EXHIBIT (8) (A): PARTICIPATION AGREEMENT WITH XXXXX AMERICAN FUND
PARTICIPATION AGREEMENT
AMONG
THE XXXXX AMERICAN FUND
XXXX XXXXX MANAGEMENT INC.
AND
UNITED OF OMAHA LIFE INSURANCE COMPANY
THIS AGREEMENT, made and entered into as of this l day of June, 1995, by
and among UNITED OF OMAHA LIFE INSURANCE COMPANY (hereinafter "United"), a
Nebraska life insurance company, on its own behalf and on behalf of its Separate
Account C (the "Account"), and The Xxxxx American Fund, a business trust
organized under the laws of Massachusetts (hereinafter the "Fund") and Xxxx
Xxxxx Management, Inc. (hereinafter the "Adviser"), a New York corporation.
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 variable
annuity contracts (collectively, the "Variable Insurance Products") to be
offered by insurance companies which have entered into participation agreements
similar to this Agreement (hereinafter "Participating Insurance Companies"); and
WHEREAS, the beneficial interests in the Fund are currently divided into
six 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, dated February 17, 1989 (File No. 812-7076), 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 both affiliated and
unaffiliated life insurance companies (hereinafter the "Shared Funding Exemptive
Order"); and
WHEREAS, the Fund is registered as an open-end diversified management
investment company under the 1940 Act and shares of the Portfolios 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 federal Investment Advisers Act of 1940, as amended, and any applicable
state securities laws and is the Fund's investment adviser and manager; and
WHEREAS, United has registered 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 hereto, 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 United on
the date shown for such account on Schedule A hereto, to set aside and invest
assets attributable to the aforesaid variable annuity contracts; and
WHEREAS, United has registered or will register the Account as a unit
investment trust under the 1940 Act; and
WHEREAS, to the extent permitted by applicable insurance laws and
regulations, United intends to purchase shares in the Portfolios listed in
Schedule A hereto, as it may be amended from time to time by mutual written
agreement (the "Designated Portfolios") on behalf of the Account to fund the
aforesaid Contracts; and
WHEREAS, United and the Adviser have entered into a Service Agreement
dated ;
NOW, THEREFORE, in consideration of their mutual promises, United, the
Fund, and the Adviser agree as follows:
ARTICLE I. SALE OF FUND SHARES
1.1. The Fund agrees to sell to United those shares of the Designated
Portfolios which the Account orders, executing such orders on a daily basis 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,
United shall be the designee of the Fund for receipt of such orders and receipt
by such designee shall constitute receipt by the Fund. United will use its best
efforts to give the Fund notice of such order by 10 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 Securities and Exchange Commission.
1.2. The Fund agrees to make shares of the Designated Portfolios
available indefinitely for purchase at the applicable net asset value per share
by United on behalf of the Account on those days on which the Fund calculates
its net asset value pursuant to rules of the Securities and Exchange Commission,
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 and the Adviser agree that shares of the Designated
Portfolios will be sold only to Participating Insurance Companies, their
separate accounts, and other persons but only insofar as consistent with the
applicability of the "lookthrough rule" of paragraph (f)(2)(i) of Treas. Reg.
ss. 1.817-5 pursuant to ss. 817(h)(4) of the Internal Revenue Code of 1986, as
amended (the "Code"). No shares of any Designated Portfolio will be sold to the
general public. The Fund will not sell shares of the Designated Portfolios to
any other insurance company or separate account unless an agreement containing
provisions substantially the same as Sections 3.4 and 3.5 and Articles I and VII
of this Agreement is in effect to govern such sales.
1.4. The Fund agrees to redeem for cash, on United's request, any full
or fractional shares of the Fund held by United, executing such requests on a
daily basis at the net asset value next computed after receipt by the Fund or
its designee of the request for redemption, except that the Fund reserves the
right to suspend the right of redemption, consistent with Section 22(e) of the
1940 Act and any applicable rules thereunder. For purposes of this Section 1.4,
United shall be the designee of the Fund for receipt of requests for redemption
and receipt by such designee shall constitute receipt by the Fund. United will
use its best efforts to give the Fund notice of such request for redemption by
10:00 a.m. 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
insurance companies (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. United shall pay for Fund shares on the next Business Day after an
order to purchase Fund shares is made 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. For purposes
of Section 2.7 hereof, upon receipt by the Fund of the federal funds so wired,
such funds shall cease to be the responsibility of United and shall become the
responsibility of the Fund.
