Exhibit 1.A(8)
PARTICIPATION/DISTRIBUTION AGREEMENT
THIS AGREEMENT is entered into on this ___ day of ________, 2002, between
TIAA-CREF Life Insurance Company ("TCL"), a life insurance company organized
under the laws of the State of New York, for itself and on behalf of TIAA-CREF
Life Separate Account VLI-1 (the "Account"), a separate account established by
TCL in accordance with the laws of the State of New York; TIAA-CREF Life Funds
(the "Company"), an open-end management investment company organized under the
laws of the State of Delaware, and Teachers Personal Investors Services, Inc.
("TPIS"), a Delaware corporation operating as a broker-dealer.
WITNESSETH:
WHEREAS, the Account has been established by TCL pursuant to the insurance
laws of the State of New York in connection with certain variable life insurance
contracts ("Contracts") proposed to be issued to the public by TCL;
WHEREAS, the Account has been registered as a unit investment trust under
the Investment Company Act of 1940, as amended (the "1940 Act");
WHEREAS, the income, if any, and gains and losses, realized and unrealized,
from assets allocated to the Account are, in accordance with the applicable
contracts, to be credited to or charged against the Account without regard to
other income, gains or losses of TCL or any other separate account thereof;
WHEREAS, the Account currently consists of a number of investment accounts
(each a "subaccount") as to which income, if any, and gains and losses, realized
and unrealized, from assets allocated to each such subaccount will be credited
to or charged against such subaccount without regard to other income, gains or
losses of other subaccounts;
WHEREAS, the Company is registered with the Securities and Exchange
Commission under the 1940 Act as an open-end management investment company;
WHEREAS, the Company is currently subdivided into various investment
portfolios (each a "Fund"), each of which is subject to certain investment
policies and restrictions that may not be changed without a majority vote of the
shareholders of such Fund; and
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WHEREAS, the shares of each Fund will be offered to a corresponding
subaccount; and
WHEREAS, TPIS is the principal underwriter for the Contracts and is a
broker-dealer registered as such under the Securities Exchange Act of 1934 and
is a member of the National Association of Securities Dealers ("NASD");
NOW THEREFORE, in consideration of the foregoing and of the mutual
covenants and conditions set forth herein TCL, the Account, TPIS and the Company
hereby agree as follows:
1. The Contracts funded through the Account will provide for the
allocation of premiums among certain sub-accounts for investment in such
shares of the Funds as may be offered from time to time in the prospectus
for the Contracts. The selection of the particular sub-account is to be
made by the contract owner and such selection may be changed or the cash
value may be transferred among or between sub-accounts in accordance with
the terms of the Contracts.
2. The Company hereby appoints TPIS as its principal underwriter and
exclusive distributor to sell its shares to the Account, and TPIS accepts
such appointment. TPIS shall offer shares of the Company only on the terms
set forth in the Company's currently effective registration statement. The
Company reserves the right to sell its shares to other persons and to
appoint additional underwriters and distributors.
3. The Company agrees to sell to TCL, on behalf of the Account, those
shares of the Funds of the Company which the Account orders, executing such
orders on a daily basis at the net asset value next computed after receipt
by the Company or its designated agent of the order for the shares of the
Company. For purposes of this Section, TCL or its designated agent shall be
the designated agent of the Company for receipt of such orders from
contract owners and receipt by such designated agent shall constitute
receipt by the Company; provided that the Company's transfer agent receives
notice of such order by 9:30 a.m. New York time on the next following
business day. Any transaction which occurs or is scheduled to occur on a
day that is not a business day will be processed as described in the
prospectus for the Contracts. For the avoidance of doubt, TCL shall be
deemed to have received a valid order for any transaction previously
scheduled to occur on a non-business day (e.g. dollar cost averaging
transaction, incurrence of monthly charge, etc.) as of the close of
business on the immediately preceding business day. "Business day" shall
mean any day on which the New York Stock Exchange is open for trading and
on which the Company calculates the net asset value of the Funds as
described in its registration statement.
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The Company agrees to make shares of each Fund available indefinitely for
purchase at the applicable net asset value per share by the Account on those
days on which the Company calculates its net asset value as described in its
registration statement and the Company shall use reasonable efforts to calculate
such net asset value on each business day as defined above. Notwithstanding the
foregoing, the Board of Trustees of the Company (hereinafter the "Board") may
refuse to sell shares of any Fund to TCL, or suspend or terminate the offering
of shares of any Fund if such action is required by law or by regulatory
authorities having jurisdiction or is, in the sole discretion of the Board
acting in good faith and in light of their fiduciary duties under federal and
any applicable state laws, necessary in the best interests of the shareholders
of such Fund or contract owners indirectly invested in such Fund.
