FUND PARTICIPATION AGREEMENT
This Agreement is entered into as of the 1st day of November, 2005, by and
among FIRST METLIFE INVESTORS INSURANCE COMPANY ("Insurance Company"), a life
insurance company organized under the laws of the State of New York, METLIFE
INVESTORS DISTRIBUTION COMPANY ("Contract Distributor"), LAZARD ASSET
MANAGEMENT SECURITIES LLC ("Lazard"), and LAZARD RETIREMENT SERIES, INC.
("Fund"), with respect to the Fund's Portfolios named on Schedule 1, as it may
be amended from time to time (each a "Portfolio").
ARTICLE I.
DEFINITIONS
The following terms used in this Agreement shall have the meanings set forth
below:
1.1 "1933 Act" shall mean the Securities Act of 1933, as amended.
1.2 "1940 Act" shall mean the Investment Company Act of 1940, as amended.
1.3 "Board" shall mean Fund's Board of Directors.
1.4 "Business Day" shall mean any day for which the Portfolios calculate net
asset value per share as described in the Portfolio Prospectuses.
1.5 "Code" shall mean the Internal Revenue Code of 1986, as amended.
1.6 "Commission" shall mean the Securities and Exchange Commission.
1.7 "Contract" shall mean a variable annuity or variable life insurance
contract that uses a Portfolio as an underlying investment medium and is
named on Schedule 1.
1.8 "Contract Portfolios" shall mean investment companies, other than the
Portfolios, used by a Contract as an underlying investment medium.
1.9 "Contract Prospectus" shall mean the currently effective prospectus and
statement of additional information or other offering documents with
respect to a Contract (such as a written description of a Contract not
registered under the 1933 Act), including any supplements or amendments
thereto.
1.10 "Contractholder" shall mean any person that is a party to a Contract with
a Participating Company.
1.11 "Disinterested Board Members" shall mean those members of the Board that
are not deemed to be "interested persons" of Fund, as defined in the 0000
Xxx.
1.12 "General Account" shall mean the general account of Insurance Company.
1.13 "IRS" shall mean the Internal Revenue Service.
1.14 "NASD" shall mean the National Association of Securities Dealers, Inc.
1.15 "Notice" shall mean the notice related to the Order.
1.16 "Order" shall mean Fund's mixed and shared funding exemptive order of the
Commission pursuant to Section 6(c) of the 0000 Xxx.
1.17 "Participants" shall mean individuals who participate under a group
Contract.
1.18 "Participating Company" shall mean any insurance company, including
Insurance Company, that offers variable annuity and/or variable life
insurance contracts and that has entered into an agreement with Fund for
the purpose of making Portfolio shares available to serve as the
underlying investment medium for Contracts.
1.19 "Parties" shall mean Insurance Company, Contract Distributor, Lazard and
Fund, collectively.
1.20 "Portfolio Prospectus" shall mean the currently effective prospectus and
statement of additional information with respect to a Portfolio, including
any supplements or amendments thereto.
1.21 "Separate Account" shall mean a separate account duly established by
Insurance Company that invests in a Portfolio and is named on Schedule 1.
ARTICLE II.
REPRESENTATIONS, WARRANTIES AND AGREEMENTS
2.1 Insurance Company represents, warrants and covenants that:
(a) it is and shall remain an insurance company duly organized and in good
standing under applicable law;
(b) it has legally and validly established and shall maintain each
Separate Account pursuant to applicable insurance laws and regulations;
(c) it has registered and shall maintain the registration of each Separate
Account as a unit investment trust under the 1940 Act to serve as a
segregated investment account for the Contracts, or, alternatively, it
has not so registered the Separate Accounts in proper reliance upon an
exclusion from such registration (which exclusion shall be
communicated to Fund);
(d) each Separate Account is and at all times shall be eligible to invest
in shares of a Portfolio without such investment disqualifying Fund as
an investment medium for insurance company separate accounts
supporting variable annuity and/or variable life insurance contracts;
(e) each Separate Account is and at all times shall be a "segregated asset
account" and interests in each Separate Account that are offered to
the public shall be issued exclusively through the purchase of a
Contract that is and at all times shall be a "variable contract," in
each case within the meaning of such terms under Section 817 of the
Code and the regulations thereunder; Insurance Company agrees to
notify Fund and Lazard immediately upon having a reasonable basis for
believing that such requirements have ceased to be met or that they
might not be met in the future;
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(f) the Contracts are and at all times shall be treated as life insurance,
endowment or annuity contracts under applicable provisions of the
Code, and it shall notify Fund 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; and
(g) all of its employees and agents who deal with money and/or securities
of Fund are and shall continue to be at all times covered by a blanket
fidelity bond or similar coverage, which shall include coverage for
larceny and embezzlement and shall be issued by a reputable bonding
company, in an amount not less than that required to be maintained by
Fund; Insurance Company agrees to hold for the benefit of Fund and to
pay to Fund any amounts lost from larceny, embezzlement or other
events covered by said bond to the extent such amounts properly belong
to Fund pursuant to the terms of this Agreement.
