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EXECUTION COPY
TRUST AGREEMENT
By and Among
SUNAMERICA LIFE INSURANCE COMPANY
as Grantor,
XXXX XXXXX LIFE INSURANCE COMPANY
as Beneficiary,
and
BANKERS TRUST COMPANY
as Trustee
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TABLE OF CONTENTS
Page
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RECITALS ............................................................................................... 1
ARTICLE 1. DEPOSIT OF ASSETS TO THE TRUST ACCOUNT...................................................... 3
ARTICLE 2. WITHDRAWAL AND SUBSTITUTION OF ASSETS OF
THE TRUST ACCOUNT ........................................................................ 3
ARTICLE 3. REDEMPTION AND INVESTMENT OF ASSETS......................................................... 7
ARTICLE 4. RIGHT TO VOTE ASSETS........................................................................ 9
ARTICLE 5. ADDITIONAL RIGHTS AND DUTIES OF THE
TRUSTEE .................................................................................. 9
ARTICLE 6. THE TRUSTEE'S COMPENSATION, EXPENSES
AND INDEMNIFICATION ...................................................................... 12
ARTICLE 7. RESIGNATION OR REMOVAL OF THE TRUSTEE....................................................... 13
ARTICLE 8. TERMINATION OF THE TRUST ACCOUNT............................................................ 15
ARTICLE 9. MISCELLANEOUS............................................................................... 15
Section 9.1. Notices..................................................................... 15
Section 9.2. Portfolio Inspection........................................................ 17
Section 9.3. Entire Agreement............................................................ 18
Section 9.4. Amendments.................................................................. 19
Section 9.5. Waivers..................................................................... 19
Section 9.6. Governing Law............................................................... 20
Section 9.7. Arbitration................................................................. 20
Section 9.8. Binding Effect; Assignment;
Third Party Beneficiaries ................................................. 23
Section 9.9. Severability................................................................ 24
Section 9.10. Headings.................................................................... 24
Section 9.11. Counterparts................................................................ 25
Section 9.12. Errors and Omissions........................................................ 25
Section 9.13. Certain Definitions......................................................... 25
SIGNATURES..............................................................................................28
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TRUST AGREEMENT
TRUST AGREEMENT, dated as of March 31, 1997 (the "Agreement"), among
SunAmerica Life Insurance Company, an Arizona corporation (the "Grantor"), Xxxx
Xxxxx Life Insurance Company, a Minnesota corporation (a "Beneficiary," as
defined in Section 9.11 hereof) and Bankers Trust Company, a banking corporation
organized and existing under the laws of the State of New York (the "Trustee")
(collectively, the "Parties" and sometimes individually a "Party").
WITNESSETH:
WHEREAS, the Beneficiary and the Grantor have entered into an Asset
Purchase and Sale Agreement dated as of November 29, 1996, as has been and as
may be amended from time to time (the "Asset Purchase Agreement"), pursuant to
which the Grantor has agreed to enter into an Indemnity Reinsurance Agreement
with Beneficiary pursuant to which it would transfer assets in the amount
specified in the Asset Purchase Agreement to a trust account established
pursuant to this Agreement (all capitalized terms used herein and not otherwise
defined shall have the meanings ascribed thereto in the Asset Purchase
Agreement, except for purposes of the terms "Insurance Liabilities," "Other
Liabilities," "Excluded Liabilities," and "Extra-Contractual Obligations," the
words "Annuity Contracts" shall be replaced with the term "Policies");
WHEREAS, pursuant to the Indemnity Reinsurance Agreement being entered
into concurrently herewith by the Grantor and the Beneficiary (the "Indemnity
Reinsurance Agreement"), the
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Grantor has agreed to deposit additional assets in such trust account, if
necessary;
WHEREAS, the Grantor desires to establish a trust account hereunder for
the benefit of the Beneficiary to assure that the Beneficiary will have access
to sufficient assets in the event that the Grantor becomes unable to meet its
obligations to the Beneficiary under the Indemnity Reinsurance Agreement; and
WHEREAS, the Trustee (1) is a member of the Federal Reserve System (2)
is organized under the laws of the United States or a state thereof, (3) is
regulated, supervised, and examined by United States federal authorities or
authorities of a state of the United States having regulatory authority over
banks and trust companies, (4) is not the Parent, a Subsidiary or an Affiliate
(as such terms are defined in Section 9.10 hereof) of the Grantor or the
Beneficiary, and (5) has been granted authority to operate with fiduciary
powers.
NOW, THEREFORE, in consideration of the premises, representations and
warranties and the mutual covenants and agreements contained herein and other
good, valuable and sufficient consideration, the receipt and sufficiency of
which are hereby acknowledged, the Parties, intending to be legally bound,
hereby agree as follows:
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ARTICLE 1. DEPOSIT OF ASSETS TO THE TRUST ACCOUNT
Section 1.1. The Grantor hereby establishes a trust account
(the "Trust Account") with the Trustee upon the terms and conditions set forth
herein. The assets held in the Trust Account shall be subject to withdrawal by
the Beneficiary and the Grantor as provided herein.
