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EXHIBIT 8(k)
PARTICIPATION AGREEMENT
AMONG
IL ANNUITY AND INSURANCE COMPANY ,
SOGEN VARIABLE FUNDS, INC.,
AND
SOCIETE GENERALE SECURITIES CORPORATION
THIS AGREEMENT, dated as of the 1st day of September, 1997 by and among
IL Annuity and Insurance Company, (the "Company"), a Massachusetts 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
(each account hereinafter referred to as the "Account"), SoGen Variable Funds,
Inc. (the "Fund"), a corporation organized under the laws of Maryland, and
Societe Generale Securities Corporation (the "Underwriter"), a New York
corporation.
WHEREAS, the Fund engages in business as an open-end management
investment company and is or will be available to act as the investment vehicle
for separate accounts established for variable life insurance and variable
annuity contracts (the "Variable Insurance Products") to be offered by
insurance companies which have entered into participation agreements with the
Fund and Underwriter ("Participating Insurance Companies");
WHEREAS, the shares of common stock of the Fund are divided into
several series of shares, each designated a "Portfolio" and representing the
interest in a particular managed portfolio of securities and other assets;
WHEREAS, the Fund will, to the extent necessary, obtain an order from
the Securities and Exchange Commission (the "SEC") 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, (the "1940 Act") and
Rules 6e-2(b)(15) and 6e-3(T)(b)(15) thereunder, if and 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 (the "Mixed and Shared Funding Exemptive Order");
WHEREAS, the Fund is registered as an open-end management investment
company under the 1940 Act and shares of the Portfolios are registered under
the Securities Act of 1933, as amended (the "1933 Act");
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WHEREAS, Societe Generale Asset Management Corp. (the "Adviser"), which
serves as investment adviser to the Fund, is duly registered as an investment
adviser under the federal Investment Advisers Act of 1940, as amended, and any
applicable state securities laws;
WHEREAS, the Company has issued or will issue certain variable life
insurance and/or variable annuity contracts supported wholly or partially by
the Account (the "Contracts"), and said Contracts are listed in Schedule A
hereto, as it may be amended from time to time by mutual written agreement;
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
the aforesaid Contracts;
WHEREAS, the Underwriter, which serves as distributor to the Fund, is
registered as a broker dealer with 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"); and
WHEREAS, to the extent permitted by applicable insurance laws and
regulations, the Company 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 the Underwriter is authorized to sell such shares to
the Account at net asset value;
NOW, THEREFORE, in consideration of their mutual promises, the Company,
the Fund 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, and has agreed to
instruct, and has so instructed, the Underwriter to make available to the
Company for purchase on behalf of the Account Fund shares of those Designated
Portfolios selected by the Underwriter. Pursuant to such authority and
instructions, and subject to Article X hereof, the Underwriter agrees to make
available to the Company for purchase on behalf of the Account, shares of those
Designated Portfolios listed on Schedule A to this Agreement, such purchases to
be effected at net asset value in accordance with Section 1.3 of this
Agreement. Notwithstanding the foregoing, (i) Fund series (other than those
listed on Schedule A) in existence now or that may be established in the future
will be made available to the
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Company only as the Underwriter may so provide, and (ii) the Board of Directors
of the Fund (the "Board") may suspend or terminate the offering of Fund shares
of any Designated Portfolio 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 Portfolio.
1.2 The Fund shall redeem, at the Company's
request, any full or fractional Designated Portfolio 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. Notwithstanding the foregoing,
(i) the Company shall not redeem Fund shares attributable to Contract owners
except in the circumstances permitted in Section 10.3 of this Agreement, and
(ii) the Fund may delay redemption of Fund shares of any Designated Portfolio
to the extent permitted by the 1940 Act, any rules, regulations or orders
thereunder, or the then current Fund Prospectus.