2.2 Insurance Company and Contract Distributor represent, warrant and covenant
that: (a) units of interest in each Separate Account available through the
purchase of Contracts are registered under the 1933 Act, or are not so
registered in proper reliance upon an exclusion from such registration;
(b) the Contracts shall be issued and sold in compliance in all material
respects with all applicable federal and state laws, including state
insurance suitability requirements; and (c) Insurance Company and Contract
Distributor will otherwise comply with all applicable federal and state
laws, including state insurance laws and regulations, in the performance
of this Agreement. Insurance Company agrees to inform Fund promptly of any
investment restrictions imposed by state insurance law and applicable to
Fund.
2.3 Neither Insurance Company nor Contract Distributor will enter into any
arrangements, formal or informal, to permit or facilitate any
Contractholder's use of market timing strategies or excessive trading with
respect to Portfolio shares. Insurance Company and Contract Distributor
have implemented reasonable procedures to monitor for such activities and
will cooperate with Fund's reasonable requests in taking steps to deter
and to detect the use of market timing strategies by Contractholders and
for deterring excessive trading by Contractholders that is identified by
the Fund or Lazard, including providing identity information (solely for
the purpose of deterring and detecting the use of market timing strategies
or excessive trading by Contractholders) and other information Fund
reasonably requests.
2.4 Contract Distributor represents and warrants that it is and at all times
shall be: (a) registered with the Commission as a broker-dealer; (b) a
member in good standing of the NASD; and (c) duly organized, validly
existing and in good standing under applicable law, with full power,
authority, and legal right to execute, deliver and perform its duties and
comply with its obligations under this Agreement.
2.5 Fund represents and warrants that:
(a) it is and shall remain registered with the Commission as an open-end,
management investment company under the 1940 Act;
(b) Portfolio shares are registered under the 1933 Act;
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(c) it possesses and shall maintain all legal and regulatory licenses,
approvals, consents and/or exemptions required for it to operate and
offer its shares as an underlying investment medium for the Contracts;
(d) each Portfolio is or will be qualified as a regulated investment
company under Subchapter M of the Code, it shall make every effort to
maintain such qualification, and it shall notify Insurance Company
promptly upon having a reasonable basis for believing that any
Portfolio invested in by a Separate Account has ceased to so qualify
or that it might not so qualify in the future; and
(e) all of its directors, officers, employees, investment advisers, and
other individuals/entities who deal with the money and/or securities
of Fund are and shall continue to be at all times covered by a blanket
fidelity bond or similar coverage, which shall include coverage for
larceny and embezzlement and shall be issued by a reputable bonding
company, for the benefit of Fund in an amount not less than that
required by Rule 17g-l under the 0000 Xxx.
2.6 Fund makes no representation as to whether any aspect of is operations,
including without limitation, investment policies, fees and expenses,
complies with the insurance laws of any state.
2.7 Each Portfolio's assets will be managed and invested in a manner that
complies with the requirements of Section 817(h) of the Code and Treasury
Regulation section 1.817-5, relating to the diversification requirements
for variable annuity, endowment or life insurance contracts. If a
Portfolio fails to comply with Section 817(h) of the Code, Fund will
immediately provide notice of this fact to the Insurance Company and take
all steps to adequately diversify the Portfolio so as to achieve
compliance within the grace period afforded by Treasury Regulation
section 1.817-5. If Fund does not adequately diversify the Portfolio
during the grace period, it will immediately notify Insurance Company that
the Portfolio has failed to so comply. In the event the IRS asserts in
writing in connection with any governmental audit or review of Insurance
Company or, to Insurance Company's knowledge, of any Contractholder, that
any Portfolio has failed or allegedly failed to comply with the
diversification requirements of Section 817(h) of the Code or the
regulations thereunder or Insurance Company otherwise becomes aware of any
facts that could give rise to any claim against Fund or its affiliates as
a result of such a failure or alleged failure, Insurance Company shall
promptly notify Fund and Lazard of such assertion or potential claim and
shall permit Fund and Lazard and its affiliates and their legal and
accounting advisers to participate in any conferences, discussions or
proceedings with the IRS, any Contractholder or any other claimant
regarding such claims.
2.8 Each Party agrees that it will comply with all applicable laws and
regulations relating to consumer privacy ("Privacy Law") and that it is
prohibited from using or disclosing any nonpublic personal information (as
defined in Regulation S-P, or any similar term or terms as defined in
other applicable Privacy Law, "Customer Information") received from
another Party other than (a) as required by law, regulation or rule;
(b) as permitted in writing by the disclosing party; (c) to its
affiliates; or (d) as necessary to perform this Agreement or to service
Contractholders, in each case in compliance with the reuse and
redisclosure provisions of Privacy Law. Each Party shall use its best
efforts to (i) cause its employees and agents to be informed of and to
agree to be bound by Privacy Law and the provisions of this Agreement and
(ii) maintain physical, electronic and procedural safeguards reasonably
designed to protect the security, confidentiality and integrity of, and to
prevent unauthorized access to or use of, Customer Information.