Section 1.2. The Grantor shall transfer, or cause to be
transferred, assets to the Trustee for initial deposit to the Trust Account, and
may from time to time transfer to the Trustee for deposit to the Trust Account
other assets (all such assets actually received in the Trust Account are herein
referred to individually as an "Asset" and collectively as the "Assets"). All
income from Assets shall be deemed to be part of the Trust Account. All Assets
in the Trust Account shall be held by the Trustee at the Trustee's office in the
United States.
Section 1.3. All payments of interest, dividends and other
income actually received in respect of Assets shall be deposited by the Trustee
in the Trust Account.
ARTICLE 2. WITHDRAWAL AND SUBSTITUTION OF ASSETS OF
THE TRUST ACCOUNT
Section 2.1. Withdrawal by Beneficiary. (a) Withdrawals from
the Trust Account may be made by or at the direction of the Beneficiary at any
time and from time to time only for the purposes permitted by Section 9.5 of the
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Indemnity Reinsurance Agreement and solely after compliance with the procedures
set forth in this Section 2.1.
(b) Before submitting a request to the Trustee to withdraw
funds from the Trust Account, the Beneficiary shall take the following actions:
(i) Notify the Grantor in writing of the specific
benefits or other amounts (the "Claim") it believes
the Grantor has not paid to a Policyholder with
respect to any Insurance Liability, including without
limitation, the Policyholder's name, address,
contract number and, if known, a social security
number, the basis upon which the Beneficiary believes
the benefits are owed, and any correspondence from
the policyholder with respect to such Claim (the
"Claim Notice").
(ii) If, within four (4) Business Days after receipt of
the Claim Notice, Grantor has not provided the
Beneficiary with reasonable evidence that Grantor has
paid the Claim, then Beneficiary shall have the right
to retain the services of a "Big 6" accounting firm
(the "Designated Accounting Firm") which will review
the Claim for four (4) Business Days and
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provide a written determination to both Parties as to
whether Grantor is obligated to pay the Claim.
(iii) If the Designated Accounting Firm determines that the
Claim is an Insurance Liability payable by Grantor
and has not been paid, the Beneficiary shall be
entitled to pay the policyholder the amounts
specified in the Claim.
(c) Following payment of a Claim, the Beneficiary shall
present to the Trustee a certificate substantially in the form of Exhibit A
hereto, signed by its Chief Executive Officer, Chief Financial Officer, General
Counsel or the Senior Vice President of Accounting, which shall be accompanied
by a certificate executed by a partner of the Designated Accounting Firm that
states (X) that the Grantor was obligated to pay the Claim and failed to do so,
and (Y) that Beneficiary has provided reasonable evidence to the Designated
Accounting Firm that Beneficiary has paid the Claim (the "Beneficiary Withdrawal
Request").
(d) Upon receipt of the Beneficiary Withdrawal Request,
Trustee shall immediately forward a copy of the Beneficiary Withdrawal Request,
together with all attachments thereto, to the Grantor and transfer to the
Beneficiary or its designee (i) all right, title and interest in any readily
marketable Assets identified by the Beneficiary, or if none are identified, cash
or any readily marketable Assets, in each
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case in an amount equal to the Claim identified in the Beneficiary Withdrawal
Request, and (ii) custody thereof. The Trustee shall be fully protected in
relying upon any Beneficiary Withdrawal Request which meets the requirement of
Section 2.1(c) hereof.
(e) The costs of any Designated Accounting Firm retained by
the Beneficiary pursuant to Section 2.1(b) shall be borne by the Party adjudged
to be incorrect.
Section 2.2. Withdrawals by Grantor. (a) Withdrawals from the
Trust Account may be made by or at the direction of the Grantor at any time or
from time to time for the purposes permitted in Section 9.1 of the Indemnity
Reinsurance Agreement upon presentation to the Trustee of a certificate
substantially in the form of Exhibit B hereto (the "Grantor Withdrawal
Request"), signed by a duly authorized officer of the Grantor, which states the
amount to be withdrawn (the "Withdrawn Amount"). Upon receipt of the Grantor
Withdrawal Request, the Trustee shall immediately transfer to the Grantor (i)
all right, title and interest in the Assets identified by the Grantor, or if
none are identified, cash or readily marketable Assets, in each case in an
amount equal to the Withdrawal Amount identified in the Grantor Withdrawal
Request, and (ii) custody thereof. No statements or documents other than the
Grantor Withdrawal Request need be presented by the Grantor in order to withdraw
or direct the withdrawal of Assets, except that the Grantor may be required by
the Trustee to acknowledge receipt of
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withdrawn Assets. The Trustee shall be fully protected in relying upon any
Grantor Withdrawal Request which meets the requirements of this Section 2.2(a).
