EXHIBIT (8)(m)
PARTICIPATION AGREEMENT
BETWEEN
XXXXXXX XXXXX LIFE INSURANCE COMPANY,
AND
FIDELITY DISTRIBUTORS CORPORATION
THIS AGREEMENT, dated as of the _____ day of _________, 2002, by and
among Xxxxxxx Xxxxx Life Insurance Company (the "Company"), an Arkansas life
insurance company, on its own behalf and on behalf of each segregated asset
account of the Company set forth on Schedule A hereto as may be amended from
time to time (hereinafter referred to individually and collectively as the
"Account"), and Fidelity Distributors Corporation (the "Underwriter"), a
Massachusetts corporation.
WHEREAS, Underwriter is the principal underwriter for each mutual fund
listed on Exhibit __, (each hereinafter referred to as "the Fund"), each of
which a series of an open-end management investment company registered under the
Investment Company Act of 1940, as amended, (the "1940 Act") and shares of the
Funds are registered under the Securities Act of 1933, as amended (the "1933
Act");
WHEREAS, the Underwriter, which serves as distributor to the Funds, is
registered as a broker-dealer with the Securities and Exchange Commission (the
"SEC") under the Securities Exchange Act of 1934, as amended (the "1934 Act"),
and is a member in good standing of the National Association of Securities
Dealers, Inc. (the "NASD");
WHEREAS, the Account is duly established and maintained as a segregated
asset account, duly established by the Company, on the date shown for such
Account on Schedule A hereto, to set aside and invest assets attributable to
variable annuity contracts set forth in Schedule A hereto, as it may be amended
from time to time by mutual written agreement (the "Contracts");
WHEREAS, each Fund issues shares to the general public and to the
separate accounts of insurance companies ("Participating Insurance Companies")
to fund variable annuity contracts sold to certain qualified pension and
retirement plans;
WHEREAS, the Company intends to purchase shares of other open-end
management investment companies that offer shares to the general public to fund
the Contracts;
1
WHEREAS, the Underwriter knows of no reason why shares in any Fund may
not be sold to Participating Insurance Companies to fund variable annuity
contracts sold to certain qualified pension and retirement plans; and
WHEREAS, to the extent permitted by applicable insurance laws and
regulations, the Company intends to purchase shares in the Funds (and classes
thereof) listed in Schedule B hereto, as it may be amended from time to time by
mutual written agreement (the "Designated Funds") on behalf of the Account to
fund the aforesaid Contracts, and the Underwriter is authorized to sell such
shares in the Designated Funds, and classes thereof, to the Account at net asset
value.
NOW, THEREFORE, in consideration of their mutual promises, the Company,
and the Underwriter agree as follows:
ARTICLE I. Sale of Fund Shares
1.1. The Fund has granted to the Underwriter exclusive authority to
distribute the Fund's shares (the "Shares"). Pursuant to such authority and
instructions, and subject to Article IX hereof, the Underwriter agrees to make
the Shares available to the Company for purchase on behalf of the Account, such
purchases to be effected at net asset value in accordance with Section 1.3 of
this Agreement, provided that the Company qualifies for any sales load waiver
described in the then current Fund prospectus. Notwithstanding the foregoing,
the Board of Trustees of the Fund (the "Board") may suspend or terminate the
offering of Shares of any Designated Fund or class thereof, if such action is
required by law or by regulatory authorities having jurisdiction or if, in the
sole discretion of the Board acting in good faith and in light of its fiduciary
duties under federal and any applicable state laws, suspension or termination is
necessary in the best interests of the shareholders of such Designated Fund.
1.2. The Fund shall redeem, at the Company's request, any full or
fractional Shares held by the Company on behalf of the Account, such redemptions
to be effected at net asset value in accordance with Section 1.3 of this
Agreement, provided that the Company qualifies for any sales load waiver
described in the then current Fund prospectus. Notwithstanding the foregoing,
(i) the Company shall not redeem Shares attributable to Contract owners except
in the circumstances permitted in Section 9.3 of this Agreement, and (ii) the
Fund may delay redemption of Shares of any Designated Fund to the extent
permitted by the 1940 Act, and any rules, regulations, or orders thereunder.