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2.9 Insurance Company and Contract Distributor have adopted and implemented
compliance policies and procedures to comply with all money laundering and
currency transaction reporting laws, regulations, requirements and
guidance applicable to Fund or applicable to Insurance Company or Contract
Distributor, as the case may be, including those relating to
Contractholder identification and verification; monitoring for Specially
Designated Nationals and Blocked Persons named on the U.S. Treasury
Department's Office of Foreign Assets Control list or other similar
governmental lists; suspicious activity reporting; and recordkeeping
requirements (collectively, "AML Requirements"), and with any "money
laundering" guidelines as may be agreed upon by Insurance Company, Lazard
and Fund.
(a) Insurance Company and Contract Distributor will ensure the ability of
federal examiners to obtain information and records relating to AML
Requirements and the ability of Lazard and Fund or their agents, at
their expense, to inspect the records and facilities of Insurance
Company and Contract Distributor during normal business hours
regarding compliance with AML Requirements.
(b) Insurance Company and Contract Distributor will provide Fund with such
information, representations and certifications regarding compliance
with AML Requirements as Fund may reasonably request.
(c) Insurance Company and Contract Distributor will notify Fund if any of
Insurance Company's or Contract Distributor's representations with
respect to compliance with AML Requirements ceases to be true.
ARTICLE III.
FUND SHARES
3.1 Fund agrees to make the shares of each Portfolio available for purchase by
Insurance Company and each Separate Account at net asset value, subject to
the terms and conditions of this Agreement and the Portfolio Prospectus.
Fund may refuse to sell the shares of any Portfolio to any person, or
suspend or terminate the offering of the shares of any Portfolio, as
permitted by law or by regulatory authorities having jurisdiction or if,
in the sole discretion of the Board acting in good faith and in light of
its fiduciary duties under federal and any applicable state laws,
suspension or termination is necessary and in the best interests of the
shareholders of such Portfolio.
3.2 Fund agrees that it shall sell shares of the Portfolios only to
Participating Companies and their separate accounts, the general accounts
of Participating Companies and their affiliates and to qualified pension
and retirement plans. No shares of any Portfolio will otherwise be sold to
the general public.
3.3 Except as noted in this Article III, Fund and Insurance Company agree that
orders and related payments to purchase and redeem Portfolio shares shall
be processed in the manner set out in Schedule 2 hereto.
(a) Insurance Company and Contract Distributor represent that they have
adopted, and will at all times during the term of this Agreement
maintain, reasonable and appropriate procedures ("Late Trading
Procedures") designed to ensure that any and all orders relating to
the purchase, sale or exchange of Portfolio shares communicated by
Contract Distributor to Fund or its agent to be treated in accordance
with Schedule 2 as having
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been received on a Business Day have been received by Contract
Distributor by the Close of Trading (as defined in Schedule 2) on such
Business Day and were not modified after the Close of Trading, and
that all orders received from Contractholders but not rescinded by the
Close of Trading were communicated to Fund or its agent as received
for that Business Day.
(b) Each transmission of Share orders by Contract Distributor shall
constitute a representation by Contract Distributor that such orders
are accurate and complete and relate to orders received by Contract
Distributor by the Close of Trading on the Business Day for which the
order is to be priced and that such transmission includes all orders
relating to Portfolio shares received from Contractholders but not
rescinded by the Close of Trading.
(c) Insurance Company and Contract Distributor will provide Fund with
(A) a copy of the Late Trading Procedures and (B) such certifications
and representations regarding the Late Trading Procedures as Fund may
reasonably request. Insurance Company and Contract Distributor will
ensure the ability of appropriate regulatory authorities to obtain
information and records relating to the Late Trading Procedures and
the ability of Lazard and Fund or their agents, at their expense, to
inspect the records and facilities during normal business hours of
Insurance Company and Contract Distributor regarding compliance with
the Late Trading Procedures. Insurance Company or Contract Distributor
will notify Fund in writing of any material change in the Late Trading
Procedures within 30 days of such change.
3.4 Fund shall confirm each purchase or redemption order made by Insurance
Company. Transfer of Portfolio shares shall be by book entry only. No
share certificates shall be issued to Insurance Company. Shares ordered
from Fund shall be recorded in an appropriate title for Insurance Company,
on behalf of each Separate Account or the General Account.
3.5 Fund shall promptly notify Insurance Company of the amount of dividend and
capital gain, if any, per share of each Portfolio to which each Separate
Account is entitled. Insurance Company hereby elects to reinvest all
dividends and capital gains of any Portfolio in additional shares of that
Portfolio at the applicable net asset value per share, until Insurance
Company otherwise notifies Fund in writing.
ARTICLE IV.
STATEMENTS AND REPORTS
4.1 Fund shall provide Insurance Company with monthly statements of account
for each Separate Account's Portfolio accounts as of the end of each month
by the fifteenth (15th) Business Day of the following month.
4.2 (a) At least annually, Fund or its designee shall provide Insurance
Company with as many copies of Portfolio Prospectuses as Insurance
Company may reasonably request for distribution by Insurance Company
to existing Contractholders and Participants with respect to Separate
Accounts invested in the relevant Portfolios.
(b) If requested by Insurance Company, Fund or its designee shall provide
Portfolio Prospectuses in "camera ready" copy or, at the request of
Insurance Company, in the electronic format sent to the financial
printer and other assistance as is reasonably
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necessary in order for the Parties once a year (or more frequently if
the Portfolio Prospectuses are supplemented or updated) to have the
Contract Prospectuses and the Portfolio Prospectuses printed together
in one document. The expenses of such printing will be borne by
Insurance Company.