1.7. The Fund generally shall pay and transmit the proceeds of
redemptions of Fund shares on the next Business Day after a redemption order is
received in accordance with Section 1.4 hereof (except that the Fund reserves
the right to postpone payment upon redemption consistent with Section 22(e) of
the 1940 Act and any applicable rules thereunder, to the extent consistent with
interpretations of the Securities and Exchange Commission or its staff). 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 United or the Account. Shares
ordered from the Fund will be recorded in an appropriate title for the Account
or the appropriate subaccount of the Account.
1.9. The Fund shall furnish same day notice (by wire or telephone,
followed by written confirmation) to United of any income, dividends, or capital
gain distributions payable on the Designated Portfolios' shares. United 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.
United reserves the right to revoke this election and to receive all such
income, dividends, and capital gain distributions in cash. The Fund shall notify
United 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 United on a daily basis 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 p.m. eastern
time. If the Fund provides incorrect share net asset value information, United
shall be entitled to an appropriate adjustment. Any material error in the
calculation or reporting of net asset value per share, dividend or capital gains
information shall be reported to United.
ARTICLE II. REPRESENTATIONS AND WARRANTIES
2.1. United represents and warrants that the Contracts are or, prior to
issuance, 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. United 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 as a segregated asset account under the Nebraska
Insurance Laws and has registered or, prior to any issuance or sale of the
Contracts, will register 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.
2.2. The Fund represents and warrants that Portfolio 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 and
state securities laws including without limitation the 1933 Act, the Securities
Exchange Act of 1934 as amended (hereinafter the "1934 Act"), applicable
securities laws of the State of Nebraska, 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 shares of
the Designated Portfolios. The Fund shall register and qualify such shares for
sale in accordance with the laws of the various states if and to the extent
required by applicable law.
2.3. The Fund undertakes to have a 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 use its best efforts
to ensure that the investment policies, fees and expenses of the Designated
Portfolios are and shall at all times remain in compliance with applicable
insurance and other applicable laws of the State of Nebraska and any other
applicable state, to the extent required to perform this Agreement and to the
extent specifically requested in writing by United.
2.5. The Fund represents and warrants that it is lawfully organized and
validly existing under the laws of the Commonwealth of Massachusetts 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 any applicable state and federal securities laws (and any other
applicable laws of the State of Nebraska to the extent specifically requested in
writing by United).
2.7. The Fund and the Adviser represent and warrant that all of their
directors, 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 as required currently 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. The Fund will provide United with as much notice as is reasonably
practicable of any material change affecting the Fund (including, but not
limited to, any proxy solicitation and any material change in its registration
statement or prospectus) and consult with United in order to implement any such
change in an orderly manner.
ARTICLE III. SHAREHOLDER COMMUNICATIONS
3.1. The Adviser shall provide United with a camera-ready copy of each
updated version of any of the Fund's then-current prospectuses relating to a
Designated Portfolio, any supplements thereto, the Fund's annual and semi-annual
reports, and any supplements thereto, and the Fund's proxy materials relating to
any Designated Portfolio.
3.2. The Adviser shall provide United with a copy of each updated
Statement of Additional Information ("SAI") for the Fund suitable for
duplication.
3.3. It is understood and agreed that, except with respect to
information regarding United, the Account or the Contracts supplied by United or
persons under its control, United is not responsible for the content of the
prospectus or SAI for the Designated Portfolios. It is also understood and
agreed that, except with respect to information regarding the Fund, Adviser, or
the Designated Portfolios provided by the Fund or the Adviser or persons under
their control, neither the Fund nor Adviser are responsible for the content of
the prospectus or SAI for the Contracts.
3.4. If and to the extent required by law or by the Shared Funding
Exemptive Order, United shall:
(i) solicit voting instructions from Contract owners;
(ii) vote the Fund shares in accordance with instructions
received from Contract owners; and
(iii) vote Fund shares for which no instructions have been
received or which are not attributable to Contract owners
in the same proportion as Fund shares of such portfolio
for which instructions have been received, so long as and
to the extent that the Securities and Exchange Commission
continues to interpret the 1940 Act to require
passthrough voting privileges for variable contract
owners.