2
1.3. Purchase and Redemption Procedures
The parties, or their authorized affiliates, have previously
entered into an Agency Trading Agreement ("ATA") dated as of March 30, 1999, and
the parties mutually agree that the ATA as amended from time to time, shall
apply to purchase and redemption transactions covered by this Agreement. In
addition, this Agreement is not intended to affect any operating processes or
procedures employed by the parties from time to time in connection with the ATA.
1.4. The Distributor or its affiliates on behalf of the Fund shall
furnish notice (by wire or telephone followed by written confirmation) to the
Company as soon as reasonably practicable of any income dividends or capital
gain distributions payable on any Shares. The Company, on its behalf and on
behalf of the Account, hereby elects to receive all such dividends and
distributions as are payable on any Shares in the form of additional Shares of
that Designated Fund. The Company reserves the right, on its behalf and on
behalf of the Account, to revoke this election and to receive all such dividends
and capital gain distributions in cash. The Distributor or its affiliates on
behalf of the Fund shall notify the Company promptly of the number of Shares so
issued as payment of such dividends and distributions.
1.6. Issuance and transfer of Shares shall be by book entry only.
Stock certificates will not be issued to the Company or the Account. Purchase
and redemption orders for Fund shares shall be recorded in an appropriate ledger
for the Account or the appropriate subaccount of the Account.
1.7. The parties hereto acknowledge that the arrangement contemplated
by this Agreement is not exclusive; the Fund's shares may be sold to other
investors and the cash value of the Contracts may be invested in other
investment companies.
3
ARTICLE II. Representations and Warranties
2.1. The Company represents and warrants that the Contracts (a) are,
or prior to issuance will be, registered under the 1933 Act, or (b) are not
registered because they are properly exempt from registration under the 1933 Act
or will be offered exclusively in transactions that are properly exempt from
registration under the 1933 Act. The Company further represents and warrants
that the Contracts will be issued and sold in compliance in all material
respects with all applicable federal securities and state securities and
insurance laws and that the sale of the Contracts shall comply in all material
respects with state insurance suitability requirements. The Company further
represents and warrants that it is an insurance company duly organized and in
good standing under applicable law, that it has legally and validly established
the Account prior to any issuance or sale thereof as a segregated asset account
under Arkansas insurance laws, and that it (a) 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, or alternatively (b) has not
registered the Account in proper reliance upon an exclusion from registration
under the 1940 Act. The Company shall register and qualify the Contracts or
interests therein as securities in accordance with the laws of the various
states only if and to the extent deemed advisable by the Company.
2.2. The Underwriter represents and warrants that during the term of
this Agreement Shares sold pursuant to this Agreement shall be registered under
the 1933 Act, duly authorized for issuance and sold in compliance with
applicable state and federal securities laws and that the Fund is and shall
remain registered under the 1940 Act. . The Fund shall register and qualify the
shares for sale in accordance with the laws of the various states only if and to
the extent deemed advisable by the Fund, the Adviser, or the Underwriter.
2.3. The Underwriter makes no representation as to whether any aspect
of any Fund's operations (including but not limited to, fees and expenses and
investment policies) complies with the insurance laws or regulations of the
various states.
2.6. The Underwriter represents and warrants that it is a member in
good standing of the NASD and is registered as a broker-dealer with the SEC. The
Underwriter further represents that it will sell and distribute the Fund shares
in accordance with any applicable state and federal securities laws.
2.7. The Company and the Underwriter, on behalf of the Fund,
represent and warrant that all of their trustees/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 minimum coverage as required currently by Rule 17g-1 of
the 1940 Act
4
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.
ARTICLE III. Prospectuses and Proxy Statements; Voting
3.1. The parties, or their authorized affiliates, have previously
entered into a Selling Dealer Agreement ("SDA") dated January 2, 1997, and the
parties mutually agree that the SDA and ATA, as amended from time to time, shall
apply to the printing and distribution of Fund prospectuses and to the printing
and solicitation of Fund proxies, except as otherwise provided herein.
