EXHIBIT 8(d)
PARTICIPATION AGREEMENT
AMONG ALLIANCE FUND DISTRIBUTORS, INC. ON BEHALF OF ITSELF
and
ALLIANCE VARIABLE PRODUCTS SERIES FUND, INC.,
and
KEYPORT BENEFIT LIFE INSURANCE COMPANY
THIS AGREEMENT made as of May 10, 1999, among Alliance Variable
Products Series Fund, Inc. (the "Trust"), a corporation organized under
Maryland law, Alliance Fund Distributors, Inc., a Delaware corporation, the
Trust's principal underwriter ("Underwriter"), and Keyport Benefit Life
Insurance Company, a life insurance company organized as a corporation
under New York law (the "Company"), on its own behalf and on behalf of each
segregated asset account of the Company set forth in Schedule A, as may be
amended from time to time (the "Accounts").
W I T N E S S E T H:
WHEREAS, the Trust is registered with the Securities and Exchange
Commission (the "SEC") as an open-end management investment company under
the Investment Company Act of 1940, as amended (the "1940 Act"), and has an
effective registration statement relating to the offer and sale of the
various series of its shares under the Securities Act of 1933, as amended
(the "1933 Act");
WHEREAS, the Trust and the Underwriter desire that Trust shares be
used as an investment vehicle for separate accounts established for
variable life insurance policies and variable annuity contracts to be
offered by life insurance companies which have entered into fund
participation agreements with the Trust (the "Participating Insurance
Companies");
WHEREAS, the beneficial interest in the Trust is divided into several
series of shares, each series representing an interest in a particular
managed portfolio of securities and other assets, and certain of those
series, named in Schedule B, (the "Portfolios") are to be made available
for purchase by the Company for the Accounts; and
WHEREAS, the Trust has been granted or currently intends to apply for
an order from the SEC granting Participating Insurance Companies and their
separate accounts exemptions from the provisions of Sections 9(a), 13(a),
15(a) and 15(b) of the 1940 Act, and Rules 6e-2 (b) (15) and 6e-3 (T) (b)
(15) thereunder, to the extent necessary to permit shares of the Trust to
be sold to and held by variable annuity and variable life insurance
separate accounts of both affiliated and unaffiliated life insurance
companies and certain qualified pension and retirement plans (the "Shared
Funding Exemptive Order");
WHEREAS, the Company has registered or will register each Account as a
unit investment trust under the 1940 Act unless an exemption from
registration under the 1940 Act is available and the Trust has been so
advised; and has registered or will register certain variable annuity
contracts and variable life insurance policies under which the portfolios
are to be made available as investment vehicles (the "Contracts") under the
1933 Act unless such interests under the Contracts in the Accounts are
exempt from registration under the 1933 Act and the Trust has been so
advised;
WHEREAS, each Account is a duly organized, validly existing segregated
asset account, established by resolution of the Board of Directors of the
Company, on the date shown for such account on Schedule A hereto, to set
aside and invest assets attributable to one or more Contracts; and
WHEREAS, the Underwriter is registered as a broker dealer with the
Securities and Exchange Commission 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. ("NASD"); and
WHEREAS, each investment adviser listed on Schedule B (each, an
"Adviser") is duly registered as an investment adviser under the Investment
Advisers Act of 1940, as amended ("Advisers Act") and any applicable state
securities laws;
WHEREAS, to the extent permitted by applicable insurance laws and
regulations, the Company intends to purchase shares in the Portfolios on
behalf of each Account to fund certain of the aforesaid Contracts and the
Underwriter is authorized to sell such shares to unit investment trusts
such as each Account at net asset value;
NOW THEREFORE, in consideration of their mutual promises, the parties
agree as follows:
ARTICLE I.
Purchase and Redemption of Trust Portfolio Shares
1.1. For purposes of this Article I, the Company shall be the Trust's
designee for receipt of purchase orders and requests for redemption
relating to each Portfolio from each Account, provided that the Company
notifies the Trust of such purchase orders and requests for redemption by
9:00 a.m. Eastern time on the next following Business Day, as defined in
Section 1.3.
1.2. The Trust agrees to make shares of the Portfolios available to
the Accounts for purchase at the net asset value per share next computed
after receipt of a purchase order by the Trust (or its designee), as
established in accordance with the provisions of the then current
prospectus of the Trust describing Portfolio purchase procedures on those
days on which the Trust calculates its net asset value pursuant to rules of
the SEC, and the Trust shall use its best efforts to calculate such net
asset value on each day on which the New York Stock Exchange ("NYSE") is
open for trading. The Company will transmit orders from time to time to the
Trust for the purchase of shares of the Portfolios. The Trustees of the
Trust (the "Trustees") may refuse to sell shares of any Portfolio to any
person, or suspend or terminate the offering of shares of any Portfolio if
such action is required by law or by regulatory authorities having
jurisdiction or if, in the sole discretion of the Trustees acting in good
faith and in light of their fiduciary duties under federal and any
applicable state laws, such action is deemed in the best interests of the
shareholders of such Portfolio.
1.3 The Company shall submit payment for the purchase of shares of a
Portfolio on behalf of an Account no later than the close of business on
the next Business Day after the Trust receives the purchase order. Payment
shall be made in federal funds transmitted by wire to the Trust or its
designated custodian. Upon receipt by the Trust of the federal funds so
wired, such funds shall cease to be the responsibility of the Company and
shall become the responsibility of the Trust for this purpose. "Business
Day" shall mean any day on which the NYSE is open for trading and on which
the Trust calculates its net asset value pursuant to the rules of the SEC.
