FUND PARTICIPATION AGREEMENT
THIS AGREEMENT is effective as of this day of , 20 by and among
Forethought Life Insurance Company, a Indiana corporation (the "Company"),
acting herein for and on behalf of the Company and on behalf of each separate
account set forth on attached Schedule A, as the same may be amended from time
to time (the "Separate Accounts"); (the "Trust");
(the "Distributor"); and (the "Adviser").
WITNESSETH:
WHEREAS, the Trust engages in business as an open-end management investment
company and is available to act as the investment vehicle for separate accounts
established by insurance companies for life insurance policies and annuity
contracts; and
WHEREAS, the Distributor is registered as a broker/dealer under the Securities
Exchange Act of 1934, as amended (the "1934 Act"), is a member in good standing
of the Financial Industry Regulatory Authority ("FINRA") and serves as principal
underwriter of the shares of the Trust; and
WHEREAS, the Trust intends to make available shares of its series and any
applicable class thereof as set forth in Separate Account registration
statements for the Company, as filed with the Securities and Exchange Commission
from time to time (the "Series"); and
WHEREAS, the Adviser is registered as an investment adviser under the Investment
Advisers Act of 1940, as amended, and any applicable state securities laws and
serves as the investment adviser to the Series; and
WHEREAS, the Company is an insurance company which has registered or will
register the variable annuities and/or variable life insurance policies funded
through the Separate Account under the Securities Act of 1933, as amended (the
"1933 Act") and the Investment Company Act of 1940, as amended (the "1940 Act"),
unless exempt from such registration, to be issued by the Company for
distribution (the "Contracts").
NOW, THEREFORE, in consideration of their mutual promises, the parties hereby
agree as follows:
ARTICLE I
SERIES SHARES
1.1 The Trust and the Distributor agree to make shares of the Series available
for purchase by the Company on behalf of the Separate Accounts on each Business
Day (as hereafter defined). The Trust will execute orders placed for each
Separate Account on a daily basis at the net asset value of each Series next
computed after receipt by the Trust, or its designee, of such order as of the
close of business on each Business Day, or to the extent appropriate, as
provided in Schedule C attached hereto.
A. For purposes of this Agreement, the Company shall be the designee of
the Trust and Distributor for receipt of orders from each Separate Account
and receipt by Company constitutes receipt by the Trust, provided that the
Trust receives notice of such orders by 9:30 a.m. (Eastern time) on the
next following Business Day.
B. For purposes of this Agreement, "Business Day" shall mean any day on
which and for so long as the New York Stock Exchange is open for trading
and on which the Trust calculates the net asset value of each Series
pursuant to the rules of the Securities and Exchange Commission ("SEC") or
as set forth in the Series' prospectus.
1.2 The Board of Trustees of the Trust (the "Board"), acting in good faith and
in the exercise of its fiduciary responsibilities, may refuse to permit the
Trust to sell shares of any Series to any person, or suspend or terminate the
offering of shares of any Series if such action is required by law or by
regulatory authorities having jurisdiction over the sale of shares.
1.3 The Trust and the Distributor agree that shares of the Trust or any of its
Series will be sold only to insurance companies for use in conjunction with
variable life insurance policies or variable annuities. No shares of the Trust
or any of its Series will be sold to the general public.
1.4 The Trust and the Distributor agree to redeem for cash, at the Company's
request, any full or fractional shares of the Series held by the Separate
Accounts, on a daily basis at the net asset value next computed after receipt by
the Trust or its designee of the request for redemption.
A. For the purposes of this Agreement, the Company shall be the designee
of the Trust for receipt of redemption requests from each Separate Account
and receipt by the Company constitutes receipt by the Trust, provided that
the Distributor receives notice of the redemption request by 9:30 a.m.
(Eastern time) on the next following Business Day.
1.5 Except as otherwise provided herein, the Company agrees that purchases and
redemptions of Series shares offered by the then current prospectus of the
Series shall be made in accordance with the provisions of the prospectus.
A. The Company will place separate orders to purchase or redeem shares of
each Series. Each order shall describe the net amount of shares and dollar
amount of each Series to be purchased or redeemed.
B. In the event of net purchases, the Company will pay for shares before
3:00 p.m. (Eastern time) on the next Business Day after receipt of an order
to purchase shares.
C. In the event of net redemptions, the Trust shall pay the redemption
proceeds in federal funds transmitted by wire before 3:00 p.m. (Eastern
time) on the next Business Day after an order to redeem Series shares is
made.
1.6 Issuance and transfer of the Series' shares will be by book entry only.
Share certificates will not be issued to the Company or any Separate Account.
Shares purchased will be recorded in an appropriate title for each Separate
Account or the appropriate sub-account of each Separate Account. The Trust shall
furnish to the Company the CUSIP number assigned to each Series as may be
amended from time to time.
1.7 The Distributor shall notify the Company in advance of any dividends or
capital gain distributions payable on the Series' shares, but by no later than
same day notice by 6:00 p.m. Eastern time on the declaration date (by wire or
telephone, followed by written confirmation). The Company elects to reinvest all
such dividends and capital gain distributions in additional shares of that
Series. The Trust shall notify the Company of the number of shares issued as
payment of dividends and distributions. The Company reserves the right to revoke
this election and to receive all such dividends and capital gain distributions
in cash.
1.8 The Distributor shall provide, in a form acceptable to the Company, the net
asset value per share of each Series to the Company on a daily basis as soon as
reasonably practical after the net asset value per share is calculated. The
Trust shall use its best efforts to make such net asset value per share
available by 6:00 p.m. Eastern time. Information specified in this Section and
Section 1.7 will be substantially in the form as set forth in Schedule C.
A. If the Distributor provides materially incorrect share net asset value
information through no fault of the Company, the Separate Accounts shall be
entitled to an adjustment with respect to the
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Series shares purchased or redeemed to reflect the correct net asset value
per share.
B. Any material error in the calculation or reporting of net asset value
per share, dividend or capital gain information shall be reported promptly
to the Company upon discovery.
1. The Trust, Adviser or Distributor shall indemnify and hold
harmless the Company against any amount the Company is legally
required to pay annuity or life insurance contract owners that have
selected a Series as an investment option ("Contract owners"), and
which amount is due to the Trust's or its agents' material
miscalculation and/or incorrect reporting of the daily net asset
value, dividend rate or capital gains distribution rate.
