EXHIBIT 8.6
FUND PARTICIPATION AGREEMENT
Janus Aspen Series
TABLE OF CONTENTS
ARTICLE I. Sale of Fund Shares . . . . . . . . . . . . . . . .3
ARTICLE II. Representations and Warranties. . . . . . . . . . .7
ARTICLE III. Prospectuses and Proxy Statements; Voting . . . . 10
ARTICLE IV. Sales Material and Information. . . . . . . . . . 13
ARTICLE V. Fees and Expenses . . . . . . . . . . . . . . . . 16
ARTICLE VI. Diversification and Qualification . . . . . . . . 17
ARTICLE VII. Potential Conflicts and Compliance With
Mixed and Shared Funding Exemptive Order . . . . 20
ARTICLE VIII.Indemnification . . . . . . . . . . . . . . . . . 23
ARTICLE IX. Applicable Law. . . . . . . . . . . . . . . . . . 32
ARTICLE X. Termination . . . . . . . . . . . . . . . . . . . 33
ARTICLE XI. Notices . . . . . . . . . . . . . . . . . . . . . 36
ARTICLE XII. Miscellaneous . . . . . . . . . . . . . . . . . . 37
SCHEDULE A Contracts . . . . . . . . . . . . . . . . . . . . 41
SCHEDULE B Designated Portfolios . . . . . . . . . . . . . . 42
SCHEDULE D Reports per Section 6.6 . . . . . . . . . . . . . 43
SCHEDULE E Expenses. . . . . . . . . . . . . . . . . . . . . 45
PARTICIPATION AGREEMENT
Among
FIRST GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY
JANUS ASPEN SERIES,
JANUS CAPITAL CORPORATION
and
XXXXXXX XXXXXX & CO., INC.
THIS AGREEMENT, made and entered into as of this ____ day of
_______________, 1997 by and among FIRST GREAT-WEST LIFE & ANNUITY
INSURANCE COMPANY (hereinafter "FirstGWL&A"), a New York life
insurance
company, on its own behalf and on behalf of its Separate Account
Variable Annuity-1 Series
Account (the "Account"); JANUS ASPEN SERIES, a business trust
organized under the
laws of Delaware (hereinafter the "Fund"); JANUS CAPITAL
CORPORATION
(hereinafter the "Adviser"), a Colorado corporation; and XXXXXXX
XXXXXX & CO.,
INC., a California corporation (hereinafter "Schwab").
WHEREAS, the Fund engages in business as an open-end
management investment
company and is available to act as the investment vehicle for
separate accounts established
for variable life insurance policies and/or variable annuity
contracts (collectively, the
"Variable Insurance Products") to be offered by insurance
companies, including
FirstGWL&A, which have entered into participation agreements
similar to this Agreement
(hereinafter "Participating Insurance Companies") and certain
qualified pension and
retirement plans; and
WHEREAS, the beneficial interest in the Fund is divided into
several series of shares,
each designated a "Portfolio" and representing the interest in a
particular managed portfolio
of securities and other assets; and
WHEREAS, the Fund has obtained an order from the Securities
and Exchange
Commission (hereinafter the "SEC"), dated Xxxxx 00, 0000 (Xxxx No.
812-8408), granting
Participating Insurance Companies and variable annuity and variable
life insurance separate
accounts exemptions from the provisions of sections 9(a), 13(a),
15(a), and 15(b) of the
Investment Company Act of 1940, as amended, (hereinafter the "1940
Act") and Rules 6e-
2(b)(15) and 6e-3(T)(b)(15) thereunder, to the extent necessary to
permit shares of the Fund
to be sold to and held by variable annuity and variable life
insurance separate accounts of
life insurance companies that may or may not be affiliated with one
another and certain
qualified pension and retirement plans ("Qualified Plans")
(hereinafter the "Mixed and
Shared Funding Exemptive Order"); and
WHEREAS, the Fund is registered as an open-end management
investment company
under the 1940 Act and shares of the Portfolio(s) are registered
under the Securities Act of
1933, as amended (hereinafter the "1933 Act"); and
WHEREAS, the Adviser is duly registered as an investment
adviser under the
Investment Advisers Act of 1940, as amended, and any applicable
state securities laws; and
WHEREAS, FirstGWL&A has registered or will register certain
variable annuity
contracts supported wholly or partially by the Account (the
"Contracts") under the 1933 Act
and said Contracts are listed in Schedule A attached hereto and
incorporated herein by
reference, as it may be amended from time to time by mutual written
agreement; and
WHEREAS, the Account is a duly organized, validly existing
segregated asset
account, established by resolution of the Board of Directors of
FirstGWL&A on January 15,
1997, to set aside and invest assets attributable to the Contracts;
and
WHEREAS, FirstGWL&A has registered or will register the
Account as a unit
investment trust under the 1940 Act and has registered or will
register the securities deemed
to be issued by the Account under the 1933 Act; and
WHEREAS, to the extent permitted by applicable insurance laws
and regulations,
FirstGWL&A intends to purchase shares in the Portfolio(s) listed in
Schedule B attached
hereto and incorporated herein by reference, as it may be amended
from time to time by
mutual written agreement (the "Designated Portfolio(s)"), on behalf
of the Account to fund
the Contracts, and the Fund is authorized to sell such shares to
unit investment trusts such
as the Account at net asset value; and
WHEREAS, to the extent permitted by applicable insurance laws
and regulations,
the Account also intends to purchase shares in other open-end
investment companies or
series thereof not affiliated with the Fund (the "Unaffiliated
Funds") on behalf of the
Account to fund the Contracts; and
WHEREAS, Schwab will perform certain services for the Fund in
connection with
the Contracts pursuant to a separate Service Agreement;
NOW, THEREFORE, in consideration of their mutual promises,
FirstGWL&A,
Schwab, the Fund and the Adviser agree as follows:
ARTICLE I. Sale of Fund Shares
1.1. The Fund agrees to sell to FirstGWL&A those shares of the
Designated
Portfolio(s) which the Account orders, executing such orders on
each Business Day at the
net asset value next computed after receipt by the Fund or its
designee of the order for the
shares of the Portfolios. For purposes of this Section 1.1,
FirstGWL&A shall be the
designee of the Fund for receipt of such orders and receipt by such
designee shall constitute
receipt by the Fund, provided that the Fund receives notice of any
such order by 10:00 a.m.
Eastern time on the next following Business Day. "Business Day"
shall mean any day on
which the New York Stock Exchange is open for trading and on which
the Fund calculates
its net asset value pursuant to the rules of the SEC.
1.2. The Fund agrees to make shares of the Designated
Portfolio(s) available for
purchase at the applicable net asset value per share by FirstGWL&A
and the Account on
those days on which the Fund calculates its Designated
Portfolio(s)' net asset value pursuant
to rules of the SEC, and the Fund shall calculate such net asset
value on each day which the
New York Stock Exchange is open for trading. Notwithstanding the
foregoing, the Board
of Trustees of the Fund (hereinafter the "Board") may refuse to
sell shares of any Portfolio
to any person, or suspend or terminate the offering of shares of
any Portfolio if such action
is required by law or by regulatory authorities having jurisdiction
or is, in the sole discretion
of the Board acting in good faith and in light of their fiduciary
duties under federal and any
applicable state laws, necessary in the best interests of the
shareholders of such Portfolio.
1.3. The Fund will not sell shares of the Designated
Portfolio(s) to any other
Participating Insurance Company, separate account or any Qualified
Plan unless an
agreement containing provisions substantially the same as Sections
2.1, 3.6, 3.7, 3.8, and
Article VII of this Agreement is in effect to govern such sales.
1.4. The Fund agrees to redeem for cash, on FirstGWL&A's
request, any full or
fractional shares of the Fund held by FirstGWL&A, executing such
requests on each
Business Day at the net asset value next computed after receipt by
the Fund or its designee
of the request for redemption. To the extent permitted by the 1940
Act, requests for
redemption identified by FirstGWL&A, or its agent, as being in
connection with surrenders,
annuitizations, or death benefits under the Contracts, upon prior
written notice, may be
executed within seven (7) calendar days after receipt by the Fund
or its designee of the
requests for redemption. This Section 1.4 may be amended, in
writing, by the parties
consistent with the requirements of the 1940 Act and
interpretations thereof. For purposes
of this Section 1.4, FirstGWL&A shall be the designee of the Fund
for receipt of requests
for redemption and receipt by such designee shall constitute
receipt by the Fund, provided
that the Fund receives notice of any such request for redemption by
10:00 A.M. Eastern
time on the next following Business Day.
1.5. The Parties hereto acknowledge that the arrangement
contemplated by this
Agreement is not exclusive; the Fund's shares may be sold to other
Participating Insurance
Companies and Qualified Plans (subject to Section 1.3 and Article
VI hereof) and the cash
value of the Contracts may be invested in other investment
companies.
1.6. FirstGWL&A shall pay for Fund shares by 11:00 a.m.
Eastern time on the
same Business Day that the Fund receives notice of the order in
accordance with the
provisions of Section 1.1 hereof. Payment shall be in federal
funds transmitted by wire
and/or by a credit for any shares redeemed the same day as the
purchase.
1.7. The Fund shall pay and transmit the proceeds of
redemptions of Fund shares
by 2:00 a.m. Eastern Time on the same Business Day a redemption
order is received in
accordance with Section 1.4 hereof. Payment shall be in federal
funds transmitted by wire
and/or a credit for any shares purchased the same day as the
redemption.
1.8. Issuance and transfer of the Fund's shares will be by
book entry only. Stock
certificates will not be issued to FirstGWL&A or the Account.
Shares ordered from the
Fund will be recorded in an appropriate title for the Account or
the appropriate sub-account
of the Account.