3.5. Participating Insurance Companies shall be responsible for assuring
that each of their separate accounts participating in a Designated Portfolio
calculates voting privileges in a consistent manner as required by the Shared
Funding Exemptive Order.
3.6. 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 or 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 Securities and Exchange Commission'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.
ARTICLE IV. SALES MATERIAL AND INFORMATION
4.1. United shall furnish, or shall cause to be furnished, to the Fund
or its designee, each piece of sales literature and other promotional material
that United develops or uses and in which the Fund (or a Portfolio thereof) or
Adviser or the underwriter for the Fund shares is named, at least 15 Business
Days prior to its use. No such material shall be used if the Fund or its
designee objects to such use within 15 Business Days after receipt of such
material.
4.2. United shall not give any information or make any representations
or statements on behalf of the Fund or the Adviser or concerning the Fund or the
Adviser in connection with the sale of the Contracts other than the information
or representations contained in the registration statement or prospectus or SAI
for the Fund shares, as such registration statement and prospectus or SAI may be
amended or supplemented from time to time, or in reports or proxy statements for
the Fund, or in sales literature and other promotional material approved by the
Fund or its designee or by the Adviser, except with the permission of the Fund
or the Adviser or the designee of either.
4.3. The Fund or Adviser shall furnish, or shall cause to be furnished,
to United, each piece of sales literature and other promotional material in
which United and/or its separate account(s), is named at least 15 Business Days
prior to its use. No such material shall be used if United objects to such use
within 15 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 United or concerning United, the Account, or the
Contracts other than the information or representations contained in a
registration statement or prospectus or SAI for the Contracts, as such
registration statement and prospectus and SAI may be amended or supplemented
from time to time, or in reports for the Account, or in sales literature and
other promotional material approved by United or its designee, except with the
permission of United.
4.5. The Fund will provide to United at least one complete copy of all
registration statements, prospectuses, Statements of Additional Information,
reports, proxy statements, 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 Designated Portfolios, contemporaneously
with the filing of such document(s) with the Securities and Exchange Commission
or other regulatory authorities.
4.6. United will provide to the Fund at least one complete copy of all
registration statements, prospectuses, Statements of Additional Information,
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
Securities and Exchange Commission.
4.7. For purposes of this Article IV, 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), 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, Statements of Additional Information, shareholder reports, and
proxy materials.
ARTICLE V. FEES AND EXPENSES
5.1. The Fund and the Adviser shall pay no fee or other compensation to
United under this Agreement, and United 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 Articles III, V, and other provisions
of this Agreement, and payments will be made as specified in the Service
Agreement.
5.2. Except as otherwise specifically provided herein or in the Service
Agreement, each party will bear all expenses incident to its performance under
this Agreement. The Fund shall bear the expenses for the cost of registration
and qualification of the Fund's shares, preparation and filing of the Fund's
prospectus and registration statement, proxy materials and reports, setting the
prospectus in type, setting the proxy materials and reports to shareholders in
type, the preparation of all statements and notices required by any federal or
state law, and all taxes on the issuance or transfer of the Fund's shares.
5.3. The Fund and Adviser acknowledge that a principal feature of the
Contracts is the Contract owner's ability to choose from a number of
unaffiliated mutual funds (and portfolios or series thereof) ("Unaffiliated
Funds"), and to transfer the Contract's cash value between funds and portfolios.
ARTICLE VI. DIVERSIFICATION AND QUALIFICATION
6.1. The Fund and Adviser represent and warrant that each Designated
Portfolio will at all times comply, to the extent that it is within the power of
the Fund and Adviser, with Section 817(h) of the Code and Treasury Regulation
ss.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. In the event that a
Designated Portfolio ceases so to comply, the Fund will take all reasonable
steps (a) to notify United of such noncompliance, and (b) to adequately
diversify the Designated Portfolios so as to achieve compliance within the grace
period afforded by Regulation 1.817-5.
6.2. The Fund and Adviser represent and warrant that each Designated
Portfolio is currently qualified as a Regulated Investment Company under
Subchapter M of the Code, and that it will maintain such qualification (under
Subchapter M or any successor or similar provisions) as long as this Agreement
is in effect. The Fund or Adviser will notify United immediately upon having a
reasonable basis for believing that 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.
6.3. United shall make every effort to maintain the treatment of the
Contracts as annuity contracts under applicable provisions of the Code, and
shall notify the Fund and the Adviser immediately upon having a reasonable basis
for believing that such Contracts have ceased to be so treated or that they
might not be so treated in the future.
