FUND PARTICIPATION AGREEMENT
Exhibie
13(d)
This
agreement is made as of this 1st day of
May, 2007 by and among WILSHIRE
VARIABLE INSURANCE TRUST, a Delaware Statutory Trust (the “Trust”), on
its own behalf and on behalf of each of the series of portfolios set forth on
Schedule A, as may be amended from time to time (each a “Fund” and
collectively, the “Funds”), PFPC DISTRIBUTORS, INC., a
Massachusetts corporation (“Distributor”), and ANNUITY INVESTORS LIFE INSURANCE
COMPANY, a life insurance company organized under the laws of the state
of Ohio (“Company”), on its own behalf and on behalf of each separate account of
the Company set forth on Schedule B, as may be amended from time to time
(each an “Account” and collectively the “Accounts”).
W I T N E S S E T
H:
WHEREAS,
the Trust is registered with the Securities and Exchange Commission (“SEC”) as
an open-end, diversified management investment company under the Investment
Company Act of 1940, as amended (the “1940 Act”); and
WHEREAS,
the Trust desires for its Funds to act as investment vehicles for separate
accounts established for variable annuity contracts and variable life insurance
policies to be offered by insurance companies that have entered into
participation agreements with the Trust (the “Participating Insurance
Companies”); and
WHEREAS,
the Distributor is registered as a broker-dealer with the SEC under the
Securities and Exchange Act of 1934, as amended (the “1934 Act”), is a member in
good standing of the National Association of Securities Dealers, Inc. (the
“NASD”) and acts as principal underwriter for the Funds; and
WHEREAS,
each Fund represents an interest in a particular managed portfolios of
securities and other assets; and
WHEREAS,
the Trust has received or will receive an order from the SEC granting
Participating Insurance Companies and their separate accounts exemptions from
the provisions of sections 9(a), 13(a), 15(a) and 15(b) of the 1940 Act, and
rules 6e-2(b)(15) and 6e-3(T)(b)(15) thereunder, to the extent necessary to
permit shares of the Funds to be sold to and held by variable annuity and
variable life insurance separate accounts of both affiliated and unaffiliated
life insurance companies (the “Mixed and Shared Funding Exemptive Order”);
and
WHEREAS,
the Company has registered or will register under the Securities Act of 1933
(the “1933 Act”) certain variable annuity contracts and/or variable life
insurance policies funded or to be funded through one or more of the Accounts
(the “Contracts”); and
WHEREAS,
the Company has registered or will register each Account as a unit investment
trust under the 1940 Act; and
WHEREAS,
to the extent permitted by applicable insurance laws and regulations, the
Company intends to purchase shares in one or more of the Funds (the “Shares”) on
behalf of the Accounts to fund the Contracts, and the Trust intends to sell such
Shares to the relevant Accounts at such Shares’ net asset value.
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NOW,
THEREFORE, in consideration of their mutual promises, the parties agree as
follows:
ARTICLE I
Sale of Fund
Shares
1.1 The Trust
has instructed the Distributor to make available for sale to the Company those
Shares of the Funds which the Company orders on behalf of the Account, executing
such orders on a daily basis at the net asset value next computed after receipt
by the Trust or its designee of the order for the shares of the
Funds. For purposes of this Section 1.1, the Company shall be
the designee of the Trust for receipt of such orders from each Account and
receipt by such designee shall constitute receipt by the Trust; provided that
the Trust receives notice of such order by 9:00 a.m. Eastern Standard Time
on the next following Business Day. “Business Day” shall mean any day
on which the New York Stock Exchange is open for trading and on which the Funds
calculate their net asset values pursuant to the rules of the SEC.
1.2 The
Company will pay for Shares on the next Business Day after it places an order to
purchase Shares in accordance with Section 1.1. Payment shall be
in federal funds transmitted by wire or by a credit for any Shares
redeemed.
1.3 The
Distributor agrees to make Fund Shares available for purchase at the applicable
net asset value per share by the Company for its Accounts on those days on which
the Funds calculate their net asset values pursuant to the rules of the SEC;
provided, however, that the Board of Trustees of the Trust may refuse to sell
Shares of any Fund to any person, or suspend or terminate the offering of Shares
of any Fund if such action is required by law or by regulatory authorities
having jurisdiction or is, in the sole discretion of the Board, 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 the Fund.
1.4 The Trust
agrees to redeem, upon the Company’s request, any full or fractional Shares of
the Funds held by the Company, executing such requests on a daily basis at the
net asset value next computed after receipt by the Trust or its designee of the
request for redemption. For purposes of this Section 1.4, the
Company shall be the designee of the Trust for receipt of requests for
redemption and receipt by such designee shall constitute receipt by the Fund;
provided that the Trust receives written (or facsimile) notice of such request
for redemption by 9:00 a.m. Eastern Standard Time on the next
following Business Day. Payment shall be made within the time period
specified in the Funds’ prospectus or statement of additional information, in
federal funds transmitted by wire to the Company’s account as designated by the
Company in writing from time to time.
1.5 The
Company agrees to purchase and redeem the Shares of the Funds in accordance with
the provisions of the Funds’ then current prospectus and statement of additional
information.
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1.6 The Trust
shall use its best efforts to inform the Company of the net asset value per
share for each Fund available to the Company by [6:30] p.m. Eastern
Standard Time or as soon as reasonably practicable after the net asset value per
share for such Fund is calculated. The Trust shall calculate such net
asset value in accordance with the prospectus for such Fund. In the
event that net asset values are not communicated to the Company by such time,
the Company agrees to use its best efforts to include the net asset value when
received in its next business cycle for purposes of calculating purchase orders
and requests for redemption. However, if net asset values are not
available for an inclusion in the next business cycle and purchase
orders/redemptions are not able to be calculated and available to the Company to
execute within the timeframe identified in Sections 1.1 and 1.4, the Trust
shall reimburse and make the Company whole for any losses incurred as a result
of such delays.