1.4 The Trust will redeem for cash any full or fractional shares of
any Portfolio, when requested by the Company on behalf of an Account, at
the net asset value next computed after receipt by the Trust (or its
designee) of the request for redemption, as established in accordance with
the provisions of the then current prospectus of the Trust describing
Portfolio redemption procedures. The Trust shall make payment for such
shares in the manner established from time to time by the Trust.
Redemption with respect to a Portfolio will normally be paid to the Company
for an Account in federal funds transmitted by wire to the Company before
the close of business on the next Business Day after the receipt of the
request for redemption. Such payment may be delayed if, for example, the
Portfolio's cash position so requires or if extraordinary market conditions
exist, but in no event shall payment be delayed for a greater period than
is permitted by the 0000 Xxx.
1.5 Payments for the purchase of shares of the Trust's Portfolios by
the Company under Section 1.3 and payments for the redemption of shares of
the Trust's Portfolios under Section 1.4 may be netted against one another
on any Business Day for the purpose of determining the amount of any wire
transfer on that Business Day.
1.6 Issuance and transfer of the Trust's Portfolio shares will be by
book entry only. Stock certificates will not be issued to the Company or
the Account. Portfolio Shares purchased from the Trust will be recorded in
the appropriate title for each Account or the appropriate subaccount of
each Account.
1.7 The Trust shall furnish, on or before the ex-dividend date, notice
to the Company of any income dividends or capital gain distributions
payable on the shares of any Portfolio of the Trust. The Company hereby
elects to receive all such income dividends and capital gain distributions
as are payable on a Portfolio's shares in additional shares of the
Portfolio. The Trust shall notify the Company of the number of shares so
issued as payment of such dividends and distributions.
1.8 The Trust shall calculate the net asset value of each Portfolio on
each Business Day, as defined in Section 1.3. The Trust shall make the net
asset value per share for each Portfolio available to the Company or its
designated agent on a daily basis as soon as reasonably practical after the
net asset value per share is calculated and shall use reasonable efforts to
make such net asset value per share available by 7:00 p.m. Eastern time
each Business Day.
1.9 The Trust agrees that its Portfolio shares will be sold only to
Participating Insurance Companies and their separate accounts and to
certain qualified pension and retirement plans to the extent permitted by
the Shared Funding Exemptive Order. No shares of any Portfolio will be sold
directly to the general public. The Company agrees that it will use Trust
shares only for the purposes of funding the Contracts through the Accounts
listed in Schedule A, as amended from time to time.
1.10 The Company agrees that all net amounts available under the
Contracts shall be invested in the Trust, in such other Funds advised by an
Adviser or its affiliates as may be mutually agreed to in writing by the
parties hereto, or in the Company's general account, provided that such
amounts may also be invested in an investment company other than the Trust
if: (a) such other investment company, or series thereof, has investment
objectives or policies that are substantially different from the investment
objectives and policies of the Portfolios; or (b) the Company gives the
Trust and the Underwriter 45 days written notice of its intention to make
such other investment company available as a funding vehicle for the
Contracts; or (c) such other investment company is available as a funding
vehicle for the Contracts at the date of this Agreement and the Company so
informs the Trust and the Underwriter prior to their signing this
Agreement; or (d) the Trust or Underwriter consents to the use of such
other investment company.
1.11 The Trust agrees that all Participating Insurance Companies shall
have the obligations and responsibilities regarding pass-through voting and
conflicts of interest corresponding to those contained in Section 2.10 and
Article IV of this Agreement.
1.12 Each party to this Agreement shall have the right to rely on
information or confirmations provided by any other party (or by any
affiliate of any other party), and shall not be liable in the event that an
error results from any incorrect information or confirmations supplied by
any other party. If an error is made in reliance upon incorrect information
or confirmations, any amount required to make a Contract owner's account
whole shall be borne by the party who provided the incorrect information or
confirmation.
ARTICLE II.
Obligations of the Parties; Fees and Expenses
2.1 The Trust shall prepare and be responsible for filing with the SEC
and any state regulators requiring such filing all shareholder reports,
notices, proxy materials (or similar materials such as voting instruction
solicitation materials), prospectuses and statements of additional
information of the Trust. The Trust shall bear the costs of registration
and qualification of its shares of the Portfolios, preparation and filing
of the documents listed in this Section 2.1 and all taxes to which an
issuer is subject on the issuance and transfer of its shares.
2.2 At the option of the Company, the Trust or the Underwriter shall
either (a) provide the Company with as many copies of portions of the
Trust's current prospectus, annual report, semi-annual report and other
shareholder communications, including any amendments or supplements to any
of the foregoing, pertaining specifically to the Portfolios as the Company
shall reasonably request; or (b) provide the Company with a camera ready
copy of such documents in a form suitable for printing and from which
information relating to series of the Trust other than the Portfolios has
been deleted to the extent practicable. The Trust or the Underwriter shall
provide the Company with a copy of its current statement of additional
information, including any amendments or supplements, in a form suitable
for duplication by the Company. Expenses of furnishing such documents for
marketing purposes shall be borne by the Company and expenses of furnishing
such documents for current contract owners invested in the Trust shall be
borne by the Trust or the Underwriter.
