[LETTERHEAD]
September 27, 1995
SAFECO Life Insurance Company
P.O. Box 34690
Seattle, Washington 98124-1690
Gentlemen:
This letter sets forth the agreement between Xxxxxx Asset Management, L.P.
(the "Adviser") and SAFECO Life Insurance Company (the "Company") concerning
certain administration services.
1 . ADMINISTRATION SERVICES AND EXPENSES. Administration services for
SAFECO Life Insurance Company Separate Account C (the "Separate Account"), which
invests in Xxxxxx Advisors Trust (the "Trust") pursuant to the Participation
Agreement between the Company and the Trust dated September 27, 1995 (the
"Participation Agreement"), and for purchasers of variable annuity contracts
issued through the Separate Account, are the responsibility of the
Company. Administration services for the Trust, in which the Separate Account
invests, and for purchasers of Trust shares, are the responsibility of the Trust
or of the Adviser.
The Adviser recognizes the Company as the sole shareholder of Trust
shares purchased under the Participation Agreement on behalf of the Separate
Account. The Adviser further recognizes that it will derive a substantial
savings in administration expenses by virtue of having a sole shareholder of
record of Trust shares purchased under the Participation Agreement,
rather than multiple shareholders having record ownership of such Trust shares.
The administration expenses for which the Adviser will derive such savings are
set forth in Schedule A to this letter agreement.
2 . ADMINISTRATION EXPENSE PAYMENTS. In consideration of the anticipated
administration expense savings resulting to the Adviser from the arrangements
set forth in the Participation Agreement, the Adviser agrees to pay to the
Company on a monthly basis, from the BONA FIDE profits of the Adviser, an amount
equal to 15 basis points (0.15%) per annum of the average aggregate amount
invested by the Company under the Participation Agreement.
For purposes of computing the payment to the Company contemplated under
this Paragraph 2, the average aggregate amount invested by the Company over a
one-month period shall be computed by totalling the Company's aggregate
investment (share net asset value
multiplied by total number of shares held by the Company) on each business day
during the month, and dividing by the total number of business days during such
month.
The payment contemplated by this Paragraph 2 shall be calculated by
the Adviser at the end of each month and will be paid to the Company within
thirty (30) business days thereafter. Payment will be accompanied by a statement
showing the calculation of the monthly amount payable by the Adviser and such
other supporting data as may be reasonably requested by the Company.
3. NATURE OF PAYMENTS. The parties to this letter agreement recognize
and agree that the Adviser's payments to the Company relate to administration
services only and do not constitute payment in any manner for investment
advisory services or for costs of distribution of Contracts or of Trust shares;
and that these payments are not otherwise related to investment advisory or
distribution services or expenses. The amount of administration expense payments
made by the Adviser to the Company pursuant to Paragraph 2 of this letter
agreement shall not be deemed to be conclusive with respect to actual
administration expenses or savings of the Adviser.
4. TERM. This letter agreement shall remain in full force and effect for
so long as assets of the Trust are attributable to amounts invested by the
Company under the Participation Agreement, unless terminated in accordance with
Paragraph 5 of this letter agreement.
5. TERMINATION. This letter agreement will be terminated upon mutual
agreement of the parties hereto in writing.
6. AMENDMENT. This letter agreement may be amended only upon mutual
agreement of the parties hereto in writing.
7. COUNTERPARTS. This letter agreement may be executed in counterparts,
each of which shall be deemed an original but all of which shall together
constitute one and the same instrument.
If this letter agreement is consistent with your understanding of the
matters we discussed concerning administration expense payments, kindly sign
below and return a signed copy to us.
Very truly yours,
Xxxxxx Asset Management, L.P.
By: /s/ Xxxxx Xxxxxx
Name: Xxxxx Xxxxxx
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Title: President
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Acknowledged and Agreed:
SAFECO LIFE INSURANCE COMPANY
By: /s/ Xxxxxxx Xxxxxx
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Name: Xxxxxxx Xxxxxx
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Title: Vice President
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Attachment: Schedule A
SCHEDULE A
Maintenance of books and records
- Record issuance of shares
- Record transfers (via net purchase orders)
- Reconciliation and balancing of the separate account at the fund level in
the general ledger, at various banks and within systems interface
Purchase orders
- Determination of net amount available for investment by the fund
- Deposit of receipts at fund's custodian by fund (wire order)
- Notify custodian of estimated amount required to pay dividend or
distribution
Redemption orders
- Determination of net amount required for redemptions by fund
- Notification of custodian and fund of cash required to meet payments
- Cost of share redemptions
Reports
- Periodic information reporting to the fund
- Preparation of annual and semi-annual shareholder reports; printing and
mailing (to existing contract owners)
Fund-related contract owner services
- Printing and mailing costs associated with dissemination of fund prospectus
to existing contract owners
- Telephonic support for contract owners with respect to inquiries about the
fund (not including information about performance or related to sales)
- Fund proxies (preparation of materials, inclusive of printing,
distribution, tabulation, and reporting)
Other administrative support
- Sub-accounting services
- Providing other administrative support to the fund as mutually agreed
between insurer and the fund
- Relieving the fund of other usual or incidental administrative services
provided to individual shareholders
Coordination of relationships between participating funds
PARTICIPATION AGREEMENT
THIS AGREEMENT, made and entered into this 27th day of September, 1995 by
and between XXXXXX ADVISORS TRUST, an unincorporated business trust formed under
the laws of Massachusetts (the "Trust"), and SAFECO LIFE INSURANCE COMPANY, a
Washington life insurance company (the "Company"), on its own behalf and on
behalf of each separate account of the Company identified herein.
WHEREAS, the Trust is a series-type mutual fund offering shares of
beneficial interest (the "Trust shares") consisting of one or more separate
series ("Series") of shares ("Series shares"), each such series representing an
interest in a particular managed portfolio of securities and other assets; and
WHEREAS, the Trust was established for the purpose of serving as an
investment vehicle for (i) separate accounts supporting variable annuity
contracts and variable life insurance policies to be offered by insurance
companies, and (ii) certain pension and retirement plans receiving favorable tax
treatment under the Internal Revenue Code of 1986, as amended; and
WHEREAS, the Company desires that the Trust serve as an investment vehicle
for certain separate accounts of the Company;
NOW, THEREFORE, in consideration of their mutual promises, the Trust and
the Company agree as follows:
ARTICLE I. ADDITIONAL DEFINITIONS
1.1. "Account" -- each separate account of the Company described more
specifically in Schedule 1 to this Agreement.