ARTICLE VII. Potential Conflicts and Compliance With
SHARED FUNDING EXEMPTIVE ORDER
7.1. The Board of Trustees of the Fund (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
and determine what action, if any, should be taken in response to such
conflicts. 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 (f) a decision
by an insurer to disregard the voting instructions of contract owners. The Board
shall promptly inform United if it determines that an irreconcilable material
conflict exists and the implications thereof.
7.2. United will report any potential or existing conflicts of which it
is aware to the Board. United will assist the Board in carrying out its
responsibilities under the 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 United to
inform the Board whenever contract owner voting instructions are disregarded and
on all other matters referred to in this Article VII.
7.3. If it is determined by a majority of the Board, or a majority of
its disinterested members, that a material irreconcilable conflict exists,
United and other Participating Insurance Companies shall, at their expense and
to the extent reasonably practicable (as determined by a majority of the
disinterested Board members), take whatever steps are necessary to remedy or
eliminate the irreconcilable material conflict, including: (1) withdrawing the
assets allocable to some or all of the separate accounts from the Fund or any
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 United to disregard contract owner voting instructions and that decision
represents a minority position or would preclude a majority vote, United 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 disinterested members
of the Board. 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 Fund shall continue
to accept and implement orders by United 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 United conflicts with the
majority of other state regulators, then United will withdraw the Account's
investment in the Fund and this Agreement shall terminate within six months
after the Board informs United 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 United 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 disinterested members of the Board 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. United 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 Contract owners materially adversely 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 United will withdraw the Account's investment in the Fund and
this Agreement shall terminate within six (6) months after the Board informs
United 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
disinterested members of the Board.
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
Act or the rules promulgated thereunder with respect to mixed or shared funding
(as defined in the Shared Funding Exemptive Order) on terms and conditions
materially different from those contained in the 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 3.4, 3.5, 7.1, 7.2, 7.3, 7.4, and 7.5 of this Agreement shall
be deemed modified to the extent necessary also to comply with the terms and
conditions contained in such Rule(s) as so amended or adopted.
7.8. United shall at least annually submit to the Board of Trustees of
the Fund such reports, materials or data as the Trustees may reasonably request
so that the Trustees may fully carry out the obligations imposed upon them by
the Shared Funding Exemptive Order, and said reports, materials and data shall
be submitted more frequently if deemed appropriate by the Board of Trustees.
7.9. United agrees that any remedial action taken by it in resolving any
irreconcilable conflict will be carried out at its expense and with a view only
to the interests of Contract owners.
ARTICLE VIII. INDEMNIFICATION
8.1. INDEMNIFICATION BY UNITED
8.1(a). United agrees to indemnify and hold harmless the Fund,
the Adviser, each of their officers, each member of their Boards and each
person, if any, who controls 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, damages, liabilities (including amounts
paid in settlement with the written consent of United), or litigation (including
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 for the Contracts or contained in the Contracts
(or any amendment or supplement to any of the foregoing), or arise out
of or are based upon the omission or the alleged omission to state
therein a material fact required to be stated therein or necessary to
make the statements therein not misleading, provided that this
Agreement to indemnify shall not apply as to any Indemnified Party if
such statement or omission or such alleged statement or omission was
made in reliance upon and in conformity with information furnished to
United by or on behalf of the Fund for use in the Registration
Statement or prospectus or SAI for the Contracts or in the Contracts
or sales literature (or any amendment or supplement) or otherwise for
use in connection with the sale of the Contracts or Fund shares; or
(ii) arise out of or as a result of statements or representations (other
than statements or representations contained in the Registration
Statement, prospectus, SAI, or sales literature of the Fund not
supplied by United or persons under its control) or wrongful conduct
of United 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, SAI,
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 to the Fund by or on
behalf of United; or
(iv) arise as a result of any material failure by United 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 United in this Agreement or arise out of or
result from any other material breach of this Agreement by United; as
limited by and in accordance with the provisions of Sections 8.1(b)
and 8.1(c) hereof.
8.1(b). United 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 its obligations or duties.
8.1(c). United 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 United 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 UNITED OF ANY SUCH CLAIM SHALL not
relieve United 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. In case any such action is brought against the
Indemnified Parties, United shall be entitled to participate, at its own
expense, in the defense of such action. United also shall be entitled to assume
the defense thereof, with counsel satisfactory to the party named in the action.