2.3 The Trust (at its expense) shall provide the Company with copies
of any Trust-sponsored proxy materials in such quantity as the Company
shall reasonably require for distribution to Contract owners. The Company
shall bear the costs of distributing proxy materials (or similar materials
such as voting solicitation instructions), prospectuses and statements of
additional information to Contract owners. The Company assumes sole
responsibility for ensuring that such materials are delivered to Contract
owners in accordance with applicable federal and state securities laws.
2.4 If and to the extent required by law, the Company shall: (i)
solicit voting instructions from Contract owners; (ii) vote the Trust
shares in accordance with the instructions received from Contract owners;
and (iii) vote Trust shares for which no instructions have been received in
the same proportion as Trust shares of such Portfolio for which
instructions have been received; so long as and to the extent that the SEC
continues to interpret the 1940 Act to require pass-through voting
privileges for variable contract owners. The Company reserves the right to
vote Trust shares held in any segregated asset account in its own right, to
the extent permitted by law.
2.5 The Company shall furnish, or cause to be furnished to the Trust
or its designee, at least one complete copy of each registration statement,
prospectus, statement of additional information, retirement plan disclosure
information or other disclosure documents or similar information, as
applicable (collectively "disclosure documents"), as well as any report,
solicitation for voting instructions, sales literature and other
promotional materials, and all amendments to any of the above that relate
to the Contracts or the Accounts prior to its first use. The Company shall
furnish, or shall cause to be furnished, to the Trust or its designee each
piece of sales literature or other promotional material in which the Trust
or an Adviser is named, at least 15 Business Days prior to its use. No such
material shall be used if the Trust or its designee reasonably objects to
such use within five Business Days after receipt of such material. For
purposes of this paragraph, "sales literature or other promotional
material" includes, but is not limited to, portions of the following that
use any Trademark related to the Trust or Underwriter or refer to the Trust
or affiliates of the Trust: 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 electronic communication or other public
media), sales literature (i.e., any written communication distributed or
made generally available to customers or the public, including brochures,
circulars, research reports, market letters, form letters, seminar texts,
reprints or excerpts or any other advertisement, sales literature or
published article or electronic communication), educational or training
materials or other communications distributed or made generally available
to some or all agents or employees, and disclosure documents, shareholder
reports and proxy materials.
2.6 The Company and its agents shall not give any information or make
any representations or statements on behalf of the Trust or concerning the
Trust, the Underwriter or an Adviser in connection with the sale of the
Contracts other than information or representations contained in and
accurately derived from the registration statement or prospectus for the
Trust shares (as such registration statement and prospectus may be amended
or supplemented from time to time), annual and semi-annual reports of the
Trust, Trust-sponsored proxy statements, or in sales literature or other
promotional material approved by the Trust or its designee, except as
required by legal process or regulatory authorities or with the written
permission of the Trust or its designee.
2.7 The Trust shall use its best efforts to provide the Company, on a
timely basis, with such information about the Trust, the Portfolios and
each Adviser, in such form as the Company may reasonably require, as the
Company shall reasonably request in connection with the preparation of
disclosure documents and annual and semi-annual reports pertaining to the
Contracts.
2.8 The Trust shall not give any information or make any
representations or statements on behalf of the Company or concerning the
Company, the Accounts or the Contracts other than information or
representations contained in and accurately derived from disclosure
documents for the Contracts (as such disclosure documents may be amended or
supplemented from time to time), or in materials approved by the Company
for distribution including sales literature or other promotional materials,
except as required by legal process or regulatory authorities or with the
written permission of the Company.
2.9 So long as, and to the extent that, the SEC interprets the 1940
Act to require pass-through voting privileges for Contract owners, the
Company will provide pass-through voting privileges to Contract owners
whose Contract values are invested, through the registered Accounts, in
shares of one or more Portfolios of the Trust. The Trust shall require all
Participating Insurance Companies to calculate voting privileges in the
same manner and the Company shall be responsible for assuring that the
Accounts calculate voting privileges in the manner established by the
Trust. With respect to each registered Account, the Company will vote
shares of each Portfolio of the Trust held by a registered Account and for
which no timely voting instructions from Contract owners are received in
the same proportion as those shares held by that registered Account for
which voting instructions are received. The Company and its agents will in
no way recommend or oppose or interfere with the solicitation of proxies
for Portfolio shares held to fund the Contracts without the prior written
consent of the Trust, which consent may be withheld in the Trust's sole
discretion.
2.10 The Trust and Underwriter shall pay no fee or other compensation
to the Company under this Agreement except as provided on Schedule C.
Nevertheless, the Trust or the Underwriter or an affiliate may make
payments (other than pursuant to a Rule 12b-1 Plan) to the Company or its
affiliates or to the Contracts' underwriter in amounts agreed to by the
Underwriter in writing and such payments may be made out of fees otherwise
payable to the Underwriter or its affiliates, profits of the Underwriter or
its affiliates, or other resources available to the Underwriter or its
affiliates.
ARTICLE III.
Representations and Warranties
3.1 The Company represents and warrants that it is an insurance
company duly organized and in good standing under the laws of its state of
incorporation and that it has legally and validly established each Account
as a segregated asset account under such law as of the date set forth in
Schedule A.
3.2 The Company represents and warrants that, with respect to each
Account, (1) the Company 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
asset account for the Contracts, or (2) if the Account is exempt from
registration as an investment company under Section 3(c) of the 1940 Act,
the Company will make every effort to maintain such exemption and will
notify the Trust and the Adviser immediately upon having a reasonable basis
for believing that such exemption no longer applies or might not apply in
the future.