(b) If the Beneficiary reasonably believes that the Grantor
has withdrawn funds from the Trust Account in violation of Section 9.1 of the
Indemnity Reinsurance Agreement, it may retain a Designated Accounting Firm to
audit any such withdrawal. If the Designated Accounting Firm determines that all
or any portion of such withdrawal was made in violation of Section 9.1 of the
Indemnity Reinsurance Agreement, it shall execute a certificate that sets forth
the amount that was withdrawn inappropriately and the basis therefor (the
"Withdrawal Dispute Certificate").
(c) Within five (5) days after receipt of a Withdrawal Dispute
Certificate, Grantor shall redeposit the amount designated in the certificate,
together with interest thereon at the one month London Interbank Offered rate.
(d) The costs of any Designated Accounting Firm retained by
the Beneficiary shall be borne (i) by the Beneficiary if the Designated
Accounting Firm determines that the amount to be paid is $1,000,000 or less, and
(ii) by the Grantor if the Designated Accounting Firm determines that the amount
to be paid is more than $1,000,000.
Section 2.3. The Grantor may substitute Assets in the Trust
Account in accordance with Section 9.3 of the Indemnity Reinsurance Agreement.
The Trustee shall be fully protected in relying upon any direction of the
Grantor to
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accept a substitution of assets and shall have no duty to determine whether the
requirements of Section 9.3 of the Indemnity Reinsurance Agreement have been
satisfied.
ARTICLE 3. REDEMPTION AND INVESTMENT OF ASSETS
Section 3.1. The Trustee shall surrender for payment all
maturing Assets and all Assets called for redemption and deposit the proceeds of
such to the Trust Account.
Section 3.2. The responsibility for directing the Trustee to
invest and reinvest the Assets shall be that of the Grantor and/or its
designated agent and, unless and until directed by the Grantor or such
designated agent, the Trustee shall not be required to take any action with
respect to the investment or reinvestment of the Assets. The Trustee shall
invest and reinvest the Assets or any part thereof in, and accept in
substitution therefor, such Authorized Investments as the Grantor or its
designated agent shall direct by electronic on-line communication or in writing.
The Grantor and its designated agent may, from time to time, provide Trustee
with written directions regarding the order in which Assets will be delivered to
the Grantor or the Beneficiary in connection with withdrawals pursuant to
Section 2.1 hereof.
Section 3.3. Trustee shall have no responsibility for trading
the Assets in the Trust Account. The Grantor or its designated agent shall have
the authority to issue orders for the purchase, sale, exchange or other
acquisition or disposition of Assets directly to brokers, dealers or issuers.
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Trustee shall be responsible for settling trades made by the Grantor. Trustee
shall follow the instructions and directions of the Grantor or its designated
agent regarding the settlement of trades.
Section 3.4. The Grantor or its designated agent shall
promptly notify the Trustee (no later than 12:00 noon New York City time on each
Settlement Date) of the issuance of each order for the purchase or sale of an
Asset and shall direct the broker, dealer or issuer to confirm the execution of
each order by advice to Trustee. Such notification shall be authority for
Trustee to pay for securities purchased against receipt thereof and to deliver
securities sold against payment thereof, as the case may be. Trustee is
authorized, in its discretion, to enter into an agreement with the Grantor to
use the Depository Trust Company's Institutional Delivery System for trade
confirmation and settlement.
Section 3.5. Trustee shall promptly forward a copy of any
notice, statement or report that it is required under this Agreement to provide
to Grantor or its designated agent.
ARTICLE 4. RIGHT TO VOTE ASSETS
The Trustee shall forward all annual and interim
stockholder reports and all proxies and proxy materials relating to the Assets
in the Trust Account to the Grantor. The Grantor shall have the full and
unqualified right to vote any Assets in the Trust Account.
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ARTICLE 5. ADDITIONAL RIGHTS AND DUTIES OF THE TRUSTEE
Section 5.1. Except as otherwise provided in Section 2.1(d)
hereof, the Trustee shall notify the Grantor and the Beneficiary in writing
within ten (10) days following each deposit to, or withdrawal from, the Trust
Account.
Section 5.2. Before accepting any asset for deposit to the
Trust Account, the Trustee shall determine that such asset is in such form that
the Beneficiary or the Trustee upon direction by the Beneficiary whenever
necessary may negotiate such asset without consent or signature from the Grantor
or any Person or entity other than the Trustee in accordance with the terms of
this Agreement.
Section 5.3. The Trustee shall receive all Assets and cause
them to be held in safekeeping.
Section 5.4. The Trustee shall accept and open all mail
directed to the Grantor or the Beneficiary in care of the Trustee.
Section 5.5. The Trustee shall furnish to the Grantor and the
Beneficiary a statement of all Assets in the Trust Account as of the inception
of the Trust Account and as of the end of each calendar month thereafter. Such
statements shall be furnished within five business days after the end of the
month.