1.9. The Fund shall furnish same day notice (by wire or
telephone, followed by
written confirmation) to FirstGWL&A of any income, dividends or
capital gain distributions
payable on the Designated Portfolio(s)' shares. FirstGWL&A hereby
elects to receive all
such income dividends and capital gain distributions as are payable
on the Portfolio shares
in additional shares of that Portfolio. FirstGWL&A reserves the
right to revoke this election
and to receive all such income dividends and capital gain
distributions in cash. The Fund
shall notify FirstGWL&A by the end of the next following Business
Day of the number of
shares so issued as payment of such dividends and distributions.
1.10.The Fund shall make the net asset value per share for
each Designated
Portfolio available to FirstGWL&A on each Business Day as soon as
reasonably practical
after the net asset value per share is calculated and shall use its
best efforts to make such
net asset value per share available by 6:00 p.m. Eastern time. In
the event of an error in
the computation of a Designated Portfolio's net asset value per
share ("NAV") or any
dividend or capital gain distribution (each, a "pricing error"),
the Adviser or the Fund shall
immediately notify FirstGWL&A as soon as possible after discovery
of the error. Such
notification may be verbal, but shall be confirmed promptly in
writing in accordance with
Article XI of this Agreement. A pricing error shall be corrected
as follows: (a) if the
pricing error results in a difference between the erroneous NAV and
the correct NAV of
less than $0.01 per share, then no corrective action need be taken;
(b) if the pricing error
results in a difference between the erroneous NAV and the correct
NAV equal to or greater
than $0.01 per share, but less than 1/2 of 1% of the Designated
Portfolio's NAV at the time
of the error, then the Adviser shall reimburse the Designated
Portfolio for any loss, after
taking into consideration any positive effect of such error;
however, no adjustments to
Contractowner accounts need be made; and (c) if the pricing error
results in a difference
between the erroneous NAV and the correct NAV equal to or greater
than 1/2 of 1% of the
Designated Portfolio's NAV at the time of the error, then the
Adviser shall reimburse the
Designated Portfolio for any loss (without taking into
consideration any positive effect of
such error) and shall reimburse FirstGWL&A for the costs of
adjustments made to correct
Contractowner accounts in accordance with the provisions of
Schedule E. If an adjustment
is necessary to correct a material error which has caused
Contractowners to receive less than
the amount to which they are entitled, the number of shares of the
applicable sub-account
of such Contractowners will be adjusted and the amount of any
underpayments shall be
credited by the Adviser to FirstGWL&A for crediting of such amounts
to the applicable
Contractowners accounts. Upon notification by the Adviser of any
overpayment due to a
material error, FirstGWL&A or Schwab, as the case may be, shall
promptly remit to Adviser
any overpayment that has not been paid to Contractowners; however,
Adviser acknowledges
that Schwab and FirstGWL&A do not intend to seek additional
payments from any
Contractowner who, because of a pricing error, may have underpaid
for units of interest
credited to his/her account. In no event shall Schwab or
FirstGWL&A be liable to
Contractowners for any such adjustments or underpayment amounts.
A pricing error within
categories (b) or (c) above shall be deemed to be "materially
incorrect" or constitute a
"material error" for purposes of this Agreement.
The standards set forth in this Section 1.10 are based on the
Parties' understanding
of the views expressed by the staff of the Securities and Exchange
Commission ("SEC") as
of the date of this Agreement. In the event the views of the SEC
staff are later modified
or superseded by SEC or judicial interpretation, the parties shall
amend the foregoing
provisions of this Agreement to comport with the appropriate
applicable standards, on terms
mutually satisfactory to all Parties.
ARTICLE II. Representations and Warranties
2.1. FirstGWL&A represents and warrants that the securities
deemed to be issued
by the Account under the Contracts are or will be registered under
the 1933 Act; that the
Contracts will be issued and sold in compliance in all material
respects with all applicable
federal and state laws and that the sale of the Contracts shall
comply in all material respects
with state insurance suitability requirements. FirstGWL&A further
represents and warrants
that it is an insurance company duly organized and in good standing
under applicable law
and that it has legally and validly established the Account prior
to any issuance or sale of
units thereof as a segregated asset account under Section 4240 of
the New York Insurance
Law and has registered the Account as a unit investment trust in
accordance with the
provisions of the 1940 Act to serve as a segregated investment
account for the Contracts.
FirstGWL&A shall amend the Contracts' registration statement under
the 1933 Act and the
Account's registration statement under the 1940 Act from time to
time as required in order
to effect the continuous offering of the Contracts. FirstGWL&A
shall register and qualify
the Contracts for sale in accordance with the securities laws of
the various states if and to
the extent required by applicable law.
2.2. The Fund represents and warrants that Designated
Portfolio(s) shares sold
pursuant to this Agreement shall be registered under the 1933 Act,
duly authorized for
issuance and sold in compliance with all applicable federal
securities laws including without
limitation the 1933 Act, the 1934 Act, and the 1940 Act and that
the Fund is and shall
remain registered under the 0000 Xxx. The Fund shall amend the
registration statement for
its shares under the 1933 Act and the 1940 Act from time to time as
required in order to
effect the continuous offering of its shares.
2.3. The Fund reserves the right to adopt a plan pursuant to
Rule 12b-1 under the
1940 Act and to impose an asset-based or other charge to finance
distribution expenses as
permitted by applicable law and regulation. In any event, the Fund
and Adviser agree to
comply with applicable provisions and SEC staff interpretations of
the 1940 Act to assure
that the investment advisory or management fees paid to the Adviser
by the Fund are in
accordance with the requirements of the 1940 Act. To the extent
that the Fund decides to
finance distribution expenses pursuant to Rule 12b-1, the Fund
undertakes to have its Board,
a majority of whom are not interested persons of the Fund,
formulate and approve any plan
pursuant to Rule 12b-1 under the 1940 Act to finance distribution
expenses.
2.4. The Fund represents and warrants that it will make every
effort to ensure that
the investment policies, fees and expenses of the Designated
Portfolio(s) are and shall at all
times remain in compliance with the insurance and other applicable
laws of the State of New
York and any other applicable state to the extent required to
perform this Agreement, to
the extent FirstGWL&A notifies the Fund of such laws. The Fund
further represents and
warrants that it will make every effort to ensure that Designated
Portfolio(s) shares will be
sold in compliance with the insurance laws of the State of New York
and all applicable state
insurance and securities laws. The Fund shall register and qualify
the shares for sale in
accordance with the laws of the various states if and to the extent
required by applicable law.
FirstGWL&A and the Fund will endeavor to mutually cooperate with
respect to the
implementation of any modifications necessitated by any change in
state insurance laws,
regulations or interpretations of the foregoing that affect the
Designated Portfolio(s) (a "Law
Change"), and to keep each other informed of any Law Change that
becomes known to
either party. In the event of a Law Change, the Fund agrees that,
except in those
circumstances where the Fund has advised FirstGWL&A that its Board
of Directors has
determined that implementation of a particular Law Change is not in
the best interest of all
of the Fund's shareholders with an explanation regarding why such
action is lawful, any
action required by a Law Change will be taken.
2.5. The Fund represents and warrants that it is lawfully
organized and validly
existing under the laws of the State of Delaware and that it does
and will comply in all
material respects with the 1940 Act.
2.6. The Adviser represents and warrants that it is and shall
remain duly registered
under all applicable federal and state securities laws and that it
shall perform its obligations
for the Fund in compliance in all material respects with the laws
of the State of Colorado
and any applicable state and federal securities laws.
2.7. The Fund and the Adviser represent and warrant that all
of their respective
officers, employees, investment advisers, and other individuals or
entities dealing with the
money and/or securities of the Fund are, and shall continue to be
at all times, covered by
a blanket fidelity bond or similar coverage for the benefit of the
Fund in an amount not less
than the minimal coverage required by Rule 17g-1 under the 1940 Act
or related provisions
as may be promulgated from time to time. The aforesaid bond shall
include coverage for
larceny and embezzlement and shall be issued by a reputable bonding
company.
2.8. Schwab represents and warrants that it has completed,
obtained and
performed, in all material respects, all registrations, filings,
approvals, and authorizations,
consents and examinations required by any government or
governmental authority as may
be necessary to perform this Agreement. Schwab does and will
comply, in all material
respects, with all applicable laws, rules and regulations in the
performance of its obligations
under this Agreement.
2.9. The Fund will provide FirstGWL&A with as much advance
notice as is
reasonably practicable of any material change affecting the
Designated Portfolio(s)
(including, but not limited to, any material change in the
registration statement or prospectus
affecting the Designated Portfolio(s)) and any proxy solicitation
affecting the Designated
Portfolio(s) and consult with FirstGWL&A in order to implement any
such change in an
orderly manner, recognizing the expenses of changes and attempting
to minimize such
expenses by implementing them in conjunction with regular annual
updates of the prospectus
for the Contracts. The Fund agrees to share equitably in expenses
incurred by FirstGWL&A
as a result of actions taken by the Fund, consistent with the
allocation of expenses contained
in Schedule E attached hereto and incorporated herein by reference.
2.10.FirstGWL&A represents and warrants, for purposes other
than diversification
under Section 817 of the Internal Revenue Code of 1986 as amended
("the Code"), that the
Contracts are currently treated as annuity contracts under
applicable provisions of the Code,
and that it will make every effort to maintain such treatment and
that it will notify Schwab,
the Fund and the Adviser immediately upon having a reasonable basis
for believing that the
Contracts have ceased to be so treated or that they might not be so
treated in the future.
In addition, FirstGWL&A represents and warrants that the Account is
a "segregated asset
account" and that interests in the Account are offered exclusively
through the purchase of
or transfer into a "variable contract" within the meaning of such
terms under Section 817 of
the Code and the regulations thereunder. FirstGWL&A will use every
effort to continue to
meet such definitional requirements, and it will notify Schwab, the
Fund, and the Adviser
immediately upon having a reasonable basis for believing that such
requirements have
ceased to be met or that they might not be met in the future.