3.3 The Company represents and warrants that, with respect to each
Contract, (1) the Contract will be registered under the 1933 Act, or (2) if
the Contract is exempt from registration under Section 3(a)(2) of the 1933
Act or under Section 4(2) and Regulation D of the 1933 Act, the Company
will make every effort to maintain such exemption and will notify the Trust
and the Adviser immediately upon having a reasonable basis for believing
that such exemption no longer applies or might not apply in the future. The
Company further represents and warrants that the Contracts will be sold by
broker-dealers, or their registered representatives, who are registered
with the SEC under the 1934 Act and who are members in good standing of the
NASD; the Contracts will be issued and sold in compliance in all material
respects with all applicable federal and state laws; and the sale of the
Contracts shall comply in all material respects with state insurance
suitability requirements.
For any unregistered Accounts which are exempt from registration under
the 1940 Act in reliance upon Sections 3(c)(1) or 3(c)(7) thereof, the
Company represents and warrants that:
(a) each Account and sub-account thereof has a principal underwriter
which is registered as a broker-dealer under the Securities
Exchange Act of 1934, as amended;
(b) Trust shares are and will continue to be the only investment
securities held by the corresponding Account sub-accounts; and
(c) with regard to each Portfolio, the Company, on behalf of the
corresponding sub-account, will:
(1) seek instructions from all Contract owners with regard to
the voting of all proxies with respect to Trust shares and
vote such proxies only in accordance with such instructions
or vote such shares held by it in the same proportion as the
vote of all other holders of such shares; and
(2) refrain from substituting shares of another security for
such shares unless the SEC has approved such substitution in
the manner provided in Section 26 of the 0000 Xxx.
3.4 The Trust represents and warrants that it is duly 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 and the rules
and regulations thereunder.
3.5 The Trust represents and warrants that the Portfolio shares
offered and sold pursuant to this Agreement will be registered under the
1933 Act and the Trust shall be registered under the 1940 Act prior to and
at the time of any issuance or sale of such shares. The Trust shall amend
its registration statement 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 Trust shall register and qualify its shares for sale in accordance with
the laws of the various states only if and to the extent deemed advisable
by the Trust or the Underwriter.
3.6 The Trust represents and warrants that the investments of each
Portfolio will comply with the diversification requirements for variable
annuity, endowment or life insurance contracts set forth in Section 817(h)
of the Internal Revenue Code of 1986, as amended (the"Code"), and the rules
and regulations thereunder, including without limitation Treasury
Regulation 1.817-5, and will notify the Company immediately upon having a
reasonable basis for believing any Portfolio has ceased to comply or might
not so comply and will in that event immediately take all reasonable steps
to adequately diversify the Portfolio to achieve compliance within the
grace period afforded by Regulation 1.817-5.
3.7 The Trust represents and warrants that it is currently qualified
as a "regulated investment company" under Subchapter M of the Code, that it
will make every effort to maintain such qualification and will notify the
Company immediately upon having a reasonable basis for believing it has
ceased to so qualify or might not so qualify in the future.
3.8 The Trust represents and warrants that should it ever desire to
make any payments to finance distribution expenses pursuant to Rule 12b-1
under the 1940 Act, the Trustees, including a majority who are not
"interested persons" of the Trust under the 1940 Act ("disinterested
Trustees"), will formulate and approve any plan under Rule 12b-1 to finance
distribution expenses.
3.9 The Trust represents and warrants that it, its directors,
officers, employees and others dealing with the money or securities, or
both, of a Portfolio shall at all times be covered by a blanket fidelity
bond or similar coverage for the benefit of the Trust in an amount not less
that the minimum coverage required by Rule 17g-1 or other regulations under
the 1940 Act. Such bond shall include coverage for larceny and embezzlement
and be issued by a reputable bonding company.
3.10 The Company represents and warrants that all of its directors,
officers, employees, investment advisers, and other individuals or entities
dealing with the money and/or securities of the Trust are and shall be at
all times covered by a blanket fidelity bond or similar coverage for the
benefit of the Trust, in an amount not less than $5 million. The aforesaid
bond shall include coverage for larceny and embezzlement and shall be
issued by a reputable bonding company. The Company agrees to make all
reasonable efforts to see that this bond or another bond containing these
provisions is always in effect, and agrees to notify the Trust and the
Underwriter in the event that such coverage no longer applies.
3.11 The Underwriter represents that each Adviser is duly organized
and validly existing under applicable corporate law and that it is
registered and will during the term of this Agreement remain registered as
an investment adviser under the Advisers Act.
3.12 The Trust currently intends for one or more classes of shares
(each, a "Class") to make payments to finance its distribution expenses,
including service fees, pursuant to a Plan adopted under Rule 12b-1 under
the 1940 Act ("Rule 12b-1"), although it may determine to discontinue such
practice in the future. To the extent that any Class of the Trust finances
its distribution expenses pursuant to a Plan adopted under Rule 12b-1, the
Trust undertakes to comply with any then current SEC and SEC staff
interpretations concerning Rule 12b-1 or any successor provisions.
ARTICLE IV.