Section 5.6. Upon the request of the Grantor or the
Beneficiary and at their sole cost and expense, the Trustee shall promptly
permit the Grantor or the Beneficiary, their respective agents, employees or
independent auditors to
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examine, audit, excerpt, transcribe and copy, during the Trustee's normal
business hours, any books, documents, papers and records relating to the Trust
Account or the Assets. Trustee shall also furnish the Grantor on line electronic
review of the Trust Account and furnish the Beneficiary review pursuant to and
in accordance with Section 9.2 hereof.
Section 5.7. Except as otherwise provided in Section 2.1(c)
hereof, the Trustee is authorized to follow and rely upon all instructions given
by officers named in incumbency certificates furnished to the Trustee from time
to time by the Grantor and the Beneficiary, respectively, and by
attorneys-in-fact acting under written authority furnished to the Trustee by the
Grantor or the Beneficiary, including, without limitation, instructions given by
letter, facsimile transmission, telegram, teletype, cablegram or electronic
media, if the Trustee believes such instructions to be genuine and to have been
signed, sent or presented by the proper Party or Parties. Except as otherwise
provided in Section 2.1(c) hereof, the Trustee shall not incur any liability to
anyone resulting from actions taken by the Trustee in reliance in good faith on
such instructions. The Trustee shall not incur any liability in executing
instructions (i) from an attorney-in-fact prior to receipt by it of notice of
the revocation of the written authority of the attorney-in-fact or (ii) from any
officer of the Grantor or the Beneficiary named in an incumbency certificate
delivered hereunder prior to receipt by it or a more current certificate.
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Section 5.8. The duties and obligations 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 shall be read into
this Agreement against the Trustee. The Trustee shall only be liable for breach
of this Agreement and direct and proximate losses due to its own gross
negligence, willful misconduct or lack of good faith.
Section 5.9. No provision of this Agreement shall require the
Trustee to take any action which, in the Trustee's reasonable judgment, would
result in any violation of this Agreement or any provision of law.
Section 5.10. The Trustee may confer with counsel of its own
choice in relation to matters arising under this Agreement and shall have full
and complete authorization and protection from the other Parties hereunder for
any action taken or suffered by it under this Agreement or under any transaction
contemplated hereby in good faith and in accordance with the advice of such
counsel.
Section 5.11. No Person other than the Beneficiary or the
Grantor may require an accounting or bring any action against the Trustee with
respect to this Agreement or its actions as Trustee.
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ARTICLE 6. THE TRUSTEE'S COMPENSATION, EXPENSES
AND INDEMNIFICATION
Section 6.1. Trustee shall be entitled to receive from the
Grantor as compensation for its services under this Agreement, a fee as agreed
upon in writing by the Grantor, which may from time to time be amended.
Section 6.2. Trustee shall be entitled to receive from Grantor
payment of or reimbursement for all of the Trustee's actual out-of-pocket
expenses and disbursements in connection with its duties under this Agreement
(including reasonable attorney('s) fees and expenses), except any such expense
or disbursement as may arise from the Trustee's gross negligence, willful
misconduct or lack of good faith, and except as provided in Section 6.4 hereof.
Section 6.3. No Assets shall be (i) withdrawn from the Trust
Account or (ii) used in any manner for paying compensation to, or reimbursement
or indemnification of, the Trustee.
Section 6.4. The Grantor hereby agrees to indemnify the
Trustee for, and hold it harmless against, any loss, liability, costs or
expenses (including reasonable attorney('s) fees and expenses) incurred by 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 and its nominee as the holder of record of the Assets;
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provided, however, that Trustee shall not be entitled to any indemnification
hereunder with respect to any loss, liability, costs or expenses resulting from
the Trustee's breach of this Agreement (including any breach of its fiduciary or
other obligations as Trustee) or any gross negligence, willful misconduct or
lack of good faith on the part of the Trustee; and provided further that the
Beneficiary (and not the Grantor) shall indemnify Trustee for any costs or
expenses (including, without limitation, attorney('s) fees and expenses)
incurred in connection with any dispute between Grantor and Beneficiary with
respect to which Grantor is determined to be the prevailing party. The Grantor
and the Beneficiary hereby acknowledge that the foregoing indemnities shall
survive the resignation of the Trustee or the termination of this Agreement.
ARTICLE 7. RESIGNATION OR REMOVAL OF THE TRUSTEE
Section 7.1. The Trustee may resign at any time for
any reason upon delivery of a written notice of resignation, effective not less
than 90 days after receipt of the notice by the Beneficiary and Grantor.
Section 7.2. The Trustee may be removed by the Grantor at any
time for any reason by delivery to the Trustee and the Beneficiary of a written
notice of removal, effective not less than 90 days after receipt of such notice
by the Trustee and the Beneficiary.
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Section 7.3. The foregoing notwithstanding, no such
resignation by the Trustee or removal of the Trustee shall be effective until a
successor trustee has been duly appointed and approved by the Beneficiary and
the Grantor and all Assets in the Trust Account have been duly transferred to
the new trustee.