After notice from United to such party of United's election to assume the
defense thereof, the Indemnified Party shall bear the fees and expenses of any
additional counsel retained by it, and United 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 United 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.
8.2. INDEMNIFICATION BY THE ADVISER
8.2(a).The Adviser agrees to indemnify and HOLD HARMless United
and each of United's directors and officers and each person, if any, who
controls United 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, damages, liabilities (including amounts paid in settlement with
the written consent of the Adviser), or litigation (including 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 of the Fund (or any amendment
or supplement to any of the foregoing), or arise out of or are based
upon the omission or the alleged omission to STATE therein a material
fact required to be stated therein or necessary to make the statements
therein not misleading, provided that this Agreement to indemnify
shall not apply as to any Indemnified Party if such statement or
omission or such alleged statement or omission was made in reliance
upon and in conformity with information furnished to the Adviser or
Fund by or on behalf of United for use in the Registration Statement
or prospectus or SAI 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 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 for the Contracts not
supplied by the Adviser or Fund or persons under their control) or
wrongful conduct of the Fund or 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
to United by or on behalf of the Fund; or
(iv) arise as a result of any material failure by the Fund to provide the
services and furnish the materials under the terms of this Agreement
(including a material failure, whether unintentional or in good faith
or otherwise, to comply 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 Adviser in this Agreement or arise out of
or result from any other material breach of this Agreement by the
Adviser; as limited by and in accordance with the provisions of
Sections 8.2(b) and 8.2(c) hereof.
8.2(b). The Adviser 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 and duties under this
Agreement or to United or the Account, whichever is applicable.
8.2(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. 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.
8.2(d). United agrees promptly to notify the Adviser of the
commencement of any litigation or proceedings against any Indemnified Party in
connection with the issuance or sale of the Contracts or the operation of the
Account.
8.3. INDEMNIFICATION BY THE FUND
8.3(a). The Fund agrees to indemnify and hold harmless United and
each of its directors and officers and each person, if any, who controls United
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 Fund), or litigation (including 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 operations of the Fund and:
(i) arise as a result of any material failure by the Fund to
provide the services and furnish the materials under the
terms of this Agreement (including a material failure,
whether unintentional or in good faith or otherwise, to
comply with the diversification and other qualification
requirements specified in Article VI of this Agreement);
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; as limited
by and in accordance with the provisions of Sections
8.3(b) and 8.3(c) hereof.
8.3(b). The Fund 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 and duties under this Agreement or to
United, the Fund, the Adviser or the Account, whichever is applicable.
8.3(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 the Fund 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. 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.
8.3(d). United agrees promptly to notify the Fund of the
commencement of any litigation or proceeding against any Indemnified Party 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.
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 Nebraska.
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 Shared Funding
Exemptive Order) and the terms hereof shall be interpreted and construed in
accordance therewith.
ARTICLE X. TERMINATION
10.1. This Agreement shall continue in full force and effect
until the first to occur of:
(a) termination by any party, with or without cause, with respect
to some or all Portfolios, by six (6) months' advance written
notice delivered to the other parties (unless a shorter time is
agreed to in writing by the non-terminating party(ies)); or
(b) termination by United by written notice to the other parties
with respect to any Portfolio based upon United's determination
that shares of such Portfolio are not reasonably available to
meet the requirements of the Contracts; or
(c) termination by United 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 United; or
(d) termination by the Fund in the event that formal
administrative proceedings are instituted against United by the
National Association of Securities Dealers, Inc. ("NASD"), the
Securities and Exchange Commission, the Insurance Commissioner or
like official of any state or any other regulatory body regarding
United's duties under this Agreement or related to the sale of
the Contracts, the operation of any Account, or the purchase of
the Fund shares, provided, however, that the Fund determines in
its sole judgment exercised in good faith, that any such
administrative proceedings will have a material adverse effect
upon the ability of United to perform its obligations under this
Agreement; or
(e) termination by United in the event that formal administrative
proceedings are instituted against the Fund or Adviser by the
NASD, the Securities and Exchange Commission, or any state
securities or insurance department or any other regulatory body,
provided, however, that United 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 Adviser to perform its obligations under this Agreement; or
(f) termination by United by written notice to the Fund and the
Adviser with respect to any Portfolio in the event that such
Portfolio fails to meet the Section 817(h) diversification
requirements or Subchapter M qualifications specified in Article
VI hereof or if United reasonably believes that the Portfolio may
fail to meet either of those requirements; or
(g) termination by either the Fund or the Adviser by written
notice to United, if either one or both of the Fund or the
Adviser respectively, shall determine, in their sole judgment
exercised in good faith, that United has suffered a material
adverse change in its business operations, financial condition,
or prospects since the date of this Agreement or is the subject
of material adverse publicity; or
(h) termination by United by written notice to the Fund and the
Adviser, if United shall determine, in its sole judgment
exercised in good faith, that the Fund or the Adviser has
suffered a material adverse change in its business, operations,
financial condition, or prospects since the date of this
Agreement or is the subject of material adverse publicity; or
(i) termination by either the Fund or the Adviser by written
notice to United, in the event that the Contracts cease to
qualify as annuity contracts under the Code or if the Contracts
are not registered, issued, or sold in material compliance with
applicable state and/or federal law; or
(j) termination by United upon a material breach of this
Agreement or of any representation or warranty herein by the Fund
or the Adviser; or
(k) termination by either the Fund or the Adviser upon a material
breach of this Agreement or of any representation or warranty
herein by United.