Potential Conflicts
4.1 The parties acknowledge that a Portfolio's shares may be made
available for investment to other Participating Insurance Companies. In
such event, the Trustees will monitor the Trust for the existence of any
material irreconcilable conflict between the interests of the contract
owners of all Participating Insurance Companies. 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 Trust shall promptly inform the Company of any determination by
the Trustees that an irreconcilable material conflict exists and of the
implications thereof.
4.2 The Company agrees to promptly report any potential or existing
conflicts of which it is aware to the Trustees. The Company will assist the
Trustees in carrying out their responsibilities by providing the Trustees
with all information reasonably necessary for the Trustees to consider any
issues raised including, but not limited to, information as to a decision
by the Company to disregard Contract owner voting instructions. All
communications from the Company to the Trustees may be made in care of the
Trust.
4.3 If it is determined by a majority of the Trustees, or a majority
of the disinterested Trustees, that a material irreconcilable conflict
exists that affects the interests of Contract owners, the Company shall, in
cooperation with other Participating Insurance Companies whose contract
owners are also affected, at its own expense and to the extent reasonably
practicable (as determined by the Trustees) take whatever steps are
necessary to remedy or eliminate the irreconcilable material conflict,
which steps could include: (a) withdrawing the assets allocable to some or
all of the Accounts from the Trust or any Portfolio and reinvesting such
assets in a different investment medium, including (but not limited to)
another Portfolio of the Trust, or submitting the question of whether or
not such withdrawal should be implemented to a vote of all affected
Contract owners and, as appropriate, withdrawal of the assets of any
appropriate group (i.e. , annuity contract owners, life insurance policy
owners, or variable contract owners of one or more Participating Insurance
Companies) that votes in favor of such withdrawal, or offering to the
affected Contract owners the option of making such a change; and (b)
establishing a new registered management investment company or managed
separate account.
4.4 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 Trust's election, to withdraw the
affected Account's investment in the Trust and terminate this Agreement
with respect to such 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 Trustees. Any such withdrawal and termination must take place
within six (6) months after the Trust gives written notice that this
provision is being implemented. Until the end of such six (6) month period,
the Trust shall continue to accept and implement orders by the Company for
the purchase and redemption of shares of the Trust.
4.5 If a material irreconcilable conflict arises because a particular
state insurance regulator's decision applicable to the Company conflicts
with a majority of other state regulators, then the Company will withdraw
the affected Account's investment in the Trust and terminate this Agreement
with respect to such Account within six (6) months after the Trustees
inform 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 Trustees. Until the end of such six (6) month period, the
Trust shall continue to accept and implement orders by the Company for the
purchase and redemption of shares of the Trust.
4.6 For purposes of Sections 4.3 through 4.6 of this Agreement, a
majority of the disinterested Trustees shall determine whether any proposed
action adequately remedies any irreconcilable material conflict, but in no
event will the Trust be required to establish a new funding medium for the
Contracts. In the event that the Trustees determine that any proposed
action does not adequately remedy any irreconcilable material conflict,
then the Company will withdraw the Account's investment in the Trust and
terminate this Agreement within six (6) months after the Trustees inform
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 Trustees.
4.7 The Company shall at least annually submit to the Trustees such
reports, materials or data as the Trustees may reasonably request so that
the Trustees may fully carry out the duties imposed upon them by the Shared
Funding Exemptive Order, and said reports, materials and data shall be
submitted more frequently if reasonably deemed appropriate by the Trustees.
4.8 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 Shared Funding Exemptive Order) on terms
and conditions materially different from those contained in the Shared
Funding Exemptive Order, then the Trust 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.
ARTICLE V.
Indemnification
5.1 Indemnification By the Company
(a) The Company agrees to indemnify and hold harmless the
Underwriter, the Trust and each of its Trustees, officers, employees
and agents and each person, if any, who controls the Trust within the
meaning of Section 15 of the 1933 Act (collectively, the "Indemnified
Parties" and individually the "Indemnified Party" for purposes of this
Article V) against any and all losses, claims, damages, liabilities
(including amounts paid in settlement with the written consent of the
Company, which consent shall not be unreasonably withheld) or expenses
(including the reasonable costs of investigating or defending any
alleged loss, claim, damage, liability or expense and reasonable legal
counsel fees incurred in connection therewith) (collectively,
"Losses"), to which the Indemnified Parties may become subject under
any statute or regulation, or at common law or otherwise, insofar as
such Losses are related to the sale or acquisition of Trust Shares or
the Contracts and
(i) arise out of or are based upon any untrue statements or
alleged untrue statements of any material fact contained in a
disclosure document for the Contracts or in the Contracts
themselves or in sales literature generated or approved by the
Company on behalf of the Contracts or Accounts (or any amendment
or supplement to any of the foregoing) (collectively, "Company
Documents" for the purposes of this Article V), 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 indemnity 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 was accurately derived
from written information furnished to the Company by or on behalf
of the Trust for use in Company Documents or otherwise for use in
connection with the sale of the Contracts or Trust shares; or
(ii) arise out of or result from statements or
representations (other than statements or representations
contained in and accurately derived from Trust Documents as
defined in Section 5.2 (a)(i)) or wrongful conduct of the Company
or persons under its control, with respect to the sale or
acquisition of the Contracts or Trust shares; or
(iii) arise out of or result from any untrue statement or
alleged untrue statement of a material fact contained in Trust
Documents as defined in Section 5.2(a)(i) or the omission or
alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not
misleading if such statement or omission was made in reliance
upon and accurately derived from written information furnished to
the Trust by or on behalf of the Company; or
(iv) arise out of or result from any failure by the Company
to provide the services or furnish the materials required under
the terms of this Agreement; or
(v) arise out of or result from any material breach of any
representation and/or warranty made by the Company in this
Agreement or arise out of or result from any other material
breach of this Agreement by the Company.
