Exhibit 11
FORM OF TRUST AGREEMENT BETWEEN THE COLONIAL LIFE INSURANCE
COMPANY OF AMERICA AND FINANCIAL INSTITUTION ACTING AS
TRUSTEE AND POLICYHOLDER OF THE GROUP POLICIES
AGREEMENT OF TRUST
This Agreement of Trust (the "Agreement") is made and entered into this
_____ day of ____________, 199_ by and between The Colonial Life Insurance
Company of America, a New Jersey corporation with its principal place of
business at One Granite Place, Concord, New Hampshire (the "Settlor" or "Issuing
Company") and ______________________, a _______________ banking corporation
having its principal office in ________________, (the "Trustee") for the
establishment of a trust to be known as the Colonial Heritage Group Insurance
Trust (the "Trust") for the purpose of enabling participating financial
institutions throughout the State of New York which have applied for and been
accepted as participants in this Trust and have accepted its terms and
conditions (the "Members") to create an efficient means for offering insurance
benefits to individuals who would be eligible for such benefits through the
creation and continuation of the Trust and through life insurance and group
joint and last survivor flexible premium variable life insurance (the "Policy"
or "Policies") of Issuing Company:
WITNESSETH
WHEREAS, Issuing Company desires to underwrite variable life insurance in a
group format, in accordance with New York Insurance Law, covering the individual
lives of those persons to whom a Member has extended credit in the ordinary
course
of its business, who has deposited funds with the Member, whose loan is serviced
by a Member or who has otherwise established an account with the Member (the
"Participants");
WHEREAS, the Members shall include only financial institutions doing
business in New York and shall include only entities which are regulated by
Federal and/or state regulatory bodies such as credit unions, corporate lending
institutions, mortgage finance companies, commercial banks, savings and loan
associations and any other organization or corporation principally engaged in
lending money, financing business transactions, or servicing loans;
WHEREAS, Section 4216 of the New York Insurance Law authorizes Issuing
Company to issue the Policies to a trustee to hold such Policies solely as a
conduit for the benefit of the Participants, who will be the individual
certificate holders and the beneficiaries of the Trust;
WHEREAS, the Trustee is duly qualified under the laws of the State of New
York to hold such Policies;
NOW, THEREFORE, in consideration of the mutual premises and covenants
contained herein, the parties agree as follows:
Section 1. Appointment of the Trustee. The Trustee by its execution of
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this Agreement accepts the Trusteeship and
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declares that it will receive and hold the Policies as Trustee by virtue of this
Agreement for the uses and purposes of the Trust, upon the terms and conditions
herein provided.
Section 2. Trustee Responsibilities. The Trustee shall hold the Policies
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issued to it until termination of the Trust as herein described or upon
cancellation of the Policy in accordance with the terms thereof. The duties and
obligations and rights of the Trustee shall only be such as are specifically set
forth in this Agreement, as it may from time to time be amended, and no implied
duties or obligations or rights shall be read into this Agreement against the
Trustee.
a. The Trustee shall make application to the Issuing Company for a group
Policy that will provide reasonable benefits to the Participants in
light of all circumstances and factors deemed to be relevant.
b. The Trustee shall become the custodian and holder of the Policy of the
Issuing Company, but will not be responsible for any promotional,
marketing, enrollment, operational, administrative or investment
functions or duties with respect thereto and shall not have the
discretion to substitute another life insurance company for the Issuing
Company or another policy for the Policy, or
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exercise any voting rights under the Policy. Such Policy, when issued,
shall automatically become subject to this Trust and shall not be
deemed the separate property of the Trustee.
c. The Trustee shall not hold, or invest, any funds whatsoever, shall not
be liable or responsible to the Trust, or the Participants for the
collection, remittance, forwarding, payment, or investment of premiums,
or any recording thereof, and shall immediately remit to the Issuing
Company all monies or correspondence received in connection therewith.
All payments in connection with the Policy shall be paid directly to
the Issuing Company.
d. The Trustee shall not be liable or responsible for the payment,
settlement processing or presentment of claims, or any recording
thereof, arising out of the coverage afforded the Participants by the
Policy hereunder.
e. The Trustee shall look to the Issuing Company for the provision of all
administrative services relating to the maintenance of the Policy, the
Trust and records of the Participants.