1.3 Purchase and Redemption Procedures
(a) The Fund hereby appoints the Company
as an agent of the Fund for the limited purpose of receiving purchase
and redemption requests on behalf of the Account (but not with respect
to any Fund shares that may be held in the general account of the
Company) for shares of those Designated Portfolios made available
hereunder, based on allocations of amounts to the Account or
subaccounts thereof under the Contracts and other transactions
relating to the Contracts or the Account. Receipt of any such request
(or relevant transactional information therefor) on any day the New
York Stock Exchange is open for trading and on which the Fund
calculates it net asset value pursuant to the rules of the SEC (a
"Business Day") by the Company as such limited agent of the Fund prior
to the time that the Fund calculates its net asset value as described
from time to time in the Fund Prospectus (which as of the date of
execution of this Agreement is 4:00 p.m. Eastern Time) shall
constitute receipt by the Fund on that same Business Day, provided
that the Fund receives notice of such request by 9:30 a.m. Eastern
Time on the next following Business Day.
(b) The Company shall pay for shares of
each Designated Portfolio on the same day that it notifies the Fund of
a purchase request for such shares. Payment for Designated Portfolio
shares shall be made in federal funds transmitted to the Fund by wire
to be received by the Fund by 4:00 p.m. Eastern Time on the day the
Fund is notified of the purchase request for Designated Portfolio
shares (unless the Fund determines and so advises the Company that
sufficient proceeds are available from redemption of shares of other
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Designated Portfolios effected pursuant to redemption requests
tendered by the Company on behalf of the Account). If federal funds
are not received on time, such funds will be invested, and Designated
Portfolio shares purchased thereby will be issued, as soon as
practicable and the Company shall promptly, upon the Fund's request,
reimburse the Fund for any charges, costs, fees, interest or other
expenses incurred by the Fund in connection with any advances to, or
borrowing or overdrafts by, the Fund, or any similar expenses incurred
by the Fund, as a result of portfolio transactions effected by the
Fund based upon such purchase request. Upon receipt of federal funds
so wired, such funds shall cease to be the responsibility of the
Company and shall become the responsibility of the Fund.
(c) Payment for Designated Portfolio
shares redeemed by the Account or the Company shall be made in federal
funds transmitted by wire to the Company or any other designated
person on the next Business Day after the Fund is properly notified of
the redemption order of such shares (unless redemption proceeds are to
be applied to the purchase of shares of other Designated Portfolio in
accordance with Section 1.3(b) of this Agreement), except that the
Fund reserves the right to delay payment of redemption proceeds to the
extent permitted under Section 22(e) of the 1940 Act and any Rules
thereunder, and in accordance with the procedures and policies of the
Fund as described in the then current prospectus. The Fund shall not
bear any responsibility whatsoever for the proper disbursement or
crediting of redemption proceeds by the Company, the Company alone
shall be responsible for such action.
(d) Any purchase or redemption request
for Designated Portfolio shares held or to be held in the Company's
general account shall be effected at the net asset value per share
next determined after the Fund's receipt of such request, provided
that, in the case of a purchase request, payment for Fund shares so
requested is received by the Fund in federal funds prior to close of
business for determination of such value, as defined from time to time
in the Fund Prospectus.
1.4 The Fund shall use its best efforts to make
the net asset value per share for each Designated Portfolio available to the
Company by 6:30 p.m. Eastern Time each Business Day, and in any event, as soon
as reasonably practicable after the net asset value per share for such
Designated Portfolio is calculated, and shall calculate such net asset value in
accordance with the Fund's Prospectus. If the Fund provides the Company with
materially incorrect share net asset value information through no fault of the
Company, the Company on behalf of the Account shall be entitled, to the extent
reasonably practicable, to an adjustment to the number of shares purchased or
redeemed to reflect the correct net asset value, and the Underwriter shall
promptly, on request of the Company, reimburse the Company, or cause the
responsible party to
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reimburse the Company, for any reasonable out-of-pocket charges, costs, fees or
other expenses incurred by the Company in implementing the steps determined by
the Fund to be necessary to correct the pricing error. Neither the Fund, any
Designated Portfolio, the Underwriter, nor any of their affiliates shall be
liable for any information provided to the Company pursuant to this Agreement
which information is based on incorrect information supplied by the Company to
the Fund or the Underwriter.
1.5 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 Designated Portfolio 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 Designated Portfolio shares in the form of
additional shares of that Designated Portfolio. 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 Fund
shall notify the Company promptly of the number of Designated Portfolio shares
so issued as payment of such dividends and distributions.