(c) Fund or its designee shall provide Insurance Company, at Insurance
Company's expense, with as many copies of Portfolio Prospectuses as
Insurance Company may reasonably request for distribution by Insurance
Company to prospective purchasers of Contracts.
(d) The form of the Portfolio Prospectuses provided to Insurance Company
shall be the final form of Portfolio Prospectus as filed with the
Commission, which form shall include only those Portfolios identified
on Schedule 1.
4.3 Fund shall provide Insurance Company with at least one complete copy of
all registration statements, periodic reports and proxy statements and all
applications for exemptive orders and requests for no-action letters that
relate to a Separate Account.
4.4 Fund shall provide Insurance Company with copies of each Portfolio's
periodic reports, proxy statements and other printed materials (which the
Portfolio customarily provides to its shareholders) in quantities as
Insurance Company may reasonably request for distribution by Insurance
Company to each Contractholder and Participant with respect to Separate
Accounts invested in that Portfolio.
4.5 Insurance Company shall provide Fund with at least one complete copy of
all registration statements, periodic reports, proxy statements,
applications for exemptive orders, requests for no-action letters, and all
amendments to any of the above, that are material to a Portfolio promptly
after the filing of such document with the Commission or other regulatory
authorities or, if such materials are not filed, contemporaneously with
first use. Insurance Company shall provide to Fund and Lazard any
complaints received from Contractholders pertaining to Fund or a Portfolio.
ARTICLE V.
EXPENSES
5.1 Except as otherwise specifically provided herein, each Party will bear all
expenses incident to its performance under this Agreement.
5.2 Lazard may pay Contract Distributor for distribution and/or other services
relating to Portfolio shares pursuant to any distribution plan adopted by
Fund in accordance with Rule 12b-l under the 1940 Act, subject to the
terms of an agreement between Contract Distributor and Lazard related to
such plan.
ARTICLE VI.
EXEMPTIVE RELIEF
6.1 Insurance Company acknowledges that it has reviewed a copy of the Order
and, in particular, has reviewed the conditions to the relief set forth in
the Notice. As required by the conditions set forth in the Notice,
Insurance Company shall report any potential or existing conflicts
promptly to the Board. In addition, Insurance Company shall be responsible
for assisting the Board in carrying out its responsibilities under the
Order by providing the Board with all information
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necessary for the Board to consider any issues raised including, without
limitation, information whenever Contract voting instructions are
disregarded. Insurance Company, at least annually (but more frequently if
requested by Fund), shall submit to the Board such reports, materials, or
data as the Board may reasonably request so that the Board may carry out
fully the obligations imposed upon it by the Order. Insurance Company
agrees to carry out such responsibilities with a view only 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 Fund, the Board shall give prompt notice to
all Participating Companies. If the Board determines that Insurance
Company is a Participating Company for whom the conflict is relevant,
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 some or all Separate Accounts from
Fund or any Portfolio and reinvesting such assets in a different
investment medium (which may include another Portfolio);
(b) submitting the question of whether such segregation should be
implemented to a vote of all affected Contractholders and, as
appropriate, segregating the assets of any appropriate group (i.e.
variable annuity or variable life insurance Contractholders) that
votes in favor of such segregation; and/or
(c) 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 that
decision represents a minority position or would preclude a majority vote,
Insurance Company may be required, at the Board's election, to withdraw
the investments of its Separate Accounts in Fund.
6.4 For the purpose of this Article, a majority of the Disinterested Board
Members shall determine whether any proposed action adequately remedies
any material irreconcilable conflict, but in no event shall Fund or Lazard
or any other investment adviser of 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 and adversely affected by the
material irreconcilable conflict.
6.5 No action by Insurance Company taken or omitted, and no action by a
Separate Account or Fund taken or omitted as a result of any act or
failure to act by Insurance Company pursuant to this Article VI shall
relieve Insurance Company of its obligations under, or otherwise affect
the operations of, this Article VI.
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ARTICLE VII.
VOTING OF FUND SHARES
7.1 Insurance Company shall provide pass-through voting privileges to all
Contractholders and Participants so long as and to the extent the
Commission continues to interpret the 1940 Act as requiring pass-through
voting privileges or to the extent otherwise required by law. Accordingly,
Insurance Company, where applicable, shall vote shares of a Portfolio held
in each Separate Account in a manner consistent with voting instructions
timely received from its Contractholders and Participants. Insurance
Company shall be responsible for assuring that the Separate Account
determines voting privileges in a manner consistent with other
Participating Companies. Insurance Company shall vote shares for which it
has not received timely voting instructions, as well as shares it owns, in
the same proportion as it votes those shares for which it has received
voting instructions.
7.2 If and to the extent Rule 6e-2 and Rule 6e-3(T) under the 1940 Act are
amended, or if Rule 6e-3 is adopted, to provide exemptive relief from any
provision of the 1940 Act or the rules thereunder with respect to mixed
and shared funding on terms and conditions materially different from any
exemptions granted in the Order, then Fund, and/or the Participating
Companies, as appropriate, shall take such steps as may be necessary to
comply with Rule 6e-2 and Rule 6e-3(T), as amended, and Rule 6e-3, as
adopted, to the extent such Rules are applicable.
