EXHIBIT 99-(I)(2)
ADMINISTRATION AGREEMENT
Agreement dated as of January 10, 2003 by and between State
Street Bank and Trust Company, a Massachusetts trust company (the
"Administrator"), and Northstar Life Insurance Company ("Company") with respect
to its separate accounts listed on Schedule A attached hereto (each, an
"Account").
WHEREAS, Company is a New York Corporation; and
WHEREAS, each Account is registered as an open-end, management
investment company under the Investment Company Act of 1940, as amended (the
"1940 Act"); and
WHEREAS, Company has retained Advantus Capital Management,
Inc. (the "Investment Adviser") to provide investment advisory services to the
Company; and
WHEREAS, Company desires to retain the Administrator to
furnish certain administrative services to the Company, and the Administrator is
willing to furnish such services, on the terms and conditions hereinafter set
forth.
NOW, THEREFORE, in consideration of the premises and mutual
covenants herein contained, the parties hereto agree as follows:
1. APPOINTMENT OF ADMINISTRATOR
Company hereby appoints the Administrator to act as
administrator with respect to the Company for purposes of providing certain
administrative services for the period and on the terms set forth in this
Agreement. The Administrator accepts such appointment and agrees to render the
services stated herein.
Company will initially have the Accounts listed in Schedule A
to this Agreement. In the event that the Company establishes one or more
additional Accounts with respect to which it wishes to retain the Administrator
to act as administrator hereunder, the Company shall notify the Administrator in
writing. Upon written acceptance by the Administrator, such Accounts shall
become subject to the provisions of this Agreement to the same extent as the
existing Accounts, except to the extent that such provisions (including those
relating to the compensation and expenses payable by the Company) may be
modified with respect to each additional Account in writing by the Company and
the Administrator at the time of the addition of the Account. Administrator
agrees that it will accept additional Accounts provided that (1) the types of
securities held by such Accounts, and (2) the services to be provided by
Administrator hereunder, are substantially the same as the types of securities
and services relating to the existing Accounts.
2. DELIVERY OF DOCUMENTS
Company will promptly deliver to the Administrator copies of
each of the following documents and all future amendments and supplements, if
any:
a. Each Account's currently effective registration
statement under the Securities Act of 1933, as
amended (the "1933 Act") (if such registration is
required), and the 1940 Act and each Account's
Prospectus(es) and Statement(s) of Additional
Information relating to all Classes and all
amendments and supplements thereto as in effect from
time to time;
b. Such other certificates, documents or opinions which
the Administrator may, in its reasonable discretion,
deem necessary or appropriate in the proper
performance of its duties.
3. REPRESENTATIONS AND WARRANTIES OF THE ADMINISTRATOR
The Administrator represents and warrants to the Company that:
a. It is a Massachusetts trust company, duly organized
and existing under the laws of The Commonwealth of
Massachusetts;
b. It has the corporate power and authority to carry on
its business in The Commonwealth of Massachusetts;
c. All requisite corporate proceedings have been taken
to authorize it to enter into and perform this
Agreement;
d. No legal or administrative proceedings have been
instituted or threatened which would impair the
Administrator's ability to perform its duties and
obligations under this Agreement; and
e. Its entrance into this Agreement shall not cause a
material breach or be in material conflict with any
other agreement or obligation of the Administrator or
any law or regulation applicable to it.
4. REPRESENTATIONS AND WARRANTIES OF THE COMPANY
Company represents and warrants to the Administrator that:
a. It is a corporation, duly organized, existing and in
good standing under the laws of the State of New
York;
b. It has the corporate power and authority under
applicable laws and by its charter and by-laws to
enter into and perform this Agreement;
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c. All requisite proceedings have been taken to
authorize it to enter into and perform this
Agreement;
d. Each Account is either an investment company properly
registered under the 1940 Act or exempt from such
registration requirement;
e. With respect to each Account for which such
registration is required, a registration statement
under the 1933 Act and the 1940 Act has been filed
and will be effective and remain effective during the
term of this Agreement. The Company also warrants to
the Administrator that as of the effective date of
this Agreement, all necessary filings under the
securities laws of the states in which the Company
offers or sells interests in the Accounts have been
made;
f. No legal or administrative proceedings have been
instituted or threatened which would impair the
Company's ability to perform its duties and
obligations under this Agreement;
g. Its entrance into this Agreement will not cause a
material breach or be in material conflict with any
other agreement or obligation of the Company or any
law or regulation applicable to it.