1.6. Issuance and transfer of Fund 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. (a) 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 1.8 hereof) and the cash value of the Contracts may be
invested in other investment companies, provided, however, that until
this Agreement is terminated pursuant to Article X, the Company shall
give equivalent prominence to the Designated Portfolios as the Company
provides to other funding vehicles available under the Contracts in
promotional materials that describe funding vehicles available under
the Contracts and are published by the Company.
(b) The Company shall not, without prior
notice to the Underwriter (unless otherwise required by applicable
law) take any action to operate the Account as a management investment
company under the 1940 Act.
(c) The Company shall not, without prior
notice to the Underwriter (unless otherwise required by applicable
law), induce Contract owners to change or modify the Fund or change
the Fund's distributor or investment adviser.
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1.8. The Underwriter and the Fund shall sell Fund
shares only to Participating Insurance Companies and their separate accounts
and to persons or plans ("Qualified Persons") that qualify to purchase shares
of the Fund under Section 817(h) of the Internal Revenue Code of 1986, as
amended (the "Code") and the regulations thereunder without impairing the
ability of the Account to consider the portfolio investments of the Fund as
constituting investments of the Account for the purpose of satisfying the
diversification requirements of Section 817(h). The Underwriter and the Fund
shall not sell Fund shares to any insurance company or separate account unless
an agreement complying with Article VI of this Agreement is in effect to govern
such sales. Subject to Sections 6.1 and 6.2 hereof, the Company hereby
represents and warrants that it and the Account are Qualified Persons. The
Fund reserves the right to cease offering shares of any Designated Portfolio in
the discretion of the Fund.
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, alternatively (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 Massachusetts 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 Fund represents and warrants that Fund
shares sold pursuant to this Agreement shall be registered under the 1933 Act,
duly authorized for issuance and sold in compliance with the laws of the
Commonwealth of Massachusetts and the State of Indiana and applicable federal
securities laws and that the Fund is and shall remain registered under the 0000
Xxx. The Fund shall amend the registration statement for its shares under the
1933 Act and the 1940 Act from time to time as required in order to effect the
continuous offering of its shares. The Fund shall register
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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 or the
Underwriter.
2.3 The Fund intends to make payments to finance
distribution expenses pursuant to Rule 12b-1 under the 1940 Act. In this
regard, the Fund's board of directors, a majority of whom are not interested
persons of the Fund, have formulated and approved the Fund's plan adopted
pursuant to Rule 12b-1 under the 1940 Act to finance distribution expenses.
2.4 The Fund makes no representations as to
whether any aspect of its operations, including, but not limited to, investment
policies, fees and expenses, complies with the insurance and other applicable
laws of the various states, except that the Fund represents that the Fund's
investment policies, fees and expenses, are and shall at all times remain in
compliance with the laws of the Commonwealth of Massachusetts and the State of
Indiana to the extent required to perform this Agreement, provided, however,
that the Company shall notify the Fund with respect to any additional
requirements that are specifically directed to the Company by state insurance
departments.
2.5 The Fund represents that it is lawfully
organized and validly existing under the laws of the State of Maryland and that
it does and will comply in all material respects with the 1940 Act.
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 the laws of the
Commonwealth of Massachusetts and the State of Indiana and any applicable state
and federal securities laws.
2.7 The Underwriter represents and warrants that
the Adviser is and shall remain duly registered under all applicable federal
and state securities laws and that the Adviser shall perform its obligations
for the Fund in compliance in all material respects with the laws of the
Commonwealth of Massachusetts and the State of Indiana and any applicable state
and federal securities laws.
2.8 The Fund and the Underwriter 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 minimum coverage as required currently by Rule 17g-1 of the 1940
Act or related provisions as may be promulgated from time to time.
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The aforesaid bond shall include coverage for larceny and embezzlement and
shall be issued by a reputable bonding company.
2.9 The Company represents and warrants that all
of its directors, officers, employees, investment advisers, and other
individuals/entities employed or controlled by the Company dealing with the
money and/or securities of the Account are covered by a blanket fidelity bond
or similar coverage for the benefit of the Account, in an amount not less than
$5 million. The aforesaid bond includes coverage for larceny and embezzlement
and is issued by a reputable bonding company.