Section 7.4. Upon such resignation by the Trustee or such
removal of the Trustee, the successor trustee shall succeed to and become vested
with all the rights, powers, privileges and duties of the Trustee, and the
Trustee shall be discharged from any future duties and obligations under this
Agreement.
Section 7.5. In the event of the inability of a successor
Trustee to be named or qualify within a reasonable time following the
resignation or removal of the Trustee, the Trustee shall have the right, upon
notice to the parties, to deposit the Assets with a court of competent
jurisdiction in the State of New York, whereupon, it shall submit a final report
of all Assets delivered and be relieved of all further responsibilities under
this Agreement.
ARTICLE 8. TERMINATION OF THE TRUST ACCOUNT
Section 8.1. This Agreement shall be terminated upon the
Trustee's receipt of a certificate substantially in the form of Exhibit C hereto
(the "Termination Certificate") signed by a duly authorized officer of the
Grantor executed in accordance with Section 9.9 of the Indemnity Reinsurance
Agreement or, other than in accordance with such Section 9.9,
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executed by both the Grantor and the Beneficiary. Within 10 days of the
termination of this Agreement, the Trustee shall transfer, pay over and deliver
to the Grantor all right, title and interest in the remaining Assets of the
Trust Account in exchange for a written receipt from the Grantor. Unless
terminated as provided above in this Section 8.1, this Agreement shall remain in
effect for so long as there are Assets remaining in the Trust Account.
ARTICLE 9. MISCELLANEOUS
Section 9.1. Notices. Any notice or other communication
required or permitted hereunder shall be in writing and shall be delivered
personally (by courier or otherwise), sent by certified, registered or express
mail, postage prepaid and return receipt requested, or transmitted by facsimile
(with a copy of such notice or other communication and a confirmation of
transmission sent by certified, registered or express mail, postage prepaid and
return receipt requested no later than the close of business on the next
business day following such transmission) and shall be addressed as follows:
When Grantor is to be notified:
SunAmerica Life Insurance Company
0 XxxXxxxxxx Xxxxxx, Xxxxxxx Xxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000-0000
Attn: General Counsel
Facsimile No.: (000) 000-0000
with a copy to:
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SunAmerica Life Insurance Company
0 XxxXxxxxxx Xxxxxx, Xxxxxxx Xxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000-0000
Attn: Controller
Facsimile No.: (000) 000-0000
O'Melveny & Xxxxx
1999 Avenue of the Stars
Xxxxx 000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attn: Xxxxxx X. Xxxxxx, Esq.
Facsimile No.: (000) 000-0000
Xxxxxx & Xxxxx LLP
000 X. Xxxxxx Xxxxxx
00xx Xxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attn: S. Xxxxxx Xxxxxxx, Esq.
Facsimile No. (000) 000-0000
When Beneficiary is to be notified:
Xxxx Xxxxx Life Insurance Company
0000 Xxxxxxxxx Xxxxxx Xxxxx
Xxxxx, Xxxxxxx 00000-0000
Attention: General Counsel
Facsimile No.: (000) 000-0000
with copies to:
Xxxxx Xxxxxxxxxx
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxx X. Xxxxxxxxxx, Esq.
Facsimile No.: (000) 000-0000
When the Trustee is to be notified:
Bankers Trust Company
Four Xxxxxx Xxxxxx
00xx Xxxxx
Xxx Xxxx, XX 00000
Attn: Corporate Trust & Agency Group
Ms. Xxxxx Leanffor
Facsimile No.: (000) 000-0000
A Party may, by notice given in accordance with this Section 9.1 to the other
Party, designate another address or Person to which notices required or
permitted to be given pursuant to
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this Agreement shall thereafter be transmitted. Each notice transmitted in the
manner described in this Section 9.1 shall be deemed to have been given,
received and become effective for all purposes at the time it shall have been
(i) delivered to the addressee as indicated by the return receipt (if
transmitted by mail), transmitted to the addressee (if transmitted by facsimile
and subject to delivery of the mailed copy thereof) or the affidavit of the
messenger (if transmitted by personal delivery) or (ii) presented for delivery
to the addressee as so indicated during normal business hours, if such delivery
shall have been refused for any reason.
Section 9.2. Portfolio Inspection. The Beneficiary shall be
provided, at its own expense, the ability to review, but not alter or give
instruction with respect to the portfolio of the Trust by electronic on-line
communication.
Section 9.3. Entire Agreement. This Agreement (including
Schedules attached hereto) contains the entire agreement and understanding
between the Parties with respect to the subject matter hereof. Nothing contained
in this Agreement shall constitute or be interpreted or construed as an
admission by any Party or any of its Affiliates of liability to third parties,
whether under any Laws or otherwise, or as an admission that any Party or any of
its Affiliates are in violation of or have ever violated any Laws.