5. ADMINISTRATION SERVICES
5.1. Services. The Administrator shall provide the following
services, in each case, subject to the control, supervision and direction of the
Company and the review and comment by the Company's auditors and legal counsel
and in accordance with procedures which may be established from time to time
between the Company and the Administrator:
a. Prepare for review and approval by officers of the
Company financial information for the Accounts'
semi-annual and annual reports;
b. Provide other services and records as agreed upon by
the parties.
The Administrator shall provide the office facilities and the personnel required
by it to perform the services contemplated herein.
5.2 Maintenance of Equipment, Procedures and Programs.
Administrator agrees that it will maintain:
a. Computer and other equipment necessary or appropriate
to carry out its obligations under this Agreement;
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b. Commercially reasonable procedures and systems to
safeguard from loss or damage attributable to fire,
theft or any other cause the records and other data
of Company; and
c. Commercially reasonable business continuation
programs and disaster recovery plans.
5.3 Training. In the event that Administrator develops remote
look-up capabilities related to its services provided under this Agreement,
Administrator agrees that it will, upon request from Company, provide training
to Company's oversight personnel necessary to assist Company to view its fund
administration records maintained by the Administrator.
6. FEES; EXPENSES; EXPENSE REIMBURSEMENT
The Administrator shall receive from the Company such
compensation for the Administrator's services provided pursuant to this
Agreement as may be agreed to from time to time in a written fee schedule
approved by the parties and initially set forth in the separate fee schedule
described on Schedule B attached to this Agreement. The fees are accrued daily
and billed monthly and shall be due and payable upon receipt of the invoice.
Upon the termination of this Agreement before the end of any month, the fee for
the part of the month before such termination shall be prorated according to the
proportion which such part bears to the full monthly period and shall be payable
upon the date of termination of this Agreement. In addition, the Company shall
reimburse the Administrator for its out-of-pocket costs incurred in connection
with this Agreement.
The Company agrees promptly to reimburse the Administrator for
any equipment and supplies specially ordered by or for the Company through the
Administrator and for any other expenses not contemplated by this Agreement that
the Administrator may incur on the Company's behalf at the Company's request or
with the Company's consent provided Administrator provides Company advance
written notice detailing the equipment, supplies or expense and the anticipated
costs.
The Company will bear all expenses that are incurred in its
operation and not specifically assumed by the Administrator. Expenses to be
borne by the Company, include, but are not limited to: organizational expenses;
cost of services of independent accountants and outside legal and tax counsel
(including such counsel's review of the Company's registration statement, proxy
materials, federal and state tax qualification as a regulated investment company
and other reports and materials prepared by the Administrator under this
Agreement); cost of any services contracted for by the Company directly from
parties other than the Administrator; cost of trading operations and brokerage
fees, commissions and transfer taxes in connection with the purchase and sale of
securities for the Company; investment advisory fees; taxes, insurance premiums
and other fees and expenses applicable to its operation; costs incidental to any
meetings of shareholders including, but not limited to, legal and accounting
fees, proxy filing fees and the costs of preparation, printing and mailing of
any proxy materials; costs incidental to Board meetings, including fees and
expenses of Board members; the salary and expenses of any officer,
director\trustee or employee of the Company; costs incidental to the
preparation, printing and
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distribution of the Company's registration statements and any amendments thereto
and shareholder reports; cost of typesetting and printing of prospectuses; cost
of preparation and filing of the Company's tax returns, Form N-1A, N-2, N-4 or
N-6 and Form N-SAR, and all notices, registrations and amendments associated
with applicable federal and state tax and securities laws; all applicable
registration fees and filing fees required under federal and state securities
laws; fidelity bond and directors' and officers' liability insurance; and cost
of independent pricing services used in computing the Company's net asset value.
The Administrator is authorized to and may employ or associate
with such person or persons as the Administrator may deem desirable to assist it
in performing its duties under this Agreement; provided, however, that the
compensation of such person or persons shall be paid for solely by the
Administrator and that the Administrator shall be as fully responsible to the
Company for the acts and omissions of any such person or persons as it is for
its own acts and omissions, and further provided Administrator provides advance
written notice of its intent to do so.