ARTICLE III. Prospectuses and Proxy Statements; Voting
3.1 The Underwriter shall provide the Company
with as many copies of the Fund's current prospectus (describing only the
Designated Portfolios listed on Schedule A) as the Company may reasonably
request. The Company shall bear the expense of printing copies of the current
prospectus for the Contracts that will be distributed to existing Contract
owners, and the Company shall bear the expense of printing copies of the Fund's
prospectus that are used in connection with offering the Contracts issued by
the Company. If requested by the Company in lieu thereof, the Fund shall
provide such documentation (including a final copy of the new prospectus on
diskette at the Fund's expense) and other assistance as is reasonably necessary
in order for the Company once each year (or more frequently if the prospectus
for the Fund is amended) to have the prospectus for the Contracts and the
prospectus for the Designated Portfolios printed together in one document (such
printing to be at the Company's expense).
3.2 The Fund's prospectus shall state that the
current Statement of Additional Information ("SAI") for the Fund is available,
and the Underwriter (or the Fund), at its expense, shall provide a reasonable
number of copies of such SAI free of charge to the Company for itself and for
any owner of a Contract who requests such SAI.
3.3 The Fund, at its expense, shall provide the
Company with copies of its proxy material, reports to shareholders, and other
communications to shareholders in such quantity as the Company shall reasonably
require for distributing to Contract owners.
3.4 The Company shall:
(i) solicit voting instructions from
Contract owners;
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(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 in the
same proportion as Fund shares of such
portfolio for which instructions have
been received.
The Company will vote Fund shares held in any segregated asset account in the
same proportion as Fund shares of such portfolio for which voting instructions
have been received from Contract owners, to the extent permitted by law.
3.5 Participating Insurance Companies shall be
responsible for assuring that each of their separate accounts participating in
a Designated Portfolio calculates voting privileges as required by the Shared
Funding Exemptive Order and consistent with any reasonable standards that the
Fund may adopt and provide in writing. The Fund hereby confirms that the
manner in which the Company currently calculates voting privileges is
consistent with the manner in which other Participating Insurance Companies are
required to calculate voting privileges. The Fund and the Underwriter will
notify the Company if either becomes aware that another Participating Insurance
Company has changed the manner in which it so calculates voting privileges.
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 Sections 16(a) and, if and when applicable, 16(b). Further,
the Fund will act in accordance with the SEC's interpretation of the
requirements of Section 16(a) with respect to periodic elections of trustees
and with whatever rule the Commission may promulgate with respect thereto.
ARTICLE IV. Sales Material and Information
4.1 The Company shall furnish, or shall cause to
be furnished, to the Fund or its designee, at least fifteen business days prior
to first use, each piece of sales literature or other promotional material that
the Company develops and in which the Fund (or a Designated Portfolio thereof)
or the Adviser or the Underwriter is named. No such material shall be used
until approved by the Fund or its designee, and the Fund will use its best
efforts for it or its designee to review such sales literature or promotional
material within ten 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 Portfolio thereof) or the
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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 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 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 shall cause to be, furnished, to the Company, at
least fifteen business days prior to first use, each piece of sales literature
or other promotional material that it develops and in which the Company, and/or
its Account, or the Contracts, is named. No such material shall be used until
approved by the Company, and the Company will use its best efforts to review
such sales literature or promotional material 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, or the Contracts, 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,
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 Fund will provide to the Company at least
one complete copy of all registration statements, prospectuses, SAIs, 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 Fund or its shares, contemporaneously
with the filing of such document(s) with the SEC or other regulatory
authorities. The Fund will provide to the Company any complaints received that
pertain to the Company, the Account, or the Contracts.
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4.6 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,
contemporaneously with 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 Portfolio.
4.7 The Fund will provide the Company with as
much notice as is reasonably practicable of any proxy solicitation for any
Designated Portfolio, and of any material change in the Fund's registration
statement, particularly any change resulting in a change to the registration
statement or prospectus for any Account. The Fund will work with the Company
so as to enable the Company to solicit proxies from Contract owners, or to make
changes to its prospectus or registration statement, in an orderly manner. The
Fund will make reasonable efforts to attempt to have changes affecting Contract
prospectuses become effective simultaneously with the annual updates for such
prospectuses.