TCL shall pay for such shares by 9:30 a.m. New York time on the next
business day after an order to purchase shares is made in accordance with the
provisions of this Section 5. Payment shall be in federal funds transmitted by
wire to the Company's transfer agent or by a credit for any shares redeemed.
4. The Company agrees to redeem for cash, on TCL's request, any full or
fractional shares of the Company held by TCL, executing such requests on a daily
basis at the net asset value next computed after receipt by the Company or its
designated agents of the request for redemption by Contract owners. For purposes
of this Section, TCL or its designated agent shall be the designated agent of
the Company for receipt of requests for redemption from Contract owners and
receipt by such designated agent shall constitute receipt by the Company;
provided that the Company receives notice of such request for redemption by 9:30
a.m. New York time on the next following business day. Any transaction which
occurs or is scheduled to occur on a day that is not a business day will be
processed as described in the prospectus for the Contracts. For the avoidance of
doubt, TCL shall be deemed to have received a valid order for any transaction
previously scheduled to occur on a non-business day (e.g. dollar cost averaging
transaction, incurrence of monthly charge, etc.) as of the close of business on
the immediately preceding business day.
The Company ordinarily shall make payment to TCL for shares redeemed on the
day the Company receives notice from TCL or its designated agent, but the
Company may delay payment for up to seven calendar days after the request is
received. Payment shall be in federal funds transmitted by wire or by a credit
for any shares purchased.
5. Transfer of shares shall be by book entry. No stock certificates will be
issued to the Account. Shares of each Fund will be recorded with an appropriate
identifier for the corresponding subaccount on the books of TCL. If, however,
state law requires transfer other than by book entry, then the Company agrees to
provide the required form of transfer.
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6. The Company shall make the net asset value per share for each Fund
available to TCL or its designated agent on a daily basis as soon as reasonably
practicable after the net asset value per share is calculated and shall use its
best efforts to make such net asset value per share available to TCL or its
designated agent by 7 p.m. New York time.
7. The Company or its transfer agent shall furnish notice on the
ex-dividend date to TCL or its designated agent of any dividend or distribution
payable on any shares to the Account. All of such dividends and distributions as
are payable on shares of a Fund shall be automatically reinvested in additional
shares of that Fund. The Company shall notify TCL or its designated agent of the
number of shares so issued.
8. The Company shall pay all of its expenses incidental to its performance
under this Agreement. The Company shall take all reasonable steps to ensure that
all of its shares are registered and authorized for issue in accordance with
applicable federal and state laws prior to their purchase by TCL for the
Account. The Company shall bear the expenses for the cost of registration of its
shares, preparation of its prospectus, proxy materials and reports, the printing
and distribution of such items to each Contract owner who has allocated net
amounts to any subaccount, the preparation of all statements and notices
required by any federal or state law, and taxes imposed upon the Company on the
issue or transfer of the Company's shares subject to this Agreement. The parties
shall cooperate in the printing of the prospectuses of the Contracts and the
Company. The Company shall provide TCL with a reasonable quantity of Company
prospectuses and reports to be sent to existing Contract owners.
9. The Company does not charge a load or redemption fee in connection with
the sale or redemption of its shares and TPIS will not charge any load or
redemption fee in connection with the sale of shares to or redemption of shares
from the Account. Notwithstanding this, TPIS assumes and will pay, from its own
resources, all expenses related to distribution of the Company's shares and will
bear other costs and expenses attributable to any activity primarily intended to
result in the sale of shares. Such expenses include, but are not limited to:
a. printing and distribution of the Company's prospectus to
prospective investors;
b. preparation, printing and distribution of advertising and sales
literature for use in the offering of the Company's shares (in
connection with the offering of the Contracts or otherwise) and
printing and distribution of reports to shareholders used as
sales literature; and
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c. the qualification of TPIS as a distributor or broker or dealer
under any applicable federal or state securities laws;
10. In selling shares of the Company, TPIS shall use its best efforts in
all respects duly to conform with the requirements of all federal and state laws
and regulations and the rules of the NASD, relating to the sales of the
Company's shares or the Contracts.