The Company shall
also be responsible for compliance with any and all applicable requirements of
the SEC, the 1940 Act, or state insurance or securities laws, regarding Fund
proxy voting by insurance company separate accounts or variable insurance
contract owners, including without limitation any pass-through voting privileges
for variable contract owners that may be required..
ARTICLE IV. Sales Material and Information
4.1. The Company shall furnish, or shall cause to be furnished, to
the Fund or its designee, each piece of sales literature or other promotional
material that the Company develops and in which the Fund (or a Designated Fund
thereof) or the Adviser or the Underwriter is named. No such material shall be
used until approved by the Fund or its designee. The Fund or its designee will
be deemed to have approved such sales literature or promotional material unless
the Fund or its designee objects or provides comments to the Company within ten
(10) Business Days after receipt of such material. The Fund or its designee
reserves the right to reasonably object to the continued use of any such sales
literature or other promotional material in which the Fund (or a Designated Fund
thereof) or the Adviser or the Underwriter is named, and no such material shall
be used if the Fund or its designee so object.
4.2. The Company shall not give any information or make any
representations or statements on behalf of the Fund or concerning the Fund or
the Adviser or the Underwriter in connection with the sale of the Contracts
other than the information or representations contained in the registration
statement or profiles or prospectus or SAI for the Fund shares, as such
registration statement and profiles 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 or other promotional material approved by the Fund or its
designee or by the Underwriter, except with the permission of the Fund or the
Underwriter or the designee of either.
4.3. The Fund and the Underwriter, or their designee, shall furnish,
or cause to be furnished, to the Company, each piece of sales literature or
other promotional material that it develops and in which the Company, and/or its
Account, is named. No such material shall be
5
used until approved by the Company. The Company will be deemed to have approved
such sales literature or promotional material unless the Company objects or
provides comments to the Fund, the Underwriter, or their designee within ten
Business Days after receipt of such material. The Company reserves the right to
reasonably object to the continued use of any such sales literature or other
promotional material in which the Company and/or its Account is named, and no
such material shall be used if the Company so objects.
4.4. The Fund and the Underwriter shall not give any information or
make any representations on behalf of the Company or concerning the Company, the
Account, or the Contracts other than the information or representations
contained in a registration statement and prospectus (which shall include an
offering memorandum, if any, if the Contracts issued by the Company or interests
therein are not registered under the 1933 Act), or SAI for the Contracts, as
such registration statement, prospectus, or SAI may be amended or supplemented
from time to time, or in published reports for the Account which are in the
public domain or approved by the Company for distribution to Contract owners, or
in sales literature or other promotional material approved by the Company or its
designee, except with the permission of the Company.
4.5. The Company will provide to the Fund at least one complete copy
of all registration statements, prospectuses (which shall include an offering
memorandum, if any, if the Contracts issued by the Company or interests therein
are not registered under the 1933 Act), 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, promptly after the filing of
such document(s) with the SEC or other regulatory authorities. The Company shall
provide to the Fund and the Underwriter any complaints received from the
Contract owners pertaining to the Fund or the Designated Fund.
4.6. For purposes of this Article IV, the phrase "sales literature
and other promotional materials" includes, but is not limited to, any of the
following that refer to the Fund or any affiliate of the Fund: 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, 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, proxy materials, and any other communications
distributed or made generally available with regard to the Fund.
6
ARTICLE V. Fees and Expenses
5.1. Except as otherwise provided herein, the Selling Dealer
Agreement and Agency Trading Agreement shall govern the fees and expenses borne
by the parties or their affiliates hereunder. Each Fund shall bear the expenses
for the cost of registration and qualification of its shares, preparation and
filing of its prospectus and registration statement, proxy materials and
reports. The Underwriter shall pay no fee or other compensation to the Company
under this Agreement, but nothing in this Agreement shall alter or affect any
compensation arrangements under the Selling Dealer Agreement or other agreements
between the parties or their affiliates. The Fund or the Underwriter shall bear
the expenses for setting in type and printing the proxy materials and reports to
shareholders (including the costs of printing a prospectus that constitutes an
annual report), if and to the extent that the Company actually distributes the
reports to and solicits proxy voting instructions from its Contract Owners..