ARTICLE III. Prospectuses and Proxy Statements; Voting
3.1. At least annually, the Adviser shall provide FirstGWL&A
and Schwab with as
many copies of the Fund's current prospectus for the Designated
Portfolio(s) as
FirstGWL&A and Schwab may reasonably request for marketing purposes
(including
distribution to Contractowners with respect to new sales of a
Contract). If requested by
FirstGWL&A in lieu thereof, the Adviser or Fund shall provide such
documentation
(including a camera-ready copy of the current prospectus for the
Designated Portfolio(s))
and other assistance as is reasonably necessary in order for
FirstGWL&A once each year
(or more frequently if the prospectuses for the Designated
Portfolio(s) are amended) to
have the prospectus for the Contracts and the Fund's prospectus for
the Designated
Portfolio(s) printed together in one document. The Fund and Adviser
agree that the
prospectuses (and semi-annual and annual reports) for the
Designated Portfolio(s) will
describe only the Designated Portfolio(s) and will not name or
describe any other portfolios
or series that may be in the Fund unless required by law.
3.2. If applicable state or federal laws or regulations
require that the Statement of
Additional Information ("SAI") for the Fund be distributed to all
Contractowners, then the
Fund and/or the Adviser shall provide FirstGWL&A with copies of the
Fund's SAI or docu-
mentation thereof for the Designated Portfolio(s) in such
quantities, with expenses to be
borne in accordance with Schedule E hereof, as FirstGWL&A may
reasonably require to
permit timely distribution thereof to Contractowners.
3.3. The Fund and/or the Adviser shall provide FirstGWL&A and
Schwab with
copies of the Fund's proxy material, reports to stockholders and
other communications to
stockholders for the Designated Portfolio(s) in such quantity, with
expenses to be borne in
accordance with Schedule E hereof, as FirstGWL&A may reasonably
require to permit
timely distribution thereof to Contractowners.
3.4. FirstGWL&A and Schwab assume sole responsibility for
ensuring that the
materials provided by the Fund in accordance with Sections 3.1
through 3.3 are delivered
to Contractowners and prospective Contractowners in accordance with
applicable federal
and state securities laws and applicable insurance law.
3.5. It is understood and agreed that, except with respect to
information regarding
FirstGWL&A or Schwab provided in writing by that party, neither
FirstGWL&A nor Schwab
are responsible for the content of the prospectus or SAI for the
Designated Portfolio(s).
It is also understood and agreed that, except with respect to
information regarding the Fund,
the Adviser or the Designated Portfolio(s) provided in writing by
the Fund or the Adviser,
neither the Fund nor Adviser are responsible for the content of the
prospectus or SAI for
the Contracts.
3.6. If and to the extent required by law FirstGWL&A shall:
(i) solicit voting instructions from Contractowners;
(ii) vote the Designated Portfolio(s) shares in
accordance with instructions
received from Contractowners: and
(iii)vote Designated Portfolio shares for which no
instructions have been
received in the same proportion as Designated
Portfolio(s) shares for
which instructions have been received from
Contractowners, so long as
and to the extent that the SEC continues to
interpret the 1940 Act to
require pass-through voting privileges for variable
contract owners.
FirstGWL&A reserves the right to vote Fund shares
held in any
segregated asset account in its own right, to the
extent permitted by
law.
3.7. FirstGWL&A shall be responsible for assuring that each of
its separate
accounts holding shares of a Designated Portfolio calculates voting
privileges as directed by
the Fund and agreed to by the Fund and FirstGWL&A. The Fund agrees
to promptly notify
FirstGWL&A of any changes of interpretations or amendments of the
Mixed and Shared
Funding Exemptive Order.
3.8. The Fund will comply with all provisions of the 1940 Act
requiring voting by
shareholders, and in particular the Fund will either provide for
annual meetings (except
insofar as the SEC may interpret Section 16 of the 1940 Act not to
require such meetings)
or, as the Fund currently intends, comply with Section 16(c) of the
1940 Act (although the
Fund is not one of the trusts described in Section 16(c) of that
Act) as well as with Sections
16(a) and, if and when applicable, 16(b). Further, the Fund will
act in accordance with the
SEC's interpretation of the requirements of Section 16(a) with
respect to periodic elections
of directors or trustees and with whatever rules the Commission may
promulgate with
respect thereto.
3.9. FirstGWL&A and Schwab shall in no way recommend or oppose
or interfere
with the solicitation of proxies for Fund shares held by
Contractowners without the prior
written consent of the Fund, which consent may be withheld in the
Fund's sole discretion.
Neither FirstGWL&A nor Schwab will initiate or solicit
Contractowners to initiate any proxy
solicitation except to the extent that the failure by FirstGWL&A or
Schwab to so initiate or
solicit would under the circumstances, be in contravention with
applicable federal or state
law.
ARTICLE IV. Sales Material and Information
4.1. FirstGWL&A and Schwab shall furnish, or shall cause to be
furnished, to the
Fund or its designee, a copy of each piece of sales literature or
other promotional material
that FirstGWL&A or Schwab, respectively, develops or proposes to
use and in which the
Fund (or a Portfolio thereof), its Adviser or one of its
sub-advisers is named in connection
with the Contracts, at least ten (10) Business Days prior to its
use. No such material shall
be used if the Fund objects to such use within five (5) Business
Days after receipt of such
material.
4.2. FirstGWL&A and Schwab shall not give any information or
make any
representations or statements on behalf of the Fund or Adviser in
connection with the sale
of the Contracts other than the information or representations
contained in the registration
statement or prospectus for the Fund shares, as such registration
statement and prospectus
may be amended or supplemented from time to time, or in reports or
proxy statements for
the Fund, or in sales literature or other promotional material
approved by the Fund or by
the Adviser, except with the permission of the Fund or the Adviser.
4.3. The Fund shall furnish, or shall cause to be furnished,
to FirstGWL&A and
Schwab, a copy of each piece of sales literature or other
promotional material in which
FirstGWL&A and/or its separate account(s), or Schwab is named at
least ten (10) Business
Days prior to its use. No such material shall be used if
FirstGWL&A or Schwab objects to
such use within five (5) Business Days after receipt of such
material.
4.4. The Fund and the Adviser shall not give any information
or make any
representations on behalf of FirstGWL&A or concerning FirstGWL&A,
the Account, or the
Contracts other than the information or representations contained
in a registration statement
or prospectus for the Contracts, as such registration statement and
prospectus may be
amended or supplemented from time to time, or in reports for the
Account, or in sales
literature or other promotional material approved by FirstGWL&A or
its designee, except
with the permission of FirstGWL&A.
4.5. FirstGWL&A, the Fund and the Adviser shall not give any
information or
make any representations on behalf of or concerning Schwab, or use
Xxxxxx'x name except
as required by legal process or regulatory authorities or with the
permission of Schwab.
4.6. The Fund will provide to FirstGWL&A and Schwab at least
one complete
copy of all registration statements, prospectuses, SAIs, reports,
proxy statements, sales
literature and other promotional materials designed for use in
connection with the Contracts,
and all amendments to any of the above, that relate to the
Designated Portfolio(s), contem-
poraneously with the filing of such document(s) with the SEC or
NASD or other regulatory
authorities. The Fund will provide to FirstGWL&A and Schwab at
least one copy of any
exemptive application and requests for no-action letters at such
time as the SEC staff may
grant such application or request.
4.7. FirstGWL&A or Schwab will provide to the Fund at least
one complete copy
of all registration statements, prospectuses, SAIs, reports,
solicitations for voting instructions,
sales literature and other promotional materials, applications for
exemptions, requests for
no-action letters, and all amendments to any of the above, that
relate to the Contracts or
the Account, contemporaneously with the filing of such document(s)
with the SEC, NASD,
or other regulatory authority.
4.8. For purposes of Articles IV and VIII, the phrase "sales
literature and 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, or other public media; e.g., on-line networks such as the
Internet or other electronic
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, seminar texts, reprints or excerpts of any
other advertisement, sales
literature, or published article), educational or training
materials or other communications
distributed or made generally available to some or all agents or
employees, and registration
statements, prospectuses, SAIs, shareholder reports, and proxy
materials and any other
material constituting sales literature or advertising under the
NASD rules, the 1933 Act or
the 0000 Xxx.
4.9. At the request of any party to this Agreement, each other
party will make
available to the other party's independent auditors and/or
representative of the appropriate
regulatory agencies, all records, data and access to operating
procedures that may be
reasonably requested in connection with compliance and regulatory
requirements related to
this Agreement or any party's obligations under this Agreement.
4.10.FirstGWL&A and Schwab acknowledge and agree that the
Adviser is the sole
owner of the name and xxxx "Janus" and that all use of any
designation comprised in whole
or in part of Janus (a "Xxxxx Xxxx") under this Agreement shall
inure to the benefit of the
Adviser. Except as provided in Sections 4.1 and 4.2, FirstGWL&A
and Schwab shall not
use any Xxxxx Xxxx on its own behalf or on behalf of the Contracts
or the Account in any
registration statement, advertisement, sales literature or other
materials relating to the
Contracts or the Account without the prior written consent of the
Adviser. Upon
termination of this Agreement for any reason and except to the
extent necessary to
administer or service existing Contracts, FirstGWL&A and Schwab
shall cease all use of any
Janus Marks as soon as reasonably practical.
ARTICLE V. Fees and Expenses
5.1. The Fund shall pay no fee or other compensation to
FirstGWL&A under this
Agreement, and FirstGWL&A shall pay no fee or other compensation to
the Fund or
Adviser under this Agreement, although the parties hereto will bear
certain expenses in
accordance with Schedule E, Articles III, V, and other provisions
of this Agreement.