11. TPIS shall act as an independent contractor and nothing contained
herein shall be construed to make it, its agents or representatives, or any
employees, employees of the Company. In addition, TPIS shall remain fully
responsible for its own conduct and that of its agents, representatives and
employees under applicable law.
12. TCL and TPIS shall make no representations concerning the Company or
its shares except those contained in the then-current prospectus of the Company
and in printed information subsequently issued on behalf of the Company and
approved by the Company as supplemental to such prospectus, or otherwise
approved by the Company.
13. The Company represents that each Fund of the Company shall comply with
Section 817(h) of the Internal Revenue Code of 1986, as amended (the "Code"),
and the regulations issued thereunder (Reg. Section 1.817-5), relating to the
diversification requirements for variable life insurance contracts and any
amendments or other modifications to such Section or regulations.
The Company represents that each Fund of the Company is currently qualified
or will be qualified as a Regulated Investment Company under Subchapter M of the
Code and that every effort will be made to maintain such qualification under
Subchapter M or under any successor or similar provision, and that the Company
will notify TCL orally (followed by written notice) or by wire immediately upon
having a reasonable basis for believing that any Series might not so qualify in
the future.
14. It is understood among the parties to this Agreement that, subject to
obtaining any applicable regulatory approvals that may be conditioned on the
parties complying with certain requirements, shares of each Fund may be offered
in the future to the separate accounts of various insurance companies in
addition to TCL and in connection with variable life insurance contracts or
variable annuity contracts other than the Contracts. It is also understood among
the parties that shares of each Fund only may be offered to the other persons
identified in paragraph (f) of Regulation Section 1.817-5.
15. The Company represents and warrants that all of its officers,
employees, investment advisers, and other individuals or entities having access
to the
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assets of the Company are and shall continue to be at all times covered by a
blanket fidelity bond or similar coverage for the benefit of the Company in an
amount not less than the minimal coverage as required currently by Section 17(g)
of the 1940 Act and Rule 17g-1 or related provisions as may be promulgated from
time to time.
16. This Agreement shall terminate:
(a) at any time on six months written notice by the Company to TCL and
TPIS or on six months' written notice by TCL to the Company and TPIS or on
six months' written notice by TPIS to TCL and the Company without the
payment of any penalty (provided, however, that if TCL is not able, acting
in good faith, to obtain suitable substitute investment media within six
months, this Agreement shall terminate one year from the date of the notice
of termination); or
(b) at the option of any party hereto upon institution of formal
enforcement proceedings against the Company, the Company's investment
manager, TCL or TPIS by the Securities and Exchange Commission, or if TCL
or the Company is determined by the other to have failed to perform its
obligations under this Agreement in a satisfactory manner; or
(c) upon a vote of the holders of a majority of the votes attributable
to the shares supporting the Contracts having an interest in a particular
subaccount to substitute the shares of another investment company or Fund
for the Company shares then being held by that subaccount in accordance
with the terms of the Contracts. TCL will give 60 days' prior written
notice to the Company upon becoming aware of a proposed Contract owner
vote; or
(d) in the event the shares of the Company are not registered, issued,
or sold in accordance with applicable state and/or federal law or such law
prohibits the use of such shares as an underlying investment for the
Contracts issued or to be issued by TCL. Prompt notice of such an event
shall be given by each party to the other in the event the conditions of
this provision occur; or
(e) upon assignment of this Agreement, at the option of any party not
assigning this Agreement.
17. Each notice required by this Agreement shall be given in writing to:
Attn: Xxxx Xxxx
TIAA-CREF Life Insurance Company
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
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Attn: Xxxx Xxxx
TIAA-CREF Life Funds
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Attn: Xxxx Xxxx
Teachers Personal Investors Services, Inc.
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
18. Each party hereto shall cooperate with each other party and all
appropriate government authorities 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.
The Company agrees that all records and other data pertaining to the
Contracts are the exclusive property of TCL and that any such records and other
data shall be furnished to TCL by the Company upon termination of this Agreement
for any reason whatsoever. TCL shall have the right to inspect, audit and copy
all pertinent records pertaining to the Contracts. This shall not preclude the
Company from keeping copies of such data or records for its own files subject to
the provisions of this section.
19. TCL, the Account and TPIS agree to look solely to the assets of the
Company for the satisfaction of any liability of the Company, with respect to
this agreement and will not seek recourse against the members of the Board or
its officers, employees, agents, or shareholders, or any of them, or any of
their personal assets for such satisfaction.