(b) The Company shall not be liable under this indemnification
provision with respect to any Losses 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 obligations and duties under this
Agreement or to the Trust or Underwriter, whichever is applicable.
The Company shall also 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 the Indemnified Parties, the Company shall be
entitled to participate, at its own expense, in the defense of such
action. The Company also shall be entitled to assume the defense
thereof, with counsel satisfactory to the party named in the action.
After notice from the Company to such party of the Company's election
to assume the defense thereof, the Indemnified Party shall bear the
fees and expenses of any additional counsel retained by it, and the
Company will not be liable to such party under this Agreement for any
legal or other expenses subsequently incurred by such party
independently in connection with the defense thereof other than
reasonable costs of investigation.
(c) The Indemnified Parties will promptly notify the Company of
the commencement of any litigation or proceedings against them in
connection with the issuance or sale of the Trust shares or the
Contracts or the operation of the Trust.
5.2 Indemnification By The Underwriter
(a) The Underwriter agrees to indemnify and hold harmless the
Company, the underwriter of the Contracts and each of its directors
and officers and each person, if any, who controls the Company within
the meaning of Section 15 of the 1933 Act (collectively, the
"Indemnified Parties" and individually an "Indemnified Party" for
purposes of this Section 5.2) against any and all losses, claims,
damages, liabilities (including amounts paid in settlement with the
written consent of the Underwriter, which consent shall not be
unreasonably withheld) or expenses (including the reasonable costs of
investigating or defending any alleged loss, claim, damage, liability
or expense and reasonable legal counsel fees incurred in connection
therewith) (collectively, "Losses") to which the Indemnified Parties
may become subject under any statute, at common law or otherwise,
insofar as such Losses are related to the sale or acquisition of the
Trust's Shares or the Contracts and:
(i) arise out of or are based upon any untrue statements or
alleged untrue statements of any material fact contained in the
Registration Statement, prospectus or sales literature of the
Trust (or any amendment or supplement to any of the foregoing)
(collectively, the "Trust Documents") 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 of such alleged statement or
omission was made in reliance upon and in conformity with
information furnished to the Underwriter or Trust by or on behalf
of the Company for use in the Registration Statement or
prospectus for the Trust or in sales literature (or any amendment
or supplement) or otherwise for use in connection with the sale
of the Contracts or Trust shares; or
(ii) arise out of or as a result of statements or
representations (other than statements or representations
contained in the disclosure documents or sales literature for the
Contracts not supplied by the Underwriter or persons under its
control) or wrongful conduct of the Trust, Adviser or Underwriter
or persons under their control, with respect to the sale or
distribution of the Contracts or Trust shares; or
(iii) arise out of any untrue statement or alleged untrue
statement of a material fact contained in a disclosure document
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 Trust; or
(iv) arise as a result of any failure by the Trust 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
representation specified in Section 3.7 of this Agreement and the
diversification requirements specified in Section 3.6 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 5.2(b) and 5.2(c)
hereof.
(b) The Underwriter shall not be liable under this
indemnification provision with respect to any Losses 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 obligations
and duties under this Agreement or to each Company or the Account,
whichever is applicable.
(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 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 Parties,
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 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.
(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 each Account.
5.3 Indemnification By The Trust
(a) The Trust agrees to indemnify and hold harmless the Company,
and each of its directors and officers and each person, if any, who
controls the Company within the meaning of Section 15 of the 1933 Act
(collectively, the "Indemnified Parties" for purposes of this Section
5.3) against any and all losses, claims, damages, liabilities
(including amounts paid in settlement with the written consent of the
Trust, which consent shall not be unreasonably withheld) or litigation
(including legal and other expenses) to which the Indemnified Parties
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 result from the gross
negligence, bad faith or willful misconduct of the Board or any member
thereof, are related to the operations of the Trust, and arise out of
or result from any material breach of any representation and/or
warranty made by the Trust in this Agreement or arise out of or result
from any other material breach of this Agreement by the Trust; as
limited by and in accordance with the provisions of Section 5.3(b) and
5.3(c) hereof. It is understood and expressly stipulated that neither
the holders of shares of the Trust nor any Trustee, officer, agent or
employee of the Trust shall be personally liable hereunder, nor shall
any resort be had to other private property for the satisfaction of
any claim or obligation hereunder, but the Trust only shall be liable.
(b) The Trust shall not be liable under this indemnification
provision with respect to any losses, claims, damages, liabilities or
litigation incurred or assessed against any Indemnified Party as such
may arise from 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 obligations and duties under this Agreement or to the
Company, the Trust, the Underwriter or each Account, whichever is
applicable.
(c) The Trust 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 Trust in writing
within a reasonable time after the summons or other first legal
process giving information of the nature of the claims 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 Trust of any such claim shall not relieve
the Trust from any liability which it may have to the Indemnified
Party against whom such action is brought otherwise than on account of
this indemnification provision. In case any such action is brought
against the Indemnified Parties, the Trust will be entitled to
participate, at its own expense, in the defense thereof. The Trust
also shall be entitled to assume the defense thereof, with counsel
satisfactory to the party named in the action. After notice from the
Trust to such party of the Trust'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 Trust 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.
