuring that each Account
participating in the Fund calculates voting privileges in a manner
consistent with the standards set forth on Schedule A hereto, which
standards will also be provided to the other Participating Insurance
Companies.
4. Sales Material and Information.
4.1The Company shall be solely responsible for sales literature or other
promotional material, in which the Fund, a Series, the Adviser, any
subadviser to any Series, or the Underwriter (in its capacity as distributor
of the Fund) is named, the substance of which is contained in the then
current prospectus or statement of additional information of the Fund. Other
sales literature or other promotional material may also be used by the
Company if such sales literature or other promotional material (or the
substance thereof) has been previously approved by the Fund or its designee.
All other sales literature or other promotional material shall not be used
by the Company until it has been approved by the Fund or its designee. The
Company shall deliver such draft sales literature or other promotional
material to the Fund or its designee at least thirty Business days prior to
its use. The Fund or such designee shall use commercially reasonable efforts
to review sales literature so delivered within ten days.
4.2The Company shall not give any information or make any representations or
statements on behalf of the Fund or concerning the Fund in connection with
the sale of the Contracts other than the information or representations
contained in the registration statement, prospectus or statement of
additional information for the Fund shares, as such registration statement
and prospectus or statement of additional information may be amended or
supplemented from time to time, or in reports or proxy statements for the
Fund, or in sales literature or other promotional material approved by the
Fund or its designee or by the Underwriter, except with the approval of the
Fund or the Underwriter or the designee of either.
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4.3The obligations set forth in Section 4.1 herein shall apply mutatis mutandis
to the Fund and the Underwriter with respect to each piece of sales
literature or other promotional material in which the Company and/or any
Account is named.
4.4The Fund and the Underwriter shall not give any information or make any
representations on behalf of the Company or concerning the Company, any
Account or the Contracts other than the information or representations
contained in a registration statement or prospectus for the Contracts, as
such registration statement and prospectus may be amended or supplemented
from time to time, or in published reports for each Account which are in the
public domain or approved by the Company for distribution to Contract
owners, or in sales literature or other promotional material approved by the
Company or its designee, except with the permission of the Company.
4.5The Fund will provide to the Company at least one complete copy of all
registration statements, prospectuses, statements of additional information,
shareholder annual, semi-annual or other reports, proxy statements,
applications for exemptions, requests for no-action letters and any
amendments to any of the above, that relate to any Series, promptly after
the filing of each such document with the SEC or any other regulatory
authority.
4.6The Company will provide to the Fund at least one complete copy of all
registration statements, prospectuses, statements of additional information,
shareholder annual, semi-annual or other reports, solicitations for voting
instructions, applications for exemptions, requests for no-action letters
and any amendments to any of the above, that relate to the Contracts or any
Account, promptly after the filing of such document with the SEC or any
other regulatory authority. Each party hereto will provide to each other
party, to the extent it is relevant to the Contracts or the Fund, a copy of
any comment letter received from the staff of the SEC or the NASD, and the
Company's response thereto, following any examination or inspection by the
staff of the SEC or the NASD.
4.7As used herein, the phrase "sales literature or other promotional material"
includes, but is not limited to, 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 (i.e.,
any written communication distributed or made generally available to
customers or the public, including brochures, circulars, research reports,
market letters, form letters, seminar texts, 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.
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5. Fees and Expenses.
5.1The Fund, the Adviser and the Underwriter shall pay no fee or other
compensation to the Company under this agreement, except that if the Fund or
any Series adopts and implements a plan pursuant to Rule 12b-1 to finance
distribution expenses or to provide personal account services to the owners
of the Contracts, then the Fund may make payments to the Underwriter or to
the Company. Each party acknowledges that the Adviser may pay service or
administrative fees to the Company and other Participating Insurance
Companies pursuant to separate agreements.
6. Diversification.
6.1The Fund will at all times invest money from the Contracts in such a manner
as to ensure that the Contracts will be treated as variable contracts under
the Code and the regulations issued thereunder. Without limiting the scope
of the foregoing, the Fund will at all times comply with Section 817(h) of
the Code and any Treasury Regulations thereunder relating to the
diversification requirements for variable annuity, endowment or life
insurance contracts, as from time to time in effect.