7. PROPER INSTRUCTIONS.
"PROPER INSTRUCTIONS" means a writing signed or initialed by
one or more of such persons as Company shall have from time to time authorized.
Each such writing shall set forth the specific transaction or type of
transaction involved, including a specific statement of the purpose for which
such action is requested. Oral instructions will be considered Proper
Instructions if Administrator reasonably believes them to have been given by a
person authorized to give such instructions with respect to the transaction
involved. Company shall cause all oral instructions to be confirmed in writing.
Proper Instructions may include communications effected directly between
electro-mechanical or electronic devices, provided that Company and
Administrator agree to security procedures. Company will deliver to
Administrator, on or prior to the date hereof and thereafter from time to time
as changes therein are necessary, Proper Instructions naming one or more
designated representatives to give Proper Instructions in the name and on behalf
of Company, which Proper Instructions may be received and accepted by
Administrator as conclusive evidence of the authority of any designated
representative to act for Company and may be considered to be in full force and
effect until receipt by Administrator of notice to the contrary. Unless such
Proper Instructions delegating authority to any person to give Proper
Instructions specifically limit such authority to specific matters or require
that the approval of anyone else will first have been obtained, Administrator
will be under no obligation to inquire into the right of such person, acting
alone, to give any Proper Instructions whatsoever. If Company fails to provide
Administrator any such Proper Instructions naming designated representatives,
any instructions received by Administrator from a person reasonably believed to
be an appropriate representative of Company will constitute valid Proper
Instructions hereunder. The term "designated representative" may include
Company's employees and agents, including investment managers and their
employees. Company will provide upon Administrator's request a certificate
signed by an officer or designated representative of Company, as conclusive
proof of any fact or matter required to be ascertained from Company hereunder.
Company will also provide Administrator Proper Instructions with respect to any
matter concerning this Agreement requested by Administrator. If Administrator
reasonably believes that it could not prudently act according to the Proper
Instructions, or the instruction or advice of Company's accountants or
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counsel, it may in its discretion, with notice to Company, refrain from acting
in accordance therewith.
8. INSTRUCTIONS AND ADVICE
At any time, the Administrator may apply to any officer of the
Company for Proper Instructions and may consult with its own legal counsel at
the expense of the Administrator or outside counsel for the Company or the
independent accountants for the Company at the expense of the Company, with
respect to any matter arising in connection with the services to be performed by
the Administrator under this Agreement. The Administrator shall not be liable,
and shall be indemnified by the Company, for any action taken or omitted by it
in good faith in reliance upon any such Proper Instructions or advice or upon
any paper or document believed by it to be genuine and to have been signed by
the proper person or persons. The Administrator shall not be held to have notice
of any change of authority of any person until receipt of written notice thereof
from the Company. Nothing in this paragraph shall be construed as imposing upon
the Administrator any obligation to seek such instructions or advice, or to act
in accordance with such advice when received.
9. LIMITATION OF LIABILITY AND INDEMNIFICATION
9.1 Limitation of Liability of Administrator. The
Administrator shall be responsible for the performance of only such duties as
are set forth in this Agreement and, except as otherwise provided under Section
6, shall have no responsibility for the actions or activities of any other
party, including other service providers. The Administrator shall have no
liability in respect of any loss, damage or expense suffered by the Company
insofar as such loss, damage or expense arises from the performance of the
Administrator's duties hereunder in reliance upon records that were maintained
for the Company by entities other than the Administrator prior to the
Administrator's appointment as administrator for the Company. The Administrator
shall have no liability for any error of judgment or mistake of law or for any
loss or damage resulting from the performance or nonperformance of its duties
hereunder unless solely caused by or resulting from the gross negligence or
willful misconduct of the Administrator, its officers or employees. The
Administrator shall not be liable for any special, indirect, incidental, or
consequential damages of any kind whatsoever (including, without limitation,
attorneys' fees) under any provision of this Agreement or for any such damages
arising out of any act or failure to act hereunder. In any event, the
Administrator's cumulative liability for each calendar year (a "Liability
Period") with respect to the Company under this Agreement regardless of the form
of action or legal theory shall be limited to its total annual compensation
earned with respect to the Company and fees payable hereunder during the
preceding Compensation Period, as defined herein, for any liability or loss
suffered by the Company including, but not limited to, any liability relating to
qualification of the Company as a regulated investment company or any liability
relating to the Company's compliance with any federal or state tax or securities
statute, regulation or ruling during such Liability Period. "Compensation
Period" shall mean the calendar year ending immediately prior to each Liability
Period in which the event(s) giving rise to the Administrator's liability for
that period have occurred. Notwithstanding the foregoing, the Compensation
Period for purposes of calculating the annual cumulative liability of the
Administrator for the Liability Period commencing on the date of
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this Agreement and terminating on December 31, 2003 shall be the date of this
Agreement through December 31, 2003 on an annualized basis, and the Compensation
Period for the Liability Period commencing January 1, 2004 and terminating on
December 31, 2004 shall be January 1, 2004 through December 31, 2004.