7.3 Insurance Company agrees that it shall not, without the prior written
consent of Fund and Lazard, solicit, introduce or encourage
Contractholders or Participants to (a) change or supplement Fund's
investment adviser or (b) change, modify, substitute, add to or delete a
Portfolio from the current investment options under the Contracts.
ARTICLE VIII.
MARKETING
8.1 Fund or its designee shall periodically furnish Insurance Company with
sales literature or other promotional materials for each Portfolio, in
quantities as Insurance Company may reasonably request, for distribution
to prospective purchasers of Contracts. Expenses for the printing and
distribution of such documents shall be borne by Insurance Company.
8.2 Insurance Company shall designate certain persons or entities that shall
have the requisite licenses to solicit applications for the sale of
Contracts.
8.3 Insurance Company shall furnish, or shall cause to be furnished, to Fund
each piece of sales literature or other promotional material in which
Fund, Lazard or Fund's investment adviser or administrator is named, at
least five (5) Business Days prior to its use. No such material shall be
used unless Fund and Lazard or their respective designees approve such
material in writing.
8.4 Fund shall furnish, or shall cause to be furnished, to Insurance Company
each piece of Fund's sales literature or other promotional material in
which Insurance Company or a Separate Account is named, at least five
(5) Business Days prior to its use. No such material shall be used unless
Insurance Company approves such material in writing.
8.5 Insurance Company shall not give any information or make any
representations or statements on behalf of Fund or Lazard or concerning
Fund or any Portfolio other than the information or representations
contained in a Portfolio Prospectus, periodic reports, proxy statements or
in sales literature or other promotional material approved by Fund.
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8.6 Fund shall not, in connection with the sale of Portfolio shares, give any
information or make any representations on behalf of Insurance Company or
concerning Insurance Company, a Separate Account, or the Contracts other
than the information or representations contained in a Contract
Prospectus, in published reports for each 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.
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, prospectuses, statements of
additional information, shareholder reports and proxy materials, and any
other material constituting sales literature or advertising under the
rules of the NASD, the 1940 Act or the 1933 Act.
ARTICLE IX.
INDEMNIFICATION
9.1 Insurance Company and Contract Distributor each agree to indemnify and
hold harmless Fund, Lazard, any investment adviser of a Portfolio, and
their affiliates, and each of their respective directors, trustees,
general members, officers, employees, agents and each person, if any, who
controls any of the foregoing entities or persons within the meaning of
the 1933 Act (collectively, the "Indemnified Parties" for purposes of this
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 or any amounts paid in settlement
of, any action, suit or proceeding or any claim asserted and any income
taxes, penalties or toll charges) (collectively, "Losses") for which the
Indemnified Parties may become subject insofar as such Losses (or actions
in respect thereof):
(a) arise out of or are based upon any untrue statement or alleged untrue
statement of any material fact contained in any registration
statement, Contract Prospectus, Contract or sales literature or other
promotional material relating to a Separate Account or the Contracts
(collectively, "Account documents") or arise out of or are based upon
the omission or the alleged omission to state in any Account documents
a material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances in which they were
made, not misleading; provided, however, that neither Insurance
Company nor Contract Distributor shall be liable in any such case to
the extent that any such Loss arises out of or is based upon any such
materially untrue statement or material omission made in any Account
document which materially untrue statement or material omission was
made in reliance upon and in conformity with written information
furnished by or on behalf of Fund specifically for use therein;
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(b) arise out of or are based upon any untrue statement or alleged untrue
statement of any material fact contained in any registration
statement, Portfolio Prospectus or sales literature or other
promotional material relating to Fund or a Portfolio (collectively,
"Portfolio documents") or arise out of or are based upon the omission
or the alleged omission to state in any Portfolio documents a material
fact required to be stated therein or necessary to make the statements
therein, in light of the circumstances in which they were made, not
misleading, provided such materially untrue statement or material
omission was made in reliance upon and in conformity with information
furnished to Fund or Lazard by or on behalf of Insurance Company or
Contract Distributor specifically for use therein;
(c) arise out of or as a result of statements or representations (other
than statements or representations contained in any Portfolio document
not made in reliance upon and in conformity with information furnished
to Fund or Lazard by or on behalf of Insurance Company or Contract
Distributor specifically for use therein and on which Insurance
Company or Contract Distributor have reasonably relied) or wrongful
conduct of Insurance Company or Contract Distributor or their
respective agents and persons under their respective control with
respect to the sale and distribution of Contracts or Portfolio shares;
(d) arise out of any material breach of any representation, warranty
and/or covenant made by Insurance Company or Contract Distributor in
this Agreement, or arise out of or result from any other material
breach of this Agreement by Insurance Company or Contract Distributor;
(e) arise out of Insurance Company's incorrect calculation and/or
incorrect or untimely reporting of net purchase or redemption orders;
or
(f) arise out of or are related to any tax liability under Section 851 of
the Code arising from purchases or redemptions by the General Account
or the accounts of Insurance Company's affiliates.