10.2. EFFECT OF TERMINATION. If this Agreements is terminated pursuant
to any of paragraphs (b), (e), (g), (h), or (j) of Section 10.1, then,
notwithstanding such termination, the Fund and the Adviser shall, at the option
of United and only to the extent consistent with applicable law, continue to
make available additional shares of the Fund 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 Fund, redeem
investments in the Fund and/or invest in the Fund upon the making of additional
purchase payments under the Existing Contracts.
10.3. SURVIVING PROVISIONS. Notwithstanding any termination of this
Agreement, each party's obligation under Article VIII to indemnify other parties
shall survive and not be affected by any termination of this Agreement.
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:
The Xxxxx American Fund
00 Xxxxxxxxxx Xxxxxx
Xxxxxx Xxxx, Xxx Xxxxxx 00000
Attention: Xxxxxxx X. Xxxx
If to United:
United of Omaha Life Insurance Company
3 - Law Division
Mutual of Xxxxx Xxxxx
Xxxxx, XX 00000-0000
Attention: Variable Products Counsel
If to the Adviser:
Xxxx Xxxxx Management, Inc.
00 Xxxxxxxxxx Xxxxxx
Xxxxxx Xxxx, Xxx Xxxxxx 00000
Attention: Xxxxxxx X. Xxxx
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 reasonably considers to be 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
Securities and Exchange Commission, 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 Nebraska 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 United are being conducted
in a manner consistent with the Nebraska Variable Annuity Regulations and any
other applicable law or regulations.
12.6. 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.
12.7. 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.
12.8. All persons dealing with the Fund must look solely to the property
of the Fund for the enforcement of any claims against the Fund as neither the
Board, officers, agents, or shareholders assume any personal liability for
obligations entered into on behalf of 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
representatives and its seal to be hereunder affixed hereto as of the date
specified below.
SEAL UNITED OF OMAHA LIFE INSURANCE COMPANY
By its authorized officer,
By: /S/ XXXXXXX X. XXXX
Title: SENIOR VICE PRESIDENT
Date:
Fund:
SEAL THE XXXXX AMERICAN FUND
By its authorized officer,
By: /S/ XXXXXXX X. XXXX
Title: TREASURER
Date: JUNE 5, 1995
Advisor:
SEAL XXXX XXXXX MANAGEMENT, INC.
By its authorized officer,
By: /S/ XXXXXXX X. XXXX
Title: EXECUTIVE VICE PRESIDENT
Date: JUNE 5, 1995
SCHEDULE A
================================================================================
SEPARATE ACCOUNTS, ASSOCIATED CONTRACTS,
AND DESIGNATED PORTFOLIOS
================================================================================
------------------------ ------------------------------------ ==================
Name of Separate
Account and Date Contracts Funded by Designated
Established Separate Account Portfolios
------------------------ --------------------------- ===========================
------------------------ --------------------------- ===========================
Xxxxx American
Separate Account C 6090L Small Capitalization
(12/1/93) Portfolio
Xxxxx American Growth
Portfolio
------------------------ --------------------------- ===========================