Company shall indemnify and hold the Administrator harmless
from all loss, cost, damage and expense, including reasonable fees and expenses
for counsel (including disbursements), incurred by the Administrator resulting
from any claim, demand, action or suit in connection with the Administrator's
acceptance of this Agreement, any action or omission by it in the performance of
its duties hereunder, or as a result of acting upon any instructions reasonably
believed by it to have been duly authorized by the Company, provided that this
indemnification shall not apply to actions or omissions of the Administrator,
its officers or employees in cases of its or their own gross negligence or
willful misconduct.
9.2 Other Limitations.
a. Neither party shall be liable to the other for
consequential, special or punitive damages.
b. The Administrator shall not be responsible or liable
for the failure or delay in performance of its
obligations hereunder, or those of any entity for
which it is responsible hereunder, arising out of or
caused, directly or indirectly, by circumstances
beyond the affected entity's reasonable control,
including, without limitation: any interruption, loss
or malfunction of any utility, transportation,
computer (hardware or software) or communication
service; inability to obtain labor, material,
equipment or transportation, or a delay in mails;
governmental or exchange action, statute, ordinance,
rulings, regulations or direction; war, strike, riot,
emergency, civil disturbance, terrorism, vandalism,
explosions, labor disputes, freezes, floods, fires,
tornadoes, acts of God or public enemy, revolutions,
or insurrection.
9.3 Survival. The indemnifications contained herein shall
survive the termination of this Agreement.
10. CONFIDENTIALITY
The Administrator agrees that, except as otherwise required by
law or in connection with any required disclosure to a banking or other
regulatory authority, it will keep confidential all records and information in
its possession relating to the Company, its Accounts, or its shareholders or
shareholder accounts and will not disclose the same to any person except at the
request or with the written consent of the Company.
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11. COMPLIANCE WITH GOVERNMENTAL RULES AND REGULATIONS; RECORDS
Company assumes full responsibility for complying with all
securities, tax, commodities and other laws, rules and regulations applicable to
it or its Accounts.
The Administrator agrees that all records which it maintains
for the Company shall at all times remain the property of the Company, shall be
readily accessible during normal business hours, and shall be promptly
surrendered upon the termination of the Agreement or otherwise on written
request. The Administrator further agrees that all records which it maintains
for the Company pursuant to Rule 31a-1 under the 1940 Act will be preserved for
the periods prescribed by Rule 31a-2 under the 1940 Act unless any such records
are earlier surrendered as provided above.
At Company's expense at an hourly rate per Administrator
employee as agreed in the fee schedule referenced in Section 6 below,
Administrator will also provide reasonable assistance to Company's oversight
personnel, and reasonable access to Administrator's offices by such personnel,
for the purpose of auditing Administrator's performance of its duties hereunder,
including the systems, disclosure controls and procedures implemented by
Administrator, but only as they relate to Company.
12. SERVICES NOT EXCLUSIVE
The services of the Administrator to the Company are not to be
deemed exclusive, and the Administrator shall be free to render similar services
to others. The Administrator shall be deemed to be an independent contractor and
shall, unless otherwise expressly provided herein or authorized by the Company
from time to time, have no authority to act or represent the Company in any way
or otherwise be deemed an agent of the Company.