In the event of any conflict between this Agreement and the
Asset Purchase Agreement as to the rights or
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obligations or Grantor or Beneficiary (but not with respect to the rights or
obligations of Trustee), the Asset Purchase Agreement shall control. In the
event of any ambiguity in this Agreement as to the rights or obligations of
Grantor or Beneficiary (but not as to the rights or obligations of Trustee) such
ambiguity shall be resolved by reference to the Asset Purchase Agreement.
Section 9.4. Amendments. No addition to, and no cancellation,
renewal, extension, modification or amendment of or approval under, this
Agreement shall be binding upon a Party unless such addition, cancellation,
renewal, extension, modification, amendment or approval is set forth in a
written instrument which states that it adds to, amends, cancels, renews or
extends this Agreement or grants an approval hereunder and which is executed and
delivered on behalf of each Party by an officer of, or attorney-in-fact for,
such Party.
Section 9.5. Waivers. No waiver of any provision of this
Agreement shall be binding upon a Party unless such waiver is expressly set
forth in a written instrument which is executed and delivered on behalf of such
Party by an officer of, or attorney-in-fact for such Party. Such waiver shall be
effective only to the extent specifically set forth in such written instrument.
Neither the exercise (from time to time or at any time) nor the delay or failure
(at any time or for any period of time) to exercise any right, power or remedy
shall operate as a waiver of, the right to exercise, or
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impair, limit or restrict the exercise on the part of any Party of any such
right, power or remedy or any other right, power or remedy at any time and from
time to time thereafter. No waiver of any right, power or remedy of a Party
shall be deemed to be a waiver of any other right, power or remedy of such Party
or shall, except to the extent so waived, impair, limit or restrict the exercise
of such right, power or remedy.
Section 9.6. Governing Law. THIS AGREEMENT SHALL BE GOVERNED
BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT
GIVING EFFECT TO THE PRINCIPLES OF CONFLICTS OF LAWS THEREOF. Each Party
consents and submits to the non-exclusive personal jurisdiction of any federal
court in the State of Delaware in respect of any proceeding for the sole purpose
of injunctive relief or to enforce an arbitration award under Section 9.7
hereof. Each Party consents to service of process upon it with respect to any
such proceeding by registered mail, return receipt requested, and by any other
means permitted by applicable Laws. Each Party waives any objection that it may
now or hereafter have to the laying of venue of any such proceeding in federal
court in the State of Delaware and any claim that it may now or hereafter have
that any such proceeding in any such court has been brought in an inconvenient
forum.
Section 9.7. Arbitration. The Parties acknowledge and agree
that the transactions contemplated herein substantially affect and impact
interstate commerce.
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Therefore, all disputes or differences between two or among three of the Parties
arising under or which are related to this Agreement (other than proceedings for
the sole purpose of injunctive relief) upon which an amicable understanding
cannot be reached within thirty (30) days shall be settled by the parties to the
dispute (the "Disputing Parties") by arbitration in accordance with the
Commercial Arbitration Rules of the American Arbitration Association, except as
hereinafter provided, and judgment upon the award entered by the Arbitrators (as
defined below) may be entered in any court having jurisdiction thereof. The
Arbitrators provided for herein shall construe this Agreement in light of the
prevailing custom and practices for transactions of a similar nature. The
"Arbitrators" shall consist of one neutral arbitrator (or as provided below,
three neutral arbitrators). The Parties agree that the arbitration, if
implemented under this Agreement, shall be held in New York, New York, unless
otherwise agreed to by the Parties. The Parties agree to arbitrate within ninety
(90) days following the transmittal of written demand of any Disputing Party to
arbitrate any dispute arbitrable under this Agreement. The Disputing Parties
will in good faith, within fifteen (15) days following notice of written demand
to arbitrate, attempt to agree on a single Arbitrator. If the Disputing Parties
cannot within fifteen (15) days thereafter agree on a single arbitrator, the
Parties' Arbitrators shall be chosen as follows:
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(a) In a dispute between two Disputing Parties, there shall be
three (3) Arbitrators. Each of the Disputing Parties shall choose one
Arbitrator. The third Arbitrator shall be chosen by the other two Arbitrators
within thirty (30) days after they have been appointed. If the two Arbitrators
cannot agree upon a third Arbitrator, each Arbitrator shall nominate, within
three (3) days of such failure to agree, three (3) persons of whom the other
shall reject two. The third Arbitrator shall then be chosen by drawing lots
within twenty-four (24) hours of determination of the two candidates. If any
Disputing Party fails to choose an Arbitrator within thirty (30) days after
receiving the written request of the other Disputing Party to do so, the other
Disputing Party shall choose both Arbitrators, who shall choose the third
Arbitrator.
(b) In a dispute among three Disputing Parties, there shall be
five (5) Arbitrators, except as otherwise provided herein. Each of the Disputing
Parties shall choose one Arbitrator. The remaining two Arbitrators shall be
chosen by the unanimous vote of the other three Arbitrators within thirty (30)
days after they have been appointed. If the three Arbitrators cannot agree upon
a fourth and/or a fifth Arbitrator, each Arbitrator shall nominate, within three
(3) days of such failure to agree, three (3) persons of whom each of the others
shall reject one. The fourth and/or fifth Arbitrator shall then be chosen by
drawing lots within twenty-four (24) hours of determination of the three (3)
candidates.