4.8 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), and sales literature (i.e., any written or electronic
communication distributed or made generally available to customers or the
public, including brochures, circulars, reports, market letters, form letters,
telemarketing scripts, seminar texts, reprints or excerpts of any other
advertisement, sales literature, or published article), distributed or made
generally available to customers or to the public, 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.
ARTICLE V. Fees and Expenses
5.1 The Fund and the Underwriter shall pay no fee
or other compensation to the Company under this Agreement, except that, the
Underwriter may, to the extent permitted under the Fund's distribution plan
adopted pursuant to Rule 12b-1
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under the 1940 Act, make payments to the Company or to the underwriter for the
Contracts if and in amounts agreed to by the Underwriter in writing, and such
payments will be made out of existing fees otherwise payable to the
Underwriter, past profits of the Underwriter, or other resources available to
the Underwriter. No such payments shall be made directly by the Fund.
5.2 All expenses incident to performance by the
Fund under this Agreement shall be paid by the Fund. The Fund shall see to it
that all its shares are registered and authorized for issuance in accordance
with applicable federal law and, if and to the extent deemed advisable by the
Fund, in accordance with applicable state laws prior to their sale. 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
in type and printing the proxy materials and reports to shareholders (including
the costs of printing a prospectus that constitutes an annual report), 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 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 Fund will invest its assets in such a
manner as to ensure that the Contracts will be treated as annuity or life
insurance contracts, whichever is appropriate, under the Code and the
regulations issued thereunder (or any successor provisions). Without limiting
the scope of the foregoing, each Designated Portfolio has complied and will
continue to comply with Section 817(h) of the Code and Treasury Regulation
Section 1.817-5, 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 of a breach of this Article VI by
the Fund, it will take all reasonable steps (a) to notify the Company of such
breach and (b) to adequately diversify the Fund so as to achieve compliance
within the grace period afforded by Regulation 817.5.
6.2 The Fund represents that it is or will be
qualified as a Regulated Investment Company under Subchapter M of the Code, and
that it will make every effort to maintain such qualification (under Subchapter
M or any successor or similar provisions) and that it will notify the Company
immediately upon having a
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reasonable basis for believing that it has ceased to so qualify or that it
might not so qualify in the future.
6.3 Subject to Sections 6.1 and 6.2 hereof, the
Company represents that the Contracts are currently, and at the time of
issuance shall be, treated as life insurance or annuity insurance contracts,
under applicable provisions of the Code, and that it will make every effort to
maintain such treatment, and that it will notify the Fund and the Underwriter
immediately upon having a reasonable basis for believing the Contracts have
ceased to be so treated or that they might not be so treated in the future.
The Company agrees that any prospectus offering a contract that is a "modified
endowment contract" as that term is defined in Section 7702A of the Code (or
any successor or similar provision), shall identify such contract as a modified
endowment contract.
ARTICLE VII. Potential Conflicts
The following provisions shall apply only upon issuance of the Mixed and Shared
Funding Order and the sale of shares of the Fund to variable life insurance
separate accounts.
7.1 The Board will monitor the Fund for the
existence of any material irreconcilable conflict between the interests of the
Contract owners of all separate accounts investing in the Fund. An
irreconcilable material conflict may arise for a variety of reasons, including:
(a) an action by any state insurance regulatory authority; (b) a change in
applicable federal or state insurance, tax, or securities laws or regulations,
or a public ruling, private letter ruling, no-action or interpretative letter,
or any similar action by insurance, tax, or securities regulatory authorities;
(c) an administrative or judicial decision in any relevant proceeding; (d) the
manner in which the investments of any Portfolio are being managed; (e) a
difference in voting instructions given by variable annuity contract and
variable life insurance contract owners; or (f) a decision by an insurer to
disregard the voting instructions of contract owners. The Board shall promptly
inform the Company if it determines that an irreconcilable material conflict
exists and the implications thereof.