5.2. All expenses incident to performance by the Fund and the
Adviser under this
Agreement shall be paid by the appropriate party, as further
provided in Schedule E. The
Fund shall see to it that all shares of the Designated Portfolio(s)
are registered and
authorized for issuance in accordance with applicable federal law
and, if and to the extent
required, in accordance with applicable state laws prior to their
sale.
5.3. The parties shall bear the expenses of routine annual
distribution (mailing
costs) of the Fund's prospectus and distribution (mailing costs) of
the Fund's proxy materials
and reports to owners of Contracts offered by FirstGWL&A, in
accordance with Schedule
E.
5.4. The Fund and the Adviser acknowledge that a principal
feature of the
Contracts is the Contractowner's ability to choose from a number of
unaffiliated mutual
funds (and portfolios or series thereof), including the Designated
Portfolio(s) and the
Unaffiliated Funds, and to transfer the Contract's cash value
between funds and portfolios.
The Fund and the Adviser agree to cooperate with FirstGWL&A and
Schwab in facilitating
the operation of the Account and the Contracts as described in the
prospectus for the
Contracts, including but not limited to cooperation in facilitating
transfers between
Unaffiliated Funds.
ARTICLE VI. Diversification and Qualification
6.1. The Fund and the Adviser represent and warrant that the
Fund will at all
times sell its shares and invest its assets in such a manner as to
ensure that the Contracts
will be treated as annuity contracts under the Code, and the
regulations issued thereunder.
Without limiting the scope of the foregoing, the Fund and Adviser
represent and warrant
that the Fund and each Designated Portfolio thereof will at all
times comply with Section
817(h) of the Code and Treasury Regulation 1.817-5, as amended
from time to time, and
any Treasury interpretations thereof, relating to the
diversification requirements for variable
annuity, endowment, or life insurance contracts and any amendments
or other modifications
or successor provisions to such Section or Regulations. The Fund
and the Adviser agree
that shares of the Designated Portfolio(s) will be sold only to
Participating Insurance
Companies and their separate accounts and certain Qualified Plans.
6.2. No shares of any Designated Portfolio of the Fund will be
sold to the general
public.
6.3. The Fund and the Adviser represent and warrant that the
Fund and each
Designated Portfolio is currently qualified as a Regulated
Investment Company under
Subchapter M of the Code, and that each Designated Portfolio will
maintain such
qualification (under Subchapter M or any successor or similar
provisions) as long as this
Agreement is in effect.
6.4. The Fund or the Adviser will notify FirstGWL&A
immediately upon having
a reasonable basis for believing that the Fund or any Designated
Portfolio has ceased to
comply with the aforesaid Section 817(h) diversification or
Subchapter M qualification
requirements or might not so comply in the future.
6.5. Without in any way limiting the effect of Sections 8.3
and 8.4 hereof and with-
out in any way limiting or restricting any other remedies available
to FirstGWL&A or
Schwab, the Adviser will pay all costs associated with or arising
out of any failure, or any
anticipated or reasonably foreseeable failure, of the Fund or any
Designated Portfolio to
comply with Sections 6.1, 6.2, or 6.3 hereof, including all costs
associated with reasonable
and appropriate corrections or responses to any such failure; such
costs may include, but are
not limited to, the costs involved in creating, organizing, and
registering a new investment
company as a funding medium for the Contracts and/or the costs of
obtaining whatever
regulatory authorizations are required to substitute shares of
another investment company
for those of the failed Portfolio (including but not limited to an
order pursuant to Section
26(b) of the 1940 Act); such costs are to include, but are not
limited to, fees and expenses
of legal counsel and other advisors to FirstGWL&A and any federal
income taxes or tax
penalties and interest thereon (or "toll charges" or exactments or
amounts paid in
settlement) incurred by FirstGWL&A with respect to itself or owners
of its Contracts in
connection with any such failure or anticipated or reasonably
foreseeable failure. For
purposes of this section 6.5 and Sections 8.3 and 8.4, a failure to
comply with Section 817(h)
diversification or Subchapter M qualification requirements shall
not include any non-
compliance with such sections that is corrected within any grace
periods allowed under the
Code.
6.6. The Fund at the Fund's expense shall provide FirstGWL&A
or its designee
with reports certifying compliance with the aforesaid Section
817(h) diversification and
Subchapter M qualification requirements, at the times provided for
and substantially in the
form attached hereto as Schedule D and incorporated herein by
reference; provided,
however, that providing such reports does not relieve the Fund of
its responsibility for such
compliance or of its liability for any non-compliance.
6.7. FirstGWL&A agrees that if the Internal Revenue Service
("IRS") asserts in
writing in connection with any governmental audit or review of
FirstGWL&A or, to
FirstGWL&A's knowledge, or any Contractowner that any Designated
Portfolio has failed
to comply with the diversification requirements of Section 817(h)
of the Code or
FirstGWL&A otherwise becomes aware of any facts that could give
rise to any claim against
the Fund or the Adviser as a result of such a failure or alleged
failure:
(a) FirstGWL&A shall promptly notify the Fund and the Adviser
of such assertion
or potential claim;
(b) FirstGWL&A shall consult with the Fund and the Adviser as
to how to minimize
any liability that may arise as a result of such failure or
alleged failure;
(c) FirstGWL&A shall use its best efforts to minimize any
liability of the Fund and
the Adviser resulting from such failure, including, without
limitation, demonstrating,
pursuant to Treasury Regulations, Section 1.817-5(a)(2), to
the commissioner of the
IRS that such failure was inadvertent;
(d) any written materials to be submitted by FirstGWL&A to
the IRS, any
Contractowner or any other claimant in connection with any of
the foregoing
proceedings or contests (including, without limitation, any
such materials to be
submitted to the IRS pursuant to Treasury Regulations, Section
1.817-5(a)(2)) shall
be provided by FirstGWL&A to the Fund and the Adviser
(together with any
supporting information or analysis) within at least two (2)
business days prior to
submission;
(e) FirstGWL&A shall provide the Fund and the Adviser with
such cooperation as
the Fund and the Adviser shall reasonably request (including,
without limitation, by
permitting the Fund and the Adviser to review the relevant
books and records of
FirstGWL&A) in order to facilitate review by the Fund and the
Adviser of any
written submissions provided to it or its assessment of the
validity or amount of any
claim against it arising from such failure or alleged failure;
(f) FirstGWL&A shall not with respect to any claim of the IRS
or any Contractowner
that would give rise to a claim against the Fund and the
Adviser (i) compromise or
settle any claim, (ii) accept any adjustment on audit, or
(iii) forego any allowable
administrative or judicial appeals, without the express
written consent of the Fund
and the Adviser, which shall not be unreasonably withheld;
provided that,
FirstGWL&A shall not be required to appeal any adverse
judicial decision unless the
Fund and the Adviser shall have provided an opinion of
independent counsel to the
effect that a reasonable basis exists for taking such appeal;
and further provided that
the Fund and the Adviser shall bear the costs and expenses,
including reasonable
attorney's fees, incurred by FirstGWL&A in complying with this
clause (f).
ARTICLE VII. Potential Conflicts and Compliance With
Mixed and Shared Funding Exemptive Order
7.1. The Board will monitor the Fund for the existence of any
material
irreconcilable conflict between the interests of the contract
owners of all separate accounts
investing in the Fund. An irreconcilable material conflict may
arise for a variety of reasons,
including: (a) an action by any state insurance regulatory
authority; (b) a change in
applicable federal or state insurance, tax, or securities laws or
regulations, or a public ruling,
private letter ruling, no-action or interpretative letter, or any
similar action by insurance, tax,
or securities regulatory authorities; (c) an administrative or
judicial decision in any relevant
proceeding; (d) the manner in which the investments of any
Portfolio are being managed;
(e) a difference in voting instructions given by variable annuity
contract and variable life
insurance contract owners or by contract owners of different
Participating Insurance
Companies; or (f) a decision by a Participating Insurance Company
to disregard the voting
instructions of contract owners. The Board shall promptly inform
FirstGWL&A if it
determines that an irreconcilable material conflict exists and the
implications thereof.
7.2. FirstGWL&A will report any potential or existing
conflicts of which it is aware
to the Board. FirstGWL&A will assist the Board in carrying out its
responsibilities under
the Mixed and Shared Funding Exemptive Order, by providing the
Board with all
information reasonably necessary for the Board to consider any
issues raised. This includes,
but is not limited to, an obligation by FirstGWL&A to inform the
Board whenever contract
owner voting instructions are to be disregarded. Such
responsibilities shall be carried out
by FirstGWL&A with a view only to the interests of its
Contractowners.
7.3. If it is determined by a majority of the Board, or a
majority of its directors who
are not interested persons of the Fund, the Adviser or any
sub-adviser to any of the
Designated Portfolios (the "Independent Directors"), that a
material irreconcilable conflict
exists, FirstGWL&A and other Participating Insurance Companies
shall, at their expense and
to the extent reasonably practicable (as determined by a majority
of the Independent
Directors), take whatever steps are necessary to remedy or
eliminate the irreconcilable
material conflict, up to and including: (1) withdrawing the assets
allocable to some or all
of the separate accounts from the Fund or any Designated Portfolio
and reinvesting such
assets in a different investment medium, including (but not limited
to) another portfolio of
the Fund, or submitting the question whether such segregation
should be implemented to
a vote of all affected contract owners and, as appropriate,
segregating the assets of any
appropriate group (i.e., annuity contract owners, life insurance
contract owners, or variable
contract owners of one or more Participating Insurance Companies)
that votes in favor of
such segregation, or offering to the affected contract owners the
option of making such a
change; and (2) establishing a new registered management investment
company or managed
separate account.