1.2. "Business Day" -- each day that the Trust is open for business as
provided in the Trust Prospectus.
1.3. "Code" -- the Internal Revenue Code of 1986, as amended.
1.4. "Contracts" -- the class or classes of variable annuity contracts or
variable life insurance contracts issued by the Company and described more
specifically on Schedule 2 to this Agreement.
1.5. "Contract Owners" -- the owners of the Contracts, as distinguished
from all Product Owners.
1.6. "Investment Adviser" -- the investment manager of the Trust.
1.7. "Participating Account" -- a separate account investing all or a
portion of its assets in the Trust, including the Account.
1.8. "Participating Insurance Company" -- any insurance company investing
in the Trust on its behalf or on behalf of a Participating Account, including
the Company.
1.9. "Products" -- variable annuity contracts and variable life insurance
policies supported by Participating Accounts investing assets attributable
thereto in the Trust, including the Contracts.
1.10. "Product Owners" -- owners of Products.
1.11. "Prospectus" -- with respect to a class of Contracts, each version of
the definitive prospectus or supplement thereto filed with the SEC pursuant to
Rule 497 under the 1933 Act ("Contracts Prospectus"). With respect to Trust
shares, each version of the definitive prospectus or supplement thereto filed
with the SEC pursuant to Rule 497 under the 1933 Act with respect to a series of
the Trust listed on Schedule 3 to this Agreement ("Trust Prospectus"). With
respect to any provision of this Agreement requiring a party to take action in
accordance with a Prospectus, such reference thereto shall be deemed to be to
the version last filed prior to the taking of such action. For purposes of
Article VIII, the term "Prospectus" shall include any statement of additional
information incorporated therein.
1.12. "Qualified Entity" -- A person or plan, including a pension or
retirement plan receiving favorable tax treatment under the Code, that qualifies
to purchase shares of the Trust under Section 817(h) of the Code. A natural
person having an indirect interest in the Trust by virtue of such natural
person's participation in a Qualified Entity is a "Qualified Participant."
1.13. "Registration Statement" -- with respect to the Trust Shares ("Trust
Registration Statement") or a class of Contracts ("Contracts Registration
Statement"), the registration statement filed with the SEC to register the
securities issued thereby under the 1933 Act, or the most recently filed
amendment thereto, in either case in the form in which it was declared or became
effective. The Contracts Registration Statement is described more specifically
on Schedule 2 to this Agreement. The Trust Registration Statement was filed on
Form N-1A (File No. 33-83548).
1.14. "1940 Act Registration Statement" -- with respect to the Trust or the
Account, the registration statement filed with the SEC to register such entity
as an investment company under the 1940 Act, or the most recently filed
amendment thereto. The Account 1940 Act Registration Statement is described more
specifically on Schedule 2 to this Agreement. The Trust 1940 Act Registration
Statement was filed on Form N-1A (File No. 811-8748).
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1.15. "Statement of Additional Information" -- with respect to the Trust or
a class of Contracts, each version of the definitive statement of additional
information or supplement thereto filed with the SEC pursuant to Rule 497 under
the 1933 Act.
1.16. "SEC" -- the Securities and Exchange Commission.
1.17. "1933 Act" -- the Securities Act of 1933, as amended.
1.18. "1940 Act" -- the Investment Company Act of 1940, as amended.
ARTICLE II. SALE OF TRUST SHARES
2.1. The Trust shall make shares of those Series listed on Schedule 3 to
this Agreement available for purchase by the Company on behalf of the Account,
such purchases to be effected at net asset value in accordance with Section 2.3
of this Agreement. Notwithstanding the foregoing, (i) Trust Series in existence
now or that may be established in the future and not listed on Schedule 3 will
be made available to the Company only as the Trust and the Company may agree
pursuant to Article XI hereof, and (ii) the Board of Trustees of the Trust (the
"Trust Board") may suspend or terminate the offering of Trust shares of any
Series in any jurisdiction, if such action is required by law or by regulatory
authorities having jurisdiction or if, in the sole discretion of the Trust Board
acting in good faith and in light of its fiduciary duties under Federal and any
applicable state laws, suspension or termination is necessary or in the best
interests of the shareholders of any Series (it being understood that
"shareholders" for this purpose shall mean Product Owners and Qualified
Participants).
2.2. The Trust shall redeem, at the Company's request, any full or
fractional shares of the Trust held by the Company on behalf of the Account,
such redemptions to be effected at net asset value in accordance with Section
2.3 of this Agreement. Notwithstanding the foregoing, (i) the Company shall not
redeem Trust shares attributable to Contract Owners except in the circumstances
permitted in Section 2.7 of this Agreement, and (ii) the Trust may delay
redemption of Trust shares of any Series to the extent permitted by the 1940
Act, any rules, regulations or orders thereunder, or as described in the Trust
Prospectus.
2.3.
(a) The Trust hereby appoints the Company as its designee for
the limited purpose of receiving purchase and redemption requests from
the Account based on allocations of net amounts to the Account or
subaccounts thereof under the Contracts and other transactions
relating to the Contracts or the Account. Purchase and redemption
requests shall be processed by the Trust at the net asset value per
share next calculated after the Trust receives and accepts such
request. The Trust shall calculate its net asset value per share at
the Trust's close of business on each Business Day (as defined from
time to time in the Trust
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Prospectus, and which as of the date of execution of this Agreement is
the time of the close of regular session trading on the New York Stock
Exchange, which is generally 4:00 p.m. Eastern Time). Receipt of any
such request on any Business Day by the Company as designee of the
Trust prior to the Trust's close of business shall constitute receipt
by the Trust on that same Business Day, provided that the Trust
receives notice of such request by 10:30 a.m. Eastern Time on the next
following Business Day.
(b) The Company shall pay for shares of each Series on the same
day that it notifies the Trust of a purchase request for such shares.