2. Should a material miscalculation by the Trust or its agents result
in a gain to the Company, subject to the immediately following
sentence, the Company shall immediately reimburse the Trust, the
applicable Series or its agents for any material losses incurred by
the Trust, the applicable Series or its agents as a result of the
incorrect calculation. Should a material miscalculation by the Trust
or its agents result in a gain for Contract owners, the Company will
consult with the Trust or its designee as to what reasonable efforts
shall be made to recover the money and repay the Trust, the applicable
Series or its agents. The Company shall then make such reasonable
effort, at the expense of the Trust or its agents, to recover the
money and repay the Trust, the applicable Series or its agents;
provided, however, the Company shall not be obligated to initiate or
otherwise pursue any legal action against Contract owners for any such
reimbursements.
3. The Trust shall reimburse the Company for any and all costs and
expenses that result from the Distributor providing a materially
incorrect share net asset value per share, dividend or capital gain,
including any administrative costs incurred by the Company in
resolving the error. The Company shall submit an invoice to the Trust
or its agents for such losses incurred as a result of the above which
shall be payable within sixty (60) days of receipt.
With respect to the material errors or omissions described above, this section
shall control over other indemnification provisions in this Agreement.
C. The Distributor or the Trust shall also provide any additional
information relating to each Series, including the non-fair market net
asset value, in the time and manner reasonably requested by the Company.
1.9 The Company agrees to use its best efforts to provide information to the
Trust solely for the purpose of facilitating its compliance with Rule 22c-2 in
accordance with the Rule 22c-2 Shareholder Information Agreement between the
Company and the Trust, among others, a form of which agreement is attached
hereto as Schedule D. Nothing herein, nor any action by the Company, shall be
construed as, or infer that the Company has undertaken any duty or obligation,
whether express or implied, at law or in equity, to detect abusive trading
activities pursuant to the Fund Policies.
ARTICLE II
REPRESENTATIONS AND WARRANTIES
2.1 The Company represents and warrants that:
A. The Contracts are or will be registered under the 1933 Act unless
exempt and that the registrations will be maintained to the extent required
by law.
B. The Contracts will be issued in material compliance with all applicable
federal and state laws and regulations.
C. The Company is duly organized and in good standing under applicable
law.
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D. The Company has legally and validly established each Separate Account
prior to any issuance or sale as a segregated asset account under the
Indiana Insurance Code and has registered or, prior to any issuance or sale
of the Contracts, will register and will maintain the registration of each
Separate Account as a unit investment trust in accordance with the 1940
Act, unless exempt from such registration.
2.2 The Trust and the Distributor represent and warrant that:
A. Series shares sold pursuant to this Agreement shall be registered under
the 1933 Act and the regulations thereunder to the extent required.
B. Series shares shall be duly authorized for issuance in accordance with
the laws of each jurisdiction in which shares will be offered.
C. Series shares shall be sold in material compliance with all applicable
federal and state securities laws and regulations.
D. The Trust is and shall remain registered under the 1940 Act and the
regulations thereunder to the extent required.
E. 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 the Series' shares.
2.3 The Trust and the Adviser represent and warrant that:
A. The Trust is currently qualified as a "regulated investment company"
under Subchapter M of the Internal Revenue Code of 1986, as amended, (the
"Code") and complies with Section 817(h) of the Code and regulations there
under. The Trust and Adviser will make every effort to maintain such
qualification and that both will notify the Company immediately in writing
upon having a reasonable basis for believing that the Trust has ceased to
qualify or that the Trust might not qualify in the future.
B. The Trust is duly organized and validly existing under the laws of the
state of its organization.
C. The Trust does and will comply in all material respects with the 0000
Xxx.
2.4 The Distributor represents and warrants that it is and shall remain duly
registered under all applicable federal, state laws and regulations and that it
will perform its obligations for the Trust and the Company in material
compliance with all applicable laws and regulations.
ARTICLE III
PROSPECTUSES, REPORTS TO SHAREHOLDERS AND PROXY STATEMENTS; VOTING
3.1 The Trust shall provide the Company with as many printed copies of the
current prospectus(es), statement of additional information, proxy statements,
annual reports and semi annual reports of each Series (and no other series), and
any supplements or amendments to any of the foregoing, as the Company may
reasonably request. If requested by the Company, the Trust shall provide such
documents in the form of typeset electronic document files or other such
electronic means and such other assistance as is reasonably necessary in order
for the Company to have any of the prospectus(es), statement of additional
information, proxy statements, annual reports and semi annual reports of each
Series (and no other series), and any supplements or amendments to any of the
foregoing. Such documents may be printed in combination with such documents of
other fund companies' and/or such documents for the Contracts and/or may be
delivered electronically. The decision of whether to distribute summary
prospectuses or statutory prospectuses for a Series is at the discretion of the
Company.
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Expenses associated with providing, printing, processing and distributing such
documents shall be allocated in accordance with Schedule Battached hereto. The
Distributor shall reimburse the Company within 30 days, upon the Company's
request, for its costs in accordance with Schedule B. If any such reimbursement
payment is not received by the Company within 30 days after being presented with
the Company's invoice therefor, interest will begin to accrue thereon at the
rate of 1.5% a month or the highest rate permitted by law, whichever shall be
greater. The Distributor agrees to use best efforts to resolve any billing
discrepancy detected by the Company and remit any corrective payment promptly
upon demand.
3.2 The Trust or its designee will provide the Company 90 days notice of any
change for a Series, including but not limited to, (a) fund objective changes,
(b) anticipated fund mergers/substitutions, (c) no-action or exemptive requests
from the SEC, (d) fund name changes, (e) fund adviser or sub-adviser changes;
and/or (f) conditions or undertakings that affect the Company's rights or
obligations hereunder. If the Trust does not provide the Company with 90 days
notice the Company will use its best efforts to make the change at the date
requested by the Trust. The Trust will reimburse the Company for all reasonable
expenses for facilitating the changes and for notifying Contract owners of such
changes, including any additional expenses incurred by the Company as a result
of the Trust failing to provide the Company with the required notice.