7.4. If a material irreconcilable conflict arises because of
a decision by
FirstGWL&A to disregard contract owner voting instructions and that
decision represents
a minority position or would preclude a majority vote, FirstGWL&A
may be required, at the
Fund's election, to withdraw the Account's investment in the Fund
and terminate this
Agreement; provided, however that such withdrawal and termination
shall be limited to the
extent required by the foregoing material irreconcilable conflict
as determined by a majority
of the Independent Directors. Any such withdrawal and termination
must take place within
six (6) months after the Fund gives written notice that this
provision is being implemented,
and until the end of that six month period the Adviser and the Fund
shall continue to accept
and implement orders by FirstGWL&A for the purchase (and
redemption) of shares of the
Fund.
7.5. If a material irreconcilable conflict arises because a
particular state insurance
regulator's decision applicable to FirstGWL&A conflicts with the
majority of other state
regulators, then FirstGWL&A will withdraw the Account's investment
in the Fund and
terminate this Agreement within six months after the Board informs
FirstGWL&A in writing
that it has determined that such decision has created an
irreconcilable material conflict;
provided, however, that such withdrawal and termination shall be
limited to the extent
required by the foregoing material irreconcilable conflict as
determined by a majority of the
disinterested members of the Board. Until the end of the foregoing
six month period, the
Fund shall continue to accept and implement orders by FirstGWL&A
for the purchase (and
redemption) of shares of the Fund.
7.6. For purposes of Sections 7.3 through 7.6 of this
Agreement, a majority of the
Independent Directors shall determine whether any proposed action
adequately remedies
any irreconcilable material conflict, but in no event will the Fund
be required to establish
a new funding medium for the Contracts. FirstGWL&A shall not be
required by Section
7.3 to establish a new funding medium for the Contracts if an offer
to do so has been
declined by vote of a majority of Contractowners affected by the
irreconcilable material
conflict. In the event that the Board determines that any proposed
action does not
adequately remedy any irreconcilable material conflict, then
FirstGWL&A will withdraw the
Account's investment in the Fund and terminate this Agreement
within six (6) months after
the Board informs FirstGWL&A in writing of the foregoing
determination; provided,
however, that such withdrawal and termination shall be limited to
the extent required by any
such material irreconcilable conflict as determined by a majority
of the Independent
Directors.
7.7. If and to the extent that Rule 6e-2 and Rule 6e-3(T) are
amended, or Rule
6e-3 is adopted, to provide exemptive relief from any provision of
the 1940 Act or the rules
promulgated thereunder with respect to mixed or shared funding (as
defined in the Mixed
and Shared Funding Exemptive Order) on terms and conditions
materially different from
those contained in the Mixed and Shared Funding Exemptive Order,
then (a) the Fund
and/or the Participating Insurance Companies, as appropriate, shall
take such steps as may
be necessary to comply with Rules 6e-2 and 6e-3(T), as amended, and
Rule 6e-3, as
adopted, to the extent such rules are applicable: and (b) Sections
3.6, 3.7, 3.8, 7.1, 7.2, 7.3,
7.4, 7.5 and 7.6 of this Agreement shall continue in effect only to
the extent that terms and
conditions substantially identical to such Sections are contained
in such Rule(s) as so
amended or adopted.
ARTICLE VIII. Indemnification
8.1. Indemnification By FirstGWL&A
8.1(a). FirstGWL&A agrees to indemnify and hold
harmless the Fund
and the Adviser and each of their officers and directors or
trustees and each person, if any,
who controls the Fund or the Adviser within the meaning of Section
15 of the 1933 Act
(collectively, the "Indemnified Parties" for purposes of this
Section 8.1) against any and all
losses, claims, expenses, damages, liabilities (including amounts
paid in settlement with the
written consent of FirstGWL&A) or litigation (including reasonable
legal and other
expenses) to which the Indemnified Parties may become subject under
any statute or
regulation, at common law or otherwise, insofar as such losses,
claims, expenses, 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 statements or
alleged untrue
statements of any material fact contained in the
registration statement or pro-
spectus or SAI covering the Contracts or contained in the
Contracts or sales
literature for the Contracts (or any amendment or
supplement to any of the
foregoing), or arise out of or are based upon the
omission or the alleged
omission to state therein a material fact required to be
stated therein or nec-
xxxxxx 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 in writing to
FirstGWL&A or Schwab by or on behalf of the Adviser or
Fund for use in the
registration statement or prospectus for the Contracts or
in the Contracts or
sales literature (or any amendment or supplement) or
otherwise for use in
connection with the sale of the Contracts or Fund shares;
or
(ii) arise out of or as a result of statements or
representations (other than
statements or representations contained in the
registration statement, pro-
spectus or sales literature of the Fund not supplied by
FirstGWL&A or
persons under its control) or wrongful conduct of
FirstGWL&A or persons
under its control, 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,
or sales literature 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
information furnished in
writing to the Fund by or on behalf of FirstGWL&A; or
(iv) arise as a result of any failure by FirstGWL&A 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 FirstGWL&A in this Agreement or arise
out of or result
from any other material breach of this Agreement by
FirstGWL&A, including
without limitation Section 2.10 and Section 6.7 hereof,
as limited by and in accordance with the provisions of Sections
8.1(b) and 8.1(c) hereof.
8.1(b). FirstGWL&A shall not be liable under this
indemnification provision
with respect to any losses, claims, expenses, damages, liabilities
or litigation to which an
Indemnified Party would otherwise be subject by reason of such
Indemnified Party's willful
misfeasance, bad faith, or negligence in the performance of such
Indemnified Party's duties
or by reason of such Indemnified Party's reckless disregard of
obligations or duties under this
Agreement or to any of the Indemnified Parties.
8.1(c). FirstGWL&A shall not be liable under this
indemnification provision
with respect to any claim made against an Indemnified Party unless
such Indemnified Party
shall have notified FirstGWL&A in writing within a reasonable time
after the summons or
other first legal process giving information of the nature of the
claim shall have been served
upon such Indemnified Party (or after such Indemnified Party shall
have received notice of
such service on any designated agent), but failure to notify
FirstGWL&A of any such claim
shall not relieve FirstGWL&A from any liability which it may have
to the Indemnified Party
against whom such action is brought otherwise than on account of
this indemnification
provision, except to the extent that FirstGWL&A has been prejudiced
by such failure to give
notice. In case any such action is brought against the Indemnified
Parties, FirstGWL&A
shall be entitled to participate, at its own expense, in the
defense of such action.
FirstGWL&A also shall be entitled to assume the defense thereof,
with counsel satisfactory
to the party named in the action. After notice from FirstGWL&A to
such party of
FirstGWL&A's election to assume the defense thereof, the
Indemnified Party shall bear the
fees and expenses of any additional counsel retained by it, and
FirstGWL&A 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.
8.1(d). The Indemnified Parties will promptly notify
FirstGWL&A 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 for which
the Indemnified Parties intend to seek indemnification from
FirstGWL&A.
8.2. Indemnification by Schwab
8.2(a). Schwab agrees to indemnify and hold harmless
the Fund and the
Adviser and each of their officers and directors or trustees and
each person, if any, who
controls the Fund or Adviser within the meaning of Section 15 of
the 1933 Act (collectively,
the "Indemnified Parties" for purposes of this Section 8.2) against
any and all losses, claims,
expenses, damages and liabilities (including amounts paid in
settlement with the written
consent of Schwab) or litigation (including reasonable legal and
other expenses), to which
the Indemnified Parties may become subject under any statute or
regulation, at common law
or otherwise, insofar as such losses, claims, damages, liabilities
or expenses (or actions in
respect thereof) or settlements are related to the sale or
acquisition of the Fund's shares or
the Contracts and:
(i) arise out of Xxxxxx'x dissemination of information
regarding the Fund that is
both (A) materially incorrect and (B) that was neither
contained in the Fund's
registration statement or sales literature nor other
promotional material of the
Fund prepared by the Fund or provided in writing to
Schwab, or approved
in writing, by or on behalf of the Fund or the Adviser;
or
(ii) arise out of or are based upon any untrue statements or
alleged untrue
statements of any material fact contained in the
registration statement,
prospectus or SAI for the Contracts or in sales
literature or other promotional
material prepared by Schwab for the Contracts or arise
out of or are based
upon the omission or the alleged omission to state
therein a material fact
required to be stated therein or necessary to make the
statements therein not
misleading, provided that this Agreement to indemnify
shall not apply as to
any Indemnified Party if such statement or omission or
such alleged statement
or omission was made in reliance upon and in conformity
with information
furnished in writing to FirstGWL&A or Schwab by or on
behalf of the Adviser
or the Fund or to Schwab by FirstGWL&A for use in the
registration state-
ment or prospectus for the Contracts or in the Contracts
or sales literature (or
any amendment or supplement) or otherwise for use in
connection with the
sale of the Contracts; or
(iii)arise out of or as a result of statements or
representations (other than
statements or representations contained in the
registration statement,
prospectus or sales literature of the Fund not supplied
by Schwab or persons
under its control) or wrongful conduct of Schwab or
persons under its control,
with respect to the sale or distribution of the
Contracts; or
(iv) arise as a result of any failure by Schwab 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 Schwab in this Agreement or arise out of
or result from any
other material breach of this Agreement by Schwab;
as limited by and in accordance with the provisions of Sections
8.2(b) and 8.2(c) hereof.
8.2(b). Schwab shall not be liable under this
indemnification provision with
respect to any losses, claims, damages, liabilities or litigation
to which an Indemnified Party
would otherwise be subject by reason of such Indemnified Party's
willful misfeasance, bad
faith, or negligence in the performance of such Indemnified Party's
duties or by reason of
such Indemnified Party's reckless disregard of obligations or
duties under this Agreement
or to any of the Indemnified Parties.