20. The Company agrees to indemnify and hold harmless TCL, each member of
its Board of Directors, each of its officers, and any person that controls TCL
within the meaning of Section 15 of the Securities Act of 1933, as amended (the
"1933 Act") 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 TCL may become subject
under any statute, at common law or otherwise, insofar as such losses, claims,
damages, liabilities or expenses (or actions in respect thereof) or settlements
arise as a result of TCL's reliance on any information contained in a then
current prospectus, statement of additional information, or report of the
Company; or any current information communicated to TCL in writing by the
Company.
The Company shall, at all times, have the right, but not the obligation, to
take over and conduct, in the name of TCL, the Account and/or TPIS, the
investigation and defense of any claim by a third party for which
indemnification may be sought, and
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in such event, TCL, the Account and/or TPIS shall cooperate in every way with
the Company.
21. The Company agrees to indemnify and hold harmless TPIS, each member of
its Board of Directors, each of its officers, and any person that controls TPIS
within the meaning of Section 15 of the 1933 Act 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 TPIS may become subject under any statute, at common law or
otherwise, insofar as such losses, claims, damages, liabilities or expenses (or
actions in respect thereof) or settlements arise as a result of TPIS's reliance
on any information contained in a then current prospectus, statement of
additional information, or report of the Company; or any current information
communicated to TPIS in writing by the Company.
The Company shall, at all times, have the right, but not the obligation, to
take over and conduct, in the name of TPIS, or any controlling person of TPIS,
the investigation and defense of any claim by a third party for which
indemnification may be sought, and in such event, TPIS shall cooperate in every
way with the Company.
22. TCL agrees to indemnify and hold harmless the Company, each member of
its Board, each of its officers, and each person that controls the Company
within the meaning of Section 15 of the 1933 Act against any and all losses,
claims, damages, liabilities (including amounts paid in settlement with the
written consent of TCL) or litigation (including legal and other expenses) to
which the Company may become subject under any statute, at common law or
otherwise, insofar as such losses, claims, damages, liabilities or expenses (or
actions in respect thereof) or settlements arise as a result of the Company's
reliance on any information contained in the then current prospectus, statement
of additional information, or contract of the Account; or any information
communicated to the Company in writing by TCL.
TCL shall, at all times, have the right, but not the obligation, to take
over and conduct, in the name of the Company, the investigation and defense of
any claim by a third party for which indemnification may be sought, and in such
event, the Company shall cooperate in every way with TCL.
23. TPIS agrees to indemnify and hold harmless the Company, each member of
its Board, each of its officers, and each person that controls the Company
within the meaning of Section 15 of the 1933 Act against any and all losses,
claims, damages, liabilities (including amounts paid in settlement with the
written consent of TPIS) or litigation (including legal and other expenses) to
which the Company may become subject under any statute, at common law or
otherwise, insofar as such losses, claims, damages, liabilities or expenses (or
actions in respect thereof) or settlements arise as a result of the Company's
reliance on any information communicated to the
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Company in writing by TPIS (for inclusion in the Company's registration
statement or otherwise), as a result of any misrepresentation or omission to
state a material fact by TPIS (or any agent or employee of TPIS) unless such
misrepresentation or omission was made in reliance on written information
furnished by the Company or as a result of TPIS's wilful misconduct or failure
to exercise reasonable care and diligence (including supervision of its agents
representatives and employees) in providing the services the Company specified
herein.
TPIS shall, at all times, have the right, but not the obligation, to take
over and conduct, in the name of the Company, the investigation and defense of
any claim by a third party for which indemnification may be sought, and in such
event, the Company shall cooperate in every way with TPIS.
24. This Agreement shall be construed in accordance with the laws of the
State of New York.
25. This Agreement shall be subject to the provisions of the 1933 Act, the
1940 Act and the Securities Exchange Act of 1934, as amended, and the rules and
regulations and rulings thereunder, including such exemptions form those
statutes, rules and regulations as the Securities and Exchange Commission may
grant and the terms hereof shall be interpreted and construed in accordance
therewith.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and attested as of the date shown on the First page.
TIAA-CREF LIFE INSURANCE
COMPANY ON BEHALF OF ITSELF
AND TIAA-CREF LIFE SEPARATE
ACCOUNT VLI-1
Attest:
By:
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TIAA-CREF LIFE FUNDS
Attest:
By:
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Assistant Secretary Executive Vice President
TEACHERS PERSONAL
INVESTORS SERVICES, INC.
Attest:
By:
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