Notwithstanding anything to the contrary, the Distributor will provide all
registration statement supplements to the Company in hand no later than the date
of filing such document with the Securities and Exchange Commission or thirty
(30) days before the effective date thereof, whichever first occurs; time being
of the essence. The Trust will provide the Company with updated shareholder
reports no later than 30 days after the end of the reporting period. The Company
reserves the right, in its sole discretion, to combine the delivery of Trust
supplements to coordinate with other Company variable product supplements and to
levy a surcharge for its administrative costs and expenses incurred in
connection with circulating supplements that do not coincide with scheduled
variable product prospectus updates.
3.3 The Trust will provide the Company with copies of its proxy solicitations
applicable to the Series. The Company will, to the extent required by law, (a)
distribute proxy materials applicable to the Series to eligible Contract owners,
(b) solicit voting instructions from eligible Contract owners, (c) vote the
Series shares in accordance with instructions received from Contract owners; and
(d) if required by law, vote Series shares for which no instructions have been
received in the same proportion as shares of the Series for which instructions
have been received.
A. To the extent permitted by applicable law, the Company reserves the
right to vote Series shares held in any Separate Account in its own right.
B. Unregistered separate accounts subject to the Employee Retirement
Income Security Act of 1974 ("ERISA") will refrain from voting shares for
which no instructions are received if such shares are held subject to the
provisions of ERISA.
3.4 The Trust will comply with all provisions of the 1940 Act and the rules
thereunder requiring voting by shareholders.
ARTICLE IV
SALES MATERIAL AND INFORMATION
4.1 The Company shall furnish, or shall cause to be furnished, to the Trust
prior to use, each piece of sales literature or advertising prepared by the
Company in which the Trust, the Adviser or the Distributor is described. No
sales literature or advertising will be used if the Trust, the Adviser, or the
Distributor reasonably objects to its use within ten (10) Business Days
following receipt by the Trust.
4.2 The Company will not, without the permission of the Trust, make any
representations or statements on behalf of the Trust or concerning the Trust in
connection with the advertising or sale of the
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Contracts, other than information or representations contained in: (a) the
registration statement or Series prospectus(es), (b) Series' annual and semi
annual reports to shareholders, (c) proxy statements for the Series, or, (d)
sales literature or other promotional material approved by the Trust.
4.3 The Trust shall furnish, or shall cause to be furnished, to the Company
prior to use, each piece of sales literature or advertising prepared by the
Trust in which the Company, the Contracts or Separate Accounts, are described.
No sales literature or advertising will be used if the Company reasonably
objects to its use within ten (10) Business Days following receipt by the
Company.
4.4 Neither the Trust nor the Distributor nor the Adviser will, without the
permission of the Company, make any representations or statements on behalf of
the Company, the Contracts, or the Separate Accounts or concerning the Company,
the Contracts or the Separate Accounts, in connection with the advertising or
sale of the Contracts, other than the information or representations contained
in: (a) the registration statement or prospectus for the Contracts, (b) Separate
Account reports to shareholders, (c) in sales literature or other promotional
material approved by the Company.
4.5. The Trust will provide to the Company at least one complete copy of all
registration statements, prospectuses, statements of additional information,
reports to shareholders, proxy statements, solicitations for voting
instructions, sales literature and other promotional materials, applications for
exemptions and requests for no-action letters, and all amendments, that relate
to the Series or its shares.
4.6 The Company will provide to the Trust, upon the Trust's request, at least
one complete copy of all registration statements, prospectuses, statements of
additional information, reports, solicitations for voting instructions, sales
literature and other promotional materials, applications for exemptions, and
requests for no action letters, and all amendments, that relate to the
Contracts.
4.7 The Company is hereby granted a royalty-free, worldwide license to use,
print, broadcast and otherwise display in any print or electronic medium the
Trust's, Distributor's and Advisor's service marks, trade names and logos in
sales literature or other promotional material. For the purposes of this
Agreement, the phrase "sales literature or other promotional material" includes,
but is not limited to, advertisements (such as material published, or designed
for use in a newspaper, magazine, or other periodical, radio, television,
telephone, Internet, or tape recording, videotape display, signs, video streams,
computerized media, websites or other public media), sales literature or other
promotional material (i.e., any written communication distributed or made
generally available to key firms, customers or the public, including brochures,
circulars, pitch books, information provided on a website, research reports,
market letters, form letters, seminar texts, reprints or excerpts of any other
advertisement, sale literature or other promotional material), educational or
training materials or other communications distributed or made generally
available to some or all agents, wholesalers or employees.
ARTICLE V
DIVERSIFICATION
5.1 The Trust and the Adviser represent and warrant that, at all times, each
Series will comply with Section 817(h) of the Code and all regulations
thereunder, relating to the diversification requirements for variable annuity,
endowment, or life insurance contracts and any amendments or other modifications
to such Section or regulations. In the event a Series ceases to so qualify, the
Trust will notify the Company immediately of such event and the Adviser will
take all steps necessary to adequately diversify the Series so as to achieve
compliance within the grace period afforded by Treasury Regulation Section
1.817-5. If a Series fails to achieve compliance with Section 817(h) within the
grace period the Trust will reimburse the Company for all damages resulting to
the Company.
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ARTICLE VI
POTENTIAL CONFLICTS
6.1 The Board will monitor the Series for the existence of any material
irreconcilable conflict between the interests of the Contract owners of all
separate accounts investing in the Series. The Board shall promptly inform the
Company if it determines that an irreconcilable material conflict exists and the
implications thereof.
6.2 The Company will report any potential or existing material irreconcilable
conflict of which it is actually aware to the Board. This includes, but is not
limited to, an obligation by the Company to inform the Board whenever Contract
owner voting instructions are disregarded.
6.3 If it is determined by a majority of the Board, or a majority of its
independent Trustees, that a material irreconcilable conflict exists due to
issues relating to the Contracts, the Company will, at the Trust's expense and
to the extent reasonably practicable, take whatever steps it can which are
necessary to remedy or eliminate the irreconcilable material conflict,
including, without limitation, withdrawal of the affected Separate Account's
investment in the Series. No charge or penalty will be imposed as a result of
such withdrawal.
6.4 The Company, at the request of the Adviser will, at least annually, submit
to the Board such reports, materials or data as the Board may reasonably request
so that the Board may fully carry out the obligations imposed upon them. All
reports received by the Board of potential or existing conflicts, and all Board
action with regard to determining the existence of a conflict, and determining
whether any proposed action adequately remedies a conflict, shall be properly
recorded in the minutes of the Board or other appropriate records, and such
minutes or other records shall be made available to the SEC upon request.