7.2. The Company will report any potential or
existing conflicts of which it is aware to the Board. The Company will assist
the Board in carrying out its responsibilities under the Mixed and Shared
Funding Exemptive Order, by providing the Board with all information reasonably
necessary for the Board to consider any issues raised. This includes, but is
not limited to, an obligation by the Company to inform the Board whenever
Contract owner voting instructions are disregarded.
- 13 -
14
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, the Company and other Participating Insurance
Companies shall, at their expense (to be allocated as near as practicable in
proportion to such parties' respective responsibilities for such conflict) 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, up to and 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 the Company to disregard Contract owner voting
instructions and that decision represents a minority position or would preclude
a majority vote, the Company may be required, at the Fund's election, to
withdraw the Account's investment in the Fund and terminate this Agreement with
respect to each Account; 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 the Company 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 the
Company conflicts with the majority of other state regulators, then the Company
will withdraw the affected Account's investment in the Fund and terminate this
Agreement with respect to such Account within six months after the Board
informs the Company 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 the Company
for the purchase (and redemption) of shares of the Fund.
- 14 -
15
7.6 For purposes of Section 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. The Company shall not be required by Section
7.3 to establish a new funding medium for the Contract 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 the Company will withdraw the Account's
investment in the Fund and terminate this Agreement within six (6) months after
the Board informs the Company 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 the Mixed and Shared
Funding Exemption Order or any amendment thereto contains terms and conditions
different from Sections 3.4, 3.5, 3.6, 7.1, 7.2, 7.3, 7.4, and 7.5 of this
Agreement, then the Fund and/or the Participating Insurance Companies, as
appropriate, shall take such steps as may be necessary to comply with the Mixed
and Shared Funding Exemptive Order, and Sections 3.4, 3.5, 3.6, 7.1, 7.2, 7.3,
7.4 and 7.5 of this Agreement shall continue in effect only to the extent that
terms and conditions substantially identical to such Sections are contained in
the Mixed and Shared Funding Exemptive Order or any amendment thereto. If and
to the extent that Rule 6e-2 and Rule 6e-3(T) are amended, or Rule 6e-3 is
adopted, to provide exemptive relief from any provision of the 1940 Act or the
rules promulgated thereunder with respect to mixed or shared funding (as
defined in the Mixed and Shared Funding Exemptive Order) on terms and
conditions materially different from those contained in the Mixed and Shared
Funding Exemptive Order, then (a) the Fund and/or the Participating Insurance
Companies, as appropriate, shall take such steps as may be necessary to comply
with Rules 6e-2 and 6e-3(T), as amended, and Rule 6e-3, as adopted, to the
extent such rules are applicable; and (b) Sections 3.4, 3.5, 7.1., 7.2, 7.3,
7.4, and 7.5 of this Agreement shall continue in effect only to the extent that
terms and conditions substantially identical to such Sections are contained in
such Rule(s) as so amended or adopted.
ARTICLE VIII. Indemnification
8.1 Indemnification By the Company
8.1(a). The Company agrees to indemnify and hold
harmless the Fund, the Underwriter, the Adviser and each of its directors and
officers, and each person, if any, who controls the Fund or Underwriter within
the meaning of Section 15 of the
- 15 -
16
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 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 are based upon any
untrue statement or alleged untrue statements
of any material fact contained in the
registration statement, prospectus (which
shall include an offering memorandum, if
any), or SAI for the Contracts or contained
in the Contracts or sales literature for the
Contracts (or any amendment or supplement to
any of the foregoing), or arise out of or are
based upon the omission or the alleged
omission to state therein a material fact
required to be stated therein or 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 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 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 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
- 16 -
17
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 the Company; or
(iv) arise as a result of any material
failure by the Company to provide the
services and furnish the materials under the
terms of this Agreement (including a failure,
whether unintentional or in good faith or
otherwise, to comply with the 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 Company in this
Agreement or arise out of or result from any
other material breach of this Agreement by
the Company,
as limited by and in accordance with the provisions of Sections 8.1(b) and
8.1(c) hereof.
8.1(b). The Company 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 gross 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 under this Agreement.
8.1(c). 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 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
- 17 -
18
independently in connection with the defense thereof other than reasonable
costs of investigation.
8.1(d). 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.