(d) The Company and the Underwriter agree promptly to notify the
Trust of the commencement of any litigation or proceedings against it
or any of its respective officers or directors in connection with this
Agreement, the issuance or sale of the Contracts, with respect to the
operation of either the Account, or the sale or acquisition of share
of the Trust.
ARTICLE VI.
Termination
6.1 This Agreement may be terminated by any party in its entirety or
with respect to one, some or all Portfolios or any reason by sixty (60)
days advance written notice delivered to the other parties, and shall
terminate immediately in the event of its assignment, as that term is used
in the 1940 Act.
6.2 This Agreement may be terminated immediately by either the Trust
or the Underwriter following consultation with the Trustees upon written
notice to the Company if :
(a) the Company notifies the Trust or the Underwriter that the
exemption from registration under Section 3(c) of the 1940 Act no
longer applies, or might not apply in the future, to the unregistered
Accounts, or that the exemption from registration under Section 4(2)
or Regulation D promulgated under the 1933 Act no longer applies or
might not apply in the future, to interests under the unregistered
Contracts; or
(b) either one or both of the Trust 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
(c) the Company gives the Trust and the Underwriter the written
notice specified in Section 1.10 hereof and at the same time such
notice was given there was no notice of termination outstanding under
any other provision of this Agreement; provided, however, that any
termination under this Section 6.2(c) shall be effective forty-five
(45) days after the notice specified in Section 1.10 was given; or
6.3 If this Agreement is terminated for any reason, except under
Article IV (Potential Conflicts) above, the Trust shall, at the option of
the Company, continue to make available additional shares of any Portfolio
and redeem shares of any Portfolio pursuant to all of the terms and
conditions of this Agreement for all Contracts in effect on the effective
date of termination of this Agreement. If this Agreement is terminated
pursuant to Article IV, the provisions of Article IV shall govern.
6.4 The provisions of Articles II (Representations and Warranties) and
V (Indemnification) shall survive the termination of this Agreement. All
other applicable provisions of this Agreement shall survive the termination
of this Agreement, as long as shares of the Trust are held on behalf of
Contract owners in accordance with Section 6.3, except that the Trust and
the Underwriter shall have no further obligation to sell Trust shares with
respect to Contracts issued after termination.
6.5 The Company shall not redeem Trust shares attributable to the
Contracts (as opposed to Trust 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"),
or (iii) as permitted by an order of the SEC pursuant to Section 26(b) of
the 1940 Act. Upon request, the Company will promptly furnish to the Trust
and the Underwriter the opinion of counsel for the Company (which counsel
shall be reasonably satisfactory to the Trust and the Underwriter) to the
effect 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 Trust or the Underwriter 90 days notice
of its intention to do so.
ARTICLE VII.
Notices.
Any notice shall be sufficiently given when sent by registered or
certified mail to the other party at the address of such party set forth
below or at such other address as such party may from time to time specify
in writing to the other party.
If to the Trust or the Underwriter:
Alliance Variable Products Series Fund, Inc. or
Alliance Fund Distributors, Inc.
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxx Xxxxxx
If to the Company:
Keyport Benefit Life Insurance Company
000 Xxxx Xxxxxx
Xxxxxx, XX 00000-0000
Attention: Xxx Xxxxxxx
ARTICLE VIII.
Miscellaneous
8.1 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.
8.2 This Agreement may be executed simultaneously in two or more
counterparts, each of which taken together shall constitute one and the
same instrument.
8.3 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.
8.4 This Agreement shall be construed and the provisions hereof
interpreted under and in accordance with the laws of the State of Rhode
Island. It shall also be subject to the provisions of the federal
securities laws and the rules and regulations thereunder and to any orders
of the SEC granting exemptive relief therefrom and the conditions of such
orders. Copies of any such orders shall be promptly forwarded by the Trust
to the Company.
8.5 The parties to this Agreement acknowledge and agree that all
liabilities of the Trust arising, directly or indirectly, under this
Agreement, of any and every nature whatsoever, shall be satisfied solely
out of the assets of the Trust and that no Trustee, officer, agent or
holder of shares of beneficial interest of the Trust shall be personally
liable for any such liabilities.
8.6 Each party 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.
8.7 Each party hereto shall treat as confidential the names and
addresses of the Contract owners and all information reasonably identified
as confidential in writing by any other party hereto, and, except as
permitted by this Agreement or as required by legal process or regulatory
authorities, shall not disclose, disseminate, or utilize such names and
addresses and other confidential information until such time as they may
come into the public domain, without the express written consent of the
affected party. Without limiting the foregoing, no party hereto shall
disclose any information that such party has been advised is proprietary,
except such information that such party is required to disclose by any
appropriate governmental authority (including, without limitation, the SEC,
the NASD, and state securities and insurance regulators).
8.8 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.
8.9 The parties to this Agreement acknowledge and agree that this
Agreement shall not be exclusive in any respect, except as provided in
Section 1.10.
8.10 Neither this Agreement nor any rights or obligations hereunder
may be assigned by either party without the prior written approval of the
other party.
8.11 No provisions of this Agreement may be amended or modified in any
manner except by a written agreement properly authorized and executed by
both parties.
IN WITNESS WHEREOF, the parties have caused their duly authorized
officers to execute this Participation Agreement as of the date and year
first above written.