9.2 Lazard agrees to indemnify and hold harmless Insurance Company and
Contract Distributor and each of their respective directors, trustees,
general members, officers, employees, agents and each person, if any, who
controls Insurance Company or Contract Distributor within the meaning of
the 1933 Act (collectively, the "Indemnified Parties" for purposes of this
Section 9.2), against Losses for which Indemnified Parties may become
subject insofar as such Losses (or actions in respect thereof):
(a) arise out of or are based upon any untrue statement or alleged untrue
statement of any material fact contained in any Portfolio documents or
arise out of or are based upon the omission or the alleged omission to
state in any Portfolio documents a material fact required to be stated
therein or necessary to make the statements therein, in light of the
circumstances in which they were made, not misleading; provided,
however, that Lazard shall not be liable in any such case to the
extent that any such Loss arises out of or is based upon any such
materially untrue statement or material omission made in any Portfolio
document which materially untrue statement or material omission was
made in reliance upon and in conformity with information furnished by
or on behalf of Insurance Company or Contract Distributor specifically
for use therein;
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(b) arise out of or are based upon any untrue statement or alleged untrue
statement of any material fact contained in Account documents or arise
out of or are based upon the omission or the alleged omission to state
in any Account documents a material fact required to be stated therein
or necessary to make the statements therein, in light of the
circumstances in which they were made, not misleading, provided such
materially untrue statement or material omission was made in reliance
upon and in conformity with written information furnished to Insurance
Company or Contract Distributor by or on behalf of Fund specifically
for use therein;
(c) arise out of or as a result of statements or representations (other
than statements or representations contained in any Account document
on which Fund or Lazard have reasonably relied) or wrongful conduct of
Fund or Lazard or their respective agents and persons under their
respective control with respect to the sale and distribution of
Portfolio shares;
(d) arise out of any material breach of any representation and/or warranty
made by Fund or Lazard in this Agreement, or arise out of or result
from any other material breach of this Agreement by Fund or Lazard; or
(e) arise out of Fund's failure to correct in a timely manner any
incorrect calculation and/or reporting of the daily net asset value,
dividend rate or capital gain distribution rate of a Portfolio;
provided, however, that Fund shall have no obligation to indemnify and
hold harmless the Indemnified Parties if the incorrect calculation or
reporting was the result of incorrect information furnished by or on
behalf of Insurance Company or Contract Distributor or otherwise as a
result of or relating to Insurance Company's or Contract Distributor's
negligence or breach of this Agreement.
9.3 In no event shall Fund or Lazard be liable for any consequential,
incidental, special or indirect damages resulting to Insurance Company or
Contract Distributor hereunder.
9.4 Notwithstanding anything herein to the contrary, in no event shall Fund or
Lazard be liable to any individual or entity including, without
limitation, Insurance Company, Contract Distributor or any Contractholder
or Participant, with respect to any Losses that arise out of or result
from a breach of any representation, warranty, and/or covenant made by
Insurance Company or Contract Distributor hereunder or by any
Participating Company under an agreement containing substantially similar
representations, warranties and covenants.
9.5 (a) Promptly after receipt by a Party that may be entitled to
indemnification under this Article ("Indemnified Party" for purposes
of this Section) of notice of the commencement of any action which may
result in Losses, such Indemnified Party shall, if a claim in respect
thereof is to be made against the indemnifying party under this
Article ("Indemnifying Party" for purposes of this Section), notify
Indemnifying Party of the commencement thereof. The failure to so
notify shall not relieve Indemnifying Party from any liability under
this Article IX, except to the extent that Indemnifying Party is
damaged as a result of the failure to give such notice. If Indemnified
Party notifies Indemnifying Party of the commencement of any such
action, Indemnifying Party shall be entitled to participate therein
and, to the extent that it may wish, assume the defense thereof, with
counsel reasonably satisfactory to Indemnified Party, and to the
extent that Indemnifying Party has given notice to such effect and is
performing its obligations under this Article, Indemnifying Party
shall not be liable for any legal or other expenses subsequently
incurred by Indemnified Party in connection with the defense thereof,
other
12
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 its expense unless (a) Indemnifying Party and Indemnified
Party shall have mutually agreed to the retention of such counsel or
(b) the named parties to any such proceeding (including any impleaded
parties) include both Indemnifying Party and Indemnified Party and
representation of both parties by the same counsel would be
inappropriate due to actual or potential differing interests between
them. Indemnifying Party shall not be liable for any settlement of any
proceeding effected without its written consent.
(b) No party shall be liable under any of the foregoing indemnification
provisions with respect to any Losses or litigation to which an
Indemnified Party would otherwise be subject by reason of such
Indemnified Party's willful misfeasance, bad faith or gross negligence
in the performance of such Indemnified Party's duties or by reason of
such Indemnified Party's reckless disregard of obligations and duties
under this Agreement.
9.6 A successor by law of any Party to this Agreement shall be entitled to the
benefits of the indemnification contained in this Article IX.
ARTICLE X.
COMMENCEMENT AND TERMINATION
10.1 This Agreement shall continue in force until terminated in accordance with
the provisions herein.