8.2 Indemnification by the Underwriter
8.2(a). The Underwriter agrees to indemnify and hold
harmless the Company and each of it directors and officer 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 8.2)
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 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
Underwriter or Fund by or on behalf of the
Company for use in the registration
statement, 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 Underwriter or persons under
its control) or wrongful
- 18 -
19
conduct of the Fund or Underwriter 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 the Company by or on
behalf of the Fund or the Underwriter; or
(iv) arise as a result of 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
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 Underwriter in this
Agreement or arise out of or result from any
other material breach of this Agreement by
the Underwriter;
as limited by and in accordance with the provisions of Sections 8.2(b) and
8.2(c) hereof.
8.2(b). The Underwriter 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 gross negligence in the performance or such Indemnified Party's duties or by
reason of such Indemnified Party's reckless disregard of obligations and duties
under this Agreement or to the Company or the Account, whichever is applicable.
8.2(c). 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
- 19 -
20
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 other
expenses subsequently incurred by such party independently in connection with
the defense thereof other than reasonable costs of investigation.
8.2(d)The Company agrees promptly to 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 IX. Applicable Law
9.1 This Agreement shall be construed and the
provisions hereof interpreted under and in accordance with the laws of the
State of New York.
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 SEC may grant (including, but not limited to, any Mixed and
Shared Funding Exemptive Order) and the terms hereof shall be interpreted and
construed in accordance therewith. If, in the future, the Mixed and Shared
Funding Exemptive Order should no longer be necessary under applicable law,
then Article VII shall no longer apply.
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, for any reason with
respect to some or all Designated Portfolios,
by 120 days advance written notice delivered
to the other parties; or
- 20 -
21
(b) termination by the Company by written notice
to the Fund and 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 Fund and the Underwriter in the event
any of the Designated 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 the
Company; or
(d) termination by the Fund or 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 Fund's
shares; provided, however, that the Fund or
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
(e) termination by the Company in the event that
formal administrative proceedings are
instituted against the Fund or 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
Underwriter to perform its obligations under
this Agreement; or
(f) termination by the Company by written notice
to the Fund and the Underwriter with respect
to any Designated Portfolio in the event that
such Portfolio ceases to qualify as a
Regulated Investment Company under Subchapter
M or fails to comply with the Section 817(h)
diversification
- 21 -
22
requirements specified in Article VI hereof,
or if the Company reasonably believes that
such Portfolio may fail to so qualify or
comply; or
(g) termination by the Fund or Underwriter by
written notice to the Company in the event
that the Contracts fail to meet the
qualifications specified in Article VI
hereof; or
(h) termination by either the Fund or the
Underwriter by written notice to the Company,
if either one or both of the Fund or the
Underwriter respectively, shall determine, in
their 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
(i) termination by the Company by written notice
to the Fund and the Underwriter, if the
Company shall determine, in its sole judgment
exercised in good faith, that the Fund,
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
(j) termination by the Company upon any
substitution of the shares of another
investment company or series thereof for
shares of a Designated Portfolio of the Fund
in accordance with the terms of the
Contracts, provided that the Company has
given at least 45 days prior written notice
to the Fund and Underwriter of the date of
substitution; or
(k) termination by any party in the event that
the Fund's Board of Directors determines that
a material irreconcilable conflict exists as
provided in Article VII.
10.2 Notwithstanding any termination of this
Agreement, the Fund and the Underwriter shall, at the option of the Company,
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"), unless the Underwriter elects to compel a substitution of other
securities for the shares of the Designated Portfolios as may be
- 22 -
23
required under Article VII. 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 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 10.2 shall not apply to any
terminations under Article VII and the effect of such Article VII terminations
shall be governed by Article VII of this Agreement. The parties further agree
that this Section 10.2 shall not apply to any terminations under Section
10.1(f) or (g) of this Agreement.
10.3 The Company shall not redeem Fund shares
attributable to the Contracts (as opposed to Fund 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) as permitted by an order of the SEC pursuant to Section
26(b) of the 1940 Act, but only if a substitution of other securities for the
shares of the Designated Portfolios 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 Contracts, the Company shall not prevent Contract owners from
allocating payments to a Portfolio that was otherwise available under the
Contracts without first giving the Fund or the Underwriter 45 days notice of
its intention to do so.