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Section 3. Compensation. The Trustee shall be entitled to reasonable fees
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and shall be reimbursed for all reasonable and necessary expenses which it may
incur in the performance of its duties, such fees and expenses to be negotiated
with the Settlor, but in no event shall such compensation bear any relationship
to the assets held under the Policies.
The Issuing Company, as Issuing Company, shall not, for any purpose, be deemed a
party to this Trust, or be responsible for its validity or sufficiency. The
obligations of the Issuing Company shall be measured and determined solely by
the terms and conditions of the Policy it may issue, and there shall be no
obligations to any person whatsoever other than that stated in such Policy.
No Participant nor beneficiary nor any other person, shall have any rights or
claim to benefits under this Trust except as specified in a Policy procured or
entered into pursuant hereto. Any dispute as to eligibility, type, amount or
duration of benefit shall be resolved by the administrator and the Issuing
Company in accordance with the Policy.
Neither the Trustee, nor any Participant shall be liable for the failure or
omission of the Issuing Company for any reason to pay any benefits or furnish
any services under the Policy.
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Section 4. Hold Harmless. The Settlor hereby indemnifies the Trustee for,
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and holds it harmless against, any loss, liability, costs or expenses (including
attorneys fees and expenses) incurred or made without negligence, willful
misconduct or lack of good faith on the part of the Trustee, arising out of or
in connection with the performance of its obligations in accordance with the
provisions of this Agreement, including any loss, liability, costs or expenses
arising out of or in connection with the status of the Trustee as the holder of
record of the Policies hereunder.
Section 5. Termination. The Trustee may resign and become and remain fully
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discharged from all further duty or responsibility hereunder, by written notice,
effective not less than ninety (90) days after receipt thereof by Settlor, and
the Settlor may remove the Trustee without the Trustee's consent at any time
without assigning any cause therefore. No such resignation or removal shall be
effective until a successor trustee has been appointed by Settlor and has
accepted such appointment and all the Policies held in the Trust have been duly
transferred to such successor trustee. The Trustee shall continue as Trustee for
purposes of the dissolution and shall take any action with regard to the
Policies which may be appropriate or required by Settlor. This Trust shall
terminate sixty (60) days after the expiration of any remaining Policy held
hereunder by the Trustee.
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Section 6. Situs and Construction of the Trust. The Trust is accepted by
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the Trustee in the State of New York and shall be construed in accordance with
the laws of the State of New York. Wherever any words are used in this
Agreement the masculine shall be construed to include the feminine or neuter and
the singular to include the plural and the plural, the singular.
Section 7. Amendments to the Trust. This Agreement may be amended at any
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time by agreement in writing between the Trustee and the Settlor.
Section 8. Mailing Addresses. Mailing addresses for notice purposes shall
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be as follows unless changed in writing:
Settlor:
The Colonial Life Insurance Company of America
Xxx Xxxxxxx Xxxxx
X.X. Xxx 0000
Xxxxxxx, Xxx Xxxxxxxxx 00000
Attention: Vice President, Corporate Accounts
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Trustee:
____________________________________
____________________________________
____________________________________
Attention: __________________________________
Section 9. Counterparts. This Agreement may be
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executed in any number of counterparts each of which shall be deemed an
original, and the counterparts shall constitute but one and the same instrument,
which shall be sufficiently evidenced by any one counterpart.
Section 10. Successors and Assigns. This Agreement shall be binding
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upon the successors and assigns of the parties hereto. Except as stated herein,
this Agreement is not subject to any conditions or qualifications.
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IN WITNESS WHEREOF, The Colonial Life Insurance Company
of America and ___________________ have caused this Agreement to be executed on
their behalf and have this day caused their respective corporate seals to be
affixed by their duly authorized officers.
THE COLONIAL LIFE INSURANCE
COMPANY OF AMERICA, SETTLOR
AND ISSUING COMPANY
By:______________________________
Title:___________________________
________________________, TRUSTEE
By:______________________________
Title:___________________________
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