5.2. The Company shall bear the expenses of distributing the Fund's
prospectus to owners of Contracts issued by the Company and of distributing the
Fund's proxy materials and reports to such Contract owners.
ARTICLE VI. Diversification and Qualification
6.1. The Underwriter represents that each Fund is or will be
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) and that it will notify the Company immediately upon having
a reasonable basis for believing that it has ceased to so qualify or that it
might not so qualify in the future.
ARTICLE VII. Indemnification
7.1. Indemnification By the Company
7.1(a). The Company agrees to indemnify and hold harmless the
Fund and the Underwriter and each of its trustees/directors and officers, and
each person, if any, who controls the Fund or the Underwriter within the meaning
of Section 15 of the 1933 Act or who is under common control with the
Underwriter (collectively, the "Indemnified Parties" for purposes of this
Section 7.1) against any and all losses, claims, damages, liabilities (including
amounts paid in settlement with the written consent of the Company) 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:
(i) arise out of or result from or are based upon any untrue
statement or alleged untrue statements of any material fact
contained in the registration statement, prospectus (which shall
include a written description of a Contract that is not
registered under the 1933 Act), or SAI for the Contracts or
contained in
7
sales literature for the Contracts (or any amendment or
supplement to any of the foregoing), or arise out of or result
from 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 Company by or on
behalf of the Fund for use in the registration statement,
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 result from or are based upon statements
or representations (other than statements or representations
contained in the registration statement, prospectus, SAI, or
sales literature of the Fund not supplied by the Company or
persons under its control) or wrongful conduct of the Company or
its agents or persons under the Company's authorization or
control, with respect to the sale or distribution of the
Contracts or Fund Shares; or
(iii) arise out of or result from or are based upon 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
Underwriter or Fund by or on behalf of the Company; or
(iv) arise out of or result from or are based upon of any
material failure by the Company 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 qualification requirements
specified in Section 2.1 of this Agreement); or
(v) arise out of or result from or are based upon any
material breach of any representation and/or warranty made by
the Company in this Agreement or arise out of or result from or
are based upon any other material breach of this Agreement by
the Company;
as limited by and in accordance with the provisions of Sections 7.1(b) hereof.
7.1(b). The Company shall not be liable under this
indemnification provision with respect to any claim made against an Indemnified
Party unless such Indemnified Party shall have
8
notified the Company 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 Company of any such claim shall not relieve the Company 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 an Indemnified Party, the Company shall be
entitled to participate, at its own expense, in the defense of such action. The
Company also shall be entitled to assume the defense thereof, with counsel
satisfactory to the party named in the action. After notice from the Company to
such party of the Company'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 Company 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.
7.1(c). The Indemnified Parties will promptly notify the Company
of the commencement of any litigation or proceedings against them in connection
with the issuance or sale of the Fund shares or the Contracts or the operation
of the Fund.
7.2. Indemnification by the Underwriter
7.2(a). The Underwriter agrees to indemnify and hold harmless
the Company and each of its directors and officers and each person, if any, who
controls the Company within the meaning of Section 15 of the 1933 Act
(collectively, the "Indemnified Parties" for purposes of this Section 7.2)
against any and all losses, claims, damages, liabilities (including amounts paid
in settlement with the written consent of the Underwriter) 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:
(i) arise out of or result from or are based upon any untrue
statement or alleged untrue statement of any material fact
contained in the registration statement or profile 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 result
from 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 Underwriter or the
Fund by or on behalf of the Company for use in the registration
statement, profile, 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
9
(ii) arise out of or result from or are based upon 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 Underwriter or persons under their control) or
wrongful conduct of the Fund or the Underwriter or persons under
their control, with respect to the sale or distribution of the
Contracts or Fund shares; or
(iii) arise out of or result from or are based upon 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 the Company by or on behalf of the
Fund or the Underwriter; or
(iv) arise out of or result from or are based upon any
failure by the Fund or the Underwriter to provide the services
and furnish the materials under the terms of this Agreement
(including a failure of the Fund, whether unintentional or in
good faith or otherwise, to comply with the qualification
requirements specified in Section 6.1 of this Agreement); or
(v) arise out of or result from or are based upon any
material breach of any representation and/or warranty made by
the Fund or the Underwriter in this Agreement or arise out of or
result from any other material breach of this Agreement by the
Fund or the Underwriter;;
as limited by and in accordance with the provisions of Sections 7.2(b) hereof.
