Exhibit 99.h(iii)
HARTFORD HLS SERIES FUND II, INC.
SHARE PURCHASE AGREEMENT
FORTIS BENEFITS INSURANCE COMPANY ("Fortis Benefits"), a Minnesota
corporation, as Sponsor-Depositor, now and in the future, of certain separate
accounts ("Separate Accounts"), and issuer of certain variable annuity and
variable life insurance contracts (the "Contracts") issued with respect to such
Separate Accounts hereby agrees as of the 1st day of May 2003 with HARTFORD HLS
SERIES FUND II, INC. (the "Fund"), an open-end, diversified, management
investment company, to this Share Purchase Agreement, which contemplates an
arrangement whereby Fund shares shall be made available to serve as the
underlying investment media for the Contracts, subject to the following
provisions:
1. Fund shares shall be purchased at the net asset value applicable to each
order as established in accordance with the provisions of the then
currently effective prospectus of the Fund. Fund shares shall be ordered in
such quantity and at such times as determined by Fortis Benefits (or its
successor) to be necessary to meet the requirements of the Contracts.
Confirmations of Fund share purchases will be sent directly to Fortis
Benefits by the Fund. All Fund share purchases shall be maintained in a
book share account in the name of Fortis Benefits. Payment for shares shall
be made directly to the Fund by Fortis Benefits and payment for redemption
shall be made directly to Fortis Benefits by the Fund, all within the
applicable time periods allowed for settlement of securities transactions.
If payment is not received by the Fund within such period, the Fund may,
without notice, cancel the order and hold Fortis Benefits responsible for
any loss suffered by the Fund resulting from such failure to receive timely
payment.
Notice shall be furnished promptly to Fortis Benefits by the Fund of any
dividend or distribution payable on Fund shares.
2. (a) The Fund represents that its shares are registered under the
Securities Act of 1933, as amended, and that all appropriate federal and
state registration provisions have been complied with as to such shares and
that such shares may properly be made available for the purposes of this
Agreement. The Fund shall bear the cost of any such registration, as well
as the expense of any taxes assessed upon the issuance or transfer of Fund
shares pursuant to this Agreement.
(b) The Fund shall supply to Fortis Benefits, in a timely manner and in a
sufficient number to allow distribution by Fortis Benefits to each owner of
or participant under a Contract (i) annual and semiannual reports of the
Fund's condition, and (ii) any other Fund shareholder notice, report or
document required by law to be delivered to shareholders. The Fund shall
bear the cost of preparing and supplying the foregoing materials and the
cost of any distribution thereof.
(c) Fortis Benefits represents that it has registered or will register
under the Securities Act of 1933, as amended and the Investment Company Act
of 1940, as amended (the "1940 Act"), unless exempt from such registration,
the Contracts. Fortis Benefits will maintain such registrations to the
extent required by law. The Contracts will be issued in compliance with all
applicable federal and state laws and regulations.
(d) Fortis Benefits has legally and validly established each Separate
Account prior to any issuance or sale as a segregated asset account under
the Minnesota Insurance Code and has registered or, prior to any issuance
or sale of the Contracts, will register and will maintain the registration
of, each Separate Account as a unit investment trust in accordance with the
1940 Act, unless exempt from such registration.
3. Fortis Benefits shall not make any representation concerning Fund shares
except those contained in the then current prospectus of the Fund and in
printed information subsequently issued by the Fund as information
supplemental to the prospectus.
4. This Agreement shall terminate as to new Contracts:
(a) At the option of Fortis Benefits or the Fund upon six months' advance
notice to the other;
(b) At the option of Fortis Benefits if Fund shares are not available for
any reason to meet the requirements of the Contracts but then only as to
those new Contracts, the terms of which require the periodic payments to be
invested in whole or in part in that particular Series;
(c) At the option of Fortis Benefits, upon institution of formal
proceedings against the Fund by the Securities and Exchange Commission or
any other regulatory body;
(d) Upon assignment of this Agreement, unless made with the written
consent of the other party to this Agreement;
(e) If Fund shares are not registered, issued or sold in conformance with
applicable federal or state law or if such laws preclude the use of Fund
shares as the underlying investment media of the Contracts. Prompt notice
shall be given to Fortis Benefits in the event the conditions of this
provision occur.