Payment for Series shares shall be made in Federal funds transmitted
to the Trust by wire to be received by the Trust by 1:00 p.m. Eastern
Time on the day the Trust is notified of the purchase request for
Series shares (unless the Trust determines and so advises the Company
that sufficient proceeds are available from redemption of shares of
other Series effected pursuant to redemption requests tendered by the
Company on behalf of the Account). If payment in Federal funds for any
purchase is not received, or is received by the Trust after 3:00 p.m.
Eastern Time on such Business Day, the Company shall promptly, upon
the Trust's request, reimburse the Trust for any charges, costs, fees,
interest or other expenses incurred by the Trust in connection with
any advances to, or borrowings or overdrafts by, the Trust, or any
similar expenses incurred by the Trust, as a result of non-payment or
late payment.
(c) Payment for Series 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 by 3:00 p.m. Eastern Time on
the next Business Day after the Trust is properly notified of the
redemption order of Series shares (unless redemption proceeds are to
be applied to the purchase of Trust shares of other Series in
accordance with Section 2.3(b) of this Agreement), except that (i) if
payment of the redemption proceeds would require the Trust to dispose
of portfolio securities or otherwise incur additional costs, proceeds
shall be wired to the Company within seven days and the Trust shall
notify the Company of such delay by 3 p.m. Eastern Time on such
Business Day; and (ii) the Trust reserves the right to delay payment
of redemption proceeds to the extent permitted under Section 22(e) of
the 1940 Act; and (iii) the Trust reserves the right to effect payment
of redemptions in kind, but only to the extent described in the Trust
Prospectus. The Trust 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.
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2.4. The Trust shall use reasonable efforts to make the net asset value per
share for each Series available to the Company by 6:00 p.m. Eastern Time each
Business Day and shall use its best efforts to make the net asset value
available to the Company by 7:00 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 Series is calculated, and shall calculate such net asset value in
accordance with the Trust Prospectus. Neither the Trust, any Series, the
Investment Adviser, 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 or any other
Participating Company to the Trust or the Investment Adviser.
2.5. The Trust shall furnish notice to the Company as soon as reasonably
practicable of any income dividends or capital gain distributions payable on any
Series shares. The Trust shall notify the Company promptly of the number of
Series shares so issued as payment of such dividends and distributions. 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 Series shares in the
form of additional shares of that Series. The Company reserves the right, on its
behalf and on behalf of the Account, to revoke this election and to receive all
such dividends in cash.
2.6. Issuance and transfer of Trust shares shall be by book entry only.
Stock certificates will not be issued to the Company or the Account. Purchase
and redemption orders for Trust shares shall be recorded in an appropriate
ledger for the Account or the appropriate subaccount of the Account.
2.7.
(a) The Company shall invest amounts available for investment
under the Contracts in the Series of the Trust specified in Schedule 3
in accordance with allocation instructions received from Contract
Owners, it being understood that no changes shall be made to Schedule
3 without the prior written consent of the Trust and the Investment
Adviser. The Company may withdraw the Account's investment in the
Trust or a Series of the Trust only: (i) as necessary to facilitate
Contract Owner requests; (ii) upon a determination by a majority of
the Trust Board, or a majority of disinterested Trust Board members,
that an irreconcilable material conflict exists among the interests of
(x) some or all Product Owners or (y) the interests of some or all of
the Participating Insurance Companies and/or Qualified Entities
investing in the Trust; or (iii) in the event that the shares of
another investment company are substituted for series shares in
accordance with the terms of the Contracts upon the (x) requisite vote
of the Contract Owners having an interest in the affected Series and
the written consent of the Trust (unless otherwise required by
applicable law); (y) upon issuance of an SEC exemptive order pursuant
to Section 26(b) of the 1940 Act permitting such substitution; or (z)
as may otherwise be permitted under applicable law.
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(b) The Company shall not, without the prior written consent of
the Trust (unless otherwise required by applicable law), take any
action to operate the Account as a management investment company under
the 1940 Act.
(c) The Trust shall not, without the prior written consent of
the Company (unless otherwise required by applicable law), take any
action to operate the Trust as a unit investment trust under the 1940
Act.
(d) The Company shall not, without the prior written consent of
the Trust (unless otherwise required by applicable law), solicit,
induce or encourage Contract Owners to change or modify the Trust or
change the Trust's investment adviser.
(e) The Company and the Trust acknowledge that the arrangement
contemplated by this Agreement is not exclusive; Trust shares may be
sold to other insurance companies; and the cash value of the Contracts
may be invested in other investment companies, provided, however, that
(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 Trust; or (b) the Company
gives the Trust 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 was available as a
funding vehicle for the Contracts prior to the date of this Agreement
and the Company so informs the Trust prior to the execution of this
Agreement; or (d) the Trust consents to the use of such other
investment company, such consent not to be unreasonably withheld.
2.8. The Trust shall sell Trust shares only to Participating Insurance
Companies and their separate accounts and to Qualified Entities. The Trust shall
not sell Trust shares to any insurance company or separate account unless an
agreement complying with Article VII of this Agreement is in effect to govern
such sales.
2.9. The Trust shall provide to the Company within 5 business days after
the end of each month a monthly statement of account reflecting all transactions
by the Company during that month.
ARTICLE III. REPRESENTATIONS AND WARRANTIES
3.1. The Company represents and warrants that: (i) the Company is an
insurance company duly organized and in good standing under applicable law; (ii)
the Account is a validly existing separate account, duly established and
maintained in accordance with applicable law; (iii) the Account 1940 Act
Registration Statement has been filed with the SEC in accordance with the
provisions of the 1940 Act and the Account is duly registered as a unit
investment trust thereunder; (iv) the Contracts Registration Statement has been
declared effective by the SEC; (v)
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the Contracts will be issued in compliance in all material respects with all
applicable Federal and state laws; and (vi) the Contracts currently are and at
the time of issuance will be treated as annuity contracts under applicable
provisions of the Code.
3.2. The Trust represents and warrants that: (i) the Trust is an
unincorporated business trust duly formed under Massachusetts law; (ii) the
Trust 1940 Act Registration Statement has been filed with the SEC in accordance
with the provisions of the 1940 Act and the Trust is duly registered as an
open-end management investment company thereunder; (iii) the Trust Registration
Statement has been declared effective by the SEC; (iv) Trust shares sold
pursuant to this Agreement have been duly authorized for issuance in accordance
with applicable law; (v) the Trust believes that it (x) currently qualifies as a
"regulated investment company" under Subchapter M of the Code and (y) currently
complies with Section 817(h) of the Code and regulations thereunder; and (vi)
the Trust's investment policies are in material compliance with any investment
restrictions set forth on Schedule 4 to this Agreement. The Trust, however,
makes no representation as to whether any aspect of its operations (including,
but not limited to, fees and expenses and investment policies) otherwise
complies with the insurance laws or regulations of any state.