The Company:
Keyport Benefit Life Insurance Company
By its authorized officer
By: /s/Xxxxx X. Xxxxxxx
Name: Xxxxx X. Xxxxxxx
Title: Vice President & Secretary
The Underwriter:
Alliance Fund Distributors, Inc.
By its authorized officer
By: /s/Xxxxxxx X. Xxxxx
Name: Xxxxxxx X. Xxxxx
Title: Managing Director
SCHEDULE A
Separate Accounts of
Keyport Benefit Life Insurance Company
1. Variable Account A
Date Established: February 6, 1998
SEC Registration Numbers: 333-75157
333-75155
SCHEDULE B
Trust Portfolios and Classes Available
Alliance Variable Products Series Adviser
Global Bond Alliance Capital Management L.P.
Premier Growth Portfolio Alliance Capital Management L.P.
Growth & Income Portfolio Alliance Capital Management L.P.
Technology Portfolio Alliance Capital Management L.P.
SCHEDULE C
RULE 12B-1 PLANS
Compensation Schedule
Each Portfolio named below shall pay the following amounts pursuant to the
terms and conditions referenced below under its Class B Rule 12b-1
Distribution Plan, stated as a percentage per year of Class B's average
daily net assets represented by shares of Class B.
Portfolio Name Maximum Annual Payment Rate
Global Bond 0.25%
Premier Growth 0.25%
Growth & Income 0.25%
Technology 0.25%
Agreement Provisions
If the Company, on behalf of any Account, purchases Trust Portfolio
shares ("Eligible Shares") which are subject to a Rule 12b-1 Plan adopted
under the 1940 Act (the "Plan"), the Company may participate in the Plan.
To the extent the Company or its affiliates, agents or designees
(collectively "you") you provide administrative and other services which
assist in the promotion and distribution of Eligible Shares or Variable
Contracts offering Eligible Shares, the Underwriter, the Trust or their
affiliates (collectively, "we") may pay you a Rule 12b-1 fee.
"Administrative and other services" may include, but are not limited to,
furnishing personal services to owners of Contracts which may invest in
Eligible Shares ("Contract Owners"), answering routine inquiries regarding
a Portfolio, coordinating responses to Contract Owner inquiries regarding
the Portfolios, maintaining such accounts or providing such other enhanced
services as a Trust Portfolio or Contract may require, maintaining customer
accounts and records, or providing other services eligible for service fees
as defined under NASD rules. Your acceptance of such compensation is your
acknowledgment that eligible services have been rendered. All Rule 12b-1
fees, shall be based on the value of Eligible Shares owned by the Company
on behalf of its Accounts, and shall be calculated on the basis and at the
rates set forth in the Compensation Schedule stated above. The aggregate
annual fees paid pursuant to each Plan shall not exceed the amounts stated
as the "annual maximums" in the Portfolio's prospectus, unless an increase
is approved by shareholders as provided in the Plan. These maximums shall
be a specified percent of the value of a Portfolio's net assets
attributable to Eligible Shares owned by the Company on behalf of its
Accounts (determined in the same manner as the Portfolio uses to compute
its net assets as set forth in its effective Prospectus).
You shall furnish us with such information as shall reasonably be
requested by the Trust's Boards of Trustees ("Trustees") with respect to
the Rule 12b-1 fees paid to you pursuant to the Plans. We shall furnish to
the Trustees, for their review on a quarterly basis, a written report of
the amounts expended under the Plans and the purposes for which such
expenditures were made.
The Plans and provisions of any agreement relating to such Plans must
be approved annually by a vote of the Trustees, including the Trustees who
are not interested persons of the Trust and who have no financial interest
in the Plans or any related agreement ("Disinterested Trustees"). Each Plan
may be terminated at any time by the vote of a majority of the
Disinterested Trustees, or by a vote of a majority of the outstanding
shares as provided in the Plan, on sixty (60) days' written notice, without
payment of any penalty. The Plans may also be terminated by any act that
terminates the Underwriting Agreement between the Underwriter and the
Trust, and/or the management or administration agreement between Alliance
Capital Management L.P. or its/their affiliates and the Trust. Continuation
of the Plans is also conditioned on Disinterested Trustees being ultimately
responsible for selecting and nominating any new Disinterested Trustees.
Under Rule 12b-1, the Trustees have a duty to request and evaluate, and
persons who are party to any agreement related to a Plan have a duty to
furnish, such information as may reasonably be necessary to an informed
determination of whether the Plan or any agreement should be implemented or
continued. Under Rule 12b-1, the Trust is permitted to implement or
continue Plans or the provisions of any agreement relating to such Plans
from year-to-year only if, based on certain legal considerations, the
Trustees are able to conclude that the Plans will benefit each affected
Trust Portfolio and class. Absent such yearly determination, the Plans must
be terminated as set forth above. In the event of the termination of the
Plans for any reason, the provisions of this Schedule C relating to the
Plans will also terminate.
Any obligation assumed by the Trust pursuant to this Agreement shall be
limited in all cases to the assets of the Trust and no person shall seek
satisfaction thereof from shareholders of the Trust. You agree to waive
payment of any amounts payable to you by Underwriter under a Plan until
such time as the Underwriter has received such fee from the Fund.
The provisions of the Plans shall control over the provisions of the
Participation Agreement, including this Schedule C, in the event of any
inconsistency.
You agree to provide complete disclosure as required by all applicable
statutes, rules and regulations of all rule 12b-1 fees received from us in
the prospectus of the contracts.