Notice of termination hereunder shall be given promptly by the party
desiring to terminate to the other party to this Agreement.
5. Termination as the result of any cause listed in the preceding paragraph
shall not affect the Fund's obligation to furnish Fund shares in connection
with Contracts then in force for which the shares of the Fund serve or may
serve as the underlying investment media, unless further sale of Fund
shares is proscribed by the Securities and Exchange Commission or other
regulatory body, or if Fund shares of the requisite Series are no longer
available.
6. This Agreement shall supersede any prior agreement between the parties
hereto relating to the same subject matter.
7. Each notice required by this Agreement shall be given in writing as
follows:
IF TO THE FUND:
Hartford HLS Series Fund II, Inc.
X.X. Xxx 0000
Xxxxxxxx, Xxxxxxxxxxx 00000-0000
Attn: Counsel to the Fund
IF TO FORTIS BENEFITS:
Fortis Benefits Insurance Company
One Chase Xxxxxxxxx Xxxxx
00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Fortis, Inc.
General Counsel
8. This Agreement shall be construed in accordance with the laws of the State
of Connecticut.
9. (a) Fortis Benefits will report to the Board of Directors of the Fund (the
"Board") any potential or existing material irreconcilable conflict, of
which it is aware, between and among the interests of the contract owners
of all separate accounts investing in the series of the Fund (the "Series")
and of the participants of qualified pension or retirement plans investing
in the Series and will assist the Board in carrying out the Board's
responsibility of monitoring the Series for the existence of any material
irreconcilable conflict by providing the Board with all information
reasonably necessary for the Board to consider the issue raised. This
includes, but is not limited to, an obligation by Fortis Benefits to inform
the Board whenever Contract owner voting instructions are disregarded.
(b) If it is determined by a majority of the Board, or a majority of its
independent Directors, that a material irreconcilable conflict exists due
to issues relating to the Contracts, Fortis Benefits will, at its expense,
to the extent reasonably practicable and with a view only to the interests
of Contract owners, take whatever steps it can which are necessary to
remedy or eliminate the irreconcilable material conflict, including,
without limitation, withdrawal of the affected Separate Account's
investment in the Series. No charge or penalty will be imposed as a result
of such withdrawal.
(c) Fortis Benefits, at the request of the Series' adviser will, at least
annually, or more frequently if deemed appropriate by the Board, submit to
the Board such reports, materials or data as the Board may reasonably
request so that the Board may fully carry out the obligations imposed upon
them.
10. The Fund will provide Fortis Benefits with copies of its proxy
solicitations applicable to the Series. Fortis Benefits will, to the extent
required by law, (a) distribute proxy materials applicable to the Series to
eligible Contract owners; (b) solicit voting instructions from eligible Contract
owners; (c) vote the Series shares in accordance with instructions received from
Contract owners; (d) if required by law, vote Series shares for which no
instructions have been received in the same proportion as shares of the Series
for which instructions have been received; and (e) calculate voting privileges
in a manner consistent with other life insurance companies to whose separate
accounts Series shares are offered. Unregistered separate accounts subject to
the Employee Retirement Income Security Act of 1974 ("ERISA") will refrain from
voting shares for which no instructions are received if such shares are held
subject to the provisions of ERISA.
Dated: May 1, 2003
HARTFORD HLS SERIES FUND II, INC.
By: /s/ Xxxxx Xxxx
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Xxxxx Xxxx
Vice President and Secretary
FORTIS BENEFITS INSURANCE COMPANY
By: /s/ Xxxxxxx Xxxx
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Vice President, Law