7. Potential Conflicts.
7.1To the extent required by the Shared Funding Exemptive Order or by
applicable law, the Board of Directors of the Fund (the "Board") will
monitor the Fund for the existence of any material irreconcilable conflict
between the interests of the contract owners of all separate accounts
investing in the Fund. An irreconcilable material conflict may arise for a
variety of reasons, including: (a) an action by any state insurance
regulatory authority; (b) a change in applicable federal or state insurance,
tax, or securities laws or regulations, or a public ruling, private letter
ruling, no-action or interpretative letter, or any similar action by
insurance, tax, or securities regulatory authorities; (c) an administrative
or judicial decision in any relevant proceeding; (d) the manner in which the
investments of any Series are being managed; (e) a difference in voting
instructions given by variable annuity contract and variable life insurance
contract owners; or (f) a decision by an insurer to disregard the voting
instructions of contract owners. The Fund shall promptly inform the Company
if it determines that an irreconcilable material conflict exists and the
implications thereof.
7.2The Company will report to the Board any potential or existing conflicts
between the interests of contract owners of different separate accounts of
which the Company is or becomes aware. The Company will assist the Board in
carrying out its responsibilities under the Shared Funding Exemptive Order
and under applicable law, by providing the Board with all information
reasonably necessary for the Board to consider any issues raised. This
includes, but is not limited to, an obligation of the Company to inform the
Board whenever contract owner voting instructions are disregarded.
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7.3If it is determined by a majority of the Board, or a majority of its
disinterested Directors, that a material irreconcilable conflict exists, the
Company and other Participating Insurance Companies shall, at their expense
take whatever steps are necessary to remedy or eliminate the irreconcilable
material conflict, which steps could include: (1) withdrawing the assets
allocable to some or all of the separate accounts from the Fund or any
Series and reinvesting such assets in a different investment medium,
including (but not limited to) another series of the Fund, or submitting the
question of whether such segregation should be implemented to a vote of all
affected Contract owners and, as appropriate, segregating the assets of any
appropriate group (i.e., annuity contract owners, life insurance contract
owners, or variable contract owners of one or more Participating Insurance
Companies) that votes in favor of such segregation, or offering to the
affected contract owners the option of making such a change; and
(2) establishing a new registered management investment company or managed
separate account.
7.4If a material irreconcilable conflict arises because of a decision by the
Company to disregard Contract owner voting instructions and that decision
represents a minority position or would preclude a majority vote, the
Company may be required, at the Fund's election, to withdraw the relevant
Account's investment in the Fund and terminate this Agreement; provided,
however, that such withdrawal and termination shall be limited to the extent
required by such material irreconcilable conflict as determined by a
majority of the disinterested members of the Board. Any such withdrawal and
termination will take place within six (6) months after the Fund gives
written notice that this provision is being implemented.
7.5If a material irreconcilable conflict arises because a particular state
insurance regulator's decision applicable to the Company conflicts with the
majority of other state regulators, then the Company will withdraw the
affected Account's investment in the Fund and terminate this Agreement
within six months after the Board informs the Company in writing that it has
determined that such decision has created an irreconcilable material
conflict; provided, however, that such withdrawal and termination shall be
limited to the extent required by such material irreconcilable conflict as
determined by a majority of the disinterested members of the Board.
7.6For purposes of Sections 7.3 through 7.6 of this Agreement, a majority of
the disinterested members of the Board shall determine whether any proposed
action adequately remedies any irreconcilable material conflict, but in no
event will the Fund be required to establish a new funding medium for the
Contracts. The Company shall not be required by Section 7.3 to establish a
new funding medium for the Contracts if an offer to do so has been declined
by vote of a majority of Contract owners materially adversely affected by
the irreconcilable material conflict. In the event that the Board determines
that any proposed action does not adequately remedy any irreconcilable
material conflict, then the Company will withdraw the Account's investment
in the Fund and terminate this Agreement within six (6) months after the
Board informs the Company in writing of the foregoing determination,
provided, however, that such withdrawal and termination shall be limited to
the extent required by any such material irreconcilable conflict as
determined by a majority of the disinterested members of the Board.