ARTICLE VII
INDEMNIFICATION
7.1 Indemnification by the Company
A. The Company agrees to indemnify and hold harmless the Distributor, the
Adviser, the Trust and each of their directors, Trustees or (if
applicable), 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, an "Indemnified
Party" for purposes of this Section 7.1) 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 Series
shares or the Contracts and:
1. Arise out of or are based upon any untrue statement or alleged
untrue statement 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 applicable to the
Contracts or Separate Accounts (or any amendment or supplement to any
of the foregoing) (collectively, "Company Documents" for the purposes
of this Article VII), 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 Series shares; or
2. Arise out of or result from statements or representations (other
than statements or representations contained in and accurately derived
from the registration statement, prospectus, statement of additional
information or sales literature of the Trust applicable to the Series
(or any
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amendment or supplement to any of the foregoing) (collectively, "Trust
Documents" for purposes of this Article VII)) or wrongful conduct of
the Company or persons under its control, with respect to the sale or
acquisition of the Contracts or Series shares; or
3. Arise out of or result from any untrue statement or alleged untrue
statement of a material fact contained in Trust Documents 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
4. 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
5. 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 which are due to an 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, the Distributor or the Adviser, whichever is applicable.
C. The Company shall not be liable under this indemnification provision
with respect to any claim made against an Indemnified Party unless such
Indemnified Party shall have notified the Company in writing within a
reasonable time after the summons or other first legal process giving
information of the nature of the claim shall have been served upon such
Indemnified Party (or after such Indemnified Party shall have received
notice of such service on any designated agent), but failure to notify the
Company of any such claim shall not relieve the Company from any liability
which it may have to the Indemnified Party against whom such action is
brought otherwise than on account of this indemnification provision. In
case any such action is brought against 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 reasonably 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.
D. The Indemnified Parties will promptly notify the Company of the
commencement of any litigation or proceedings against them or any of their
officers or directors in connection with the issuance or sale of the Series
shares or the Contracts or the operation of the Trust.
7.2 Indemnification by the Distributor
A. The Distributor agrees to indemnify and hold harmless the Company and
each of its directors, officers, employees and agents 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 7.2) against any and all
losses, claims, damages, liabilities (including amounts paid in settlement
with the written consent of the Distributor, 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 the Series
shares or the Contracts and:
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1. Arise out of or are based upon any untrue statement or alleged
untrue statement of any material fact contained in Trust Documents or
arise out of or are based upon 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, 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 Trust, the Adviser, or the Distributor by or on
behalf of the Company for use in Trust Documents or otherwise for use
in connection with the sale of the Contracts or Series shares; or
2. Arise out of or result from statements or representations (other
than statements or representations contained in and accurately derived
from Company Documents) or wrongful conduct of the Distributor or
persons under its control, with respect to the sale or distribution of
the Contracts or Series shares; or
3. Arise out of or result from any untrue statement or alleged untrue
statement of a material fact contained in Company Documents, 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 Company
by or on behalf of the Distributor or the Trust; or
4. Arise out of or result from any failure by the Distributor to
provide the services or furnish the materials required under the terms
of this Agreement; or
5. Arise out of or result from any material breach of any
representation and/or warranty made by the Distributor in this
Agreement or arise out of or result from any other material breach of
this Agreement by the Distributor.
B. The Distributor shall not be liable under this indemnification
provision with respect to any Losses which are due to an 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 or the Separate Account, whichever is
applicable.
C. The Distributor 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 Distributor 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 Distributor of any such claim shall not relieve the
Distributor 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 Distributor shall be entitled to participate, at
its own expense, in the defense thereof. The Distributor also shall be
entitled to assume the defense thereof, with counsel satisfactory to the
party named in the action. After notice from the Distributor to such party
of its election to assume the defense thereof, the Indemnified Party shall
bear the expenses of any additional counsel retained by it, and the
Distributor 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 Indemnified Parties shall promptly notify the Distributor of the
commencement of any litigation or proceedings against them or any of their
officers or directors in connection with the issuance or sale of the
Contracts or the operation of a Separate Account.
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7.3 Indemnification by the Adviser
A. The Adviser agrees to indemnify and hold harmless the Company and each
of its directors, officers, employees and agents 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 7.3) against any and all losses,
claims, damages, liabilities (including amounts paid in settlement with the
written consent of the Adviser, 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 the Series
shares or the Contracts and:
1. Arise out of or are based upon any untrue statement or alleged
untrue statement of any material fact contained in any 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 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 Trust, the Adviser, or the Distributor by or on
behalf of the Company for use in Trust Documents or otherwise for use
in connection with the sale of the Contracts or Series shares; or
2. Arise out of or result from statements or representations (other
than statements or representations contained in and accurately derived
from Company Documents) or wrongful conduct of the Adviser or persons
under its control, with respect to the sale or distribution of the
Contracts or Series shares; or
3. Arise out of or result from any untrue statement or alleged untrue
statement of a material fact contained in Company Documents, 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 Company
by or on behalf of the Adviser or the Trust; or
4. Arise out of or result from any failure by the Adviser to provide
the services or furnish the materials required under the terms of this
Agreement; or
5. Arise out of or result from any material breach of any
representation and/or warranty made by the Adviser in this Agreement
or arise out of or result from any other material breach of this
Agreement by the Adviser.
B. The Adviser shall not be liable under this indemnification provision
with respect to any Losses which are due to an 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 or the Separate Account, whichever is applicable.
C. The Adviser 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 Adviser 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
Adviser of any such claim shall not relieve the Adviser 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
Adviser shall be entitled to participate, at its own expense, in the
defense thereof. The Adviser also shall be entitled to assume the defense
thereof, with counsel satisfactory to the party named in the action. After
notice from the Adviser to such party of its election to assume the defense
thereof, the Indemnified Party shall bear the expenses of any additional
10
counsel retained by it, and the Adviser 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 Indemnified Parties shall promptly notify the Adviser of the
commencement of any litigation or proceedings against them or any of their
officers or directors in connection with the issuance or sale of the
Contracts or the operation of a Separate Account.