1.7 Any
material errors in the calculation of a Fund’s net asset value, dividends or
capital gain information shall be reported to the Trust promptly upon discovery
by the Company. The Trust shall make the Company whole for any
payments to, or adjustments to the number of Shares in, the Account that are the
result of any such material errors. An error shall be deemed
“material” based on the Company’s interpretation of the SEC’s position and
policy with regard to materiality, as it may be modified from time to
time. Neither the Trust, the Distributor nor any of their affiliates
shall be liable for any information provided to the Company pursuant to this
Agreement which information is based on incorrect information supplied by or on
behalf of the Company to the Trust or the Distributor.
1.8 The Trust
shall furnish notice (by wire or telephone followed by written confirmation) to
the Company as soon as reasonably practicable of any income dividends or capital
gain distributions payable on any Shares. The Company, on its behalf
and on behalf of the Account(s), hereby elects to receive all such dividends and
distributions as are payable on any Shares in the form of additional Shares of
that Fund. The Company reserves the right, on its behalf and on
behalf of the Account(s), to revoke this election and to receive all such
dividends and capital gain distributions in cash. The Trust shall
notify the Company of the number of Fund Shares so issued as payment of such
dividends and distributions.
1.9 Issuance
or transfer of Shares shall be by book entry only. Stock certificates
will not be issued to the Company or the Account(s). Purchase and
redemption orders for Shares shall be recorded in an appropriate ledger for the
Account(s) or the appropriate subaccount of the Account(s).
1.10 The
parties hereto acknowledge that the arrangement contemplated by this Agreement
is not exclusive; the Fund Shares may be sold to other insurance companies
(subject to Section 1.12 hereof) and to certain qualified retirement plans,
and the cash value of the Contracts may be invested in other investment
companies.
1.11 The
Distributor and the Trust shall sell Fund Shares only to Participating Insurance
Companies and their separate accounts and to persons or plans (“Qualified
Persons”) that qualify to purchase Shares of a Fund under Section 817(h) of
the Internal Revenue Code of 1986, as amended (the “Code”), and the regulations
thereunder without impairing the ability of an Account to consider the portfolio
investments of the Fund as constituting investments of the Account for the
purpose of satisfying the diversification requirements of
Section 817(h). The Company hereby represents and warrants that
it and the Account(s) are Qualified Persons. The Trust reserves the
right to cease offering Shares of any Fund in the discretion of the
Trust.
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1.12 The
Company agrees to provide to the Trust or its designee, upon written request,
the taxpayer identification number (“TIN”), Individual/International Taxpayer
Identification Number (“ITIN”) or other government-issued identified (“GII”) and
the Contract owner number or participant account number associated with the
holder of interests in a Contract or a participant in an employee benefit plan
with a beneficial interest in a Contract (“Shareholder”), if known, of any or
all Shareholders of the account and the amount, date and transaction type
(purchase, redemption, transfer, or exchange) of every purchase, redemption,
transfer, or exchange of Shares held through an account maintained by the
Company during the period covered by the request. Unless otherwise
specifically requested by the Trust, the Company shall only be required to
provide information related to Shareholder-Initiated Transfer Purchases or
Shareholder-Initiated Transfer Redemptions.
The terms
“Shareholder-Initiated Transfer Purchase” and “Shareholder-Initiated Transfer
Redemption” mean a transaction that is initiated or directed by a Shareholder
that results in a transfer of assets within a Contract to a Fund, but does not
include transactions that are executed: (i) automatically
pursuant to a contractual or systematic program or enrollment such as transfer
of assets within a Contract to a Fund as a result of “dollar cost averaging”
programs, insurance company approved asset allocation programs, or automatic
rebalancing programs or within a Contract out of a Fund as a result of annuity
payouts, loans, systematic withdrawal programs, insurance company approved asset
allocation programs and automatic rebalancing programs; (ii) pursuant to a
Contract death benefit; (iii) one-time step-up in Contract value pursuant to a
Contract death benefit; (iv) allocation of assets to a Fund through a
Contract as a result of payments such as loan repayments, scheduled
contributions, retirement plan salary reduction contributions, or planned
premium payments to the Contract; (v) pre-arranged transfers at the
conclusion of a required free look period; (vi) as a result of any
deduction of charges or fees under a Contract; (vii) within a Contract out
of a Fund as a result of scheduled withdrawals or surrenders from a Contract; or
(vii) as a result of payment of a death benefit from a
Contract.
(a) Requests
must set forth a specific period not to exceed ninety (90) days (or any three
(3) month period, as applicable) for which transaction information is
sought. The Trust may request transaction information older than
ninety (90) days from the date of the request as it deems necessary to
investigate compliance with policies established by the Trust for the purpose of
eliminating or reducing any dilution of the value of the outstanding Shares
issued by the Funds.
(b) Trust
requests for Shareholder information shall be made no more frequently than
quarterly except as the Trust deems necessary to investigate compliance with
policies established by the Trust for the purpose of eliminating or reducing any
dilution of the value of the outstanding Shares issued by the
Funds.
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(c) The
Company agrees to provide, promptly upon request of the Trust or its designee,
the requested information specified in Section 1.12(a). If
requested by the Trust or its designee, the Company agrees to use best efforts
to determine promptly whether any specific person about whom it has received the
identification and transaction information specified in Section 1.12(a) is
itself a financial intermediary (“Indirect Intermediary”) and, upon further
request of the Trust or its designee, promptly either (i) provide (or
arrange to have provided) the information set forth in Section 1.12(a) for
those Shareholders who hold an account with an Indirect Intermediary or
(ii) restrict or prohibit the Indirect Intermediary from purchasing, in
nominee name on behalf of other persons, Fund Shares. The Company
additionally agrees to inform the Trust or its agent whether it plans to perform
(i) or (ii). Responses required by this paragraph must be
communicated in writing and in a format mutually agreed upon by the Trust or its
designee and the Company. To the extent practicable, the format for
any transaction information provided to the Trust or its agent should be
consistent with the NSCC Standardized Data Reporting Format.