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7.7If and to the extent that Rule 6e-2 and Rule 6e-3(T) under the 1940 Act are
amended, or Rule 6e-3 is adopted, to provide exemptive relief from any
provision of the Act or the rules promulgated thereunder with respect to
mixed or shared funding (as defined in the Shared Funding Exemptive Order)
on terms and conditions materially different from those contained in the
Shared Funding Exemptive Order, then (a) the Fund and/or Participating
Insurance Companies, as appropriate, shall take such steps as may be
necessary to comply with Rules 6e-2 and 6e-3(T), as amended, and Rule 6e-3,
as adopted, to the extent such rules are applicable; and (b) Sections 3.4,
7.1, 7.2, 7.3, 7.4, and 7.5 of this Agreement shall continue in effect only
to the extent that terms and conditions substantially identical to such
Sections are contained in such Rule(s) as so amended or adopted.
8. Indemnification.
8.1Indemnification by the Company
(a) The Company agrees to indemnify and hold harmless the Fund and each of
its Directors and officers and each person, if any, who controls the Fund
within the meaning of Section 15 of the 1933 Act (collectively, the
"Indemnified Parties" for purposes of this Section 8.1) against any and all
losses, claims, damages, liabilities (including amounts paid in settlement
with the written consent of the Company) 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 are related to the sale or acquisition of the Fund's shares or
the Contracts and: (i) arise out of or are based upon any untrue statements
or alleged untrue statements of any material fact contained in the
registration statement or prospectus or statement of additional information
(if applicable) for the Contracts or contained in the Contracts or sales
literature or other promotional material for the 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 the Company by or on behalf of the Fund for use in
the registration statement or prospectus or statement of additional
information (if applicable) for the Contracts or in the Contracts or sales
literature or other promotional material (or any amendment or supplement) or
otherwise for use in connection with the sale of the Contracts or Fund
shares; or (ii) arise out of or as a result of statements or representations
(other than statements or representations contained in the registration
statement, prospectus or statement of additional information (if applicable)
or sales literature or other promotional material of the Fund not supplied
by the Company, or persons under its control) or wrongful conduct
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of the Company or persons under its control, with respect to the sale or
distribution of the Contracts or Fund Shares; or (iii) arise out of any
untrue statement or alleged untrue statement of a material fact contained in
any registration statement, prospectus or statement of additional
information (if applicable) or sales literature or other promotional
material of the Fund 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 a statement or omission was made in reliance upon information furnished
to the Fund by or on behalf of the Company; or (iv) arise as a result of any
failure by the Company to provide the services and furnish the materials
under the terms of this Agreement; or (v) arise out of or result from any
material breach of any representation and/or warranty made by the Company in
this Agreement or arise out of or result from any other material breach of
this Agreement by the Company, as limited by and in accordance with the
provisions of Section 8.1(b) and 8.1(c) hereof.
(b) The Company shall not be liable under this Section 8.1 with respect to
any losses, claims, damages, liabilities or litigation to which an
Indemnified Party would otherwise be subject if such loss, claim, damage,
liability or litigation is caused by or arises out of such Indemnified
Party's willful misfeasance, bad faith or gross negligence or by reason of
such Indemnified Party's reckless disregard of obligations or duties under
this Agreement or to the Fund, whichever is applicable.
(c) Each Indemnified Party shall notify the Company of any claim made
against an Indemnified Party 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 the Company of any such claim shall
not relieve the Company from any liability which it may have to the
Indemnified Party against whom such action is brought under this
indemnification provision unless the Company's ability to defend against the
claim shall have been materially prejudiced by the Indemnified Party's
failure to give such notice and shall not in any way relieve the Company
from any liability which it may have to the Indemnified Party against whom
the action is brought otherwise than on account of this indemnification
provision. In case any such action is brought against one or more
Indemnified Parties, the Company shall be entitled to participate, at its
own expense, in the defense of such action. The Company also shall be
entitled to assume the defense thereof, with counsel satisfactory to each
Indemnified Party named in the action. After notice from the Company to such
party of the 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 the 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. An Indemnified Party shall not settle any
claim involving a remedy other than monetary damages without the prior
written consent of the Company.
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(d) The Indemnified Parties will promptly notify the Company of the
commencement of any litigation or proceedings against them in connection
with the issuance or sale of the Fund Shares or the Contracts or the
operation of the Fund.