3.3. Each party represents that the execution and delivery of this
Agreement and the consummation of the transactions contemplated herein have been
duly authorized by all necessary corporate or trust action, as applicable, by
such party, and, when so executed and delivered, this Agreement will be the
valid and binding obligation of such party enforceable in accordance with its
terms.
ARTICLE IV. FILINGS, INFORMATION AND EXPENSES
4.1. The Trust shall amend the Trust Registration Statement and the Trust
1940 Act Registration Statement from time to time as required in order to effect
the continuous offering of Trust shares and to maintain the Trust's registration
under the 1940 Act for so long as Trust shares are sold.
4.2. The Company shall amend the Contracts Registration Statement and the
Account 1940 Act Registration Statement from time to time as required in order
to effect the continuous offering of the Contracts or as may otherwise be
required by applicable law. The Company shall maintain a current effective
Contracts Registration Statement and the Account's registration under the 1940
Act for so long as the Contracts are outstanding, unless (a) a no-action letter
from the SEC has been obtained by the Company to the effect that such
registration statement need no longer be maintained; or (b) the Company has
supplied the Trust with an opinion of counsel to the effect that maintaining
such registration statement is no longer required; or (c) the Company has
notified the Trust in writing that, with respect to such registration statement,
the Company
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meets the terms and conditions of, and is relying on, GREAT WEST LIFE & ANNUITY
INSURANCE COMPANY (pub. avail. Oct. 23, 1990), and any subsequent no-action
letter released by the staff of the SEC addressing the same subject matter. The
Company shall file, register, qualify and obtain approval of the Contracts for
sale to the extent required by applicable insurance and securities laws of the
various states.
4.3 The Trust shall provide the Company with as many copies of the Trust
Prospectus as the Company may reasonably request. If requested by the Company in
lieu thereof, the Trust shall provide such documentation (including a final copy
of the Trust Prospectus as set in type at the Trust's expense) and other
assistance as is reasonably necessary in order for the Company once each year
(or more frequently if the Trust Prospectus is more frequently amended) to have
the Contracts Prospectus and Trust Prospectus printed together in one document.
4.4 The Company shall deliver Contracts, Contracts and Trust Prospectuses,
Contracts and Trust Statements of Additional Information, and all amendments or
supplements to any of the foregoing to Contract Owners and prospective Contract
Owners, as required by applicable federal securities laws.
4.5. The Company shall:
(a) inform the Trust of any state in which the Trust is required
under such state's securities laws to register the offering of its
shares pursuant to this participation agreement; and
(b) inform the Trust of any investment restrictions imposed by
state insurance law that may become applicable to the Trust from time
to time as a result of the Account's investment therein (including,
but not limited to, restrictions with respect to fees and expenses and
investment policies), other than those set forth on Schedule 4 to this
Agreement.
4.6. Upon receipt of information from the Company pursuant to Section
4.5(b), the Trust shall determine whether it is in the best interests of
shareholders (it being understood that "shareholders" for this purpose shall
mean Product Owners and Qualified Participants) to comply with any such
restrictions. If the Trust determines that it is not in the best interests of
shareholders, the Trust shall so inform the Company, and the Trust and the
Company shall discuss alternative accommodations in the circumstances. If the
Trust determines that it is in the best interests of shareholders to comply
with such restrictions, the Trust and the Company shall amend Schedule 4 to this
Agreement to reflect such restrictions.
4.7. All expenses incident to each party's performance under this Agreement
(including expenses expressly assumed by such party pursuant to this Agreement)
shall be paid by the such party to the extent permitted by law.
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(a) Expenses assumed by the Trust include, but are not limited
to, the costs of: registration and qualification of the Trust shares
under the federal securities laws; preparation and filing with the SEC
of the Trust Prospectus, Trust Registration Statement, Trust proxy
materials and shareholder reports; the printing and mailing of all
proxy statements and periodic reports; the preparation of Trust
Prospectuses and Statements of Additional Information required to be
provided by the Trust to its then-current shareholders; preparation of
all statements and notices required by any Federal or state securities
law; all taxes on the issuance or transfer of Trust shares; and any
expenses permitted to be paid or assumed by the Trust pursuant to a
plan, if any, under Rule 12b-1 under the 1940 Act. The Trust shall pay
no fee or other compensation to the Company under this Agreement, and
shall not be charged for the costs of printing and mailing to
prospective Contract Owners copies of the Trust Prospectus, Trust
Statement of Additional Information, notices, proxy statements,
periodic reports, or other printed materials.
(b) Expenses assumed by the Company include, but are not limited
to, the costs of: registration and qualification of the Contracts
under the federal securities laws; preparation and filing with the SEC
of the Contracts Prospectus, Contracts Registration Statement, and
Contract Owner reports; and the printing and mailing of all periodic
reports, Contracts Prospectuses, Statements of Additional
Information, and notices to current and prospective Contract Owners
required by any Federal or state insurance law other than those paid
for by the Trust.
4.8. No piece of advertising or sales literature or other promotional
material in which the Trust is named shall be used, except with the prior
written consent of the Trust. Any such piece shall be furnished to the Trust for
such consent prior to its use. The Trust shall respond to any request for
written consent on a prompt and timely basis, but failure to respond shall not
relieve the Company of the obligation to obtain the prior written consent of the
Trust. The Trust may at any time in its sole discretion revoke such written
consent, and upon notification of such revocation, the Company shall no longer
use the material subject to such revocation. The Trust may delegate its rights
and responsibilities under this provision to the Investment Adviser. However,
should the Trust or its delegate revoke such consent, it agrees to reimburse the
Company for all costs of producing, printing and filing of such material
incurred prior to notification that consent has been revoked.