7.4 Indemnification by the Trust
A. The Trust agrees to indemnify and hold harmless the Company and each of
its directors, officers, employees and agents 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 7.4) 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 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 the Series
shares or the Contracts and:
1. Arise out of or are based upon any untrue statement or alleged
untrue statement of any material fact contained in any 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 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 Trust, the Adviser, or the Distributor by or on
behalf of the Company for use in Trust Documents or otherwise for use
in connection with the sale of the Contracts or Series shares; or
2. Arise out of or result from statements or representations (other
than statements or representations contained in and accurately derived
from Company Documents) or wrongful conduct of the Trust or persons
under its control, with respect to the sale or distribution of the
Contracts or Series shares; or
3. Arise out of or result from any untrue statement or alleged untrue
statement of a material fact contained in Company Documents, 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 Company
by or on behalf of the Trust; or
4. Arise out of or result from any failure by the Trust to provide
the services or furnish the materials required under the terms of this
Agreement; or
5. 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; or
6. Arise out of a material error in the calculation or reporting of
net asset value per share, dividend or capital gain information
whether or not reported to the Company.
B. The Trust shall not be liable under this indemnification provision with
respect to any Losses which are due to an 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
11
disregard of obligations and duties under this Agreement or to the Company
or the Separate 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 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
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
shall 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 its election to assume the defense thereof,
the Indemnified Party shall bear the 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 Indemnified Parties shall promptly notify the Trust of the
commencement of any litigation or proceedings against them or any of their
officers or directors in connection with the issuance or sale of the
Contracts or the operation of a Separate Account.
7.5 Any party seeking indemnification (the "Potential Indemnitee") will
promptly notify any party from whom they intend to seek indemnification (each a
"Potential Indemnitor") of all demands made and/or actions commenced against the
Potential Indemnitee which may require a Potential Indemnitor to provide such
indemnification. At its option and expense, a Potential Indemnitor may retain
counsel and control any litigation for which it may be responsible to indemnify
a Potential Indemnitee under this Agreement.
7.6 With respect to any claim, the parties each shall give the others
reasonable access during normal business hours to its books, records, and
employees and those books, records, and employees within its control pertaining
to such claim, and shall otherwise cooperate with one and other in the defense
of any claim. Regardless of which party defends a particular claim, the
defending party shall give the other parties written notice of any significant
development in the case as soon as practicable, and such other parties, at all
times, shall have the right to intervene in the defense of the case.
7.7 If a party is defending a claim and indemnifying another party hereto,
and: (i) a settlement proposal is made by the claimant, or (ii) the defending
party desires to present a settlement proposal to the claimant, then the
defending party promptly shall notify the Indemnified Party of such settlement
proposal together with its counsel's recommendation. If the defending party
desires to enter into the settlement and the Indemnified Party fails to consent
within thirty (30) Business Days (unless such period is extended, in writing, by
mutual agreement of the parties hereto), then the Indemnified Party, from the
time it fails to consent forward, shall defend the claim and shall indemnify the
defending party for all costs associated with the claim which are in excess of
the proposed settlement amount.
Regardless of which party is defending the claim: (i) if a settlement requires
an admission of liability by the non-defending party or would require the
non-defending party to either take action (other than purely ministerial action)
or refrain from taking action (due to an injunction or otherwise) (a "Specific
Performance Settlement"), the defending party may agree to such settlement only
after obtaining the express, written consent of the non-defending party. If a
non-defending party fails to consent to a Specific Performance Settlement, the
consequences described in the last sentence of the first paragraph of this
Section 7.7 shall not apply.
7.8 The parties shall use good faith efforts to resolve any dispute concerning
this indemnification obligation. Should those efforts fail to resolve the
dispute, the ultimate resolution shall be determined in a de novo proceeding,
separate and apart from the underlying matter complained of, before a court of
12
competent jurisdiction. Either party may initiate such proceedings with a court
of competent jurisdiction at any time following the termination of the efforts
by such parties to resolve the dispute (termination of such efforts shall be
deemed to have occurred thirty (30) days from the commencement of the same
unless such time period is extended by the written agreement of the parties).
The prevailing party in such a proceeding shall be entitled to recover
reasonable attorneys' fees, costs, and expenses.
ARTICLE VIII
APPLICABLE LAW
8.1 This Agreement shall be construed and the provisions hereof interpreted
under and in accordance with the laws of the State of Indiana without giving
effect to the principles of conflicts of laws.
8.2 This Agreement, its terms and definitions, shall be subject to the
provisions of the 1933 Act, the Securities Exchange Act of 1934, and the 1940
Act, and the rules and regulations and rulings thereunder, including such
exemptions from those statutes, rules and regulations as the SEC may grant.
ARTICLE IX
TERMINATION
9.1 This Agreement shall continue in full force and effect until the first to
occur of:
A. Termination by any party for any reason upon six-months advance written
notice delivered to the other parties; or
B. Termination by the Company by written notice to the Trust, the Adviser
or the Distributor with respect to any Series in the event any of the
Series' shares are not registered, issued or sold in accordance with
applicable state and/or federal law, or such law precludes the use of such
shares as the underlying investment medium of the Contracts issued or to be
issued by the Company; or
C. Termination by the Company upon written notice to the Trust with
respect to any Series in the event that such Series ceases to qualify as a
"regulated investment company" under Subchapter M of the Code or under any
successor or similar provision; or
D. Termination by the Company upon written notice to the Trust and the
Distributor with respect to any Series in the event that such Trust fails
to meet the diversification requirements specified in Section 5.1 of this
Agreement; or
E. Termination upon mutual written agreement of the parties to this
Agreement.
9.2 Effect of Termination.
A. Notwithstanding any termination of this Agreement, the Trust shall, at
the option of the Company, continue to make available additional shares of
the Series pursuant to the terms and conditions of this Agreement, for all
Contracts in effect on the effective date of termination of this Agreement
(the "Existing Contracts") unless such further sale of Series shares is
proscribed by law, regulation or applicable regulatory body. Specifically,
without limitation, the owners of the Existing Contracts will be permitted
to direct allocation and reallocation of investments in the Series, redeem
investments in the Series and invest in the Series through additional
purchase payments.
B. The Company agrees not to redeem Series shares attributable to the
Contracts except (i) as necessary to implement Contract owner initiated or
approved transactions, or (ii) as required by state and/or federal laws or
regulations or judicial or other legal precedent of general application or
(iii) as permitted by an order of the SEC. Upon request, the Company will
promptly furnish to the Trust the opinion of counsel for the Company to the
effect that any redemption pursuant to clause (ii) above is a legally
required redemption.