(d) The Trust
agrees not to use the information received pursuant to this Section 1.13
for any purpose other than as necessary to comply with the provisions of
Rule 22c-2 under the 1940 Act or to fulfill other regulatory or legal
requirements subject to the privacy provisions of Title V of the
Xxxxx-Xxxxx-Xxxxxx Act (Public Law 106-102) and comparable state
laws.
(e) The
Company agrees to execute written instructions from the Trust to restrict or
prohibit further purchases or exchanges of Shares by a Shareholder that has been
identified by the Trust as having engaged in transactions of the Funds’ Shares
(directly or indirectly through an account with the Company) that violate
policies established by the Trust for the purpose of eliminating or reducing any
dilution of the value of the outstanding Shares issued by the
Funds. Unless otherwise directed by the Trust, any such restrictions
or prohibitions shall only apply to Shareholder-Initiated Transfer Purchases or
Shareholder-Initiated Transfer Redemptions that are effected directly or
indirectly through the Company. Instructions must be received by the
Company at the address set forth in Article IX to this Agreement.
(i) Instructions
to restrict trading must include the TIN, ITIN or GII and the specific
individual Contract owner number or participant account number associated with
the Shareholder, if known, and the specific restriction(s) to be executed,
including how long the restriction(s) is (are) to remain in place. If
the TIN, ITIN, GII or the specific individual Contract owner number or
participant account number associated with the Shareholder is not known, the
instructions must include an equivalent identifying number of the Shareholder(s)
or account(s) or other agreed upon information to which the instruction
relates.
(ii) The
Company agrees to execute instructions as soon as reasonably practicable, but
not later than five (5) business days after receipt of the instructions by
Company.
(iii) The
Company will provide written confirmation to the Trust that instructions have
been executed. The Company agrees to provide confirmation as soon as
reasonably practicable, but not later than ten (10) business days after the
instructions have been executed.
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ARTICLE II
Representations and
Warranties
2.1 The
Company makes the following representations and warranties:
(a) The
Company is an insurance company duly organized and in good standing under the
laws of the State of Ohio and has established each Account as a separate account
under such law.
(b) The
execution and delivery of this Agreement and the performance of the transactions
contemplated hereby have been duly authorized by all necessary action and all
other authorizations and approvals (if any) required for the Company’s lawful
execution and delivery of this Agreement and the Company’s performance hereunder
have been obtained.
(c) The
Company has 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 to serve as a separate account for the
Contracts.
(d) The
Contracts have been registered under the 1933 Act or will be registered under
the 1933 Act prior to any issuance or sale of the Contracts, the Contracts will
be issued in compliance in all material respects with all applicable federal and
state laws, and the sale of the Contracts shall comply in all material respects
with state insurance suitability requirements.
(e) The
Contracts are currently and at the time of issuance will be treated as annuity
contracts or life insurance polices, whichever is appropriate, under applicable
provisions of the Code. The Company shall make every effort to
maintain such treatment and shall notify the Trust and the Distributor
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.
(f) All of
the Company’s directors, officers, employees, investment advisers, and other
individuals/entities, if any, dealing with the money and/or securities of the
Trust are covered by a blanket fidelity bond or similar coverage in an amount
not less than the minimal coverage that the Accounts would be required to
maintain if they were subject to Rule 17g-1 under the 1940 Act or related
provisions as may be promulgated from time to time. The aforesaid
includes coverage for larceny and embezzlement and is issued by a reputable
bonding company. The Company agrees to make all reasonable efforts to
see that this bond or another bond containing these provisions is always in
effect, and agrees to notify the Trust in the event that such coverage no longer
applies.
(g) All
shares of the Funds purchased by the Company will be purchased on behalf of one
or more unmanaged separate accounts that offer interests therein that are
registered under the 1933 Act and upon which a registration fee has been or will
be paid, and the Company acknowledges that the Trust intends to rely upon this
representation and warranty for purposes of calculating SEC registration fees
payable with respect to such Shares of the Funds pursuant to Form 24F-2 or
any similar form or SEC registration fee calculation procedure that allows the
Trust to exclude Shares so sold for purposes of calculating its SEC registration
fee. The Company will certify the amount of any Shares of the Funds
purchased by the Company on behalf of any separate account offering interests
not subject to registration under the 1933 Act. The Company agrees to
cooperate with the Trust on no less than an annual basis to certify as to its
continuing compliance with this representation and warranty.
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(h) The
Company has in place an anti-money laundering program (“AML program”) that does
now and will continue to comply with applicable laws and regulations, including
the relevant provisions of the USA PATRIOT Act (Pub. L. No. 107-56 (2001))
and the regulations issued thereunder by the U.S. Treasury
Department. The Company undertakes and agrees to comply with any and
all applicable laws, regulations, protocols and other requirements relating to
money laundering including, without limitation, the relevant provisions of the
USA PATRIOT Act and the regulations issued thereunder by the U.S. Treasury
Department.
The
Company further agrees promptly to notify the Trust should it become aware of
any change in the above representations and warranties.
The
Company represents that the principal underwriter of the Contracts requires any
broker-dealer/insurance agency that distributes the Contracts to fully comply
with the requirements of the USA PATRIOT Act and all other applicable federal or
state laws applicable to the offer, sale and service of the Contracts and to
establish such rules and procedures as may be necessary to cause diligent
supervision of the securities and insurance activities of its
representatives.
In
addition, the Trust hereby provides notice to the Company that the Trust
reserves the right to make inquiries of and request additional information from
the Company regarding its AML program.