8.2Indemnification by the Adviser and the Underwriter
(a) The Adviser and the Underwriter agree to indemnify and hold harmless the
Company and each of its directors and officers and each person, if any, who
controls the Company within the meaning of Section 15 of the 1933 Act
(collectively, the "Indemnified Parties" for purposes of this Section 8.2)
against any and all losses, claims, damages, liabilities (including amounts
paid in settlement with the written consent of the Adviser and the
Underwriter) 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 are
related to the sale or acquisition of the Fund's shares or the Contracts
and: (i) 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 statement of additional information, or sales
literature or other promotional material of the Fund (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 the Adviser, the Underwriter, or Fund by or on
behalf of the Company for use in the registration statement, prospectus or
statement of additional information for the Fund or in sales literature or
other promotional material (or any amendment or supplement) or otherwise for
use in connection with the sale of the Contracts or Fund shares; or
(ii) arise out of or as a result of statements or representations (other
than statements or representations contained in the registration statement,
prospectus or statement of additional information or sales literature or
other promotional material for the Contracts not supplied by the Adviser,
the Underwriter or the Fund or persons under their control) or wrongful
conduct of the Adviser, the Underwriter or the Fund or persons under their
control, with respect to the sale or distribution of the Contracts or Fund
Shares; or (iii) arise out of any untrue statement or alleged untrue
statement of a material fact contained in any registration statement,
prospectus or statement of additional information or sales literature or
other promotional material covering the 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 was made in
reliance upon information furnished to the Company by or on behalf of the
Adviser, the Underwriter, or the Fund; or (iv) arise as a result of any
failure by the Adviser, the Underwriter or the Fund to provide the services
and furnish the materials under the terms of this Agreement (including a
failure, whether unintentional or in good faith or otherwise, to comply with
the diversification requirements specified in Article VI of this Agreement);
or (v) arise out of or result from any material breach of any
12
representation and/or warranty made by the Adviser, the Underwriter, or the
Fund in this Agreement or arise out of or result from any other material
breach of this Agreement by the Adviser, the Underwriter, or the Fund; as
limited by and in accordance with the provisions of Sections 8.2(b) and
8.2(c) hereof.
(b) Neither the Adviser nor the Underwriter shall be liable under this
Section 8.2 with respect to any losses, claims, damages, liabilities or
litigation to which an Indemnified Party would otherwise be subject if such
loss, claim, damage, liability or litigation is caused by or arises out of
such Indemnified Party's willful misfeasance, bad faith or gross negligence
or by reason of such Indemnified Party's reckless disregard of obligations
and duties under this Agreement or to the Company or each Account, whichever
is applicable.
(c) Each Indemnified Party shall notify each of the Adviser, the
Underwriter, and the Fund of any claim made against the Indemnified Party
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 each
of the Adviser, the Underwriter, and the Fund of any such claim shall not
relieve the Adviser or the Underwriter from any liability which it may have
to the Indemnified Party against whom such action is brought under this
indemnification provision unless the Adviser or the Underwriter's ability to
defend against the claim shall have been materially prejudiced by the
Indemnified Party's failure to give such notice and shall not in any way
relieve the Adviser or the Underwriter from any liability which it may have
to the Indemnified Party against whom the action is brought otherwise than
on account of this indemnification provision. In case any such action is
brought against one or more Indemnified Parties, the Adviser and the
Underwriter will be entitled to participate, at their own expense, in the
defense thereof. The Adviser and/or the Underwriter shall be entitled to
assume the defense thereof, with counsel satisfactory to the party named in
the action. After notice from the Adviser and/or the Underwriter to such
party of the election of the Adviser and/or the Underwriter to assume the
defense thereof, the Indemnified Party shall bear the fees and expenses of
any additional counsel retained by it, and the Adviser and/or the
Underwriter 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. An Indemnified Party shall not settle any claim involving any
remedy other than monetary damages without the prior written consent of the
Adviser and/or the Underwriter.
(d) The Company agrees promptly to notify the Adviser, the Underwriter and
the Fund of the commencement of any litigation or proceedings against it or
any of its officers or directors in connection with the issuance or sale of
the Contracts or the operation of each Account.
13
9. Applicable Law.
9.1This Agreement shall be construed and the provisions hereof interpreted
under and in accordance with the laws of the State of Maryland.
9.2This Agreement shall be subject to the provisions of the 1933, 1934 and 1940
acts, and the rules and regulations and rulings thereunder, including such
exemptions from those statutes, rules and regulations as the SEC may grant
(including, but not limited to, the Shared Funding Exemptive Order) and the
terms hereof shall be interpreted and construed in accordance therewith.