7.2(b). The Underwriter 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 Underwriter 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 Underwriter of
any such claim shall not relieve the Underwriter 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 Party, the Underwriter will be entitled to participate,
at its own expense, in the defense thereof. The Underwriter also shall be
entitled to assume the defense thereof, with counsel satisfactory to the party
named in the action. After notice from the Underwriter to such party of the
Underwriter'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 Underwriter will not be liable to such party under this Agreement for any
legal or
10
other expenses subsequently incurred by such party independently in connection
with the defense thereof other than reasonable costs of investigation.
7.2(c). The Indemnified Party will promptly notify the
Underwriter 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.
ARTICLE VIII. Applicable Law
8.1. This Agreement shall be construed and the provisions hereof
interpreted under and in accordance with the laws of the State of
Massachusetts..
8.2. 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 SEC
may grant and the terms hereof shall be interpreted and construed in accordance
therewith.
ARTICLE IX. Termination
9.1. This Agreement shall continue in full force and effect until the
first to occur of:
(a) termination by any party, for any reason with respect to
some or all Designated Funds, by three (3) months
advance written notice delivered to the other parties;
or
(b) termination by the Company by written notice to the
Underwriter based upon the Company's determination that
shares of the Fund are not reasonably available to meet
the requirements of the Contracts; or
(c) termination by the Company by written notice to the
Underwriter in the event any of the 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 the Company; or
(d) termination by the Underwriter in the event that formal
administrative proceedings are instituted against the
Company by the NASD, the SEC, the Insurance
Commissioner, or like official of any state or any other
regulatory body regarding the Company's duties under
this Agreement or related to the sale of the Contracts,
the operation of any Account, or the purchase of the
Shares; provided, however, that the Underwriter
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 Company
to perform its obligations under this Agreement; or
11
(e) termination by the Company in the event that formal
administrative proceedings are instituted against the
Fund or the Underwriter by the NASD, the SEC, or any
state securities or insurance department, or any other
regulatory body; provided, however, that the Company
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 Underwriter to perform its obligations under this
Agreement; or
(f) termination by the Company by written notice to the
Underwriter with respect to any Designated Fund in the
event that such Fund ceases to qualify as a Regulated
Investment Company under Subchapter M as specified in
Section 6.1 hereof, or if the Company reasonably
believes that such Fund may fail to so qualify or
comply; or
(g) termination by the Underwriter by written notice to the
Company, if the Underwriter shall determine, in its sole
judgment exercised in good faith, that the Company 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 the Company by written notice to the
Underwriter, if the Company shall determine, in its sole
judgment exercised in good faith, that the Fund, the
Adviser, or the Underwriter 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 the Company upon any substitution of the
shares of another investment company or series thereof
for Shares in accordance with the terms of the
Contracts, provided that the Company has given at least
90 days prior written notice to the Fund and the
Underwriter of the date of substitution.
9.2. Notwithstanding any termination of this Agreement, the
Underwriter shall, at the option of the Company, continue to make available
additional Shares 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"), unless the Underwriter
requests that the Company seek an order pursuant to Section 26(c) of the 1940
Act to permit the substitution of other securities for the Shares. The
Underwriter agree to split the cost of seeking such an order, and the Company
agrees that it shall reasonably cooperate with the Underwriter and seek such an
order upon request. Specifically, the owners of the Existing Contracts may be
permitted to reallocate investments in the Fund, redeem investments in the Fund,
and/or invest in
12
the Fund upon the making of additional purchase payments under the existing
Contracts (subject to any such election by the Underwriter). The parties agree
that this Section 9.2 shall not apply to any terminations under Section 9.1(i)
of this Agreement.