8.2(c). Schwab shall not be liable under this
indemnification provision with
respect to any claim made against an Indemnified Party unless such
Indemnified Party shall
have notified Schwab in writing within a reasonable time after the
summons or other first
legal process giving information of the nature of the claim shall
have been served upon such
Indemnified Party (or after such Indemnified Party shall have
received notice of such service
on any designated agent), but failure to notify Schwab of any such
claim shall not relieve
Schwab from any liability which it may have to the Indemnified
Party against whom such
action is brought otherwise than on account of this indemnification
provision, except to the
extent that Schwab has been prejudiced by such failure to give
notice. In case any such
action is brought against the Indemnified Parties, Schwab shall be
entitled to participate, at
its own expense, in the defense of such action. Schwab also shall
be entitled to assume the
defense thereof, with counsel satisfactory to the party named in
the action. After notice
from Schwab to such party of Xxxxxx'x election to assume the
defense thereof, the
Indemnified Party shall bear the fees and expenses of any
additional counsel retained by it,
and Schwab will not be liable to such party under this Agreement
for any legal or other ex-
penses subsequently incurred by such party independently in
connection with the defense
thereof other than reasonable costs of investigation.
8.2(d). The Indemnified Parties will promptly notify
Schwab 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 for which the
Indemnified Parties intend to seek indemnification from Schwab.
8.3. Indemnification by the Adviser
8.3(a). The Adviser agrees to indemnify and hold
harmless FirstGWL&A and
Schwab and each of their directors and officers and each person, if
any, who controls
FirstGWL&A or Schwab within the meaning of Section 15 of the 1933
Act (collectively, the
"Indemnified Parties" for purposes of this Section 8.3) against any
and all losses, claims,
expenses, damages, liabilities (including amounts paid in
settlement with the written consent
of the Adviser) or litigation (including reasonable legal and other
expenses) to which the
Indemnified Parties may become subject under any statute or
regulation, at common law or
otherwise, insofar as such losses, claims, damages, liabilities or
expenses (or actions in
respect thereof) or settlements are related to the sale or
acquisition of the 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
registration statement or
prospectus or SAI or sales literature or other
promotional material of the
Fund prepared by the Fund or the Adviser (or any
amendment or supplement
to any of the foregoing), or arise out of or are based
upon the omission or the
alleged omission to state therein a material fact
required to be stated therein
or necessary to make the statements therein not
misleading, provided that this
Agreement to indemnify shall not apply as to any
Indemnified Party if such
statement or omission or such alleged statement or
omission was made in reli-
ance upon and in conformity with information furnished in
writing to the
Adviser or the Fund by or on behalf of FirstGWL&A or
Schwab for use in the
registration statement or prospectus for the Fund or in
sales literature (or any
amendment or supplement) 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 statements or
representations (other than
statements or representations contained in the
registration statement,
prospectus, SAI or sales literature or other promotional
material for the
Contracts not supplied by the Adviser or persons under
its control) or
wrongful conduct of the Fund or the Adviser or persons
under their control,
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,
SAI, or sales literature
covering 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
information furnished in writing to FirstGWL&A or Schwab
by or on behalf
of the Adviser or the Fund; or
(iv) arise as a result of any failure by the Fund or the
Adviser to provide the
services and furnish the materials under the terms of
this Agreement (in-
cluding a failure, whether unintentional or in good faith
or otherwise, to com-
ply with the diversification and other qualification
requirements specified in
Article VI of this Agreement); or
(v) arise out of or result from any material breach of any
representation and/or
warranty made by the Fund or the Adviser in this
Agreement or arise out of
or result from any other material breach of this
Agreement by the Adviser or
the Fund; or
(vi) to the extent set forth in Section 1.10, arise out of or
result from the incorrect
or untimely calculation or reporting of the daily net
asset value per share or
dividend or capital gain distribution rate;
as limited by and in accordance with the provisions of Sections
8.3(b) and 8.3(c) hereof.
This indemnification is in addition to and apart from the
responsibilities and obligations of
the Adviser specified in Article VI hereof.
8.3(b). The Adviser shall not be liable under this
indemnification provision
with respect to any losses, claims, expenses, damages, liabilities
or litigation to which an
Indemnified Party would otherwise be subject by reason of such
Indemnified Party's willful
misfeasance, bad faith, or negligence in the performance of such
Indemnified Party's duties
or by reason of such Indemnified Party's reckless disregard of
obligations or duties under this
Agreement or to any of the Indemnified Parties.
8.3(c). The Adviser shall not be liable under this
indemnification provision
with respect to any claim made against an Indemnified Party unless
such Indemnified Party
shall have notified the Adviser in writing within a reasonable time
after the summons or
other first legal process giving information of the nature of the
claim shall have been served
upon such Indemnified Party (or after such Indemnified Party shall
have received notice of
such service on any designated agent), but failure to notify the
Adviser of any such claim
shall not relieve the Adviser from any liability which it may have
to the Indemnified Party
against whom such action is brought otherwise than on account of
this indemnification
provision, except to the extent that the Adviser has been
prejudiced by such failure to give
notice. In case any such action is brought against the Indemnified
Parties, the Adviser will
be entitled to participate, at its own expense, in the defense
thereof. The Adviser also shall
be entitled to assume the defense thereof, with counsel
satisfactory to the party named in
the action. After notice from the Adviser to such party of the
Adviser's election to assume
the defense thereof, the Indemnified Party shall bear the fees and
expenses of any additional
counsel retained by it, and the Adviser 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.
8.3(d). FirstGWL&A and Schwab agree promptly to notify the
Adviser of the
commencement of any litigation or proceedings against it or any of
its officers or directors
in connection with the issuance or sale of the Contracts or the
operation of the Account for
which FirstGWL&A or Schwab intend to seek indemnification from the
Adviser.
8.4. Indemnification By the Fund
8.4(a). The Fund agrees to indemnify and hold harmless
FirstGWL&A and Schwab
and each of their directors and officers and each person, if any,
who controls FirstGWL&A
or Schwab within the meaning of Section 15 of the 1933 Act
(collectively, the "Indemnified
Parties" for purposes of this Section 8.4) against any and all
losses, claims, expenses,
damages, liabilities (including amounts paid in settlement with the
written consent of the
Fund) or litigation (including reasonable legal and other expenses)
to which the Indemnified
Parties may be required to pay or become subject under any statute
or regulation, at
common law or otherwise, insofar as such losses, claims, expenses,
damages, liabilities or
expenses (or actions in respect thereof) or settlements, are
related to the operations of the
Fund and:
(i) arise as a result of any failure by the Fund to provide
the services and furnish
the materials under the terms of this Agreement
(including a failure, whether
unintentional or in good faith or otherwise, to comply
with the diversification
and other qualification requirements specified in Article
VI of this Agree-
ment); or
(ii) arise out of or result from any material breach of any
representation and/or
warranty made by the Fund in this Agreement or arise out
of or result from
any other material breach of this Agreement by the Fund;
or
(iii)arise out of or result from the incorrect or untimely
calculation or reporting
of the daily net asset value per share or dividend or
capital gain distribution
rate;
as limited by and in accordance with the provisions of Sections
8.4(b) and 8.4(c) hereof.
8.4(b). The Fund shall not be liable under this
indemnification provision with
respect to any losses, claims, expenses, damages, liabilities or
litigation to which an
Indemnified Party would otherwise be subject by reason of such
Indemnified Party's willful
misfeasance, bad faith, or negligence in the performance of such
Indemnified Party's duties
or by reason of such Indemnified Party's reckless disregard of
obligations or duties under this
Agreement or to any of the Indemnified Parties.
8.4(c). The Fund shall not be liable under this
indemnification provision with
respect to any claim made against an Indemnified Party unless such
Indemnified Party shall
have notified the Fund in writing within a reasonable time after
the summons or other first
legal process giving information of the nature of the claim shall
have been served upon such
Indemnified Party (or after such Indemnified Party shall have
received notice of such service
on any designated agent), but failure to notify the Fund of any
such claim shall not relieve
it from any liability which it may have to the Indemnified Party
against whom such action
is brought otherwise than on account of this indemnification
provision, except to the extent
that the Fund has been prejudiced by such failure to give notice.
In case any such action
is brought against the Indemnified Parties, the Fund will be
entitled to participate, at its own
expense, in the defense thereof. The Fund shall also be entitled
to assume the defense
thereof, with counsel satisfactory to the party named in the
action. After notice from the
Fund to such party of the Fund's election to assume the defense
thereof, the Indemnified
Party shall bear the fees and expenses of any additional counsel
retained by it, and the Fund
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.
8.4(d). FirstGWL&A and Schwab each agree promptly to
notify the Fund of
the commencement of any litigation or proceeding against itself or
any of its respective
officers or directors in connection with the Agreement, the
issuance or sale of the Contracts,
the operation of the Account, or the sale or acquisition of shares
of the Fund for which
FirstGWL&A or Schwab intend to seek indemnification from the Fund.
ARTICLE IX. Applicable Law
9.1. This Agreement shall be construed and the provisions
hereof interpreted under
and in accordance with the laws of the State of New York, without
regard to the New York
Conflict of Laws provisions.
9.2. This Agreement shall be subject to the provisions of the
1933, 1934 and 1940
Acts, and the rules and regulations and rulings thereunder,
including such exemptions from
those statutes, rules and regulations as the Securities and
Exchange Commission may grant
(including, but not limited to, the Mixed and Shared Funding
Exemptive Order) and the
terms hereof shall be interpreted and construed in accordance
therewith.