13
C. In addition to the foregoing, Article VII Indemnification shall survive
any termination of this Agreement.
ARTICLE X
NOTICES
10.1 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:
If to the Distributor:
If to the Adviser:
If to the Company:
Forethought Life Insurance Company
000 Xxxxx Xxxxxxxx Xxxxxx Xxxxx 0000
Xxxxxxxxxxxx, XX 00000
Attn: Xxxx Xxxx, EVP, Chief Investment Officer
ARTICLE XI
MISCELLANEOUS
11.1 Each party will treat as confidential any and all "Nonpublic Personal
Financial Information," Shareholder Information and all information reasonably
expected to be treated as confidential (collectively, "Confidential
Information") and not release any Confidential Information unless (a) the other
party provides written consent to do so; (b) a party is compelled to do so by
court order, subpoena or comparable request issued by any governmental agency,
regulator or other competent authority; or (c) permitted by applicable law. Each
party shall safeguard Confidential Information as required by applicable law and
provide reasonable confirmation upon request. As used above, (i) "Nonpublic
Personal Financial Information" shall refer to personally identifiable financial
information about any prospective or then existing customer of the Company
including customer lists, names, addresses, account numbers and any other data
provided by customers to the Company in connection with the purchase or
maintenance of a product or service that is not Publicly Available; and (ii)
"Publicly Available" shall mean any information that the disclosing party has a
reasonable basis to believe is lawfully made available to the general public
from federal, state, or local government records, widely distributed media, or
disclosures made to the general public that are required by federal, state, or
local law. The Trust and its
14
affiliates agree that it and they shall not use the information received
pursuant to this Agreement, including any Confidential Information, for
marketing or solicitation purposes.
11.2 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.
11.3 This Agreement may be executed simultaneously in two or more counterparts,
each of which taken together shall constitute one and the same instrument.
11.4 If any provision of this Agreement shall be held or made invalid by a
court decision, statute, rule or otherwise, the remainder of this Agreement
shall not be affected thereby.
11.5 Each party shall cooperate with each other party and all appropriate
governmental authorities (including, without limitation, the SEC, FINRA and
state insurance regulators) and shall permit such authorities (and other
parties) reasonable access to its books and records in connection with any
investigation or inquiry relating to this Agreement or the transactions
contemplated hereby.
11.6 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.
11.7 This Agreement or any of the rights and obligations hereunder may not be
assigned by any party without the prior written consent of all parties.
11.8 The waiver of, or failure to exercise, any right provided for in this
Agreement shall not be deemed a waiver of any further or future right under this
Agreement.
11.9 The Company shall be excused from performance under this Agreement and
shall have no liability to any other party hereof or any third person for any
period that it is prevented, hindered or unable to perform any of our
obligations, in whole or in part, as a result of acts of God, strikes, terrorist
activities, power outages (including so-called xxxxx outs), material changes in
circumstances or laws, regulations or interpretations of the same affecting any
of our obligations hereunder, or other causes beyond its reasonable control; and
such non-performance shall not be a default under this Agreement.
11.10 The parties mutually acknowledge that this Agreement represents the
collective drafting efforts of each party and therefore any ambiguity shall not
be interpreted against the interests of any party.
11.11 The parties hereby mutually agree to use their best efforts to seek an
amicable solution to any controversy or dispute regarding the subject matter
hereof. Except as provided in Section 7.8, any unresolved controversy, claim or
dispute shall be submitted to non-binding arbitration in accordance with the
Commercial Rules of the American Arbitration Association and judgment upon any
such award may be entered in any court having jurisdiction thereof. Arbitration
shall be conducted by a single arbitrator who shall have the authority to grant
any and all appropriate relief, including, but not limited to, granting
injunctive relief or demanding specific performance. The arbitrator may make an
initial determination of the location of the arbitration or whether proceedings
may ensue based entirely upon documentary evidence. Arbitration costs and
expenses shall be borne equally by the parties. Each party hereby agrees to
waive and suspend enforcement of any and all rights pursuant to this and all
related agreements during the pendency of such arbitration proceedings.
15
IN WITNESS WHEREOF, each of the parties has caused this Agreement to be executed
in its name and on its behalf by its duly authorized representative as of the
day of , 20 .
FORETHOUGHT LIFE INSURANCE COMPANY
On its behalf and each Separate Account named in
Schedule A
By:
-------------------------
Its
[TRUST] [DISTRIBUTOR]
By: By:
------------------------- -------------------------
Its Its
[ADVISER]
By:
-------------------------
Its
16
SCHEDULE A
SEPARATE ACCOUNTS
NAME OF SEPARATE ACCOUNT
Forethought Life Insurance Company Separate Account A
NAME OF CONTRACT FUNDED BY SEPARATE ACCOUNT
All Contracts Funded by the Separate Account
17
SCHEDULE B
ALLOCATION OF EXPENSES
ITEM PAID BY THE COMPANY PAID BY THE TRUST
----------------------------------------------------------------------------------------------------------------
Registration Statements Preparing and filing the Separate Account's Preparing and filing the Trust's
registration statement registration statement
Prospectuses, Text composition and alterations for Separate Text composition and alterations for
Supplements, and Account prospectus, supplements and statements Series prospectuses, supplements and
Statements of of additional information statements of additional information
Additional Information Printing, processing, mailing and distributing Printing, processing, mailing and
or electronically delivering of Separate distributing and/or electronically
Account prospectuses, supplements and delivering of Series prospectuses,
statements of additional information to new and supplements and statements of
existing Contract owners as required by additional information for use with
applicable law Contract owners, including Contract
Printing, processing, mailing and distributing owners making an initial investment in
Separate Account and Series prospectuses, a Series, as required by applicable
supplements and statements of additional law (1)
information for use with prospective Contract
owners
Documents and Printing, processing, mailing and
Communications related distributing or electronically
fund to changes delivering Series and Separate Account
supplements and other communications
related to fund substitutions, fund
closings, fund mergers and other
similar fund transactions (1)
Annual and Semi-Annual Text composition of annual and semi-annual Text composition of annual and
Reports reports of the Separate Account semi-annual reports of the Series
Printing, processing, mailing, and distributing Printing, processing, mailing, and
or electronically delivering annual and distributing or electronically
semi-annual reports of the Separate Account to delivering annual and semi-annual
Contract owners reports of the Series to Contract
owners (1)
Proxies Text composition, printing, processing, Text composition, printing,
mailing, distributing or electronically processing, mailing, distributing or
delivering and tabulation of proxy statements electronically delivering and
and voting instruction solicitation materials tabulation of proxy statements and
to Contract owners with respect to proxies voting instruction solicitation
sponsored by the Separate Accounts materials to Contract owners with
respect to proxies sponsored by a
Series or the Trust (1)
------------
(1) The Company may request that the Trust provide typeset electronic document
files of such documents for use with Contract owners. The Company may
choose to print the Series' prospectus(es), statement of additional
information, and semi-annual and annual reports, or any of such documents,
in combination with such documents of other fund companies; or may utilize
electronic delivery for such fund documents. In this case, the Trust's
share of the total expense for printing, processing, mailing, and
distribution of the combined materials or of electronic delivery of such
materials shall be allocated based upon the methodology deemed reasonable
and appropriate by the Company.