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If any one Disputing Party fails to choose an Arbitrator within thirty (30) days
after receiving the written request of the another Disputing Party to do so,
then the Arbitrator will be decided by a panel of three (3) Arbitrators pursuant
to Paragraph 9.7(a) above. If any two Disputing Parties fail to choose an
Arbitrator within thirty (30) days after receiving the written request of the
other Disputing Party to do so, then such latter Disputing Party shall choose
two Arbitrators, who shall choose a third Arbitrator.
A decision of a majority of the Arbitrators shall be final and
binding and there shall be no appeal therefrom. The Arbitrators shall award
compensatory damages only, not consequential or punitive damages. The
Arbitrators shall within forty-five (45) days after the final hearing enter an
award and the award shall be supported by a written opinion. The fees of the
Arbitrators and the direct costs of the arbitration shall be shared equally by
the Disputing Parties; all other costs of the respective Disputing Parties,
including without limitation fees and expenses of the respective Disputing
Party's attorneys, witnesses, and discovery shall be paid by the respective
Disputing Party, except to the extent that the Arbitrators otherwise direct
based on the equities of the situation.
Section 9.8. Binding Effect; Assignment; Third Party
Beneficiaries. This Agreement shall be binding upon and inure to the benefit of
the Parties and their respective successors and permitted assigns. Neither the
Grantor nor the
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Beneficiary shall assign any of its rights or delegate any of its duties
hereunder, (in whole or in part and by operation of law or otherwise) without
the prior written consent of the other Party hereto, except that Grantor may
assign its rights and obligations under this Agreement to any of its Affiliates,
provided that Grantor shall remain liable for its obligations hereunder
notwithstanding such assignment. Any assignment of rights or delegation of
duties under this Agreement by a Party without the prior written consent of the
other Party, if such consent is required hereby, shall be void. No Person
(including, without limitation, any employee of a Party) shall be, or be deemed
to be, a third party beneficiary of this Agreement.
Section 9.9. Severability. If any provision of this Agreement
shall hereafter be held to be invalid, unenforceable or illegal, in whole or in
part, in any jurisdiction under any circumstances for any reason, (i) such
provision shall be reformed to the minimum extent necessary to cause such
provision to be valid, enforceable and legal while preserving the intent of the
Parties as expressed in, and the benefits to the Parties provided by, this
Agreement or (ii) if such provision cannot be so reformed, such provision shall
be severed from this Agreement and an equitable adjustment shall be made to this
Agreement (including, without limitation, addition of necessary further
provisions to this Agreement) so as to give effect to the intent as so expressed
and the benefits so provided. Such holding shall not affect or impair
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the validity, enforceability or legality of such provision in any other
jurisdiction or under any other circumstances. Neither such holding nor such
reformation or severance shall affect or impair the legality, validity or
enforceability of any other provision of this Agreement.
Section 9.10. Headings. The headings in this Agreement have
been inserted for convenience of reference only, and shall not be considered a
part of this Agreement and shall not limit, modify or affect in any way the
meaning or interpretation of this Agreement.
Section 9.11. Counterparts. This Agreement may be executed by
the parties in any number of counterparts, each of which when so executed and
delivered shall constitute an original instrument, but all such counterparts
shall together constitute one and the same instrument. This Agreement shall
become effective and be deemed to have been executed and delivered by all of the
Parties at such time as counterparts shall have been executed and delivered by
both of the Parties, regardless of whether each of the Parties has executed the
same counterpart. It shall not be necessary when making proof of this Agreement
to account for any counterparts other than a sufficient number of counterparts
which, when taken together, contain signatures of both of the Parties.
Section 9.12. Errors and Omissions. Inadvertent delays, errors
or omissions made by either the Grantor or the Beneficiary in connection with
this Agreement or any transaction hereunder shall not relieve the other party
from
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any liability which would have attached to such party had such delay, error or
omission not occurred, provided that the party causing such delay error or
omission rectifies the same as soon as possible after its discovery thereof.
Section 9.13. Certain Definitions. Except as the context shall
otherwise require, the following terms shall have the following meanings for all
purposes of this Agreement (the definitions to be applicable to both the
singular and the plural form of each term defined if both such forms of such
term are used in this Agreement):
(a) The term "Affiliate" with respect to any corporation
shall mean a corporation which directly, or
indirectly through one or more intermediaries,
controls or is controlled by, or is under common
control with, such corporation. The term "control"
(including the related terms "controlled by" and
"under common control with") shall mean the
ownership, directly or indirectly, of more than fifty
percent (50%) of the voting stock of a corporation.