10.Termination.
10.1This Agreement shall terminate:
(a) at the option of any party upon 180 days' advance written notice to the
other parties; provided, however, that such notice shall not be given
earlier than one year following the date of this Agreement; or
(b) at the option of the Company to the extent that shares of a Series are
not reasonably available to meet the requirements of the Contracts as
determined by the Company, provided however, that such termination shall
apply only to those Series the shares of which are not reasonably available.
Prompt notice of the election to terminate for such cause shall be furnished
by the Company; or
(c) at the option of the Fund in the event that formal administrative
proceedings are instituted against the Company by the NASD, the SEC, any
state insurance department or commissioner or similar insurance regulator or
any other regulatory body regarding the Company's duties under this
Agreement or related to the sale of the Contracts, with respect to the
operation of any Account or the purchase by any Account of Fund shares,
provided, however, that the Fund determines in its sole judgment, exercised
in good faith, that any such administrative proceedings will have a material
adverse effect upon the ability of the Company to perform its obligations
under this Agreement; or
(d) at the option of the Company in the event that formal administrative
proceedings are instituted against the Fund, the Adviser or the Underwriter
by the NASD, the SEC or any state securities or insurance department or
commissioner or any other regulatory body, provided, however, that the
Company determines in its sole judgment exercised in good faith, that any
such administrative proceedings will have a material adverse effect upon the
ability of the Fund, the Adviser or the Underwriter to perform its
obligations under this Agreement; or
(e) with respect to any Account, upon requisite authority (by vote of the
Contract owners having an interest in such Account or any subaccount
thereof, or otherwise) to substitute the shares of another investment
company (or separate series thereof) for the shares of any
14
Series in accordance with the terms of the Contracts for which shares of
that Series had been selected to serve as the underlying investment medium.
The Company will give 90 days' prior written notice to the Fund of the date
of any proposed vote to replace the Fund's shares or of the filing by the
Company with the SEC of any application relating to any such substitution; or
(f) at the option of the Company, in the event any shares of any Series are
not registered, issued or sold in accordance with applicable state and/or
federal law or such law precludes the use of such shares as the underlying
investment medium of the Contracts issued or to be issued by the Company; or
(g) at the option of the Company, if any Series ceases to qualify as a
Regulated Investment Company under Subchapter M of the Code or under any
successor or similar provision, or if the Company reasonably believes that
any Series may fail to so qualify; or
(h) at the option of the Company, if the Fund fails to meet the
diversification requirements specified in Section 6 hereof; or
(i) at the option of the Fund, the Adviser or the Underwriter, if (1) the
Fund, the Adviser or the Underwriter, as the case may be, shall determine,
in its sole judgment reasonably exercised in good faith, that the 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 will have a material adverse
impact on the business and operations of the Fund, the Adviser or the
Underwriter, as the case may be, (2) the Fund, the Adviser or the
Underwriter shall notify the Company in writing of such determination and
its intent to terminate this Agreement, and (3) after considering the
actions taken by the Company and any other changes in circumstances since
the giving of such notice, such determination of the Fund, the Adviser or
the Underwriter 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; or
(j) at the option of the Company, if (1) the Company shall determine, in its
sole judgment reasonably exercised in good faith, that the Fund, the Adviser
or the Underwriter 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 will have a material
adverse impact upon the business and operations of the Company, (2) the
Company shall notify the Fund, the Adviser and the Underwriter in writing of
such determination and its intent to terminate the Agreement, and (3) after
considering the actions taken by the Fund, the Adviser and/or the
Underwriter and any other changes in circumstances since the giving of such
notice, such determination 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; or
15
(k) in the case of an Account not registered under the 1933 Act or 1940 Act,
the Company shall give the Fund 90 days' prior written notice if the Company
chooses to cease using any Series as an investment vehicle for such Account.
It is understood and agreed that the right of any party hereto to terminate
this Agreement pursuant to Section 10.1(a) may be exercised for any reason or
for no reason.
10.2Notice Requirement. No termination of this Agreement shall be effective
unless and until the party terminating this Agreement gives prior written
notice to all other parties to this Agreement of its intent to terminate
which notice shall set forth the basis for such termination. Furthermore,
in the event that any termination is based upon the provisions of Article
VII, or the provision of Section 10.1(a), 10.1(i) or 10.1(j) of this
Agreement, such prior written notice shall be given in advance of the
effective date of termination as required by such provisions; and
10.3In the event that any termination is based upon the provisions of
Section 10.1(c) or 10.1(d) of this Agreement, such prior written notice
shall be given at least ninety (90) days before the effective date of
termination.