9.3. The Company shall not redeem Shares attributable to the
Contracts (as opposed to Shares attributable to the Company's assets held in the
Account) except (i) as necessary to implement Contract owner initiated or
approved transactions, (ii) as required by state and/or federal laws or
regulations or judicial or other legal precedent of general application
(hereinafter referred to as a "Legally Required Redemption"), (iii) upon 45 days
prior written notice to the Fund and Underwriter, as permitted by an order of
the SEC pursuant to Section 26(c) of the 1940 Act, but only if a substitution of
other securities for the Shares is consistent with the terms of the Contracts,
or (iv) as permitted under the terms of the Contract. Upon request, the Company
will promptly furnish to the Fund and the Underwriter reasonable assurance that
any redemption pursuant to clause (ii) above is a Legally Required Redemption.
Furthermore, except in cases where permitted under the terms of the Contacts,
the Company shall not prevent Contract owners from allocating payments to a Fund
that was otherwise available under the Contracts without first giving the Fund
or the Underwriter 45 days notice of its intention to do so.
9.4. Notwithstanding any termination of this Agreement, each party's
obligation under Article VII to indemnify the other parties shall survive.
ARTICLE X. 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 Company: Xxxxx X. Xxxxxxxx, Esq.
Senior Vice President and General Counsel
Xxxxxxx Xxxxx Life Insurance Company
0 Xxxxxx Xxxx
Xxxxxxxxx, Xxx Xxxxxx 00000
If to the Underwriter: Fidelity Distributors Corporation
00 Xxxxxxxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Attention: Treasurer
13
ARTICLE XI. Miscellaneous
11.1. All persons dealing with any Fund must look solely to the
property of the Fund, for the enforcement of any claims against the Fund. The
parties agree that neither the Board, officers, agents, or shareholders of any
Fund assume any personal liability or responsibility for obligations entered
into by or on behalf of the Fund.
11.2. 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 has come into the
public domain.
11.3. The captions in this Agreement are included for convenience of
reference only and in no way define or delineate any of the provisions hereof or
otherwise affect their construction or effect.
11.4. This Agreement may be executed simultaneously in two or more
counterparts, each of which taken together shall constitute one and the same
instrument.
11.5. If any provision of this Agreement shall be held or made invalid
by a court decision, statute, rule or otherwise, the remainder of the Agreement
shall not be affected thereby.
11.6. 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 Arkansas 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 contract
operations of the Company are being conducted in a manner consistent with the
Arkansas variable annuity laws and regulations and any other applicable law or
regulations.
11.7. 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.
11.8. 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.
11.9. The Company shall furnish, or shall cause to be furnished, to
the Distributor or its designee copies of the following reports:
14
(a) the Company's annual statement (prepared under statutory accounting
principles) and annual report (prepared under generally accepted
accounting principles ("GAAP")), as soon as practical and in any
event within 90 days after the end of each fiscal year;
(b) the Company's quarterly statements (statutory and GAAP), as soon as
practical and in any event within 45 days after the end of each
quarterly period;
(c) any financial statement, proxy statement, notice or report of the
Company sent to stockholders and/ or policyholders, as soon as
practical after the delivery thereof to stockholders;
(d) any registration statement (without exhibits) and financial reports
of the Company filed with the Securities and Exchange Commission or
any state insurance regulator, as soon as practical after the filing
thereof;
(e) any other nonconfidential report submitted to the Company by
independent accountants in connection with any annual, interim or
special audit made by them of the books of the Company, as soon as
practical after the receipt thereof.
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.
XXXXXXX XXXXX LIFE INSURANCE COMPANY:
By its authorized officer
By:
---------------------------------
Title:
---------------------------------
Date:
---------------------------------
FIDELITY DISTRIBUTORS CORPORATION:
By its authorized officer
By:
---------------------------------
Title:
---------------------------------
Date:
---------------------------------
15
SCHEDULE A
SEPARATE ACCOUNTS OF THE COMPANY
Dated: , 2002
------------------
Xxxxxxx Xxxxx Life Variable Annuity Separate Account D
SCHEDULE B
DESIGNATED FUNDS AND CLASSES
Dated: , 2002
------------------
Fidelity Advisor Equity Growth Fund
Fidelity Advisor Mid-Cap Growth Fund
Fidelity Advisor Overseas Fund