4.9. The Company shall not give any information or make any representations
or statements on behalf of the Trust or concerning the Trust other than the
information or representations contained in the Trust Registration Statement or
Trust Prospectus or in reports or
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proxy statements for the Trust which are in the public domain or approved in
writing by the Trust for distribution to Contract Owners, or in sales literature
or other promotional material approved in accordance with Section 4.8 of this
Agreement, except with the prior written consent of the Trust.
4.10. The Trust 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 the Contracts
Registration Statement or Contracts Prospectus or in reports of the Account
which are in the public domain or approved in writing by the Company for
distribution to Contract Owners, or in sales literature or other promotional
material approved in writing by the Company, except with the prior written
consent of the Company.
4.11. Each party shall provide to the other at least one complete copy of
all Registration Statements, Prospectuses, Statements of Additional Information,
periodic and other shareholder or Contract Owner reports, proxy statements,
solicitations of voting instructions, sales literature and other promotional
materials, applications for exemptions, requests for no-action letters, and all
amendments or supplements to any of the above, that relate to the Trust, the
Contracts or the Account, as the case may be, promptly after the filing by or on
behalf of such party of such document with the SEC or other regulatory
authorities.
4.12. Each party shall provide to the other upon request copies of draft
versions of any Registration Statements, Prospectuses, Statements of Additional
Information, periodic and other shareholder or Contract Owner reports, proxy
statements, solicitations for voting instructions, sales literature and other
promotional materials, applications for exemptions, requests for no-action
letters, and all amendments or supplements to any of the above, to the extent
that the other party reasonably needs such information for purposes of preparing
a report or other filing to be filed with or submitted to a regulatory agency.
If a party requests any such information before it has been filed, the other
party will provide the requested information if then available and in the
version then available at the time of such request.
4.13. Each party hereto shall cooperate with the other party and all
appropriate governmental authorities (including without limitation the SEC, the
NASD and state insurance regulators) and shall permit each other and 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. However, such access shall not extend to attorney-client
privileged information.
4.14. For purposes of this Article IV, the phrase "sales literature or
other promotional material" includes, but is not limited to, any material
constituting sales literature or advertising under the NASD rules, the 1940 Act
or the 1933 Act.
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4.15. The Trust agrees to provide the Company within ten (10) days after
the end of each month (i) performance information consisting of (x) the total
return of each Series then listed in Schedule 3 hereto through the end of that
month, and (y) the average annual total return of each such Series for the one-,
five-, and ten-year periods ended as of the most recent calendar quarter, or the
life of such Series, if shorter, in each case calculated in accordance with the
methods of calculation described in the Trust Prospectus; (ii) a listing of the
10 portfolio companies in which each such Series had its largest investments at
the end of that month; and (iii) a summary of the allocation of each such
Series' investments among industry groups.
ARTICLE V. VOTING OF TRUST SHARES
With respect to any matter put to vote by the holders of Trust shares or
Series shares ("Voting Shares"), the Company shall:
(a) solicit voting instructions from Contract Owners to which Voting
Shares are attributable;
(b) vote Voting Shares of each Series attributable to Contract Owners
in accordance with instructions or proxies timely received from such
Contract Owners;
(c) unless permitted under applicable law, vote Voting Shares of each
Series attributable to Contract Owners for which no instructions have been
received in the same proportion as Voting Shares of such Series for which
instructions have been timely received; and
(d) unless permitted under applicable law, vote Voting Shares of each
Series held by the Company on its own behalf or on behalf of the Account
that are not attributable to Contract Owners in the same proportion as
Voting Shares of such Series for which instructions have been timely
received.
The Company shall be responsible for assuring that voting privileges for
the Account are calculated in a manner consistent with the provisions set forth
above.
ARTICLE VI. COMPLIANCE WITH CODE
6.1. The Trust undertakes to comply with Section 817(h) of the Code, and
all regulations issued thereunder.
6.2. The Trust undertakes to maintain its qualification as a registered
investment company (under Subchapter M or any successor or similar provision),
and undertakes to notify the Company immediately upon having a reasonable basis
for believing that it has ceased to so qualify or that it might not so qualify
in the future.
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6.3. The Company undertakes to maintain the treatment of the Contracts as
annuity contracts or life insurance policies, whichever is appropriate, under
applicable provisions of the Code and shall notify the Trust immediately upon
having a reasonable basis for believing that the Contracts have ceased to be so
treated or that they might not be so treated in the future.
6.4. The Trust undertakes to provide the Company within fifteen (15) days
after the end of each calendar quarter a letter from an appropriate Trust
officer certifying to the continued accuracy of the Trust's representations in
sections 6.1 and 6.2 of this Agreement with respect to any Series then listed on
Schedule 3 to this Agreement, and providing a detailed listing of the individual
securities and other assets, if any, held by each such Series as of the end of
such calendar quarter.
ARTICLE VII. POTENTIAL CONFLICTS
The parties to this Agreement acknowledge that the Trust may file an
application with the SEC to request an order granting relief from various
provisions of the 1940 Act and the rules thereunder to the extent necessary to
permit Trust shares to be sold to and held by variable annuity and variable life
insurance separate accounts of both affiliated and unaffiliated Participating
Insurance Companies, as well as by Qualified Entities. Any conditions or
undertakings that may be imposed on the Company and the Trust by virtue of such
order shall be incorporated herein by this reference, as of the date such order
is granted, as though set forth herein in full, and the parties to this
Agreement shall comply with such conditions and undertakings to the extent
applicable to each such party. The Trust will not enter into a participation
agreement with any other Participating Insurance Company unless it imposes the
same conditions and undertakings imposed by virtue of such order and
incorporated by reference herein on the parties to such agreement.