13. TERM AND TERMINATION
13.1 Term. This Agreement shall remain in full force and
effect for an initial term of three (3) years, and thereafter may be renewed for
two successive one (1) year terms upon consent by both parties. Thereafter, this
Agreement shall automatically continue in full force and effect for subsequent
one (1) year terms unless either party terminates this Agreement.
13.2 Termination. This Agreement may be terminated without
penalty in accordance with the following:
a. Either party may terminate this Agreement at the end
of the initial term or any subsequent term by
providing written notice of termination to the other
party at least one hundred eighty (180) days' prior
to the end of such term. Notwithstanding the
preceding sentence, Administrator agrees that it will
not terminate this agreement at the end of the
initial term solely due to economic considerations
relating to the fee schedule agreed to by the
parties.
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b. In addition, either party may terminate this
Agreement at any time if any of the following events
occur:
1) In the case of a material breach of any
obligation under this Agreement by the other
party. The non-breaching party shall give
written notice to the breaching party
specifying the nature of the breach. If the
breaching party fails to cure such breach
within ninety (90) days after its receipt of
written notice, or if such breach cannot be
cured within ninety (90) days with
reasonable efforts then within a reasonable
time after receipt of such notice (provided,
however, that the defaulting party promptly
commences and diligently pursues efforts to
cure), the non-breaching party shall have
the right to terminate this Agreement by
written notice to the breaching party
specifying the date of termination, which
shall be not less than ninety (90) days
thereafter; or
2) In the case of four (4) material breaches of
any obligation or obligations under this
Agreement by the other party during any
consecutive twelve-month period, whether or
not such breaches are cured as contemplated
in Section 13.2(b)(1). The non-breaching
party shall have the right to terminate this
Agreement within thirty (30) days after the
occurrence of the fourth material breach by
written notice to the breaching party
specifying the date of termination, which
shall be not less than sixty (60) days
thereafter; or
3) The other party makes an assignment for the
benefit of creditors or admits in writing
its inability to pay its debts as they
become due; or a trustee, receiver or
liquidator of such other party or of any
substantial part of its assets is appointed,
and if appointed in a proceeding brought
against such other party, such other party
approves, consents to or acquiesces in such
appointment, or such trustee, receiver or
liquidator is not discharged within sixty
(60) days; or any proceedings are commenced
by or against such other party under any
bankruptcy, reorganization, dissolution,
liquidation or supervision law or statute of
the United States government or any state
government; or
4) In the event Company or an Account is
liquidated or agrees to merge with another
insurance company or Account and will not be
the surviving entity. Company shall be
entitled to terminate this Agreement as to
itself if Company is the entity to be
liquidated or merged, or as to such Account
if an Account is to be liquidated or merged,
upon one hundred eighty (180) days prior
written notice to the Administrator.
Termination of this Agreement with respect
to
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any given Account shall in no way affect the
continued validity of this Agreement with
respect to any other Account; or
5) Termination of the separate Investment
Accounting Agreement between Administrator
and the Company. Unless the parties agree
otherwise, this Agreement shall terminate
automatically upon the date that such
Investment Accounting Agreement is
terminated.
Neither party shall have any liability to the other party as a result of a
termination of this Agreement pursuant to clause (1), (2), (3), (4) or (5) above
or with respect to the unexpired portion of the then-current term of this
Agreement, provided, however, that all rights, obligations and liabilities
arising or accruing under this Agreement prior to the effective date of
termination shall survive such termination.
13.3 Actions upon Termination. Upon termination of this
Agreement, the parties agree that:
a. Company shall pay to the Administrator such
compensation and any reimbursable expenses as may be
due under the terms hereof as of the date of such
termination, including reasonable out-of-pocket
expenses associated with such termination.
b. Company will designate a successor (which may be
Company) by Proper Instruction to Administrator; and
c. Administrator will, upon payment of all sums due to
it from Company hereunder, deliver all accounts and
records and other properties of Company to the
successor, or, if none, to Company, at the
Administrator's office. Records maintained in
electronic form on the Administrator's systems will
be delivered in machine readable form.
In the event that accounts, records or other properties remain
in the possession of the Administrator after the date of termination hereof for
any reason other than Administrator's failure to deliver the same, Administrator
is entitled to compensation for storage thereof during such period, and shall be
entitled to destroy the same if not removed by Company within thirty (30) days
after written demand.