ARTICLE X. Termination
10.1.This Agreement shall terminate:
(a) at the option of any party, with or without cause,
with respect to some or
all Portfolios, upon six (6) months advance written
notice delivered to the
other parties; provided, however, that such notice shall
not be given earlier
than six (6) months following the date of this Agreement;
or
(b) at the option of FirstGWL&A or Schwab by written
notice to the other
parties with respect to any Portfolio based upon
FirstGWL&A's or Xxxxxx'x
determination that shares of such Portfolio are not
reasonably available to
meet the requirements of the Contracts; or
(c) at the option of FirstGWL&A or Schwab by written
notice to the other
parties with respect to any Portfolio in the event any of
the Portfolio's shares
are not registered, issued or sold in accordance with
applicable state and/ or
federal law or such law precludes the use of such shares
as the underlying
investment media of the Contracts issued or to be issued
by FirstGWL&A; or
(d) at the option of the Fund or Adviser in the event
that formal
administrative proceedings are instituted against
FirstGWL&A or Schwab by
the NASD, the SEC, the Insurance Commissioner or like
official of any state
or any other regulatory body regarding FirstGWL&A's or
Xxxxxx'x duties
under this Agreement or related to the sale of the
Contracts, the operation
of any Account, or the purchase of the Fund shares, if,
in each case, the Fund
reasonably determines in its sole judgment exercised in
good faith, that any
such administrative proceedings will have a material
adverse effect upon the
ability of FirstGWL&A or Schwab to perform its
obligations under this
Agreement; or
(e) at the option of FirstGWL&A or Schwab in the event
that formal
administrative proceedings are instituted against the
Fund or the Adviser by
the NASD, the SEC, or any state securities or insurance
department or any
other regulatory body, if Schwab or FirstGWL&A reasonably
determines in
its sole judgment exercised in good faith, that any such
administrative
proceedings will have a material adverse effect upon the
ability of the Fund
or the Adviser to perform their obligations under this
Agreement; or
(f) at the option of FirstGWL&A by written notice to the
Fund with respect
to any Portfolio if FirstGWL&A reasonably believes that
the Portfolio will fail
to meet the Section 817(h) diversification requirements
or Subchapter M
qualifications specified in Article VI hereof; or
(g) at the option of either the Fund or the Adviser, if
(i) the Fund or Adviser,
respectively, shall determine, in their sole judgment
reasonably exercised in
good faith, that either FirstGWL&A or Schwab has suffered
a material
adverse change in their business or financial condition
or is the subject of
material adverse publicity and that material adverse
change or publicity will
have a material adverse impact on FirstGWL&A's or
Xxxxxx'x ability to
perform its obligations under this Agreement, (ii) the
Fund or the Adviser
notifies FirstGWL&A or Schwab, as appropriate, of that
determination and
its intent to terminate this Agreement, and (iii) after
considering the actions
taken by FirstGWL&A or Schwab and any other changes in
circumstances
since the giving of such a notice, the determination of
the Fund or the Adviser
shall continue to apply on the sixtieth (60th) day
following the giving of that
notice, which sixtieth day shall be the effective date of
termination; or
(h) at the option of either FirstGWL&A or Schwab, if (i)
FirstGWL&A or
Schwab, respectively, shall determine, in its sole
judgment reasonably exercised
in good faith, that either the Fund or the Adviser has
suffered a material
adverse change in its business or financial condition or
is the subject of
material adverse publicity and that material adverse
change or publicity will
have a material adverse impact on the Fund's or the
Adviser's ability to
perform its obligations under this Agreement, (ii)
FirstGWL&A or Schwab
notifies the Fund or the Adviser, as appropriate, of that
determination and its
intent to terminate this Agreement, and (iii) after
considering the actions
taken by the Fund or the Adviser and any other changes in
circumstances
since the giving of such a notice, the determination of
FirstGWL&A or
Schwab shall continue to apply on the sixtieth (60th) day
following the giving
of that notice, which sixtieth day shall be the effective
date of termination; or
(i) at the option of FirstGWL&A in the event that formal
administrative
proceedings are instituted against Schwab by the NASD,
the Securities and
Exchange Commission, or any state securities or insurance
department or any
other regulatory body regarding Xxxxxx'x duties under
this Agreement or
related to the sale of the Fund's shares or the
Contracts, the operation of any
Account, or the purchase of the Fund shares, provided,
however, that
FirstGWL&A determines in its sole judgment exercised in
good faith, that any
such administrative proceedings will have a material
adverse effect upon the
ability of Schwab to perform its obligations related to
the Contracts; or
(j) at the option of Schwab in the event that formal
administrative
proceedings are instituted against FirstGWL&A by the
NASD, the Securities
and Exchange Commission, or any state securities or
insurance department or
any other regulatory body regarding FirstGWL&A's duties
under this
Agreement or related to the sale of the Fund's shares or
the Contracts, the
operation of any Account, or the purchase of the Fund
shares, provided,
however, that Schwab determines in its sole judgment
exercised in good faith,
that any such administrative proceedings will have a
material adverse effect
upon the ability of FirstGWL&A to perform its obligations
related to the
Contracts; or
(k) at the option of any non-defaulting party hereto in
the event of a material
breach of this Agreement by any party hereto (the
"defaulting party") other
than as described in 10.1(a)-(j); provided, that the
non-defaulting party gives
written notice thereof to the defaulting party, with
copies of such notice to all
other non-defaulting parties, and if such breach shall
not have been remedied
within thirty (30) days after such written notice is
given, then the non-
defaulting party giving such written notice may terminate
this Agreement by
giving thirty (30) days written notice of termination to
the defaulting party.
10.2.Notice Requirement. No termination of this Agreement
shall be effective
unless and until the party terminating this Agreement gives prior
written notice to all other
parties of its intent to terminate, which notice shall set forth
the basis for the termination.
Furthermore,
(a) in the event any termination is based upon the provisions
of Article VII, or the
provisions of Section 10.1(a), 10.1(g), 10.1(h) or 10.1(k) of
this Agreement, the prior
written notice shall be given in advance of the effective date
of termination as
required by those provisions unless such notice period is
shortened by mutual written
agreement of the parties;
(b) in the event any termination is based upon the provisions
of Section 10.1(d),
10.1(e), 10.1(i) or 10.1(j) of this Agreement, the prior
written notice shall be given
at least sixty (60) days before the effective date of
termination; and
(c) in the event any termination is based upon the provisions
of Section 10.1(b),
10.1(c) or 10.1(f), the prior written notice shall be given in
advance of the effective
date of termination, which date shall be determined by the
party sending the notice.
10.3.Effect of Termination. Notwithstanding any termination
of this Agreement,
other than as a result of a failure by either the Fund or
FirstGWL&A to meet Section
817(h) of the Code diversification requirements, the Fund and the
Adviser shall, at the
option of FirstGWL&A or Schwab, continue to make available
additional shares of the
Designated Portfolios pursuant to the terms and conditions of this
Agreement, for all
Contracts in effect on the effective date of termination of this
Agreement (hereinafter
referred to as "Existing Contracts"). Specifically, without
limitation, the owners of the
Existing Contracts shall be permitted to reallocate investments in
the Designated Portfolios,
redeem investments in the Designated Portfolios and/or invest in
the Designated Portfolios
upon the making of additional purchase payments under the Existing
Contracts. The parties
agree that this Section 10.3 shall not apply to any terminations
under Article VII and the
effect of such Article VII terminations shall be governed by
Article VII of this Agreement.
10.4.Surviving Provisions. Notwithstanding any termination of
this Agreement, each
party's obligations under Article VIII to indemnify other parties
shall survive and not be
affected by any termination of this Agreement. In addition, with
respect to Existing
Contracts, all provisions of this Agreement shall also survive and
not be affected by any
termination of this Agreement.
10.5.Survival of Agreement. A termination by Schwab shall
terminate this
Agreement only as to Schwab, and this Agreement shall remain in
effect as to the other par-
ties; provided, however, that in the event of a termination by
Schwab the other parties shall
have the option to terminate this Agreement upon 60 (sixty) days
notice, rather than the six
(6) months specified in Section 10.1(a).
ARTICLE XI. Notices
Any notice shall be sufficiently given when sent by
registered or certified mail
to the other party at the address of such party set forth below or
at such other address as
such party may from time to time specify in writing to the other
party.
If to the Fund:
Janus Aspen Series
000 Xxxxxxxx Xxxxxx
Xxxxxx, XX 00000
Attention: General Counsel
If to FirstGWL&A:
First Great-West Life & Annuity Insurance Company
0000 Xxxx Xxxxxxx Xxxx
Xxxxxxxxx, XX 00000
Attention:Assistant Vice President, Savings Products
If to the Adviser:
Janus Capital Corporation
000 Xxxxxxxx Xxxxxx
Xxxxxx, XX 00000
Attention: General Counsel
If to Schwab:
Xxxxxxx Xxxxxx & Co., Inc.
000 Xxxxxxxxxx Xxxxxx
Xxx Xxxxxxxxx, XX 00000
Attention: General Counsel
ARTICLE XII. Miscellaneous
12.1.Subject to the requirements of legal process and
regulatory authority, each
party hereto shall treat as confidential the names and addresses of
the owners of the
Contracts and all information reasonably identified as confidential
in writing by any other
party hereto and, except as permitted by this Agreement, shall not
disclose, disseminate or
utilize such names and addresses and other confidential information
without the express
written consent of the affected party until such time as such
information may come into the
public domain. Without limiting the foregoing, no party hereto
shall disclose any
information that another party has designated as proprietary.
12.2.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.
12.3.This Agreement may be executed simultaneously in two or
more counterparts,
each of which taken together shall constitute one and the same
instrument.
12.4.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.
12.5.Each party hereto shall cooperate with each other party
and all appropriate
governmental authorities (including without limitation the SEC, the
NASD and state
insurance regulators) and shall permit such authorities reasonable
access to its books and
records in connection with any investigation or inquiry relating to
this Agreement or the
transactions contemplated hereby. Notwithstanding the generality
of the foregoing, each
party hereto further agrees to furnish the New York 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 variable
annuity operations of
FirstGWL&A are being conducted in a manner consistent with the New
York Variable
Annuity Regulations and any other applicable law or regulations.
12.6.Any controversy or claim arising out of or relating to
this Agreement, or
breach thereof, may, upon the agreement of all parties, be settled
by arbitration in a forum
jointly selected by the relevant parties (but if applicable law
requires some other forum, then
such other forum) in accordance with the Commercial Arbitration
Rules of the American
Arbitration Association, and judgment upon the award rendered by
the arbitrators may be
entered in any court having jurisdiction thereof.