ARTICLE VIII. INDEMNIFICATION
8.1. The Company shall indemnify and hold harmless the Trust and each
person who controls or is associated with the Trust within the meaning of such
terms under the federal securities laws (but not any Participating Insurance
Companies or Qualified Entities) and any officer, trustee, director, employee
or agent of the foregoing, against any and all losses, claims, damages or
liabilities, joint or several (including any investigative, legal and other
expenses reasonably incurred in connection with, and any amounts paid in
settlement of, any action, suit or proceeding or any claim asserted), to which
they or any of them may become subject under any statute or regulation, at
common law or otherwise, insofar as such losses, claims, damages or liabilities:
(a) arise out of or are based upon any untrue statement or
alleged untrue statement of any material fact contained in the
Contracts Registration Statement, Contracts Prospectus, sales
literature or other promotional material for the Contracts or the
Contracts themselves (or any amendment or supplement to
-12-
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 in light
of the circumstances in which they were made; provided that this obligation
to indemnify shall not apply if such statement or omission or such alleged
statement or alleged omission was made in reliance upon and in conformity
with information furnished in writing to the Company by the Trust for use
in the Contracts Registration Statement, Contracts Prospectus or in the
Contracts or sales literature or promotional material for the Contracts (or
any amendment or supplement to any of the foregoing) or otherwise for use
in connection with the sale of the Contracts or Trust shares; or
(b) arise out of any untrue statement or alleged untrue statement of a
material fact contained in the Trust Registration Statement, Trust
Prospectus or sales literature or other promotional material of the Trust
(or any amendment or supplement to any of the foregoing), 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 in light
of the circumstances in which they were made, if such statement or omission
was made in reliance upon and in conformity with information furnished in
writing to the Trust by or on behalf of the Company; or
(c) arise out of or are based upon any wrongful conduct of the Company
or persons under its control (or subject to its authorization or
supervision) with respect to the sale or distribution of the Contracts or
Trust shares; or
(d) arise as a result of any failure by the Company to perform its
obligations under the terms of this Agreement (including a failure, whether
unintentional or in good faith or otherwise, to comply with the undertaking
specified in Article VI of this Agreement, unless such failure is a result
of the Trust's material breach of this Agreement); or
(e) arise out of any material breach by the Company of this Agreement,
including but not limited to any failure to transmit a request for
redemption or purchase of Trust shares on a timely basis in accordance with
the procedures set forth in Article II.
This indemnification will be in addition to any liability that the Company may
otherwise have; provided, however, that no person otherwise entitled to
indemnification pursuant to this Section 8.1 shall be entitled to
indemnification if such loss, claim, damage or liability is due to the willful
misfeasance, bad faith, gross negligence or reckless disregard of duty by the
person seeking indemnification.
-13-
8.2. The Trust shall indemnify and hold harmless the Company and each
person who controls or is associated with the Company within the meaning of such
terms under the federal securities laws and any officer, director, employee or
agent of the foregoing, against any and all losses, claims, damages or
liabilities, joint or several (including any investigative, legal and other
expenses reasonably incurred in connection with, and any amounts paid in
settlement of, any action, suit or proceeding or any claim asserted), to which
they or any of them may become subject under any statute or regulation, at
common law or otherwise, insofar as such losses, claims, damages or liabilities:
(a) arise out of or are based upon any untrue statement or
alleged untrue statement of any material fact contained in the Trust
Registration Statement, Trust Prospectus or sales literature or other
promotional material of the Trust (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 in light of the circumstances in which they were made;
provided that this obligation to indemnify shall not apply if such
statement or omission or alleged statement or alleged omission was
made in reliance upon and in conformity with information furnished in
writing by the Company to the Trust for use in the Trust Registration
Statement, Trust Prospectus or sales literature or promotional
material for the Trust (or any amendment or supplement to any of the
foregoing); or
(b) arise out of any untrue statement or alleged untrue statement
of a material fact contained in the Contracts Registration Statement,
Contracts Prospectus or sales literature or other promotional material
for the Contracts (or any amendment or supplement to any of the
foregoing), 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 in light of the circumstances in
which they were made, if such statement or omission was made in
reliance upon information furnished in writing by the Trust to the
Company; or
(c) arise out of or are based upon wrongful conduct of the Trust
with respect to the sale of Trust shares; or
(d) arise as a result of any failure by the Trust to perform its
obligations under the terms of this Agreement (including a failure,
whether unintentional or in good faith or otherwise, to comply with
the undertakings specified in Article VI of this Agreement, unless
such failure is a result of the Company's material breach of this
Agreement); or
(e) arise out of any material breach by the Trust of this
Agreement.
-14-
This indemnification will be in addition to any liability that the Trust may
otherwise have; provided, however, that no person otherwise entitled to
indemnification pursuant to this Section 8.2 shall be entitled to
indemnification if such loss, claim, damage or liability is due to the willful
misfeasance, bad faith, gross negligence or reckless disregard of duty by the
person seeking indemnification.
8.3. After receipt by a party entitled to indemnification ("indemnified
party") under this Article VIII of notice of the commencement of any action,
if a claim in respect thereof is to be made by the indemnified party against
any person obligated to provide indemnification under this Article VIII
("indemnifying party"), such indemnified party will notify the indemnifying
party in writing of the commencement thereof as soon as practicable
thereafter, provided that the failure to so notify the indemnifying party
will not relieve the indemnifying party from any liability under this Article
VIII, except to the extent that the omission results in a failure of actual
notice to the indemnifying party and such indemnifying party is damaged
solely as a result of the failure to give such notice. The indemnifying
party, upon the request of the indemnified party, shall retain counsel
reasonably satisfactory to the indemnified party to represent the indemnified
party and any others the indemnifying party may designate in such proceeding
and shall pay the fees and disbursements of such counsel related to such
proceeding. In any such proceeding, any indemnified party shall have the
right to retain its own counsel, but the fees and expenses of such counsel
shall be at the expense of such indemnified party unless (i) the indemnifying
party and the indemnified party shall have mutually agreed to the retention
of such counsel or (ii) the named parties to any such proceeding (including
any impleaded parties) include both the indemnifying party and the
indemnified party and representation of both parties by the same counsel
would be inappropriate due to actual or potential differing interests between
them. The indemnifying party shall not be liable for any settlement of any
proceeding effected without its written consent but if settled with such
consent, or if there be a final judgment for the plaintiff, the indemnifying
party agrees to indemnify the indemnified party from and against any loss or
liability by reason of such settlement or judgment.
A successor by law of the parties to this Agreement shall be entitled to
the benefits of the indemnification contained in this Article VIII. The
indemnification provisions contained in this Article VIII shall survive any
termination of this Agreement.
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 Commonwealth of
Massachusetts, without giving effect to the principles of conflicts of laws.
9.2. This Agreement shall be subject to the provisions of the 1933 Act,
1940 Act and Securities Exchange Act of 1934, as amended, and the rules and
regulations and rulings thereunder, including such exemptions from those
statutes, rules and regulations as the SEC may grant, and the terms hereof shall
be limited, interpreted and construed in accordance therewith.