10.2 This Agreement shall terminate without penalty as to one or more
Portfolios:
(a) at any time from the date hereof upon 60 days' written notice;
(b) at the option of Insurance Company if it determines that shares of any
Portfolio are not reasonably available to meet the requirements of the
Contracts; Insurance Company shall furnish prompt written notice of
election to terminate and termination shall be effective ten days
after receipt of written notice unless Fund makes available a
sufficient number of shares to meet the requirements of the Contracts
within such ten day period;
(c) at the option of Insurance Company upon the institution of formal
proceedings against Fund or Lazard or their respective affiliates by
the Commission or any other regulatory body, the expected or
anticipated ruling, judgment or outcome of which would, in Insurance
Company's reasonable judgment, materially impair the other's ability
to meet and perform its obligations and duties hereunder; prompt
written notice of election to terminate shall be furnished with
termination to be effective as specified therein;
(d) at the option of Fund upon the institution of formal proceedings
against Insurance Company or Contract Distributor or their respective
affiliates by the Commission, the NASD or any other regulatory body,
the expected or anticipated ruling, judgment or outcome of which
would, in Fund's reasonable judgment, materially impair the other's
ability to meet and perform its obligations and duties hereunder;
prompt written notice of election to terminate shall be furnished with
termination to be effective as specified therein;
13
(e) upon termination of the Investment Management Agreement between Fund,
on behalf of its Portfolios, and Lazard Asset Management LLC or its
successors unless Insurance Company specifically approves the
selection of a new investment adviser for the Portfolios;
(f) at the option of Fund upon a determination by the Board in good faith
that it is no longer advisable and in the best interests of
shareholders for Fund to continue to operate pursuant to this
Agreement; termination shall be effective upon notice by Fund to
Insurance Company of such termination;
(g) at the option of any Party, upon another's breach of any material
representation, warranty or other provision of this Agreement; or
(h) upon assignment (as defined in the 0000 Xxx) of this Agreement, unless
made with the written consent of the non-assigning Parties.
Any such termination pursuant to this Article X shall not affect the
operation of Articles V or IX of this Agreement. The Parties agree that
any termination pursuant to Article VI shall be governed by that Article.
10.3 Notwithstanding any termination of this Agreement, Fund and Lazard will
for a period of at least six months continue to make available additional
Portfolio shares 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 the "Existing
Contracts"), except in the case where the Fund is no longer available due
to its liquidation or being merged out of existence. Specifically, without
limitation, if Fund makes additional Portfolio shares available, the
owners of the Existing Contracts or Insurance Company, whichever shall
have legal authority to do so, shall be permitted to reallocate
investments among the Portfolios, redeem investments in the Portfolios
and/or invest in the Portfolios upon the making of additional purchase
payments under the Existing Contracts. In the event of a termination of
this Agreement pursuant to Section 10.2 hereof, Fund, as promptly as is
practicable under the circumstances, shall notify Insurance Company as to
whether Fund shall continue to make Portfolio shares available after such
termination. If Portfolio shares continue to be made available after such
termination, the provisions of this Agreement shall remain in effect and
thereafter either Fund or Insurance Company may terminate the Agreement,
as so continued pursuant to this Section 10.3, upon prior written notice
to the other Parties, such notice to be for a period that is reasonable
under the circumstances but, if given by Fund, need not be for more than
six months.
10.4 In the event of any termination of this Agreement, the Parties agree to
cooperate and give reasonable assistance to one another in taking all
necessary and appropriate steps for the purpose of ensuring that a
Separate Account owns no shares of a Portfolio beyond six months from the
date of termination. Such steps may include, without limitation,
substituting other investment company shares for those of the affected
Portfolio.
ARTICLE XI.
AMENDMENTS
11.1 Any changes in the terms of this Agreement shall be made by agreement in
writing by the Parties hereto, except as otherwise specified herein.
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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:
Insurance Company: First MetLife Investors Insurance
Company
0 Xxxx Xxxxx, Xxxxx 0000
Xxxxxx, Xxxxxxxxxx 00000
Attention: President
Contract Distributor: MetLife Investors Distribution Company
0 Xxxx Xxxxx, Xxxxx 0000
Xxxxxx, Xxxxxxxxxx 00000
Attention: President
Fund: Lazard Retirement Series, Inc.
00 Xxxxxxxxxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxx Xxxxxxxx
Lazard: Lazard Asset Management Securities LLC
00 Xxxxxxxxxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxx X. Xxxx, Esq.
with a copy to: Stroock & Stroock & Xxxxx LLP
000 Xxxxxx Xxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Attention: 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 If any provision of this Agreement is held or made invalid by a court
decision, statute, rule, or otherwise, the remainder of this Agreement
will not be affected thereby.
13.2 The rights, remedies, indemnities and obligations contained in this
Agreement are cumulative and are in addition to any and all rights,
remedies, indemnities and obligations, at law or in equity, to which the
Parties are entitled.
13.3 This Agreement may be executed simultaneously in two or more counterparts,
each of which taken together shall constitute one and the same instrument.
15
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.
IN WITNESS WHEREOF, this Agreement has been executed and attested on behalf of
the Parties as of the date first above written.