14. NOTICES
Any notice or other communication authorized or required by
this Agreement to be given to either party shall be in writing and deemed to
have been given when delivered in person or by confirmed facsimile, or posted by
certified mail, return receipt requested, to the following address (or such
other address as a party may specify by written notice to the other):
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if to the Company:
Northstar Life Insurance Company
University Corporate Center at Amherst
Suite 424
000 Xxxxxxxxx Xxxxxxx
Xxxxxxx, Xxx Xxxx 00000
Attn: General Counsel
fax: 000-000-0000
if to the Administrator:
State Street Bank and Trust Company
000 Xxxxxxxxxxxx
Xxxxxx Xxxx, XX 00000
Attn: Senior Vice President, Insurance Services
Fax: 000-000-0000
15. ASSIGNMENT
This Agreement shall not be assigned by either party hereto
without the prior consent in writing of the other party, except that the
Administrator may assign this Agreement to a successor of all or a substantial
portion of its business, or to a party controlling, controlled by or under
common control with the Administrator. Administrator shall have the right to
delegate and sub-contract for the performance of any or all of its duties
hereunder, provided that Administrator shall remain responsible for the
performance of such duties and all the terms and conditions hereof shall
continue to apply as though Administrator performed such duties itself, and
further provided that Administrator provides prior notice of such sub-contract
to Company.
16. COUNTERPARTS
This Agreement may be executed in several counterparts, each
of which shall be deemed to be an original, and all such counterparts taken
together shall constitute but one and the same Agreement.
17. ENTIRE AGREEMENT
This Agreement and the attached schedules contain the entire
understanding between the parties hereto with respect to the subject matter
hereof and supersede all previous representations, warranties or commitments
regarding the services to be performed hereunder whether oral or in writing.
18. WAIVER
The failure of a party to insist upon strict adherence to any
term of this Agreement on any occasion shall not be considered a waiver nor
shall it deprive such party of the right
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thereafter to insist upon strict adherence to that term or any term of this
Agreement. Any waiver must be in writing signed by the waiving party.
19. SEVERABILITY
If any provision of this Agreement is invalid or
unenforceable, the balance of the Agreement shall remain in effect, and if any
provision is inapplicable to any person or circumstance it shall nevertheless
remain applicable to all other persons and circumstances.
20. GOVERNING LAW
This Agreement shall be construed and the provisions thereof
interpreted under and in accordance with the laws of The Commonwealth of
Massachusetts.
21. REPRODUCTION OF DOCUMENTS
This Agreement and all schedules, exhibits, attachments and
amendments hereto may be reproduced by any photographic, photostatic, microfilm,
micro-card, miniature photographic or other similar process. The parties hereto
all/each agree that any such reproduction shall be admissible in evidence as the
original itself in any judicial or administrative proceeding, whether or not the
original is in existence and whether or not such reproduction was made by a
party in the regular course of business, and that any enlargement, facsimile or
further reproduction of such reproduction shall likewise be admissible in
evidence.
22. EACH ACCOUNT A SEPARATE PARTY
Each Account will be regarded for all purposes hereunder as a
separate party apart from each other Account. Unless the context otherwise
requires, with respect to every transaction covered hereby, every reference
herein to Account is deemed to relate solely to the particular Account to which
such transaction relates. Under no circumstances will the rights, obligations or
remedies with respect to a particular Account constitute a right, obligation or
remedy applicable to any other Account. The use of this single document to
memorialize the separate agreement as to each Account is understood to be for
clerical convenience only and will not constitute any basis for joining the
Accounts for any reason.
23. AMENDMENT
This Agreement may be modified or amended from time to time by
mutual written agreement signed by the parties hereto.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their officers designated below as of the date first written above.
NORTHSTAR LIFE INSURANCE COMPANY
By:
-----------------------------------
Name:
-----------------------------------
Title:
-----------------------------------
STATE STREET BANK AND TRUST COMPANY
By:
-----------------------------------
Name:
-----------------------------------
Title:
-----------------------------------
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ADMINISTRATION AGREEMENT
SCHEDULE A
LISTING OF ACCOUNTS
Northstar Life Variable Universal Life Account
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SCHEDULE B
FEE SCHEDULE
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