-15-
ARTICLE X. TERMINATION
10.1 This Agreement shall not terminate until the Trust is dissolved,
liquidated, or merged into another entity, or, as to any Series of the Trust, an
Account no longer invests in that Series. However, certain obligations of, or
restrictions on, the parties to this Agreement may terminate as provided in
Sections 10.2 and 10.3.
10.2 The obligation of the Trust to sell shares to the Company pursuant to
Article II of this Agreement shall terminate at the option of the Trust:
(a) upon six months' notice to the Company;
(b) upon 30 days' notice to the Company:
(1) upon institution of formal proceedings against the
Company by the NASD, the SEC, the insurance commission 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 the Account, the
administration of the Contracts or the purchase of Trust
shares, or an expected or anticipated ruling, judgment or
outcome which would, in the Trust's reasonable judgment,
materially impair the Company's ability to meet and perform
the Company's obligations and duties hereunder;
(2) in the event any of the Contracts are not
registered, issued or sold in accordance with applicable
Federal and/or state law;
(3) if the Contracts cease to qualify as annuity
contracts under the Code, or if the Trust reasonably
believes that the Contracts may fail to so qualify;
(4) if the Trust shall determine, in its sole judgment
exercised in good faith, that either (1) the Company shall
have suffered a material adverse change in its business or
financial condition or (2) the Company shall have been the
subject of material adverse publicity which is likely to
have a material adverse impact upon the business and
operations of the Trust;
(5) upon the Company's assignment of this Agreement
(including, without limitation, any transfer of the
Contracts or the Account to another insurance company
pursuant to an assumption reinsurance agreement) unless the
Trust consents thereto; or
-16-
(6) upon termination pursuant to Section 10.1 or notice
from the Company pursuant to Section 10.3.
In exercising its option to terminate its obligation to sell Shares to the
Company, the Trust shall continue to make its shares available to the extent
required by applicable law and may elect to continue to make Trust shares
available to the extent necessary to permit owners of Contracts in effect on the
effective date of such termination (hereinafter referred to as "Existing
Contracts") to reallocate investments in the Trust, redeem investments in the
Trust and/or invest in the Trust upon the making of additional purchase payments
under the Existing Contracts. The Trust shall promptly notify the Company
whether the Trust is electing to make Trust shares so available after
termination.
10.3. The restrictions on the Company under Section 2.7 of this Agreement
shall terminate at the option of the Company:
(a) upon six months' notice to the Trust;
(b) upon 30 days' notice to the Trust:
(1) if shares of any Series are not reasonably
available to meet the requirements of the Contracts as
determined by the Company, and the Trust, after receiving
written notice from the Company of such non-availability,
fails to make available a sufficient number of Trust shares
to meet the requirements of the Contracts within 5 days
after receipt thereof;
(2) upon institution of formal proceedings against the
Trust by the NASD, the SEC or any state securities or
insurance commission or any other regulatory body;
(3) if the Trust ceases to qualify as a Regulated
Investment Company under Subchapter M of the Code, or under
any successor or similar provision, or if the Company
reasonably believes based on an opinion of counsel
satisfactory to the Trust that the Trust may fail to so
qualify, and the Trust upon written request, fails to
provide reasonable assurance that it will take action to
cure or correct such failure;
(4) if the Trust fails to meet the diversification
requirements specified in Section 817(h) of the Code and any
regulations thereunder and the Trust, upon written request,
fails to provide reasonable assurance that it will take
action to cure or correct such failure; or
-17-
(5) if the Trust informs the Company pursuant to
Section 4.6 that the Trust will not comply with investment
restrictions as requested by the Company and the Trust and
the Company are unable to agree upon any reasonable
alternative accommodations.
10.4. This Article X shall not apply to any termination made pursuant to
Article VII or any conditions or undertakings incorporated by reference in
Article VII, and the effect of such Article VII termination shall be governed by
the provisions set forth or incorporated by reference therein.
ARTICLE XI. APPLICABILITY TO NEW ACCOUNTS AND NEW CONTRACTS
The parties to this Agreement may amend the schedules to this Agreement
from time to time to reflect, as appropriate, changes in or relating to the
Contracts or Series, or additions of new classes of Contracts to be issued by
the Company through separate accounts investing in the Trust. The provisions of
this Agreement shall be equally applicable to each such class of Contracts,
Series and Accounts, effective as of the date of amendment of such Schedule,
unless the context otherwise requires.
ARTICLE XII. NON-LIABILITY OF TRUSTEES AND SHAREHOLDERS
Any obligation of the Trust hereunder shall be binding only upon the
assets of the Trust (or applicable Series thereof) and shall not be binding upon
any trustee, officer, employee, agent or shareholder of the Trust. Neither the
authorization of any action by the Trust Board or shareholders of the Trust nor
the execution of this Agreement on behalf of the Trust, shall impose any
liability upon any trustee, officer, or shareholder of the Trust.
ARTICLE XIII. 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:
Name: Xxxxxxxxx X. Xxxxxx
Title: Vice President
Xxxxxx Advisors Trust
000 Xxxx Xxxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
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If to the Company:
Name: Xxxxxxx Xxxxxx
Title: Vice President
SAFECO Life Insurance Company
P.O. Box 34690
Seattle, Washington 98124-1690
ARTICLE XIV. MISCELLANEOUS
14.1. 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.
14.2. This Agreement may be executed simultaneously in two or more
counterparts each of which together shall constitute one and the same
instrument.
14.3. 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.
IN WITNESS WHEREOF, each of the parties hereto has caused this Agreement to
be executed in its name and behalf by its duly authorized officer on the date
specified below.