(b) In addition to the entity designated as "Beneficiary"
in the introductory paragraph of this Agreement, the
term "Beneficiary" shall also include any successor
by operation of law of the Beneficiary named in the
introductory paragraph. If a court of law appoints a
successor in interest to the named Beneficiary, then
the named Beneficiary includes and is limited to the
court appointed domiciliary receiver
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(including conservator, rehabilitator or liquidator).
(c) The term "business day" shall mean any day on which
the offices of the Trustee are open for business.
(d) The term "Person" shall mean and include an
individual, a corporation, a partnership, an
association, a trust, an unincorporated organization
or a government or political subdivision thereof.
(e) The term "Parent" shall mean an institution that,
directly or indirectly, controls another institution.
Section 9.14. Documentation to be Provided to Trustee. Grantor
has provided or shall provide Trustee with copies of the Asset Purchase
Agreement and the Indemnity Reinsurance Agreement.
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IN WITNESS WHEREOF, the Parties have caused this Agreement to be
executed and delivered by their respective officers thereunto duly authorized.
SUNAMERICA LIFE INSURANCE
COMPANY,
As Grantor
By: /s/ Xxxxx X. Xxxxx
-------------------------------------
Name: Xxxxx X. Xxxxx
Title: SVP
XXXX XXXXX LIFE INSURANCE COMPANY,
As Beneficiary
By: /s/ Xxxxx X. Xxxxxxx
-------------------------------------
Name: Xxxxx X. Xxxxxxx
Title: SVP & CFO
BANKERS TRUST COMPANY,
As Trustee
By: /s/ Xxxxx X. Xxxxx
-------------------------------------
Name: Xxxxx X. Xxxxx
Title: Vice President
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Exhibit A
BENEFICIARY WITHDRAWAL REQUEST
The undersigned, the [insert position]* of Xxxx Xxxxx Life
Insurance Company ("Xxxx Xxxxx"), does hereby certify that, pursuant to Section
2.1 of the Trust Agreement (as defined below) established by SunAmerica for the
benefit of Xxxx Xxxxx pursuant to the Trust Agreement dated as of March 31, 1997
entered into by and among Xxxx Xxxxx, SunAmerica Life Insurance Company
("SunAmerica") and Bankers Trust Company (the "Trust Agreement"):
(1) Xxxx Xxxxx has paid the Policyholder(s) identified
[below/on the attached schedule] with respect to the following claim(s):
Policyholder Address Contract Social Security Claim Type of
Name Number Number Amount Claim**
(2) Attached hereto is a certificate executed by a partner of
a "Big 6" Accounting Firm stating that SunAmerica was obligated to pay the
claim(s) identified hereon, and Xxxx Xxxxx has provided reasonable evidence to
such Accounting Firm that Xxxx Xxxxx has paid such Claim(s).
This Beneficiary Withdrawal Request is within the meaning of
Section 2.1(c) of the Trust Agreement.
Dated: _______________ _________________________
Name:
Title:
* Chief Executive Officer, Chief Financial Officer, General Counsel or
Senior Vice President of Accounting
** E.g., surrender, withdrawal, other benefit or type of payment
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Exhibit B
GRANTOR WITHDRAWAL REQUEST
The undersigned, the [insert position] and a duly authorized
officer of SunAmerica Life Insurance Company ("SunAmerica"), does hereby certify
that, pursuant to Section 2.2 of the Trust Agreement dated as of March 31, 1997
among SunAmerica, Xxxx Xxxxx Life Insurance Company, and Bankers Trust Company
(the "Trust Agreement"), SunAmerica is entitled to withdraw from the Trust
Account established pursuant to the Trust Agreement $[ ] (the "Withdrawal
Amount").
SunAmerica requests payment of the Withdrawal Amount [in cash]
[by transfer to it of all right, title and interest in, and custody of, the
Assets identified in Exhibit attached hereto or readily marketable Assets].
This Grantor Withdrawal Request is within the meaning of
Section 2.2(a) of the Trust Agreement. All capitalized terms used herein without
definition shall have the meanings given them in the Trust Agreement.
Dated:_______________________ ___________________________________
Name:
Title:
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Exhibit C
TERMINATION CERTIFICATE
The undersigned, the [insert position] and a duly
authorized officer of SunAmerica Life Insurance Company ("SunAmerica")
does hereby certify that:
(1) this Certificate is a "Termination Certificate" within the
meaning of Section 8.1 of the Trust Agreement dated as of [_______ __, 1996]
entered into by and among Xxxx Xxxxx Life Insurance Company ("Xxxx Xxxxx"),
SunAmerica and Bankers Trust Company, as Trustee; and
(2) the Statutory Reserves (as such term is defined in the
Indemnity Reinsurance Agreement by and between Sun America and Xxxx Xxxxx) as
shown on SunAmerica's Quarterly Report for the quarter ended ______________ (a
true and correct copy of which is attached hereto) are less than $75 million.
Dated: __________ _________________________
Name:
Title:
