FUND PARTICIPATION AGREEMENT
THIS AGREEMENT, made and entered into this 1st of May, 2006, by and among
HARTFORD LIFE INSURANCE COMPANY, a stock life insurance company organized under
the laws of Connecticut (hereinafter the "COMPANY"), on its own behalf and on
behalf of each separate account of the Company set forth in SCHEDULE A hereto,
as may be amended from time to time (each such account hereinafter referred to
as a "SEPARATE ACCOUNT") and Ivy Funds Distributor, Inc., a Florida corporation
(hereinafter the "UNDERWRITER").
WITNESSETH:
WHEREAS, Underwriter is the principal underwriter for the series or classes of
shares set forth and identified as "Ivy Funds" on Schedule A hereto
(collectively, the "FUNDS" and individually, a "FUND"); and
WHEREAS, the Funds are registered as open-end management investment companies
under the Investment Company Act of 1940, as amended (hereinafter the "1940
ACT") and its shares are registered under the Securities Act of 1933, as amended
(hereinafter the "1933 ACT"); and
WHEREAS, the Company issues certain group variable annuity contracts and group
funding agreements (the "CONTRACTS") in connection with retirement plans
("PLANS") intended to meet the qualification requirements of Sections 401,
403(b) or 457 ofthe Internal Revenue Code of 1986, as amended (the "CODE"); and
WHEREAS, each Separate Account is a duly organized, validly existing segregated
asset account, established by resolution of the Board of Directors of the
Company under the insurance laws of the State of Connecticut to set aside and
invest assets attributable to the Contracts; and
WHEREAS, the Underwriter is the principal underwriter of the Funds and is
registered as a broker-dealer with the Securities and Exchange Commission
(hereinafter the "SEC") under the Securities Exchange Act of 1934, as amended
(hereinafter the "1934 ACT"), and is a member in good standing of the National
Association of Securities Dealers, Inc. (hereinafter "NASD"); and
WHEREAS, to the extent permitted by applicable insurance laws and regulations,
the Company intends to purchase shares in the Funds set forth in SCHEDULE A on
behalf of each corresponding Separate Account set forth on such SCHEDULE A
through one or more omnibus accounts to fund the Contracts and the Underwriter
is authorized to sell such shares to unit investment trusts such as the Separate
Accounts at net asset value; and
WHEREAS, the Company desires to provide administrative services as specified in
SCHEDULE C hereto (the "SERVICES"), which services include processing and
transfer arrangements for the investment and reinvestment of Plan assets in
Funds as specified by the person or persons designated to direct the investments
of the Plan assets (the "PLAN REPRESENTATIVE") on the terms and conditions set
forth herein.
NOW, THEREFORE, in consideration of their mutual promises, the Company and the
Underwriter agree as follows:
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ARTICLE 1. Purchase and Redemption of Fund Shares.
1.1 The Underwriter agrees to sell to the Company those shares of the Funds
which the Company orders on behalf of any Separate Account, executing such
orders on a daily basis at the net asset value next computed after receipt and
acceptance by the Underwriter of such order. For purposes of this Section, the
Company shall be the designee of the Underwriter for receipt of such orders from
each Separate Account. Receipt by such designee shall constitute receipt by the
Underwriter; provided that the Underwriter receives notice of such order via the
National Securities Clearing Corporation (the "NSCC") by 10:00 a.m. Eastern Time
on the next following Business Day. The Underwriter will receive all orders to
purchase Fund shares using the NSCC's Defined Contribution Clearance &Settlement
("DCC&S") platform. The Underwriter will also provide the Company with account
positions and activity data using the NSCC's Networking platform. The Company
shall pay for Fund shares by the scheduled close of federal funds transmissions
on the same Business Day it places an order to purchase Fund shares in
accordance with this section using the NSCC's Fund/SERV System. Payment shall be
in federal funds transmitted by wire from the Underwriter's designated Settling
Bank to the NSCC. "BUSINESS DAY" shall mean any day on which the New York Stock
Exchange is open for trading and on which the Underwriter calculates its net
asset value pursuant to the rules of the SEC. "NETWORKING" shall mean the NSCC's
product that allows Underwriter's and Companies to exchange account level
information electronically. "SETTLING BANK" shall mean the entity appointed by
the Underwriter to perform such settlement services on behalf of the Underwriter
and agrees to abide by the NSCC's Rules and Procedures insofar as they relate to
the same day funds settlement.
If the Company is somehow prohibited from submitting purchase andsettlement
instructions to the Underwriter for Fund shares via the NSCC's DCC&S platform
the following shall apply to this Section:
The Underwriter agrees to sell the Company those shares of the Funds which the
Company orders on behalf of any Separate Account, executing such orders on a
daily basis at the net asset value next computed after receipt and acceptance by
the Underwriter or its designee of such order. For purposes of this Section, the
Company shall be the designee of the Underwriter for the receipt of such orders
from the Separate Account and receipt by such designee shall constitute receipt
by the Underwriter; provided that the Underwriter receives notice of such order
by 9:30 a.m. Eastern Time on the next following Business Day. The Company shall
pay for Fund shares by the scheduled close of federal funds transmissions on the
same Business Day it places an order to purchase Fund shares in accordance with
this section. Payment shall be in federal funds transmitted by wire to the
Underwriter's designated custodian. "BUSINESS DAY" shall mean any day on which
the New York Stock Exchange is open for trading and on which the Underwriter
calculates its net asset value pursuant to the rules of the SEC.
1.2 The Underwriter agrees to make shares of the Funds available for purchase
at the applicable net asset value per share by the Company on Business Days;
provided, however, that the Board of Trustees or Directors, as applicable, of
the Fund (hereinafter the "TRUSTEES/DIRECTORS") 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 Trustees/Directors, acting in
good faith and in compliance with their fiduciary duties under federal and any
applicable state laws, necessary in the best interests of the shareholders of
any Fund.
1.3 The Underwriter agrees to redeem for cash, upon the Company's request, any
full or fractional shares of the Fund(s) held by the Company on behalf of a
Separate Account, executing such requests on a daily basis at the net asset
value next computed after receipt and acceptance by the
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Underwriter or its designee of the request for redemption. For purposes of this
Section, the Company shall be the designee of the Underwriter for receipt of
requests for redemption from each Separate Account and receipt by such designee
shall constitute receipt by the Underwriter; provided the Underwriter receives
notice of such request for redemption via the NSCC by 10:00 a.m. Eastern Time on
the next following Business Day. The Underwriter will receive all orders to
redeem Fund shares using the NSCC's DCC&S platform. The Underwriter will also
provide the Company with account positions and activity data using the NSCC's
Networking platform. Payment for Fund shares redeemed shall be made in
accordance with this section using the NSCC's Fund/SERV System. Payment shall be
in federal funds transmitted by the NSCC to the Separate Account's Settling Bank
as designated by the Company, on the same Business Day the Underwriter receives
notice of the redemption order from the Company provided that the Underwriter
receives notice by 10:00 a.m. Eastern Time on such Business Day.
If the Company is somehow prohibited from submitting redemption and settlement
instructions to the Underwriter for Fund shares via the NSCC's DCC&S platform
the following shall apply to this Section:
The Underwriter agrees to redeem for cash, upon the Company's request, any full
or fractional shares of the Fund(s) held by the Company on behalf of a Separate
Account, executing such requests on a daily basis at the net asset value next
computed after receipt and acceptance by the Underwriter or its designee of the
request for redemption. For purposes of this Section, the Company shall be the
designee of the Underwriter for receipt of requests for redemption from each
Separate Account and receipt by such designee shall constitute receipt by the
Underwriter; provided the Underwriter receives notice of such request for
redemption by 9:30 a.m. Eastern Time on the next following Business Day. Payment
shall be in federal funds transmitted by wire to the Separate Account as
designated by the Company, on the same Business Day the Underwriter receives
notice of the redemption order from the Company provided that the Underwriter
receives notice by 9:30 a.m. Eastern Time on such Business Day.
1.4 The Company will place separate orders to purchase or redeem shares of each
Fund, and only in accordance with the Funds' then current prospectus(es).
1.5 Issuance and transfer of the Fund's shares will be by book entry only.
Share certificates will not be issued to the Company or any Separate Account.
Purchase and redemption orders for Fund shares will be recorded in an
appropriate title for each Separate Account or the appropriate sub-account of
each Separate Account.
1.6 The Underwriter shall furnish prior day and same day notice to the Company
of any income, dividends or capital gain distributions payable on the Fund's
shares. The Company hereby elects to receive all such dividends and
distributions as are payable on a Fund's shares in the form of additional shares
of that Fund. The Underwriter shall notify the Company of the number of shares
so issued as payment of such dividends and distributions no later than one
Business Day after issuance. The Company reserves the right to revoke this
election and to receive in cash all such dividends and distributions declared
after receipt of notice of revocation by the Underwriter. The Company shall
provide an email contact to which the Underwriter shall distribute dividend
information.
1.7 The Underwriter shall make the net asset value per share of each Series
available to the Company on a daily basis as soon as reasonably practical after
the close of trading each Business Day.
1.8(a) If the Underwriter provides materially incorrect share net asset value
information through no fault of the Company, the Separate Accounts shall be
entitled to an adjustment with respect to the
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Series shares purchased or redeemed to reflect the correct net asset value per
share.
1.8(b) The determination of the materiality of any net asset value pricing
error and its correction shall be based on the SEC's recommended guidelines
regarding these errors. Any material error in the calculation or reporting of
net asset value per share, dividend or capital gain information shall be
reported promptly to the Company upon discovery. The Underwriter shall indemnify
and hold harmless the Company against any amount the Company is legally required
to pay contract owners, participants or beneficiaries that have selected a Fund
as an investment option ("CONTRACT OWNERS"), and which amount is due to the
Underwriter's or its agents' material miscalculation and/or incorrect reporting
of or failure to report the daily net asset value, dividend rate or capital
gains distribution rate. The Company shall submit an invoice to the Trust or its
agents for such losses incurred as a result of the above which shall be payable
within sixty (60) days of receipt. Should a material miscalculation by the
Underwriter or its agents result in a gain to the Company, the Company shall
immediately reimburse the Underwriter, the applicable Funds or its agents for
any material losses incurred by the Underwriter, the applicable Funds or its
agents as a result of the incorrect calculation. Should a material
miscalculation by the Underwriter or its agents result in a gain to Contract
Owners, the Company will consult with the Underwriter or its designee as to what
reasonable efforts shall be made to recover the money and repay the Underwriter,
the applicable Fund or its agents. The Company shall then make such reasonable
efforts to recover the money and repay the Underwriter, the applicable Funds or
its agents; but the Company shall not be obligated to take legal action against
Contract Owners.
With respect to the material errors or omissions described above, this section
shall control over other indemnification provisions in this Agreement.
1.9 In the event that Underwriter agrees to allow the Company to purchase
and/or transfer assets into one or more of the mutual funds distributed by
Underwriter or its affiliates, but which are not included on SCHEDULE A hereto
(the "UNAUTHORIZED FUNDS"), Company agrees that it shall not be entitled to any
commission or service fee with respect to transactions in the Unauthorized
Funds. Further, if Underwriter does mistakenly pay commissions and/or service
fees on the Unauthorized Funds, Company agrees to promptly return all such
payments to Underwriter.
Company agrees that it shall perform all services listed on SCHEDULE C with
respect to the Unauthorized Funds held in omnibus and/or network level 3
accounts.
1.10 The Company agrees to provide Underwriter with information as Underwriter
may reasonably request as may be necessary or advisable to enable Underwriter to
comply with its applicable laws.
The Company shall not transmit any order for the purchase of shares on behalf of
any underlying purchaser who (i) is not a resident of the United States or (ii)
is a resident of another jurisdiction in which such shares are not qualified for
sale.
ARTICLE II. Representations and Warranties
2.1. The Company represents and warrants that the Contracts are or will be
registered unless exempt and that it will make every effort to maintain such
registration under the 1933 Act to the extent required by the 1933 Act; that the
Contracts are intended to be issued and sold in compliance in all material
respects with all applicable federal and state laws. The Company further
represents and warrants
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that it is an insurance company duly organized and in good standing under
applicable law and that it has legally and validly established each Separate
Account prior to any issuance or sale of Contracts, shares or other interests
therein, as a segregated asset account under the insurance laws of the State of
Connecticut and has registered or, prior to any issuance or sale of the
Contracts, will register and will maintain the registration of each Separate
Account as a unit investment trust in accordance with and to the extent required
by the provisions of the 1940 Act, unless exempt there from, to serve as a
segregated investment account for the Contracts. Unless exempt, the Company
shall amend its registration statement for its Contracts under the 1933 Act and
the 1940 Act from time to time as required in order to affect the continuous
offering of its Contracts. The Company shall register and qualify the Contracts
for sale in accordance with securities laws of the various states only if and to
the extent deemed necessary by the Company.
The Company represents and warrants that (i) it has full power and authority
under applicable law, and has taken all action necessary, to enter into and
perform this Agreement and the person executing this Agreement on its behalf is
duly authorized and empowered to execute and deliver this Agreement; (ii) this
Agreement constitutes a legal, valid and binding obligation, enforceable against
it in accordance with its terms; (iii) no consent or authorization of, filing
with, or other act by or in respect of any governmental authority is required in
connection with the execution, delivery, performance, validity or enforceability
of this Agreement; (iv) the execution, performance and delivery of this
Agreement by the Company will not result in it violating any applicable law or
breaching or otherwise impairing any of its contractual obligations; (v) the
arrangements provided for in this Agreement will be disclosed to the Separate
Accounts with which it deals; (vi) it and any of its designees are not and will
not be a "fiduciary" with respect to the provisions of the services it provides
pursuant to this Agreement as such term is defined in Section 3(21) of the
Employee Retirement Income Security Act of 1974, as amended ("ERISA"), and
Section 4975 of the Internal Revenue Code of 1986, as amended (the "CODE");
(vii) the receipt of the fees described in SCHEDULE B hereof by Company or any
designee and the provision of services Plans and/or plan participants under this
Agreement by Company or its designees does not and will not constitute a
non-exempt "prohibited transaction" as such term is defined in Section 406 of
ERISA and Section 4975 of the Code; (viii) it and each designee is registered as
a transfer agent under the 1934 Act and any applicable state securities laws, or
is not required to be so registered; and (ix) it and each designee is in
compliance with and will continue to comply with the USA Patriot Act of 2001
(the "AML ACT") and applicable anti-money laundering rules of self regulatory
organizations in all relevant respects, or it is not so required to comply; (x)
it and each designee is in compliance with and will continue to comply with all
applicable broker-dealer books and records rules, including Rules 17a-3 and
17a-4 under the 1934 Act, or it is not so required to comply; and (xi) it will
comply with all relevant rules and regulations, agreements, prospectuses,
policies and procedures regarding the handling of mutual fund orders basis, that
all mutual fund trades submitted to any of the Funds for receipt of a particular
day's net asset value are received by Company on or before the close of trading
of the New York Stock Exchange on that day and that Company has established
appropriate internal controls to assure compliance.
2.2 The Underwriter represents and warrants that (i) Fund shares sold pursuant
to this Agreement shall be registered under the 1933 Act and duly authorized for
issuance in accordance with applicable law and that the Underwriter is and shall
remain registered under the 1940 Act for as long as the Fund shares are sold;
(ii) the Underwriter shall amend the registration statement for its Fund shares
under the 1933 Act and the 1940 Act from time to time as required in order to
effect the continuous offering of its Fund shares; and (iii) the Underwriter
shall register and qualify its Fund shares for sales in accordance with the laws
of the various states only if and to the extent deemed advisable by the
Underwriter.
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2.3 The Underwriter represents that each Fund (a) is currently qualified as a
Regulated Investment Company under Subchapter M of the Code; (b) will make every
effort to maintain such qualification (under Subchapter M or any successor or
similar provision); and (c) will notify the Company promptly upon having a
reasonable basis for believing that such Fund has ceased to so qualify or might
not so qualify in the future.
2.4 To the extent that the Underwriter finances distribution expenses pursuant
to Rule 12b-1 under the 1940 Act, the Underwriter represents that its Board of
Trustees or Directors, as applicable, including a majority of its
Trustees/Directors who are not interested persons of the Underwriter, have
formulated and approved a plan under Rule 12b-1 to finance distribution
expenses.
2.5 The Underwriter makes no representation as to whether any aspect of its
operations (including, but not limited to, fees and expenses and investment
policies) complies with the insurance laws or insurance regulations of the
various states.
2.6 The Underwriter represents and warrants that it is a member in good
standing of the NASD and is registered as a broker-dealer with the SEC. The
Underwriter further represents that it will sell and distribute the Fund shares
in accordance in all material respects with all applicable federal and state
securities laws, including without limitation the 1933 Act, the 1934 Act, and
the 0000 Xxx.
2.7 The Underwriter represents that the Funds are lawfully organized and
validly existing under the laws of the State of Maryland and that it does and
will comply in all material respects with applicable provisions of the 0000 Xxx.
2.8 The Underwriter represents and warrants that all of its Trustees/Directors,
officers, employees, investment advisers, and other individuals/entities having
access to the Funds and/or securities of the Fund are and continue to be at all
times covered by a blanket fidelity bond or similar coverage for the benefit of
the Underwriter in an amount not less than the minimal coverage as required by
Rule 17g-1 under the 1940 Act or related provisions as may be promulgated from
time to time. The aforesaid bond includes coverage for larceny and embezzlement
and is issued by a reputable bonding company.
2.9 The Company represents and warrants that all of its directors, officers,
employees, investment advisers, and other individuals/entities dealing with the
money and/or securities of the Underwriter are covered by a blanket fidelity
bond or similar coverage in an amount not less than $5 million. The aforesaid
includes coverage for larceny and embezzlement and is issued by a reputable
bonding company.
2.10 The foregoing representations and warranties shall be made, by the party
hereto that makes the representation or warranty as of the date first written
above and at the time of each purchase and each sale of the Fund shares pursuant
to this Agreement.
ARTICLE III. Prospectuses; Reports and Proxy Statements; Voting
3.1 The Underwriter shall provide the Company at no charge with as many printed
copies of the Fund's current prospectus and statement of additional information
as the Company may reasonably request. If requested by the Company, in lieu of
providing printed copies of the Fund's current prospectus and statement of
additional information, the Underwriter shall provide camera-ready film,
computer
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diskettes, e-mail transmissions or PDF files containing the Fund's prospectus
and statement of additional information, and such other assistance as is
reasonably necessary in order for the Company once each year (or more frequently
if the prospectus and/or statement of additional information for the Funds are
amended during the year) to have the prospectus for the Contracts (if
applicable) and the Fund's prospectus printed together in one document or
separately. The Company may elect to print the Fund's prospectus and/or its
statement of additional information in combination with other fund companies'
prospectuses and statements of additional information.
3.2(a) The Underwriter shall provide the Company at no charge with copies of
the Fund's proxy statements, Fund reports to shareholders, and other Fund
communications to shareholders in such quantity as the Company shall reasonably
require for distributing to Contract Owners.
3.2(b) For those accounts that are omnibus and/or network level 3, the Company
shall, at its expense, distribute or arrange for the distribution of, all proxy
material furnished by Underwriter or the Funds to each Contract Owner and, if
applicable, will vote the shares as described in Section 3.4, below. The Company
and its agents will in no way recommend action in connection with or oppose or
interfere with the solicitation of such proxies.
3.3. The Fund's statement of additional information shall be obtainable by
Contract Owners from the Underwriter, the Company or such other person as the
Underwriter may designate.
3.4 If and to the extent required by law the Company shall distribute all proxy
material furnished by the Underwriter to Contract Owners to whom voting
privileges are required to be extended and shall:
A. solicit voting instructions from Contract Owners;
B. vote the Fund shares held in the Separate Account in accordance with
instructions received from Contract Owners;
C. so long as and to the extent that the SEC continues to interpret the
1940 Act to require pass through voting privileges for variable
annuity contract owners, vote Fund shares held in the Separate
Account for which no timely instructions have been received, in the
same proportion as shares of such Fund for which instructions have
been received from the Company's Contract Owners. The Company
reserves the right to vote Fund shares held in any segregated asset
account for its own account, to the extent permitted by law.
Notwithstanding the foregoing, with respect to the Fund shares held
by unregistered Separate Accounts that issue Contracts issued in
connection with employee benefit plans subject to the provisions of
ER1SA, the Company shall vote such Fund shares allocated to such
Contracts only in accordance with the Company's agreements with such
Contract Owners; and
D. the Company and its agents will in no way recommend action in
connection with or oppose or interfere with the solicitation of such
proxies.
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ARTICLE IV. Sales Material and Information
4.1 The Company shall furnish, or shall cause to be furnished, to the
Underwriter, or its designee, each piece of sales literature or other
promotional material prepared by the Company or any person contracting with the
Company in which the Funds or the Underwriter are described, at least ten
calendar days prior to its use. No such literature or material shall be used
without prior approval from the Underwriter or its designee, however, the
failure to object in writing within five Business days will be deemed approval.
Such approval process shall not apply to subsequent usage of materials that are
substantially similar to prior approved materials.
4.2 Neither the Company nor any person contracting with the Company shall give
any information or make any representations or statements on behalf of the
Underwriter or concerning the Underwriter 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 to shareholders or proxy statements for the Underwriter, or in sales
literature or other promotional material approved by the Underwriter, except
with the permission of the Underwriter.
4.3 The Underwriter shall not give any information or make any representations
on behalf of the Company or concerning the Company, each Separate Account, or
the Contracts other than the information or representations contained in the
Contracts, a disclosure document, registration statement or prospectus for the
Contracts (if applicable), as such registration statement and prospectus may be
amended or supplemented from time to time, or in published reports for each
Separate Account which are in the public domain or approved by the Company for
distribution to Contract Owners or participants, or in sales literature or other
promotional material approved by the Company, except with the permission of the
Company.
4.4 The Underwriter will provide to the Company at least one complete copy of
all prospectuses, statements of additional information, reports to shareholders,
proxy statements, and all amendments to any of the above, that relate to the
Fund or its shares, promptly after the filing of such document with the SEC or
other regulatory authorities.
4.5. The Company will provide to the Underwriter at least one complete copy of
all prospectuses, statements of additional information, reports, solicitations
for voting instructions, and all amendments to any of the above, if applicable
to the investment in a Separate Account or Contract, promptly after the filing
of such document with the SEC or other regulatory authorities.
4.6 For purposes of this Article IV, the phrase "sales literature or other
promotional material" includes, but is not limited to, advertisements (such as
material published, or designed for use in, a newspaper, magazine, or other
periodical, radio, television, telephone or tape recording, videotape display,
signs or billboards, motion pictures, Internet, or other public media), sales
literature (i.e., any written communication distributed or made generally
available to customers or the public, including brochures, circulars, research
reports, market letters, form letters, electronic mail, 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, registration statements,
disclosure documents, prospectuses, statements of additional information,
shareholder reports, and proxy materials.
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4.7 The Company agrees and acknowledges that the Company has no right, title or
interest in the names and marks of the Underwriter and that all use of any
designation comprised in whole or part of such names or marks under this
Agreement shall inure to the benefit of the Funds and the Underwriter. Except as
provided in Section 4.1, the Company shall not use any such names or marks on
its own behalf or on behalf of a Separate Account in connection with marketing
the Contracts without prior written consent of the Underwriter. Upon termination
of this Agreement for any reason, the Company shall cease all use of any such
names or marks.
4.8 The Underwriter agrees and acknowledges that it has no right, title or
interest in the names and marks of the Company, and that all use of any
designation comprised in whole or part or such names or marks under this
Agreement shall inure to the benefit of the Company. Except as provided in
Section 4.3, the Underwriter shall not use any such names or marks on its own
behalf or on behalf of a Fund in connection with marketing the Fund without
prior written consent of the Company. Upon termination of this Agreement for any
reason, the Underwriter shall cease all use of any such names or marks.
ARTICLE V. Fees and Expenses
5.1 The Underwriter shall pay the fees and expenses provided for in the
attached SCHEDULE B.
ARTICLE VI. Indemnification
6.1 Indemnification By The Company
(a) The Company agrees to indemnify and hold harmless the Funds, the
Underwriter and each of their respective trustees, directors,
officers, employees or agents and each person, if any, who controls
the Funds or the Underwriter within the meaning of section 15 of the
1933 Act (collectively, the "INDEMNIFIED PARTIES" for purposes of
this Section 6.1) against any and all losses, claims, damages,
liabilities (including amounts paid in settlement with the written
consent of the Company) or litigation (including reasonable legal
and other expenses), 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 Fund's shares or the Contracts and:
(i) arise out of or are based upon any untrue statement or alleged
untrue statement of any material fact contained in the disclosure
statement, registration statement, prospectus or statement of
information for the Contracts or contained in the Contracts or
sales literature or other promotional material 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 an
Indemnified Party if such statement or omission or such alleged
statement or omission was made in reliance upon and in conformity
with information furnished by such Indemnified Party or the Fund
to the Company on behalf of the Fund for use in the registration
statement, prospectus or statement of additional information 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
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(ii) arise out of or as a result of (a) statements or representations
by or on behalf of the Company (other than statements or
representations contained in the Fund registration statement, Fund
prospectus or sales literature or other promotional material of
the Fund not supplied by the Company, or persons under its control
and other than statements or representations authorized by the
Fund or the Underwriter); or (b) the willful misfeasance, bad
faith, gross negligence or reckless disregard of duty 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 as a result of any untrue statement or alleged
untrue statement of a material fact contained in the Fund
registration statement, Fund prospectus, statement of additional
information or sales literature or other promotional material of
the Fund (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 information furnished to
the Fund or the Underwriter by the Company or persons under its
control; or
(iv) arise as a result of any material 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 and/or warranty made by the Company in this
Agreement or arise out of or result from any other material breach
by the Company of this Agreement; except to the extent provided in
Sections 6.1(b) and 6.3 hereof.
(b) No party shall be entitled to indemnification to the extent that such
loss, claim, damage, liability or litigation is due to the willful
misfeasance, bad faith, gross negligence or reckless disregard of
duty by the party seeking indemnification.
(c) In accordance with Section 6.3 hereof, 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 Fund.
6.2 Indemnification By the Underwriter
(a) The Underwriter agrees, with respect to each Fund that it
distributes, to indemnify and hold harmless the Company and each of
its directors, officers, employees or agents and each person, if
any, who controls the Company within the meaning of section 15 of
the 1933 Act (collectively, the "INDEMNIFIED PARTIES" for purposes
of this Section 6.2) against any and all losses, claims, damages,
liabilities (including amounts paid in settlement with the written
consent of the Underwriter) or litigation (including reasonable
legal and other expenses) 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 shares of the Funds that it
distributes or the Contracts and:
(i) arise out of or are based upon any untrue statement or alleged
untrue statement of any material fact contained in the
registration statement, prospectus or statement of additional
information for the Fund or sales literature or other promotional
material of the Fund (or any amendment or supplement to any of the
foregoing), or arise out of or are based upon the omission or the
10
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 by
such Indemnified Party or the Company to the Fund or the
Underwriter on behalf of the Company for use in the
registration statement, prospectus or statement of additional
information for the Fund or in sales literature of the Fund (or
any amendment or supplement thereto) or otherwise for use in
connection with the sale of the Contracts or the Fund shares;
or
(ii) arise out of or as a result of (a) statements or representations
(other than statements or representations contained in the
registration statement, prospectus or sales literature for the
Contracts not supplied by the Fund or the Underwriter or persons
under their respective control and other than statements or
representations authorized by the Company); or (b) the willful
misfeasance, bad faith, gross negligence or reckless disregard
of duty of the Fund or the Underwriter or persons under the
control of the Fund or the Underwriter, respectively, with
respect to the sale or distribution of the Contracts or Fund
shares; or
(iii) arise out of any untrue statement or alleged untrue statement
of a material fact contained in a registration statement,
prospectus, statement of additional information or sales
literature or other promotional material with respect to the
Contracts (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
statement or statements therein not misleading, if such
statement or omission was made in reliance upon and in
conformity with information furnished to the Company by the
Fund or the Underwriter or persons under the control of the
Fund or the Underwriter, respectively; or
(iv) arise as a result of any material failure by the Underwriter 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 and/or warranty made by the Underwriter or the
Fund in this Agreement or arise out of or result from any other
material breach of this Agreement by the Underwriter or the
Fund; except to the extent provided in Sections 6.2(b) and 6.3
hereof.
(b) No party shall be entitled to indemnification to the extent that such
loss, claim, damage, liability or litigation is due to the willful
misfeasance, bad faith, gross negligence or reckless disregard of
duty by the party seeking indemnification.
(c) In accordance with Section 6.3 hereof, the Indemnified Parties will
promptly notify the Underwriter 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 Separate Accounts.
6.3. Indemnification Procedure
(a) Any person obligated to provide indemnification under this Article
VI ("INDEMNIFYING PARTY" for the purpose of this Section 6.3) shall
not be liable under the indemnification provisions of this Article
VI with respect to any claim made against a party entitled to
indemnification under this Article VI ("INDEMNIFIED PARTY" for the
purpose of this Section 6.3) unless such Indemnified Party shall
have notified the Indemnifying Party 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
11
Indemnified Party (or after such party shall have received notice of
such service on any designated agent), but failure to notify the
Indemnifying Party of any such claim shall not relieve the
Indemnifying Party from any liability which it may have to the
Indemnified Party against whom such action is brought otherwise than
on account of the indemnification provision of this Article VI. In
case any such action is brought against the Indemnified Party, the
Indemnifying Party will be entitled to participate, at its own
expense, in the defense thereof. The Indemnifying Party also shall be
entitled to assume the defense thereof, with counsel satisfactory to
the party named in the action. After notice from the Indemnifying
Party to the Indemnified Party of the Indemnifying Party's election
to assume the defense thereof, the Indemnified Party shall bear the
fees and expenses of any additional counsel retained by the
Indemnified Party, and the Indemnifying Party 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,
unless:
(i) the Indemnifying Party and the Indemnified Party shall have
mutually agreed to the retention of such counsel or
(ii) the named parties to any such proceeding (including any
impleaded parties) include both the Indemnifying Party and the
Indemnified Party and representation of both parties by the same
counsel would be inappropriate due to actual or potential
differing interests between them.
A successor by law of the parties to this Agreement shall be entitled to the
benefits of the indemnification contained in this Article VI. The
indemnification provisions contained in this Article VI shall survive any
termination of this Agreement.
ARTICLE VII. Applicable Law
7.1 This Agreement shall be construed and the provisions hereof interpreted
under and in accordance with the laws of the State of Kansas.
7.2 This Agreement shall be subject to the provisions of the 1933, 1934 and
1940 Acts, and the rules and regulations and rulings hereunder, including such
exemptions from those statutes, rules and regulations as the SEC may grant and
the terms hereof shall be interpreted and construed in accordance therewith.
ARTICLE VIII. Termination
8.1 This Agreement shall terminate:
(a) at the option of any party upon two months' advance written notice
to the other party unless otherwise agreed in a separate written
agreement among the parties; or
(b) at the option of the Fund or the Underwriter upon institution of
formal proceedings against the Company by the NASD, NASD Regulation,
Inc. ("NASDR"), the SEC, the insurance commission 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 administration
of the Contracts, the operation of the Separate Accounts, or the
purchase of the Fund shares, which in the judgment of the Fund or the
12
Underwriter are reasonably likely to have a material adverse effect on
the Company's ability to perform its obligations under this Agreement;
or
(c) at the option of the Company upon institution of formal proceedings
against the Fund or the Underwriter by the NASD, NASDR, the SEC, or any
state securities or insurance department or any other regulatory body,
related to the purchase or sale of the Fund shares or the operation of
the Underwriter which in the judgment of the Company are reasonably
likely to have a material adverse effect on the Underwriter's or the
Fund's ability to perform its obligations under this Agreement; or
(d) at the option of the Company if a Fund delineated in SCHEDULE A ceases
to qualify as a Regulated Investment Company under Subchapter M of the
Code (a "RIC"), or under any successor or similar provision, and the
disqualification is not cured within the period permitted for such cure,
or if the Company reasonably believes that any such Fund may fail to so
qualify and be unable to cure such disqualification within the period
permitted for such cure; or
(e) at the option of any party to this Agreement, upon another party's
material breach of any provision of this Agreement; provided that the
party not in breach shall give the party in breach notice of the breach
and the party in breach does not cure such breach within 30 days of
receipt of such notice of breach; or
(f) at the option of the Company, if the Company determines in its sole
judgment exercised in good faith, that either the Fund or the
Underwriter has suffered a material adverse change in its business,
operations or financial condition since the date of this Agreement or
is the subject of material adverse publicity which is likely to have a
material adverse impact upon the business and operations of the
Company; or
(g) at the option of the Fund or the Underwriter, if the Fund or the
Underwriter respectively, shall determine in its sole judgment
exercised in good faith, that the Company has suffered a material
adverse change in its business, operations or financial condition since
the date of this Agreement or is the subject of material adverse
publicity which is likely to have a material adverse impact upon the
business and operations of the Fund or Underwriter.
8.2 Notice Requirement
(a) In the event that any termination of this Agreement is based upon the
provisions of Sections 8.1(b), 8.1(c) or 8.1(d), prompt written notice
of the election to terminate this Agreement for cause shall be
furnished by the party terminating the Agreement to the non-terminating
parties, with said termination to be effective upon receipt of such
notice by the non-terminating party; provided that for any termination
of this Agreement based on the provisions of Section 8.1(d), said
termination shall be effective upon the Fund's failure to qualify as a
RIC and to cure such disqualification within the period permitted for
such cure.
(b) In the event that any termination of this Agreement is based upon the
provisions of Sections 8.1(f) or 8.1(g), prior written notice of the
election to terminate this Agreement for cause shall be furnished by
the party terminating this Agreement to the non-terminating party. Such
prior written notice shall be given by the party terminating this
Agreement to the non-terminating party at least 60 days before the
effective date of termination.
13
8.3 It is understood and agreed that the right to terminate this Agreement
pursuant to Section 8.1(a) may be exercised for any reason or for no reason.
8.4 Effect of Termination
(a) Fund and/or Underwriter shall remain obligated to pay Company the fee
in effect as of the date of termination for so long as shares are held
by the Accounts and Company continues to provide services to the
Accounts. Such fee shall apply to shares purchased prior to the date of
termination. This Agreement, or any provision thereof, shall survive
the termination to the extent necessary for each party to perform its
obligations with respect to shares for which a fee continues to be due
subsequent to such termination.
ARTICLE IX. Notices
9.1 (a) Any notice shall be deemed duly given only if sent by hand or overnight
express delivery, evidenced by written receipt or by certified mail, return
receipt requested, 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. All notices shall be deemed given the date received
or rejected by the addressee.
If to the Company:
Hartford Life Insurance Company
000 Xxxxxxxxx Xxxxxx
Xxxxxxxx, Xxxxxxxxxxx 00000
Attention: Vice President, Investment Products Division
with a copy to:
General Counsel
Hartford Life Insurance Company
000 Xxxxxxxxx Xxxxxx
Xxxxxxxx, Xxxxxxxxxxx 00000
14
If to the Underwriter:
Ivy Funds Distributor, Inc.
0000 Xxxxx Xxxxxx
Xxxxxxxx Xxxx, XX 00000
Attention: Xxxx Xxxxxx (for business issues)
Attention: Xxxxxxx X'Xxxxx (for operational issues)
with a copy to:
Legal Department
Ivy Funds Distributor, Inc.
0000 Xxxxx Xxxxxx
Xxxxxxxx Xxxx, XX 00000
ARTICLE X. Miscellaneous
10.1 Subject to law and regulatory authority, each party hereto shall treat as
confidential the names and addresses of the owners of the Contracts and all
other information reasonably identified as such in writing by any other party
hereto, and, except as contemplated by this Agreement, shall not disclose,
disseminate or utilize such confidential information without the express prior
written consent of the affected party until such time as it may come into the
public domain. In addition, the parties hereby represent that they will use and
disclose Personal Information (as defined below) only to carry out the purposes
for which it was disclosed to them and will not use or disclose Personal
information if prohibited by applicable law, including, without limitation,
statutes and regulations enacted pursuant to the Xxxxx-Xxxxx-Xxxxxx Act (Public
Law 106-102). "PERSONAL INFORMATION" means financial and medical information
that identifies an individual personally and is not available to the public,
including, but not limited to, credit history, income, financial benefits,
policy or claim information and medical records. If either party out-sources
services to a third party, such third party will agree in writing to maintain
the security and confidentiality of any information shared with them.
10.2 Each party acknowledges and agrees that any and all technical or business
information, including without limitation financial information, business and
marketing strategies and plans, that is disclosed to the other party or is
otherwise obtained by such party or its affiliates or agents during the term of
this Agreement (the "PROPRIETARY INFORMATION") constitutes the valuable property
of the other party. Each party agrees that should it come into possession of
Proprietary Information of the other party, it will use its best efforts to hold
such information in confidence and shall refrain from using, disclosing or
distributing any such information except (i) as may be necessary in the ordinary
course of performing the services and transactions contemplated by this
Agreement; (ii) with the written consent of the other party; or (iii) as
required by law or judicial process. Proprietary Information shall not include
information that a party to this Agreement can clearly establish was (i) known
to it prior to the date of this Agreement; (ii) rightfully acquired by it from a
third party whom it reasonably believes was not under an obligation of
confidentiality to the other party to this Agreement; (iii) placed in public
domain without its fault or its affiliates; or (iv) independently developed by
the party without reference or reliance upon Proprietary Information. The
provisions of this section shall survive termination of this Agreement.
10.3 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.
15
10.4 This Agreement may be executed simultaneously in two or more counterparts,
each of which taken together shall constitute one and the same instrument.
10.5 If any provision of this Agreement shall be held or made invalid by a
court decision, statute, rule or otherwise, the remainder of the Agreement shall
not be affected thereby.
10.6 This Agreement shall not be assigned by any party hereto without the prior
written consent of all the parties.
10.7 Each party hereto shall cooperate with each other party and all
appropriate governmental authorities (including without limitation the SEC, the
NASD, NASDR and state insurance regulators) and shall permit each other and such
authorities (and the parties hereto) reasonable access to its books and records
in connection with any investigation or inquiry relating to this Agreement or
the transactions contemplated hereby. Notwithstanding the foregoing, each party
hereto further agrees to furnish the California Insurance Commissioner with any
information or reports in connection with services provided under this Agreement
which such Commissioner may request in order to ascertain whether the insurance
operations of the Company are being conducted in a manner consistent with the
California laws and regulations.
10.8 Each party represents that (a) the execution and delivery of this
Agreement and the consummation of the transactions contemplated herein have been
duly authorized by all necessary corporate or trust action, as applicable, by
such party and when so executed and delivered this Agreement will be the valid
and binding obligation of such party enforceable in accordance with its terms
subject to bankruptcy, insolvency, reorganization, moratorium and similar laws
of general applicability relating to or affecting creditors' rights and to
general equity principles; (b) the party has obtained, and during the term of
this Agreement will maintain, all authorizations, licenses, qualifications or
registrations required to be maintained in connection with the performance of
its duties under this Agreement; and (c) the party will comply in all material
respects with all applicable laws, rules and regulations.
10.9 Each party shall comply with all laws, rules and regulations applicable to
them in connection with the performance of each of their respective obligations
under this Agreement or applicable to the performance of each of their
respective businesses, including the requirements of the AML Act to adopt
compliance programs to guard against money laundering.
10.10 The parties to this Agreement may amend by written agreement the
Schedules to this Agreement from time to time to reflect changes in or relating
to the Contracts, the Separate Accounts or the Funds.
11.0 22c-2 Redemption Fee Rule ICI standard language here. . .
16
IN WITNESS WHEREOF, each of the parties hereto has caused this Agreement to be
executed in its name and behalf by its duly authorized representative as of the
date first written above.
HARTFORD LIFE INSURANCE COMPANY IVY FUNDS DISTRIBUTOR, INC.
By: /s/ Xxxxx Xxxxx By: /s/ Xxxxxx X. Xxxxx
--------------------------------- ---------------------------------
Name: Xxxxx Xxxxx Name: Xxxxxx X. Xxxxx
Title: Vice President Title: President
17
SCHEDULE A
SEPARATE ACCOUNTS
Each Separate Account established by resolution of the Board of Directors of the
Company under the insurance laws of the State of Connecticut to set aside and
invest assets attributable to the Contracts. Currently, those Separate Accounts
are as follows:
401 MARKET
K, Kl, K2, K3, K4
TK, TK1, TK2, TK3, TK4
VK, VK1, VK2, VK3, VK4
UK, XX0, XX0, XX0, XX0
403 AND 457 MARKETS
DCI, DCII, DCIII, DCIV, DCV, DCVI, 457, 403, UFC,
Eleven
PORTFOLIOS
Ivy Funds
*Class Y Shares
18
SCHEDULE B
In consideration of the services provided by the Company, UNDERWRITER agrees to
pay the Company an amount equal to the following basis points per annum on the
average aggregate amount invested by the Company's Separate Account(s) in each
Fund under the
Fund Participation Agreement, such amounts to be paid within 30
days of the end of each calendar quarter.
SERVICE
FUND FEES 12B-1 FEES
--------------------------------------------------------------------------------
Ivy Global Natural Resources Fund Y .25 bps .25 bps
Ivy Global Natural Resources Fund R .25 bps .50 bps
Ivy Large Cap Growth Fund Y .25 bps .25 bps
Ivy Large Cap Growth Fund R .25 bps .50 bps
Ivy Core Equity Fund Y .25 bps .25 bps
Ivy Dividend Income Fund Y .25 bps .25 bps
Ivy Mid-Cap Growth Fund Y .25 bps .25 bps
Ivy Mid-Cap Growth Fund R .25 bps .50 bps
Ivy Small Cap Growth Fund Y .25 bps .25 bps
Ivy Small Cap Growth Fund R .25 bps .50 bps
Ivy Small Cap Value Fund Y .25 bps .25 bps
Ivy Value Fund Y .25 bps .25 bps
Ivy Bond Fund Y .25 bps .25 bps
Ivy High Income Fund Y .25 bps .25 bps
Ivy Limited-Term Bond Fund Y .25 bps .25 bps
Ivy Mortgage Securities Fund Y .25 bps .25 bps
Xxx Xxxxxxx Global Value Fund Y .25 bps .25 bps
Ivy European Opportunities Fund Y .25 bps .25 bps
Ivy International Balanced Fund Y .25 bps .25 bps
Ivy International Fund Y .25 bps .25 bps
Ivy International Value Fund Y .25 bps .25 bps
Ivy International Growth Fund Y .25 bps .25 bps
Ivy Pacific Opportunities Fund Y .25 bps .25 bps
Ivy Asset Strategy Fund Y .25 bps .25 bps
Ivy Balanced Fund Y .25 bps .25 bps
Ivy Real Estate Securities Fund Y .25 bps .25 bps
Ivy Real Estate Securities Fund R .25 bps .50 bps
Ivy Science and Technology Fund Y .25 bps .25 bps
Ivy Science and Technology Fund R .25 bps .50 bps
Ivy Money Market Fund A .00 bps .00 bps
19
SCHEDULE C
THE SERVICES
The Company and/or its sub-designee shall perform the following Services for
both the Funds and Unauthorized Funds. Such Services shall be the responsibility
of Company and shall not be the responsibility of the Underwriter or any Fund.
1. To facilitate the beneficial ownership of shares of any Fund, Company shall
provide or arrange to provide adequate facilities and procedures to: (a)
establish and maintain Fund investments on behalf of the Separate Accounts
within accounts on the Company's transaction processing and recordkeeping
system, and (b) access the Separate Account's current Fund information
including, but not limited to, share balances, dividend information and
transaction history.
2. Company shall support service inquiries from Separate Accounts maintaining
accounts with Company.
3. Company's transaction processing system shall enable the Separate Accounts
to purchase, redeem and exchange shares of Funds available through Company. If
Company has established omnibus accounts, Company shall facilitate the
settlement of the Separate Account's transactions in each Fund.
4. Company shall maintain all records required under, and in accordance with,
applicable law for each Separate Account holding shares of any Fund in a Company
account and for each Fund, which records shall, without limitation include:
(a) number of shares;
(b) date and price of purchases and redemptions (including dividend
reinvestments) and dates and amounts of dividends paid for at least
the current year to date;
(c) name and address of each Contract Owner, including zip codes and tax
identification numbers;
(d) records of distributions and dividend payments;
(e) any transfers of shares; and
(f) such other records relating to the Separate Accounts as may be
required by applicable law.
5. In the event that the parties hereto have executed and agreed to be bound by
the terms of the Investment Company Institute's Standard Networking Agreement
(the "NSCC Agreement") and have filed executed copies thereof with the NSCC,
recordkeeping and other administrative services to the Separate Accounts
specified in the NSCC Agreement shall be the responsibility of Company and shall
not be the responsibility of Underwriter, or any Fund. Neither Underwriter nor
any Fund shall maintain separate accounts or records for the Contracts. Company
shall maintain and preserve all records as required by law to be maintained and
preserved in connection with providing the Services and in making shares of the
Funds available to the Separate Accounts.
20
6. Company shall, in accordance with applicable law:
(a) mail Fund prospectuses, statements of additional information, and
any supplements thereto, upon request by the Plan Representatives
and to the extent such materials are provided by Underwriter or its
affiliates to Company;
(b) respond to inquiries by the Separate Accounts regarding, among other
things, share prices, account balances, dividend amounts and dividend
payment dates; and
(c) mail certain Fund-related materials such as updated prospectuses,
annual and semi-annual reports, proxy statements, and other
appropriate shareholder communications to Contract Owners holding
shares of such Fund to the extent such materials are provided by
Underwriter or its affiliates to Company.
7. With respect to each Separate Account's ownership of, or transactions with
respect to, any Fund, Company shall prepare and file with the appropriate
governmental agencies, such information, returns and reports as are required to
be so filed for reporting, among other things, (a) dividends and other
distributions made, (b) amounts withheld in dividends and other distributions
and payments under applicable laws, and (c) gross proceeds of sales transactions
as required.
8. Company shall use reasonable due diligence to ensure that the purchase of
Shares of a Fund by a Separate Account pursuant to this Agreement are in
accordance with the terms of the applicable Fund prospectus, including the
minimum investment applicable to each Fund.
9. With respect to each Separate Account holding any Fund investment through
Company, Company shall deliver or cause to be delivered to such Contract Owner
monthly statements when there has been activity in such Separate Account during
such month, or quarterly statements during periods when there has been no
monthly account activity. Statements shall include transaction detail for the
statement period for each Fund in which shares were purchased, redeemed or
exchanged, and a summary of the number of Fund shares owned and share value
thereof as of the statement date to the extent such value is provided by the
Fund.
10. Company shall generate a written confirmation of each purchase, redemption
and exchange transaction affecting each Separate Account's Fund investments held
through Company and such confirmation shall be distributed to the Contract Owner
through or on behalf of Company.
11. In the event cash dividends are received by the Company for payment to a
Separate Account, Company shall distribute to such Separate Account all such
dividends in a timely manner and shall be solely responsible for any liabilities
arising from dividend payments reported by a Separate Account as lost, stolen,
materially altered or forged.
12. Subsequent to any Separate Account's acquisition of shares of a Fund by
purchase or exchange, Company shall provide to such Contract Owner a confirming
prospectus for such Fund to the extent such prospectus is required under
applicable law with respect to such acquisition. Underwriter or its affiliates
shall supply, at its own expense, to Company such number of prospectuses as are
reasonably requested by Company to comply with such requirement.
21
FIRST AMENDMENT
TO THE
FUND PARTICIPATION AGREEMENT
BY AND AMONG
HARTFORD LIFE INSURANCE COMPANY
AND
IVY FUNDS DISTRIBUTOR, INC.
Pursuant to Section 10.10 of the
Fund Participation Agreement dated May 1, 2006
by and among Hartford Life Insurance Company ("Company") and Ivy Funds
Distributor, Inc. ("Underwriter") (the "Agreement"), the Agreement is hereby
amended as provided below, effective as of the earliest date set forth below:
1. Hartford Securities Distribution Company, Inc. ("HSD"), a broker-dealer
registered with the Securities Exchange Commission under the Securities Act
of 1934, a member of the Financial Industry Regulatory Authority, and
affiliate of Company, is hereby added as a party to the Agreement for the
purpose of receiving fees paid pursuant to the Agreement.
2. Section 2.11 is hereby added to the Agreement:
"2.11 HSD represents and warrants that (i) it has full power and authority under
applicable law, and has taken all action necessary, to enter into and perform
this Agreement and the person executing this Amendment on its behalf is duly
authorized and empowered to execute and deliver this Amendment; (ii) this
Amendment constitutes a legal, valid and binding obligation, enforceable against
it in accordance with its terms; (iii) no consent or authorization of, filing
with, or other act by or in respect of any governmental authority is required in
connection with the execution, delivery, performance, validity or enforceability
of this Amendment; (iv) the execution, performance and delivery of this
Amendment by HSD will not result in it violating any applicable law or breaching
or otherwise impairing any of its contractual obligations; (vi) it and any of
its designees are not and will not be a "fiduciary" with respect to the
provisions of the services it provides pursuant to the Agreement as such term is
defined in Section 3(21) of ERISA, and Section 4975 of the Code; (vii) the
receipt of the fees described in SCHEDULE B hereof by HSD or any designee and
the provision of services Plans and/or plan participants under the Agreement by
HSD or its designees does not and will not constitute a non-exempt "prohibited
transaction" as such term is defined in Section 406 of ERISA and Section 4975 of
the Code; (viii) it and each designee is registered as a transfer agent under
the 1934 Act and any applicable state securities laws, or is not required to be
so registered; (ix) it and each designee is in compliance with and will continue
to comply with the AML Act and applicable anti-money laundering rules of self
regulatory organizations in all relevant respects, or it is not so required to
comply; and (x) it and each designee is in compliance with and will continue to
comply with
1
all applicable broker-dealer books and records rules, including Rules 17a-3 and
17a-4 under the 1934 Act, or it is not so required to comply."
3. Section 6.4 is hereby added to the Agreement:
"6.4 Indemnification by HSD
(a) HSD agrees to indemnify and hold harmless the Funds, the Underwriter
and each of their respective trustees, directors, officers,
employees or agents and each person, if any, who controls the Funds
or the Underwriter within the meaning of Section 15 of the 1933 Act
(collectively, the "Indemnified Parties" for purposes of this
Section 6.4) against any and all losses, claims, damages,
liabilities (including amounts paid in settlement with the written
consent of HSD) or litigation (including reasonable legal and other
expenses), 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 Fund's shares or the Contracts and:
(i) arise out of or as a result of (a) statements or representations
by or on behalf of HSD (other than statements or representations
contained in the Fund registration statement, Fund prospectus or
sales literature or other promotional material of the Fund not
supplied by HSD, or persons under its control and other than
statements or representations authorized by the Fund or the
Underwriter); or (b) the willful misfeasance, bad faith, gross
negligence or reckless disregard of duty of HSD or persons under
its control, with respect to the sale or distribution of the
Contracts or Fund shares; or
(ii) arise out of or as a result of any untrue statement or alleged
untrue statement of a material fact contained in the Fund
registration statement, Fund prospectus, statement of additional
information or sales literature or other promotional material of
the Fund (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 information furnished to
the Fund or the Underwriter by HSD or persons under its control;
or
(iii) arise out of or result from any material breach of any
representation and/or warranty made by HSD in this Agreement or
arise out of or result from any other material breach
2
by HSD of this Agreement; except to the extent provided in
Section 6.3 hereof.
(b) No party shall be entitled to indemnification to the extent that
such loss, claim, damage, liability or litigation is due to the
willful misfeasance, bad faith, gross negligence or reckless
disregard of duty by the party seeking indemnification.
(c) In accordance with Section 6.4 hereof, the Indemnified Parties
will promptly notify HSD 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 Fund.
4. Section 9.1(a) is hereby amended to add the following to the end of this
subsection:
If to Hartford Securities Distribution Company, Inc.:
Hartford Securities Distribution Company, Inc.
000 Xxxxxxxxx Xxxxxx
Xxxxxxxx, Xxxxxxxxxxx 00000
Attention: General Counsel
5. Section 10.3 is hereby deleted in its entity and restated to read as
follows:
10.3 This Agreement and any amendments hereto may be executed simultaneously in
two or more counterparts, each of which shall be an original and each of which
shall constitute one and the same instrument.
6. Section 11.0 of the Agreement is hereby deleted in its entirety.
7. Schedule B is hereby deleted in its entirety and replaced with the new
Schedule B, attached hereto.
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IN WITNESS WHEREOF, the undersigned have executed this Amendment to the
Agreement.
HARTFORD LIFE INSURANCE COMPANY HARTFORD SECURITIES DISTRIBUTION
COMPANY, INC.
Xxxxxxx X. Xxxx, Assistant Vice Xxxxxxx X. Xxxx, Assistant Vice
President President
-------------------------------------- ------------------------------------
Print name and title Print name and title
/s/ Xxxxxxx X. Xxxx /s/ Xxxxxxx X. Xxxx
-------------------------------------- ------------------------------------
Signature Signature
1/18/12 1/18/12
-------------------------------------- ------------------------------------
Date Date
IVY FUNDS DISTRIBUTOR, INC.
Xxxxxx X. Xxxxx, President
--------------------------------------
Print name and title
/s/ Xxxxxx X. Xxxxx
--------------------------------------
Signature
1/31/12
--------------------------------------
Date
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SCHEDULE B
In consideration of the services provided by Company, Underwriter agrees to pay
HSD, as provided for below, an amount equal to the following basis points per
annum on the average aggregate amount invested by the Company's Separate
Account(s) in each Fund under the Agreement. Company, or HSD, shall submit a
detailed invoice by Fund CUSIP and asset level to Underwriter within sixty (60)
days of the end of the calendar quarter. Company shall remit payment to HSD
within sixty (60) days of receipt of such invoice.
FUNDS SERVICE FEE DISTRIBUTION FEE
--------------------------------------------------------------------
Ivy Family of Funds A shares
(excluding Money Market Fund) .25% .25%
Ivy Money Market Fund A shares .00% .00%
Ivy Family of Funds I shares .10% .00%
Ivy Family of Funds R shares .25% .50%
Ivy Family of Funds Y shares .25% .25%
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