18
SCHEDULE C
PROCESSING SPECIFICATIONS
I. FORMAT FOR NAV AND DIVIDEND INFORMATION
Please provide the following information when sending the nightly NAV and
Dividend Distribution Date Fax/Email. This information should be received
nightly via Fax/ Email even if it is also provided through NSCC.
Mutual Fund Company Name
Pricing Company Name
Fund Name (no abbreviations)
Fund Number
Ticker and/or Cusip Number
NAV
NAV Change from Prior Day
Prior Day NAV
Ordinary Dividend Distribution
Ordinary Dividend Distribution Change from Prior Day
Daily Accrual Dividend
Daily Accrual Dividend Change from Prior Day
Short Term Gain Distribution
Short Term Gain Distribution Change from Prior Day
Long Term Gain Distribution
Long Term Gain Distribution Change from Prior Day
Pricing Contact Name and Phone Number
Distribution Data Contact Name and Phone Number
Emergency after hours Name & Phone Number
II. NSCC TRANSACTIONS
The following terms and conditions hereby amend Article I of the Agreement with
respect to the receipt and transmission of orders routed through the National
Securities Clearing Corporation ("NSCC") in accordance with the NSCC's Defined
Contribution Clearance & Settlement ("DCC&S") platform cycle file:
A. The Trust will accept all orders to purchase shares of the Series available
using the NSCC's DCC&S platform. The Trust will also provide the Company with
account positions and activity data using the NSCC's Networking platform. The
Company shall pay for Series shares by federal funds wire using the NSCC's
Fund/SERV System in accordance with the rules and regulations of the NSCC, as
the same may be amended from time to time.
B. The Company shall use best efforts to promptly notify the Trust or its
designated transfer agent of its inability to use the NSCC's DCC&S platform by
telephone and/ or facsimile.
C. The Trust will provide the Company with account positions and activity data
using the NSCC's Networking platform (i.e., the NSCC's product that allows
Trusts, Distributors and Companies to exchange account level information
electronically).
D. Payment for Series shares redeemed in accordance with this Schedule shall be
effectuated using the NSCC's FundSERV System. Payment shall be in federal funds
transmitted by wire to the Trust's designated Settling Bank. For the purposes of
the foregoing, a "Settling Bank" shall mean the entity
19
appointed by the Trust to perform such settlement services on behalf of the
Series and which entity agrees to abide by the NSCC's Rules and Procedures
insofar as they relate to the same day funds settlement.
E. The Distributor shall furnish notice to the Company of any income, dividends
or capital gain distributions payable on the Series' shares through the NSCC's
FundSERV System.
20
SCHEDULE D
RULE 22C-2 SHAREHOLDER INFORMATION AGREEMENT
THIS AGREEMENT is entered into as of , 2012 by and between (i)
Forethought Life Insurance Company ("we" or "us") and
(ii) , ("you") in your capacity as the [transfer
agent/principal underwriter] of the Funds (each a "Fund" and
together the "Funds").
WHEREAS, Rule 22c-2 under the Investment Company Act of 1940, as amended,
requires mutual funds to enter into "shareholder information agreements" with
financial intermediaries that hold fund shares on behalf of other investors in
"omnibus accounts" and submit orders to purchase or redeem fund shares on behalf
of such investors directly to the fund, its transfer agent or principal
underwriter; and
WHEREAS, shares of one or more of the Funds are purchased and redeemed on an
omnibus basis directly by our Accounts (as defined below) in connection with for
one or more Contracts (as defined below).
NOW, THEREFORE, In consideration of the premises and mutual covenants contained
below, the parties hereby agree as follows:
1. DEFINITIONS. As used in this Agreement, the following terms have the
following meanings, unless a different meaning is clearly required by the
context:
(A) "ACCOUNT" means an insurance company separate account sponsored or
administered by us.
(B) "BUSINESS DAY" means any day that the New York Stock Exchange is open
for trading.
(C) "CONFIDENTIAL INFORMATION"includes, but is not limited to: (i)
"Nonpublic Personal Information" as defined in Title V of the
Xxxxx-Xxxxx-Xxxxxx Act of 1999 or any successor federal or state statute,
and the rules and regulations thereunder, all as may be amended or
supplemented from time to time, (ii) "Protected Health Information" as such
term is defined in the Health Insurance Portability and Accountability Act
of 1996, or any successor federal or state statute, and the rules and
regulations thereunder, all as may be amended or supplemented from time to
time; and (iii) "Shareholder Information" as such term is defined below.
(D) "CONTRACT" means a variable annuity contract, variable life insurance
policy or variable funding agreement issued through an Account.
(E) "FUND POLICIES" means policies established by the Fund and communicated
to us in writing for the purpose of eliminating or reducing potentially
harmful market timing or frequent trading in shares of the Fund as
described in the Fund's prospectus or statement of additional information
as amended from time to time. This term "Fund" does not include any
"excepted funds" as defined in Rule 22c-2(b), 17 C.F.R. 270.22c-2(b).
(F) "INDIRECT INTERMEDIARY" means a "financial intermediary" as defined by
Rule 22c-2(c)(5)(iii)(excluding any exempted financial intermediary
pursuant to Rule 22c-
21
2(c)(1)(iv)) that transmits purchase and redemption orders directly to us
on behalf of Shareholders with respect to a Contract invested in a Fund
through an Account.
(G) "SHAREHOLDER" means (1) the holder of interests in a Contract or (2) a
participant in an employee benefit plan with a beneficial interest in a
Contract.