12.7.The rights, remedies and obligations contained in this
Agreement are
cumulative and are in addition to any and all rights, remedies and
obligations, at law or in
equity, which the parties hereto are entitled to under state and
federal laws.
12.8.This Agreement or any of the rights and obligations
hereunder may not be
assigned by any party without the prior written consent of all
parties hereto.
12.9.Schwab and FirstGWL&A are hereby expressly put on notice
of the limitation
of liability as set forth in the Trust Instrument of the Fund and
agree that the obligations
assumed by the Fund pursuant to this Agreement shall be limited in
any case to the Fund
and its assets and neither Schwab nor FirstGWL&A shall seek
satisfaction of any such
obligation from the shareholders of the Fund or the Adviser, the
Trustees, officers,
employees or agents of the Fund, or any of them, except to the
extent permitted under this
Agreement.
12.10.Schwab and FirstGWL&A agree that the obligations assumed
by the Adviser
pursuant to this Agreement shall be limited in any case to the
Adviser and its assets and
neither Schwab nor FirstGWL&A shall seek satisfaction of any such
obligation from the
shareholders of the Adviser, the directors, officers, employees or
agents of the Adviser, or
any of them, except to the extent permitted under this Agreement.
12.11.The Fund and the Adviser agree that the obligations
assumed by FirstGWL&A
and Schwab pursuant to this Agreement shall be limited in any case
to FirstGWL&A and
Schwab and their respective assets and neither the Fund nor the
Adviser shall seek
satisfaction of any such obligation from the shareholders of the
FirstGWL&A or Schwab,
the directors, officers, employees or agents of the FirstGWL&A or
Schwab, or any of them,
except to the extent permitted under this Agreement.
00.00.Xx provision of this Agreement may be deemed or
construed to modify or
supersede any contractual rights, duties, or indemnifications, as
between the Adviser and the
Fund.
IN WITNESS WHEREOF, each of the parties hereto has caused this
Agreement to
be executed in its name and on its behalf by its duly authorized
representative and its seal
to be hereunder affixed hereto as of the date specified below.
FIRST GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY
By its authorized officer,
By:/s/ Xxxxxx X. Xxxx
Title: Vice President, Marketing & Product
Development
Date: April 1, 1997
JANUS ASPEN SERIES
By its authorized officer,
By:/s/ Xxxxxx Xxxx
Title: Assistant Vice President
Date: March 25, 1997
JANUS CAPITAL CORPORATION
By its authorized officer,
By:/s/ Xxxxxxx Xxxxxxxxx
Title: Vice President of Compliance
Date: March 25, 1997
XXXXXXX XXXXXX & CO., INC.
By its authorized officer,
By:/s/ Xxxx Xxxxxx
Title:Vice President, Annuities & Life Insurance
Date:March 31, 1997
Schwab Variable
Annuity
SCHEDULE A
Contracts Form Numbers
First Great-West Life & Annuity Insurance Company
Group Variable/Fixed Annuity Contract J434NY
SCHEDULE B
Designated Portfolios
Janus Aspen Aggressive Growth Portfolio
Janus Aspen Growth Portfolio
Janus Aspen Worldwide Growth Portfolio
SCHEDULE D
Reports per Section 6.6
With regard to the reports relating to the quarterly testing
of compliance with the
requirements of Section 817(h) and Subchapter M under the Internal
Revenue Code (the
"Code") and the regulations thereunder, the Fund shall provide
within twenty (20)
Business Days of the close of the calendar quarter (45 days for the
last quarter) a report
to FirstGWL&A in the Form D1 attached hereto and incorporated
herein by reference,
regarding the status under such sections of the Code of the
Designated Portfolio(s), and
if necessary, identification of any remedial action to be taken to
remedy non-compliance.
With regard to the reports relating to the year-end testing of
compliance with the
requirements of Subchapter M of the Code, referred to hereinafter
as "RIC status," the
Fund will provide a year-end report within 45 days after the end of
the calendar year.
However, if a problem with regard to RIC status, as defined below,
is identified in any of
the quarterly reports, on a weekly basis thereafter, additional
interim reports will be
provided specifically addressing the problems identified in such
report. If any interim
report memorializes the cure of the problem, subsequent interim
reports will not be
required.
A problem with regard to RIC status is defined as any
violation of the following
standards, as referenced to the applicable sections of the Code:
(a) If, at the Fund's fiscal year end, less than ninety
percent of gross income is
derived from sources of income specified in Section 851(b)(2);
(b) If, at the end of the Fund's fiscal year end, thirty
percent or greater gross
income is derived from the sale or disposition of assets
specified in Section
851(b)(3);
(c) If, at the end of each fiscal quarter end, less than fifty
percent of the value of
the Fund's total assets consists of assets specified in
Section 851(b)(4)(A); and
(d) If, at the end of each fiscal quarter end, no more than
twenty-five percent of
the value of total assets of the Fund is invested in the
securities of one issuer, as
that requirement is set forth in Section 851(b)(4)(B).
FORM D1
CERTIFICATE OF COMPLIANCE
I, , a duly authorized officer,
director or agent of
Fund hereby certify that Fund is in compliance
with all requirements of
Section 817(h) and Subchapter M of the Internal Revenue Code (the
"Code") and the
regulations thereunder as required in the Fund Participation
Agreement among First
Great-West Life & Annuity Insurance Company, Xxxxxxx Xxxxxx & Co.,
Inc. and
other than the exceptions discussed below:
Exceptions Remedial Action
If no exception to report, please indicate "None."
Signed this day of
, .
(Signature)
By:
(Type or Print Name and
Title/Position)
SCHEDULE E
EXPENSES
The Fund and/or Adviser, and FirstGWL&A will coordinate the
functions and pay
the costs of the completing these functions based upon an
allocation of costs in
the tables below. Costs shall be allocated to reflect the Fund's
share of the total
costs determined according to the number of pages of the Fund's
respective
portions of the documents.
Item
Function
Party Responsible for
Coordination
Party Responsible
for Expense
Mutual Fund
Prospectus
Printing of combined
prospectuses
FirstGWL&A
Fund or Adviser,
as applicable
Fund or Adviser shall
supply FirstGWL&A
film/disk or such
number of Designated
Portfolio(s)
prospectus(es) as
FirstGWL&A requires
for printing combined
prospectus
FirstGWL&A
Fund or Adviser,
as applicable
Distribution to New
and Inforce Clients
FirstGWL&A
FirstGWL&A
Distribution to
Prospective Clients
Schwab
Schwab
Product Prospectus
Printing for Inforce
Clients
FirstGWL&A
FirstGWL&A
Printing for Prospective
Clients
FirstGWL&A
Schwab
Distribution to New
and Inforce Clients
FirstGWL&A
FirstGWL&A
Distribution to
Prospective Clients
Schwab
Schwab
Mutual Fund
Prospectus Update &
Distribution
If Required by Fund or
Adviser
Fund or Adviser
Fund or Adviser
If Required by
FirstGWL&A
FirstGWL&A
FirstGWL&A
If Required by Schwab
Schwab
Schwab
Product Prospectus
Update & Distribution
If Required by Fund or
Adviser
FirstGWL&A
Fund or Adviser
Item
Function
Party Responsible for
Coordination
Party Responsible
for Expense
If Required by
FirstGWL&A
FirstGWL&A
FirstGWL&A
If Required by Schwab
Schwab
Schwab
Mutual Fund SAI
Printing
Fund or Adviser
Fund or Adviser
Distribution
FirstGWL&A
FirstGWL&A
Product SAI
Printing
FirstGWL&A
FirstGWL&A
Distribution
FirstGWL&A
FirstGWL&A
Item
Function
Party Responsible for
Coordination
Party Responsible
for Expense
Proxy Material for
Mutual Fund:
Printing if proxy
required by Law
Fund or Adviser
Fund or Adviser
Distribution (including
labor) if proxy required
by Law
FirstGWL&A
Fund or Adviser
Printing & distribution
if required by
FirstGWL&A
FirstGWL&A
FirstGWL&A
Printing & distribution
if required by Schwab
FirstGWL&A
Schwab
Item
Function
Party Responsible for
Coordination
Party Responsible
for Expense
Mutual Fund Annual &
Semi-Annual Report
Printing of combined
reports
FirstGWL&A
Fund or Adviser
Distribution
FirstGWL&A
FirstGWL&A and
Schwab
Other communication
to New and Prospective
clients
If Required by the
Fund or Adviser
Schwab
Fund or Adviser
If Required by
FirstGWL&A
Schwab
FirstGWL&A
Item
Function
Party Responsible for
Coordination
Party Responsible
for Expense
If Required by Schwab
Schwab
Schwab
Other communication
to inforce
Distribution (including
labor) if required by
the Fund or Adviser
FirstGWL&A
Fund or Adviser
If Required by
FirstGWL&A
FirstGWL&A
FirstGWL&A
If Required by Schwab
FirstGWL&A
Schwab
Item
Function
Party Responsible for
Coordination
Party Responsible
for Expense
Errors in Share Price
calculation pursuant to
Section 1.10
Cost of error to
participants
FirstGWL&A
Fund or Adviser
Cost of administrative
work to correct error
FirstGWL&A
Fund or Adviser
Operations of the Fund
All operations and
related expenses,
including the cost of
registration and
qualification of shares,
taxes on the issuance or
transfer of shares, cost
of management of the
business affairs of the
Fund, and expenses
paid or assumed by the
fund pursuant to any
Rule 12b-1 plan
Fund or Adviser
Fund or Adviser
Operations of the
Account
Federal registration of
units of separate
account (24f-2 fees)
FirstGWL&A
FirstGWL&A