(i) The
Company shall comply with any applicable privacy and notice provisions of 15
U.S.C. §§ 6801-6827 and any applicable regulations promulgated thereunder
(including but not limited to 17 C.F.R. Part 248), as they may be
amended.
2.2 The
Trust, on its own and on behalf of the Funds, makes the following
representations and warranties:
(a) The Trust
is duly organized and validly existing and in good standing under the laws of
the State of Delaware.
(b) The Trust
is a registered open-end investment company under the 1940 Act, and all Shares
will be issued and sold in compliance in all material respects with all
applicable federal and state laws.
(c) Each Fund
is in compliance with the diversification requirements set forth in
Section 817(h) of the Code and Section 1.817-5 of the regulations
under the Code. The Trust will notify the Company immediately upon
having a reasonable basis for believing that a Fund has ceased to so comply or
that a Fund might not so comply in the future. In the event of a
breach of this Section 2.2(c) by the Trust, it will take all steps
necessary to adequately diversity the Fund so as to achieve compliance within
the grace period afforded by Section 1.817-5 of the regulations under the
Code.
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(d) Each Fund
is currently qualified as a regulated investment company (“RIC”) under
Subchapter M of the Code, and represents that it will use every effort to
qualify and to maintain qualification of each Fund as a RIC. The
Trust will notify the Company immediately in writing upon having a reasonable
basis for believing that a Fund has ceased to so qualify or that it might not so
qualify in the future.
(e) The Trust
represents and warrants that its trustees, officers, employees, and other
individuals/entities, if any, dealing with the money and/or securities of the
Funds are and shall continue to be at all times covered by a blanket fidelity
bond or similar coverage for the benefit of the Funds in an amount not less than
the minimal coverage as required currently by Rule 17g-1 under the 1940 Act
or related provisions as may be promulgated from time to time. The
aforesaid blanket fidelity bond shall include coverage for larceny and
embezzlement and shall be issued by a reputable bonding company.
2.3 The
Distributor makes the following representations and warranties:
(a) The
Distributor is a registered broker-dealer under the 1934 Act and is a member in
good standing of the NASD, and will remain duly registered under all applicable
federal and state securities laws and the laws of any applicable self-regulatory
organizations.
(b) Pursuant
to an Underwriting Agreement entered into between the Distributor and the Trust,
the Distributor serves as principal underwriter/distributor of the
Fund.
ARTICLE III
Sales Material, Prospectuses
and Other Reports; Voting
3.1 The
Company shall furnish, or shall cause to be furnished, to the Trust or its
designee, each piece of sales literature or other promotional material in which
the Trust (or a Fund) is named, at least five Business Days prior to its
use. No such material shall be used if the Trust or its designee
reasonably objects to such use within five Business Days after receipt of such
material. The Trust or its designee reserves the right to reasonably
object to the continued use of any such sales literature or other promotional
material in which the Trust (or a Fund) is named, and no such material shall be
used if the Trust or its designee so objects.
3.2 Except
with the express permission of the Trust, the Company shall not give any
information or make any representations or statements on behalf of the Trust or
concerning the Trust in connection with the sale of the Contracts other than the
information or representations contained in the registration statement or
prospectus for the Fund shares, as such registration statement and prospectus
may be amended or supplemented from time to time, or in reports or proxy
statements for the Trust, or in sales literature or other promotional material
approved by the Trust or its designee.
3.3 The Trust
and the Distributor or their designee shall furnish, or shall cause to be,
furnished, to the Company, each piece of sales literature or other promotional
material that it develops or uses and in which the Company, and/or any Account,
is named, at least five Business Days prior to its use. No such
material shall be used until approved by the Company, and the Company will use
its best efforts to review such sales literature or promotional material within
five Business Days after receipt of such material. The Company
reserves the right to reasonably object to the continued use of any such sales
literature or other promotional material in which the Company and/or any Account
is named, and no such material shall be used if the Company so
objects.
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3.4 Except
with the express permission of the Company, the Trust and the Distributor shall
not give any information or make any representations or statements 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 the
Accounts 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.
3.5 For
purposes of this Article III, the phrase “sales literature or other
promotional material” includes, but is not limited to, any of the
following: advertisements (such as material published, or designed
for use in, a newspaper, magazine, or other periodical, radio, television,
internet website or other electronic media), 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,
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, and registration statements,
prospectuses, statements of additional information, shareholder reports, proxy
materials, and any other communications distributed or made generally
available.
3.6 The
Distributor shall provide to the Company a copy of the Funds’ current prospectus
within a reasonable period of its effective filing date, and provide other
assistance as is reasonably necessary in order for the Company once each year
(or more frequently if the prospectus for the Funds is supplemented or amended)
to have the prospectus for the Contracts and the prospectus for the Funds
printed together in one document (such printing to be at the Company’s
expense).
3.7 The
Distributor shall provide to the Company at least one complete copy of any
prospectuses and statements of additional information, and all amendments to any
of the above, that relate to the Fund(s) reasonably promptly after the filing of
such document(s) with the SEC. Upon request, the Trust will provide
to the Company copies of SEC exemptive orders and no-action letters and sales
literature and other promotional material that relate to the Funds and to the
performance of this Agreement by the parties.
3.8 The
Funds’ prospectus shall state that the current statement of additional
information for the Fund is available from the Company (or in the Funds’
discretion, from the Funds), and the Trust shall provide a copy of such
statement of additional information to any owner of a Contract who requests such
statement of additional information and to the Company in such quantities as the
Company may reasonably request.
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3.9 The Trust
shall provide the Company with either: (i) a copy of the Funds’
proxy material, reports to shareholders, other information relating to the Funds
necessary to prepare financial reports, and other communications to shareholders
for printing and distribution to Contract owners at the Company’s expense, or
(ii) camera ready and/or printed copies, if appropriate, of such material
for distribution to Contract owners at the Company’s expense, within a
reasonable period of the filing date for definitive copies of such
material.
3.10 The Trust
and the Distributor hereby consent to the Company’s use of the names of the
Trust and/or the Distributor as well as the names of the
Funds set forth in Schedule A of this Agreement, in connection with
marketing the Contracts, subject to the terms of Sections 3.1 of this Agreement and the
related trademarks, trade names, service marks or logos. The Company
acknowledges and agrees that the Trust and the Distributor and/or their
affiliates own all right, title and interest in and to such names, marks and
logos and covenants not, at any time, to challenge the rights of the Trust and
the Distributor and/or their affiliates to such names, marks or logos, or the
validity or distinctiveness thereof. Such consent will terminate
with the termination of this Agreement. The
Trust or the Distributor may withdraw this consent as to any particular use of
any such name or identifying marks at any time (i) upon the Trust’s or the
Distributor’s reasonable determination that such use would have a material
adverse effect on the reputation or marketing efforts of the Trust, the
Distributor or the Fund or (ii) if no series or class of shares of the Trust
continues to be offered through variable insurance contracts issued by the
Company. The Company will cease all use of any such name, xxxx or
logo as soon as reasonably practicable after the termination or withdrawal of
such consent.
3.11 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 a particular separate
account in the same proportion as shares of such Fund for which instructions
have been received in that separate account,
so long
as and to the extent that the SEC continues to interpret the 1940 Act to require
pass-through voting privileges for variable contract owners or to the extent
otherwise required by law. The Company reserves the right to vote
Fund shares held in any segregated asset account in its own right, to the extent
permitted by law.
3.12 Participating
Insurance Companies shall be responsible for assuring that each of their
separate accounts participating in a Fund calculates voting privileges as
required by the Mixed and Shared Funding Exemptive Order and consistent with any
reasonable standards that the Fund may adopt and provide in
writing.
3.13 It is
understood and agreed that, except with respect to information regarding the
Trust or the Funds provided in writing by the Trust, the Trust is not
responsible for the content of the prospectus or statement of additional
information for the Contracts.
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ARTICLE IV
Fees and
Expenses
4.1 The Trust
and the Distributor shall pay no fee or other compensation to the Company under
this Agreement, and the Company shall pay no fee or other compensation to the
Trust or the Distributor, although the parties will bear certain expenses as
provided herein.
4.2 All
expenses incident to performance by each party of its respective duties under
this Agreement shall be paid by that party. The Trust shall ensure
that the Fund Shares are registered and authorized for issuance in accordance
with applicable federal law and, if and to the extent advisable by the Trust, in
accordance with applicable state laws prior to their sale. The Trust
shall bear the expenses for the cost of registration and qualification of the
Funds’ Shares, preparation and filing of the Funds’ prospectus and registration
statement, proxy materials and reports, and the preparation of all statements
and notices required by any federal or state law.
4.3 The
Trust, at its expense, shall provide the Company with copies of the Funds’ proxy
statements, reports to shareholders, and other communications (except for
prospectuses and statements of additional information, which are covered in
Section 3.4) to shareholders in such quantity as the Company shall
reasonably require for distributing to Contract owners. The Trust
shall bear the expense of mailing such proxy materials in the event
the proxy vote is a result of actions initiated by the Trust.
4.4 In the
event the Trust adds one or more additional Funds and the parties desire to make
such Funds available to the respective Contract owners as an underlying
investment medium, a new Schedule A which shall be an amendment to this
Agreement shall be executed by the parties authorizing the issuance of shares of
the new Funds to the particular Account. The amendment may also
provide for the sharing of expenses for the establishment of new Funds among
Participating Insurance Companies desiring to invest in such Funds and the
provision of funds as the initial investment in the new Funds.
4.5 Except as
provided in this Section 4.5, all expenses of preparing, setting in type
and printing and distributing Fund prospectuses and statements of additional
information, or supplements thereto, shall be the expense of the
Company. For prospectuses and statements of additional information
provided by the Company to its existing owners of Contracts who currently own
Shares of one or more of the Funds, in order to update disclosure as required by
the 1933 Act and/or the 1940 Act, the cost of printing shall be borne by the
Trust. If the Company chooses to receive camera-ready film or
computer diskettes in lieu of receiving printed copies of the Funds’ prospectus,
the Funds shall bear the cost of typesetting to provide the Funds’ prospectus to
the Company in the format in which the Funds are accustomed to formatting
prospectuses, and the Company shall bear the expense of adjusting or changing
the format to conform with any of its prospectuses. In such event,
the Funds will reimburse the Company in an amount equal to the product of x and
y where x is the number of such prospectuses distributed to owners of the
Contracts who currently own shares of one or more of the Funds, and y is the
Funds’ per unit cost of typesetting and printing the Funds’
prospectus. The same procedure shall be followed with respect to the
Funds’ statement of additional information. The Company agrees to
provide the Trust or its designee with such information as may be reasonably
requested by the Trust to assure that the Funds’ expenses do not include the
cost of printing, typesetting, and distributing any prospectuses or statements
of additional information other than those actually distributed to existing
owners of the Contracts who currently own shares of one or more of the
Funds.
11
ARTICLE V
Applicable
Law
5.1 This
Agreement shall be construed and the provisions hereof interpreted under and in
accordance with the laws of the State of Delaware.
5.2 This
Agreement shall be subject to the provisions of the 1933 Act, the 1934 Act, and
the 1940 Act, 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 Mixed and Shared Funding Exemptive Order)
and the terms hereof shall be interpreted and construed in accordance
therewith. If, in the future, the Mixed and Shared Funding Exemptive
Order should no longer be necessary under applicable law, then Article VI
shall no longer apply.
ARTICLE VI
Potential
Conflicts
6.1 The Board
of Trustees of the Trust will monitor the Funds for the existence of any
material irreconcilable conflict between the interests of the Contract owners of
all separate accounts investing in the Funds. A material
irreconcilable 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 Fund are being managed; (e) a difference in voting
instructions given by variable insurance product owners; or (f) a decision
by a Participating Insurance Company to disregard the voting instructions of
contract owners. The Board shall promptly inform the Company if it
determines that an irreconcilable material conflict exists and the implications
thereof.
ARTICLE VII
Indemnification
7.1 Indemnification
By The Company.
(a) The
Company agrees to indemnify and hold harmless the Trust and the Distributor and
each of their trustees, directors and officers and each person, if any, who
controls the Trust or the Distributor within the meaning of Section 15 of
the 1933 Act (collectively, the “Indemnified Parties” and individually,
“Indemnified Party,” for purposes of this Section 7.1) against any and all
losses, claims, expenses, damages, liabilities (including amounts paid in
settlement with the written consent of the Company) or litigation (including
reasonable legal and other expenses incurred in connection therewith), 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 Funds’ Shares or the Contracts and:
12
(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 for the
Contracts or contained in the Contracts or sales literature 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 Trust for use in the registration
statement or prospectus for the Contracts or in the Contracts or sales
literature (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 sales
literature of the Trust not supplied by the Company or persons under its control
and other than statements or representations authorized by the Trust) or
wrongful conduct 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 or are based upon any untrue statements or alleged untrue statements of a
material fact contained in a registration statement, prospectus, or sales
literature of the Trust 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 and in conformity with
written information furnished to the Trust 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, warranty
and/or agreement 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 Sections 7.1(b) and
7.1(c) hereof.
(b) The
Company shall not be liable under this indemnification provision with respect to
any losses, claims, expenses, damages, liabilities or litigation incurred or
assessed against an Indemnified Party as such may arise from 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 or duties under this Agreement or to the Trust
or the Distributor.
13
(c) The
Company shall not be liable under this indemnification provision with respect to
any claim made against an Indemnified Party unless such Indemnified Party shall
have notified the Company 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 otherwise than on account of this indemnification provision, except to
the extent that the Company has been materially prejudiced by such failure to
give notice. In case any such action is brought against the
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 the party
named in the action and to settle the claim at its own expense; provided,
however, that no such settlement shall, without the Indemnified Party’s written
consent, include any factual stipulation related to the Indemnified Party or its
conduct. 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, but, in case the Company
does not elect to assume the defense of any such suit, the Company will
reimburse the Indemnified Party in such suit, for the reasonable fees and
expenses of any counsel retained by it.
(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 Trust.
7.2 Indemnification
by the Trust.
(a) The Trust
agrees 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 (hereinafter collectively, the “Indemnified
Parties” and individually, “Indemnified Party,” for purposes of this
Section 7.2) against any and all losses, claims, expenses, damages,
liabilities (including amounts paid in settlement with the written consent of
the Trust) or litigation (including reasonable legal and other expenses incurred
in connection therewith) 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 operations of the Trust 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 SAI or
sales literature of the Funds (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 Distributor or the
Trust by or on behalf of the Company for use in the registration statement,
prospectus or SAI for the Funds or sales literature (or any amendment or
supplement) or otherwise for use in connection with the sale of the Contracts or
Fund Shares; or
14
(ii) arise as
a result of any failure by the Trust to provide the services and furnish the
materials under the terms of this Agreement (including a failure of a Fund,
whether unintentional or in good faith or otherwise, to comply with the
diversification requirements specified in Section 2.2(c) of this
Agreement); or
(iii) arise as
a result of any failure by the Trust to provide the services and furnish the
materials under the terms of this Agreement (including any failure to comply
with Section 2.2(c) of this Agreement; or
(iv) arise out
of or result from any material breach of any representation, warranty and/or
agreement made by the Trust in this Agreement or arise out of or result from any
other material breach of this Agreement by the Fund
as
limited by and in accordance with the provisions of Sections 7.2(b) and
7.2(c) hereof.
(b) The Trust
shall not be liable under this indemnification provision with respect to any
losses, claims, expenses, damages, liabilities or litigation incurred or
assessed against an Indemnified Party as may arise from 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 or to the Company or
the Accounts.
(c) The Trust
shall not be liable under this indemnification provision with respect to any
claim made against an Indemnified Party unless such Indemnified Party shall have
notified the Trust 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 Trust of any such claim shall not relieve the Trust from any
liability which it may have to the Indemnified Party against whom such action is
brought otherwise than on account of this indemnification provision, except to
the extent that the Trust has been materially prejudiced by such failure to give
notice. In case any such action is brought against the Indemnified
Parties, the Trust will be entitled to participate, at its own expense, in the
defense thereof. The Trust also shall be entitled to assume the
defense thereof, with counsel satisfactory to the party named in the action and
to settle the claim at its own expense; provided, however, that no such
settlement shall, without the Indemnified Party’s written consent exclude any
factual stipulation related to the Indemnified Party or its
conduct. After notice from the Trust to such party of the Trust’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 Trust 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, but, in case the Trust
does not elect to assume the defense of any such suit, the Trust will reimburse
the Indemnified Party in such suit, for the reasonable fees and expenses of any
counsel retained by it.
15
(d) The
Company and the Distributor agree promptly to notify the Trust of the
commencement of any litigation or proceedings against it or any of its
respective officers or directors in connection with this Agreement, the issuance
or sale of the Contracts, with respect to the operation of any Account, or the
sale or acquisition of Shares of the Funds.
7.3 Indemnification by the
Distributor.
(a) The
Distributor agrees 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” and individually, “Indemnified Party,” for purposes of this Section
7.3) against any and all losses, claims, expenses, damages, liabilities
(including amounts paid in settlement with the written consent of the
Distributor) or litigation (including reasonable legal and other expenses
incurred in connection therewith) to which the Indemnified Parties may become
subject under any statute or 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 Funds’
Shares or the Contracts and:
(i) arise out
of or as a result of statements or representations (other than statements or
representations contained in the registration statement, prospectus, SAI or
sales literature for the Contracts not supplied by the Distributor or persons
under its control and other than statements or representations authorized by the
Company) or wrongful conduct of the Trust or the Distributor or persons under
their control, with respect to the sale or distribution of the Contracts or Fund
Shares; or
(ii) arise out
of or are based upon any untrue statements or alleged untrue statements of any
material fact contained in the registration statement, prospectus, SAI or sales
literature covering the Contracts, or any amendments or supplements thereto, or
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,
if such a statement or omission was made in reliance upon and in conformity with
written information furnished to the Company by or on behalf of the Distributor;
or
(iii) arise as
a result of any failure by the Distributor to provide the services and furnish
the materials under the terms of this Agreement; or
(iv) arise out
of or result from any material breach of any representation, warranty and/or
agreement made by the Distributor in this Agreement or arise out of or result
from any other material breach of this Agreement by the
Distributor,
as
limited by and in accordance with the provisions of Sections 7.3(b) and 7.3(c)
hereof.
(b) The
Distributor shall not be liable under this indemnification provision with
respect to any losses, claims, expenses, damages, liabilities or litigation
incurred or assessed against an Indemnified Party as such may arise from such
Indemnified Party’s willful misfeasance, bad faith, or gross negligence in the
performance or such Indemnified Party’s duties or by reason of such Indemnified
Party’s reckless disregard of obligations and duties under this Agreement or to
the Company or the Accounts.
16
(c) The
Distributor shall not be liable under this indemnification provision with
respect to any claim made against an Indemnified Party unless such Indemnified
Party shall have notified the Distributor 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 Distributor of any such claim shall not
relieve the Distributor from any liability which it may have to the Indemnified
Party against whom such action is brought otherwise than on account of this
indemnification provision, except to the extent that the Distributor has been
prejudiced by such failure to give notice. In case any such action is
brought against the Indemnified Parties, the Distributor shall be entitled to
participate, at its own expense, in the defense of such action. The
Distributor also shall be entitled to assume the defense thereof, with counsel
satisfactory to the party named in the action and to settle the claim at its own
expense; provided, however, that no such settlement shall, without the
Indemnified Party’s written consent, include any factual stipulation related to
the Indemnified Party or its conduct. After notice from the
Distributor to such party of the Distributor’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 Distributor 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, but, in case the Distributor does
not elect to assume the defense of any such suit, the Distributor will reimburse
the Indemnified Party in such suit, for the reasonable fees and expenses of any
counsel retained by it.
(d) The
Company will promptly notify the Distributor 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 the
Account.
ARTICLE VIII
Termination
8.1 This
Agreement shall terminate with respect to some or all Funds:
(a) at the
option of any party, for any reason, upon six months advance written notice to
the other parties at the address specified in Section IX of this Agreement;
or
(b) at the
option of the Company by written notice to the Trust and the Distributor to the
extent that Shares of Funds are not reasonably available to meet the
requirements of its Contracts or are not appropriate funding vehicles for the
Contracts, as determined by the Company reasonably and in good faith;
or
(c) at the
option of the Company by written notice to the Trust and the Distributor in the
event a Fund’s shares are not registered, issued or sold in accordance with
applicable state and/or federal securities laws or such law precludes the use of
such shares as the underlying investment media of the Contracts issued or to be
issued by the Company; or
17
(d) at the
option of the Trust or the Distributor by written notice to the Company in the
event that formal administrative proceedings are instituted against the Company
by the NASD, the SEC, the insurance commissioner or like official of any state
or any other regulatory body regarding the Company’s duties under this Agreement
or related to the sale of the Contracts, the operation of any Account, or the
purchase of the Funds’ Shares; provided, however, that the Trust 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
(e) at the
option of the Company by written notice to the Trust and the Distributor in the
event that formal administrative proceedings are instituted against the Trust or
the Distributor by the NASD, the SEC, or any state securities or insurance
department 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 Trust or the Distributor, as applicable, to perform its obligations under
this Agreement; or
(f) at the
option of the Company by written notice to the Trust and the Distributor with
respect to a Fund in the event that such Fund ceases to qualify as a Regulated
Investment Company under Subchapter M or fails to comply with the
Section 817(h) diversification requirements specified in
Section 2.2(c) hereof, or if the Company reasonably believes that such Fund
may fail to so qualify or comply; or
(g) at the
option of the Trust by written notice to the Company in the event that the
Contracts fail to meet the qualifications specified in Section 2.1(e)
hereof; or
(h) at the
option of the Trust or the Distributor by written notice to the Company, if the
Trust or the Distributor, respectively, determines, in its sole judgment
exercised in good faith, that the Company has suffered a material adverse change
in its business, operations, financial condition, insurance company rating or
prospects since the date of this Agreement or is the subject of material adverse
publicity, and that material adverse change or publicity will have a material
effect on the Company’s ability to perform its obligation under this Agreement;
or
(i) at the
option of the Company by written notice of the Trust and the Distributor if the
Company determines, in its sole judgment exercised in good faith, that the Trust
or the Distributor has suffered a material adverse change in its business,
operations, financial condition or prospects since the date of this Agreement or
is the subject of material adverse publicity, and that material adverse change
or publicity will have a material effect on the Trust’s ability to perform its
obligation under this Agreement; or
(j) at the
option of the Company upon any substitution of the shares of another investment
company or series thereof for Shares of a Fund in accordance with the terms of
the Contracts, provided that the Company has given at least 45 days’ prior
written notice to the Trust of the date of substitution; or
18
(k) at the
option of any party in the event that the Trust’s Board of Trustees determines
that a material irreconcilable conflict exists as provided in Article VI
upon written notice to the other parties; or
(l) at the
option of the Company, as one party, or the Trust and the Distributor, as
another party, upon the other party’s material breach of any provision of this
Agreement upon 30 days’ written notice and the opportunity to cure within such
notice period.
8.2 Prompt
written notice of the election to terminate for cause specified in
Section 8.1(b)-(k) and an explanation of such cause shall be furnished by
the terminating party.
8.3 Notwithstanding
any termination of this Agreement, each party’s obligation under
Article VII to indemnify the other parties shall survive.
ARTICLE IX
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
Trust:
0000
Xxxxx Xxxxxx, Xxxxx 000
Xxxxx
Xxxxxx, XX 00000
Attn: Funds
Management
If to the
Distributor:
Xx. Xxxxx
XxXxxxxxx
PFPC
Distributors, Inc.
000 Xxxxx
Xxxx
Xxxx xx
Xxxxxxx, XX 00000
If to the
Company:
Annuity
Investors Life Insurance Company
000 Xxxx
Xxxxxx
Xxxxxxxxxx
XX 00000
Attn: General
Counsel 525-18H
19
ARTICLE X
Miscellaneous
10.1 This
Agreement is not, and shall not be deemed, an exclusive arrangement between the
parties and shall not prohibit, restrict, condition, or otherwise prevent either
party from entering into the same or similar arrangements with either party’s
affiliates or with third parties.
10.2 If any
provision of this Agreement is deemed to be in violation of law or is
unenforceable, the remainder of this Agreement with such provision omitted will
remain in full force and effect.
10.3 This
Agreement contains the entire understanding of the parties with respect to the
subject matter hereof and supersedes all prior agreements relating to the
subject matter hereof. This Agreement may be modified, and any
provision of this Agreement may be waived, only in writing signed by the
parties. No failure of either party to insist upon strict performance
of any provision of this Agreement shall constitute a waiver.
10.4 Any
amendment to this Agreement will be valid only if in writing and signed by the
parties. The parties agree that Funds may be deleted from and
additional Funds may be added to Schedule A of this Agreement (and become
funds for purposes of this Agreement), upon the parties execution of an amended
Schedule A detailing such change.
10.5 Each
party shall, to the extent reasonable, cooperate with each other party and all
appropriate governmental authorities (including, but not limited to, 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
hereunder. Each party hereto shall promptly notify the other parties
to this Agreement, by written notice to the addresses specified in
Article IX, of any such investigation or inquiry.
10.6 Subject
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 the Agreement, shall not
disclose, disseminate or utilize such names and addresses and other confidential
information without the express written consent of the affected party until such
time as it may come into the public domain. In addition, the parties
hereto agree that any Nonpublic Personal Information, as the term is defined in
SEC Regulation S-P (“Reg S-P”), that may be disclosed by a party hereunder is
disclosed for the specific purpose of permitting the other party to perform the
services set forth in this Agreement. Each party agrees that, with
respect to such information, it will comply with Reg S-P and any other
applicable regulations and that it will not disclose any Nonpublic Personal
Information received in connection with this Agreement or any other party,
except to the extent required to carry out the services set forth in this
Agreement or as otherwise permitted by law.
20
10.7 The
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.
10.8 This
Agreement may be executed simultaneously in one or more counterparts, each of
which taken together shall constitute one and the same instrument.
10.9 The
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.
10.10 Each
party understands and agrees that the obligations of a Fund under this Agreement
are not binding upon any shareholder of the Fund personally, but bind only the
Fund and the Fund’s property. This Agreement has been executed by and
on behalf of the Trust by its representatives as such representatives and not
individually, and the obligations of the Trust with respect to a Fund hereunder
are not binding upon any of the trustees, officers or shareholders of the Trust
individually, but are binding upon only the assets and property of such
Trust. All parties dealing with the Trust with respect to a Fund
shall look solely to the assets of such Portfolio for the enforcement of any
claims against the Trust hereunder.
10.11 This
Agreement shall not be assigned by any party hereto without the prior written
consent of the other parties.
10.12 The
Company is expressly put on notice that prospectus disclosure regarding the
potential risks of mixed and shared funding may be appropriate.
10.13 The
Company shall furnish, or shall cause to be furnished, to the Trust or its
designee upon request copies of the following reports:
(a) the
Company’s annual statement (prepared under statutory accounting principles) and
annual report (prepared under generally accepted accounting principles) filed
with any state or federal regulatory body or otherwise made available to the
public, as soon as practicable and in any event within 90 days after the end of
each fiscal year; and
(b) any
registration statement (without exhibits) and financial reports of the Company
filed with the SEC or any state insurance regulatory agency, as soon as
practicable after the filing thereof.
10.14 The Trust
reserves the right to take all actions, including but not limited to, the
dissolution, termination, merger and sale of all assets of the Trust or any Fund
upon the sole authorization of the Board, to the extent permitted by the laws of
the State of Delaware and the 1940 Act.
21
IN
WITNESS WHEREOF, the parties have caused their duly authorized officers to
execute this Fund Participation Agreement as of the date and year first above
written.
|
By:
Name:
Title:
Date:
|
|
|
PFPC
DISTRIBUTORS, INC.
By:
Name:
Title:
Date:
|
|
|
ANNUITY
INVESTORS INSURANCE COMPANY
By:
Name:
Title:
Date:
|
22
SCHEDULE A
Wilshire
2010 Moderate Fund
Wilshire
2015 Moderate Fund
Wilshire
2025 Moderate Fund
Wilshire
2035 Moderate Fund
Wilshire
2045 Moderate Fund
SCHEDULE B
Annuity
Investors Variable Account A
Annuity
Investors Variable Account B