SAFECO LIFE INSURANCE COMPANY
(COMPANY)
Date: September 30, 1995
---------------------
By: /s/ Xxxxxxx Xxxxxx
----------------------------------
Name: Xxxxxxx Xxxxxx
Title: Vice President
XXXXXX ADVISORS TRUST
(TRUST)
Date: September 27, 1995
--------------------
By: /s/ Xxxxx Xxxxxx
----------------------------------
Name: Xxxxx Xxxxxx
Title: President
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SCHEDULE 1
Accounts of the Company
Investing in the Trust
Effective as of the date the Agreement was executed, the following separate
accounts are subject to the Agreement:
--------------------------------------------------------------------------------
Name of Account Date Established by SEC 1940 Act Type of Product
and Subaccounts Board of Directors of Registration Number Supported by
the Company Account
--------------------------------------------------------------------------------
SAFECO Life
Insurance Company
Separate Account C 9/14/93 811-8052 Xxxxxxxx Xxxxxxx
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Effective as of August 1, 1997, the following separate accounts are hereby added
to this Schedule 1 and made subject to the Agreement:
--------------------------------------------------------------------------------
Name of Account Date Established by SEC 1940 Act Type of Product
and Subaccounts Board of Directors of Registration Number Supported by
the Company Account
--------------------------------------------------------------------------------
SAFECO Life
Insurance
Company Separate 11/6/86 811-04909 Variable
Account SL Universal Life
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
IN WITNESS WHEREOF, the Trust and the Company hereby amend this Schedule 1 in
accordance with Article XI of the Agreement.
------------------------------------- -------------------------------------
Xxxxxx Advisors Trust SAFECO Life Insurance Company
SCHEDULE 2
Classes of Contracts
Supported by Separate Accounts
Listed on Schedule 1
Effective as of the date the Agreement was executed, the following classes of
Contracts are subject to the Agreement:
--------------------------------------------------------------------------------
Contract Marketing Name SEC 1933 Act Name of Supporting
Registration Number Account
--------------------------------------------------------------------------------
SAFECO Life Insurance
Company Separate
MainSail 33-60331 Account C
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Effective as of August 1, 1997, the following classes of Contracts are hereby
added to this Schedule 2 and made subject to the Agreement:
--------------------------------------------------------------------------------
Contract Marketing Name SEC 1933 Act Name of Supporting
Registration Number Account
--------------------------------------------------------------------------------
Premier Variable 333-30329 SAFECO Life Insurance
Universal Life Company Separate
Account SL
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
IN WITNESS WHEREOF, the Trust and the Company hereby amend this Schedule 2 in
accordance with Article XI of the Agreement.
------------------------------------- -------------------------------------
Xxxxxx Advisors Trust SAFECO Life Insurance Company
SCHEDULE 3
Trust Series Available Under
Each Class of Contracts
Effective as of the date the Agreement was executed, the following Trust Series
are available under the Contracts:
-------------------------------------------------------------------------
Contract Marketing Name Trust Series
-------------------------------------------------------------------------
Xxxxxxxx Xxxxxx U.S. Small Cap Advisor
-------------------------------------------------------------------------
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Effective as of August 1, 1997, this Schedule 3 is hereby amended to reflect the
following changes in Trust Series:
-------------------------------------------------------------------------
Contract Marketing Name Trust Series
-------------------------------------------------------------------------
Premier Variable Universal Life Xxxxxx U.S. Small Cap Advisor
-------------------------------------------------------------------------
-------------------------------------------------------------------------
-------------------------------------------------------------------------
IN WITNESS WHEREOF, the Trust and the Company hereby amend this Schedule 3 in
accordance with Article XI of the Agreement.
------------------------------------- -------------------------------------
Xxxxxx Advisors Trust SAFECO Life Insurance Company
[LETTERHEAD]
January 15, 1997
SAFECO Life Insurance Company
P.O. Box 34690
Seattle, Washington 98124-1690
AMENDMENT NO. 1 TO LETTER DATED SEPTEMBER 27, 1995
CONCERNING CERTAIN ADMINISTRATION SERVICES
Ladies and Gentlemen:
This letter amends the agreement between Xxxxxx Asset Management, L.P. (the
"Adviser") and SAFECO Life Insurance Company (the "Company"), dated September
27, 1995, concerning certain administration services for the separate accounts
of the Company that invest in Xxxxxx Advisors Trust (the "Trust") pursuant to
the Participation Agreement dated September 27, 1995, as amended December 18,
1996 (the "Letter Agreement").
The Trust has filed an application with the SEC requesting exemptive relief
from various provisions of the 1940 Act and the rules thereunder to the extent
necessary to permit Trust shares to be sold to and held by variable annuity and
variable life insurance separate accounts of both affiliated and unaffiliated
insurance companies, as well as by certain qualified pension and retirement
plans outside of the separate account context.
Therefore, Paragraph 1 of the Letter Agreement is hereby amended to read as
follows:
"1. ADMINISTRATION SERVICES AND EXPENSES. Administration services for
the separate accounts of the Company that invest in Xxxxxx Advisors Trust
(the "Separate Accounts") pursuant to the Participation Agreement between
the Company and Xxxxxx Advisors Trust (the "Trust") dated September 27,
1995, as amended by Amendment No. 1 dated December 18, 1996 (the
"Participation Agreement"), and for purchasers of variable annuity
contracts and variable life insurance issued through the Separate Accounts,
are the responsibility of the Company. Administration services for the
Trust, in which the Separate Accounts invest, and for purchasers of Trust
shares, are the responsibility of the Trust or of the Adviser.
The Adviser recognizes the Company as the sole shareholder of Trust
shares purchased under the Participation Agreement on behalf of each
Separate Account. The Adviser further recognizes that it will derive a
substantial savings in administration expenses by virtue of having a sole
shareholder of record of Trust shares purchased by each Separate Account
under the Participation Agreement, rather than multiple
[Logo] INVESTMENT ADVISOR TO ACORN INVESTMENT TRUST AND XXXXXX ADVISORS TRUST
shareholders having record ownership of such Trust shares. The
administration expenses for which the Adviser will derive such savings are
set forth in Schedule A to this letter agreement."
If you agree to the above changes, please sign below and return a signed
copy of this letter to us.
Very truly yours,
Xxxxxx Asset Management, L.P.
By its General Partner, Xxxxxx Asset
Management, Ltd.
By: /s/ Xxxxxxx X. XxXxxxx
----------------------------------
Name: Xxxxxxx X. XxXxxxx
--------------------------------
Title: Senior Vice President
-------------------------------
Acknowledged and Agreed:
SAFECO Life Insurance Company
By: /s/ Xxxxxxx Xxxxxx
----------------------------------
Name: Xxxxxxx Xxxxxx
--------------------------------
Title: Vice President
-------------------------------
Date: January 27, 1997
--------------------------------