10.4 Notwithstanding any termination of this
Agreement, each party's obligation under Article VIII to indemnify the other
parties shall survive.
ARTICLE XI. Notices
Any notice shall be sufficiently given when sent by
registered or certified mail, postage prepaid, return receipt requested, or by
nationally recognized overnight courier, charges prepaid, with evidence of
delivery, 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 parties, and such notice shall be effective upon delivery.
If to the Fund:
SoGen Variable Funds, Inc.
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxx-Xxxxx Xxxxxxxxx
- 23 -
24
If to the Company:
IL Annuity and Insurance Company
0000 X. Xxxxxxxx Xxxxxx
Xxxxxxxxxxxx, XX 00000
Attention: Xxxxxxxx XxXxxxxx, Esq.
If to the Underwriter:
Societe Generale Securities Corporation
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, XX 00000
ARTICLE XII. Miscellaneous
12.1 All persons dealing with the Fund must look
solely to the property of the Fund, and in the case of a series company, the
respective Designated Portfolios listed on Schedule A hereto as though each
such Designated Portfolio had separately contracted with the Company and the
Underwriter for the enforcement of any claims against the Fund. The parties
agree that neither the Board, officers, agents or shareholders of the Fund
assume any personal liability or responsibility for obligations entered into by
or on behalf of the Fund.
12.2 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.
12.3 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.
12.4 This Agreement may be executed simultaneously
in two or more counterparts, each of which taken together shall constitute one
and the same instrument.
- 24 -
25
12.5 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.
12.6 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 Massachusetts and Indiana 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 the Company are being
conducted in a manner consistent with the Massachusetts and Indiana variable
annuity laws and regulations and any other applicable law or regulations.
12.7 The rights, remedies and obligations contained
in this Agreement are cumulative and are in addition to any and all rights,
remedies, and obligations, at law or in equity, which the parties hereto are
entitled to under state and federal laws.
12.8 This Agreement or any of the rights and
obligations hereunder may not be assigned by any party without the prior
written consent of all parties hereto.
12.9 The Company shall furnish, or shall cause to be
furnished, to the Fund or its designee copies of the following reports:
(a) the Company's annual statement (prepared
under statutory accounting principles) and
annual report (prepared under generally
accepted accounting principles) filed with
any state or federal regulatory body or
otherwise made available to the public, as
soon as practicable and in any event within
90 days after the end of each fiscal year;
and
(b) any registration statement (without exhibits)
and financial reports of the Company filed
with the Securities and Exchange Commission
or any state insurance regulatory, as soon as
practicable after the filing thereof.
- 25 -
26
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.
COMPANY: IL ANNUITY AND INSURANCE COMPANY
By its authorized officer
By: /s/ XXXXXXX X. XXXXXX
-----------------------------------
Title: President
--------------------------------
Date: 6/27/97
---------------------------------
FUND: SOGEN VARIABLE FUNDS, INC.
By its authorized officer
By: /s/ XXXXXX X. XXXXXXX
-----------------------------------
Title: Vice President
--------------------------------
Date: 7/25/97
---------------------------------
UNDERWRITER: SOCIETE GENERALE SECURITIES CORPORATION
By its authorized officer
By: /s/ XXXXXXXXX X. XXXXXXX
-----------------------------------
Title: First Vice President
--------------------------------
Date: 7/8/97
---------------------------------
- 26 -
27
SCHEDULE A
Segregated Asset Accounts of the Company
IL Annuity and Insurance Company Separate Account I
Contracts to be Issued by the Company
VCA - 97
Designated Portfolio Shares to be Purchased
SoGen Overseas Variable Fund
Other Funding Vehicles Available Under the Contracts
The Xxxxx American Fund
Fidelity Variable Insurance Products Fund
Fidelity Variable Insurance Products Fund II
OCC Accumulation Trust
X. Xxxx Price Fixed Income Series, Inc.
X. Xxxx Price International Series, Inc.
Xxx Xxx Worldwide Insurance Trust
Royce Capital Fund
Safeco Resource Series Trust
- 27 -