10.4Effect of Termination. Notwithstanding any termination of this Agreement,
the Fund and the Underwriter shall, at the option of the Company, continue
to make available additional shares of each Series pursuant to the terms
and conditions of this Agreement, 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 shall be permitted to reallocate investments in the
Fund, redeem investments in the Fund and/or invest in the Fund upon the
making of additional purchase payments under the Existing Contracts. The
parties agree that this Section 10.4 shall not apply to any terminations
under Section 10.1(b) or Section 7, and in the case of terminations under
Section 7 terminations, the effect of such terminations shall be governed
by Section 7 of this Agreement.
11.Notices.
Any notice shall be sufficiently given when sent by registered or certified
mail 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 the Fund or to the Adviser:
000 Xxxxxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Attention: Xxxxxx X. Xxxx, Secretary
16
If to the Company:
Metropolitan Life Insurance Company
000 Xxxxxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Attention: Xxxx X. Xxxxxx, Vice President
If to the Underwriter:
MetLife Securities, Inc.
000 Xxxxxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Attention: Xxxxxxx Xxxxx, Associate General Counsel
12.Miscellaneous.
12.1A copy of the Articles of Incorporation establishing Metropolitan Series
Fund, Inc. is on file with the Secretary of State of Maryland, and notice
is hereby given that this Agreement is executed on behalf of the Fund by
officers of the Fund as officers and not individually and that the
obligations of or arising out of this Agreement are not binding upon any of
the Directors, officers or shareholders of the Fund individually but are
binding only upon the assets and property belonging to the Series.
12.2Subject to the requirements of legal process and regulatory authority, each
party hereto shall treat as confidential the names and addresses of the
owners of the 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.
12.3The 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.
12.4This Agreement may be executed simultaneously in two or more counterparts,
each of which taken together shall constitute one and the same instrument.
12.5If 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.
12.6Each party hereto shall cooperate with each other party and all appropriate
governmental authorities (including without limitation the SEC, 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.
17
12.7The 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.
Signatures appear on the following page.
18
IN WITNESS WHEREOF, each of the parties hereto has caused this Agreement to
be executed in its name and on its behalf by its duly authorized representative
as of the date first specified above.
METROPOLITAN LIFE INSURANCE COMPANY
By: /s/ Xxxxxxxxx X. Forget
------------------------------------
Xxxxxxxxx X. Forget
Vice President
METROPOLITAN SERIES FUND, INC.
By: /s/ Xxxxxxxxx X. Forget
------------------------------------
Xxxxxxxxx X. Forget
Chairman, Chief Executive Officer and President
METLIFE ADVISERS, LLC
By: /s/ Xxxx X. Xxxxxxx, Xx.
------------------------------------
Xxxx X. Xxxxxxx, Xx.
Senior Vice President
METLIFE SECURITIES, INC.
By: /s/ Xxxx X. Xxxxxxxx
------------------------------------
Xxxx X. Xxxxxxxx
Vice President and
Financial and Operations
Principal
19
PARTICIPATION AGREEMENT
Among
METROPOLITAN SERIES FUND, INC.,
METLIFE ADVISERS, LLC,
METLIFE SECURITIES, INC.
and
METROPOLITAN LIFE INSURANCE COMPANY
Schedule A
With respect to each Account, all shares of each Series attributable to such
policies and contracts for which no owner instructions have been received by
the Company and all shares of the Series attributable to charges assessed by
the Company against such policies and contracts will be voted for, voted
against, or withheld from voting on any proposal in the same proportions as are
the shares for which owner instructions have been received by the Company with
respect to policies or contracts issued by such Account. To the extent the
Company has so agreed with respect to an Account not registered with the SEC
under the 1940 Act, all shares of each Series held by the Account will be voted
for, voted against or withheld from voting on any proposal in the same
proportions as are the shares of such Series for which contract owners' voting
instructions have been received. If the Company has not so agreed, the shares
of each Series attributable to such unregistered Account will be voted for,
voted against, or withheld from voting on any proposal in the same proportions
as are all other shares for which the Company has received voting instructions.
20