FIRST METLIFE INVESTORS INSURANCE
COMPANY
Attest: /s/ illegible By: /s/ illegible
--------------------- --------------------------------
METLIFE INVESTORS DISTRIBUTION
COMPANY
Attest: /s/ illegible By: /s/ illegible
--------------------- --------------------------------
LAZARD RETIREMENT SERIES, INC.
Attest: /s/ illegible By: /s/ illegible 11/4/05
--------------------- --------------------------------
LAZARD ASSET MANAGEMENT SECURITIES
LLC
Attest: /s/ illegible By: /s/ illegible 11/4/05
--------------------- --------------------------------
16
SCHEDULE 1
Portfolios
__________
Lazard Retirement Small Cap Portfolio
_____________________________________
Separate Accounts and Contracts
_______________________________
First MetLife Investors Variable Annuity Account One Form 6010
SCHEDULE 2
PORTFOLIO SHARE ORDER PROCESSING
________________________________
PRICING
_______
1. Each Business Day, Fund shall use its best efforts to make each Portfolio's
closing net asset value per share ("NAV") available to Insurance Company by
6:30 p.m. Eastern time.
2. At the end of each Business Day, Insurance Company shall calculate each
Separate Account's unit values. Using this unit value, Insurance Company
shall process that Business Day's Contract and Separate Account
transactions to determine the net dollar amount of each Portfolio's shares
to be purchased or redeemed.
3. Fund hereby appoints Insurance Company as its agent for the limited purpose
of receiving orders for the purchase and redemption of Portfolio shares for
the Separate Accounts. Orders that Insurance Company receives from
Contractholders by the close of regular trading (the "Close of Trading") on
the New York Stock Exchange (the "NYSE") (usually 4:00 p.m., Eastern time)
on each Business Day shall be treated by Fund and Insurance Company as
though received on that Business Day. Orders that Insurance Company
receives after the Close of Trading shall be treated by Fund and Insurance
Company as though received on the next Business Day. All orders are subject
to acceptance or rejection in the sole discretion of Lazard or Fund or its
agent, and orders shall be effective only upon receipt in proper form.
4. Insurance Company shall transmit net purchase or redemption orders to Fund
or its designee by 9:30 a.m. Eastern time on the Business Day next
following the effective trade date. For informational purposes only,
Insurance Company shall separately describe the amount of shares of each
Portfolio that are being purchased, redeemed, or exchanged from one
Portfolio to the other. In addition, Insurance Company shall use its best
efforts to notify Fund in advance of any unusually large purchase or
redemption orders.
5. Fund shall execute purchase and redemption orders for a Portfolio's shares
that relate to Insurance Company's General Account, or that do not relate
to Contract transactions, at that Portfolio's NAV next determined after
Fund (not Insurance Company) receives the order and any related purchase
payments in accordance with this Schedule.
6. Fund shall execute purchase and redemption orders for a Portfolio's shares
that relate to Contracts funded by Separate Accounts either registered
under the 1940 Act or not so registered in the same manner, but only to the
extent that Insurance Company represents and warrants that it is legally or
contractually obligated to treat such orders in the same manner. Each order
for Portfolio shares placed by Insurance Company that is attributable, in
whole or in part, to Contracts funded by an unregistered Separate Account
shall be deemed to constitute such representation and warranty by Insurance
Company unless the order specifically states to the contrary. Otherwise,
Fund shall treat orders attributable to unregistered Separate Account
Contracts in the same manner as orders for the General Account.
7. Fund shall execute purchase or redemption orders for a Portfolio's shares
that do not satisfy the conditions specified in this Schedule at the
Portfolio's NAV next determined after such conditions have been satisfied.
8. If Fund provides Insurance Company with materially incorrect net asset
value per share information through no fault of Insurance Company,
Insurance Company, on behalf of the Separate Account, may be entitled to an
adjustment to the number of shares purchased or redeemed to reflect the
correct net asset value per share in accordance with Fund's current
policies for correcting pricing errors. Any material error in the
calculation of net asset value per share, dividend rate or capital gain
distribution rate information shall be reported promptly upon discovery to
Insurance Company.
PAYMENT
_______
9. Insurance Company shall pay for any net purchase order by wiring Federal
Funds to Fund or its designated custodial account by 4:00 p.m. Eastern time
on the same Business Day it transmits the order to Fund. If Fund does not
receive such payment by 4:00 p.m., Insurance Company shall promptly, upon
Fund's request, reimburse Fund for any charges, costs, fees, interest or
other expenses incurred by Fund in connection with any advances to, or
borrowings or overdrafts by, Fund, or any similar expenses incurred by
Fund, as a result of portfolio transactions effected by Fund based upon
such purchase request.
10. Fund shall pay for any net redemption order by wiring the redemption
proceeds to Insurance Company, except as provided below, within one
Business Days after Insurance Company transmits such order to Fund or, upon
notice to Insurance Company, such longer period as permitted by the 1940
Act or the rules, orders or regulations thereunder. In the case of any net
redemption order requesting the application of proceeds from the redemption
of one Portfolio's shares to the purchase of another Portfolio's shares,
Fund shall so apply such proceeds the same Business Day that Insurance
Company transmits such order to Fund.
2