(H) "SHAREHOLDER-INITIATED TRANSFER PURCHASE" means a transaction that is
initiated or directed by a Shareholder that results in a transfer of assets
within a Contract to a Fund, but does not include transactions that are
executed: (i) automatically pursuant to contractual or systematic programs
or enrollments such as transfers of assets within a Contract to a Fund as a
result of "dollar cost averaging" programs, asset allocation programs and
automatic rebalancing programs; (ii) pursuant to a Contract death benefit;
(iii) a step-up (or comparable benefit) in Contract value (or comparable
benefit base) pursuant to a Contract death benefit or guaranteed minimum
withdrawal benefit; or (iv) allocation of assets to a Fund through a
Contract as a result of payments such as loan repayments, scheduled
contributions, or retirement plan salary reduction contributions, or
planned premium payments to the Contract.
(I) "SHAREHOLDER-INITIATED TRANSFER REDEMPTION" means a transaction that is
initiated or directed by a Shareholder that results in a transfer of assets
within a Contract out of a Fund, but does not include transactions that are
executed: (i) automatically pursuant to contractual or systematic programs
or enrollments such as transfers of assets within a Contract out of a Fund
as a result of annuity payouts, loans, systematic withdrawal programs,
asset allocation programs and automatic rebalancing programs; (ii) as a
result of any deduction of charges or fees under a Contract; (iii) within a
Contract out of a Fund as a result of scheduled withdrawals or surrenders
from a Contract; or (iv) as a result of the payment of a death benefit from
a Contract.
(J) "WRITTEN" means any communication other than an oral communication
transmitted in paper, electronically or by facsimile.
2. AGREEMENT TO PROVIDE REQUESTED SHAREHOLDER INFORMATION. We agree to use our
best efforts to provide the following information to you solely for the purpose
of facilitating your compliance with Rule 22c-2. Nothing herein, nor any action
by us, shall be construed as, or infer that we have undertaken any duty or
obligation, whether express or implied, at law or in equity, to detect abusive
trading activities pursuant to the Fund Policies. We agree to provide to you,
upon prior written request, the following information that is on our books and
records (collectively, "Shareholder Information") for all Shareholders that
engaged in any purchase, redemption, transfer or exchange transactions in the
Fund shares through an Account during the period covered by the request, if
known:
(A) the taxpayer identification number ("TIN"), Individual/International
Taxpayer Identification Number ("ITIN") or other government issued
identifier ("GII");
(B) the individual Contract number or participant account number associated
with the Shareholder;
(C) the amount and date(s) and transaction type (purchase, redemption,
transfer, or exchange); and
22
(D) any other data mutually agreed upon in writing.
Unless otherwise specifically requested by you, this Paragraph 2 shall be
understood to require us to provide only Shareholder Information relating to
Shareholder-Initiated Transfer Purchases and Shareholder-Initiated Transfer
Redemptions.
All requests must contain the relevant fund account number, CUSIP, trade amount
and date. Requests must be made to us directly via e-mail at:
XX0Xxxx00x-0@xx0.xxx
or such other address we may communicate to you in writing from time to time.
3. PERIOD COVERED BY REQUEST AND FREQUENCY OF REQUESTS. Requests to provide
Shareholder Information shall set forth the specific period for which it is
sought, not to exceed 90 calendar days from the date of the request for which
Shareholder Information is sought. You shall not request Shareholder Information
more frequently than monthly, or older than 90 calendar days from the date of
the request, except as you deem reasonably necessary to investigate compliance
with Fund Policies.
4. FORM AND TIMING OF RESPONSE; PROCEDURES REGARDING INDIRECT INTERMEDIARIES.
(a) We agree to provide the requested Shareholder Information that is on our
books and records to you promptly, but in any event not later than 10 Business
Days after receipt of a good order request given in accordance with Paragraph 2
above, which shall contain the fund account number, CUSIP, trade amount and
date. If you so request, we agree to use best efforts to promptly determine
whether any specific person, identified by you from the requested Shareholder
Information, is itself an Indirect Intermediary. Upon your further request,
which must be given in accordance with Paragraph 2 above, we agree to use best
efforts either to: (i) provide (or arrange to have provided) the requested
Shareholder Information from the Indirect Intermediary; or (ii) if the Indirect
Intermediary refuses to provide the requested Shareholder Information and you so
direct us in writing, restrict or prohibit further purchases of Fund shares by
such Indirect Intermediary through the Account. We agree to inform you whether
we plan to perform (i) or (ii).
(B) Responses required by this paragraph must be communicated in writing
and in a format mutually agreed upon by the parties.
(C) To the extent reasonably practicable, the format for any Shareholder
Information provided to you will be consistent with the NSCC Standardized
Data Reporting Format.
5. LIMITATION ON USE OF INFORMATION. You agree that you shall not use the
information received pursuant to this Agreement, including any Confidential
Information, for any purpose other than to comply with Rule 22c-2. You and your
affiliates shall observe applicable state and federal privacy laws, rules and
regulations with respect to Confidential Information. You shall safeguard all
Confidential Information and promptly notify us of any voluntary or involuntary
dissemination thereof. Neither you nor any of your affiliates or subsidiaries
may use any information provided pursuant to this Agreement for marketing or
solicitation purposes.
23
6. AGREEMENT TO RESTRICT TRADING. We agree to execute reasonable, clear and
unequivocal written instructions from you given on behalf of the Fund to
restrict or prohibit further purchases of Fund shares by a Shareholder that has
been identified by you as having engaged in transactions of the Fund's shares
(directly or indirectly through an Account) that violate Fund Policies. Unless
you specifically direct us otherwise, such restrictions and prohibitions shall
apply only to Shareholder-Initiated Transfer Purchases and Shareholder-Initiated
Transfer Redemptions. We will execute such restrictions with respect to the
Shareholder, but only for the Contract through which such transactions in the
Fund's shares occurred. We will not impose any restriction, and nothing in this
Agreement shall require that we impose any restriction, on a Shareholder based
on any transactions other than transactions in the Fund's shares through an
Account. Instructions must be received by us via email at the following address:
XX0Xxxx00x-0@xx0.xxx , or such other address that we may communicate to you in
writing from time to time. Other correspondence may be sent to us at the
following address, or such other address that we may communicate to you in
writing from time to time:
se2
X.X. Xxx 000000
Xxxxxx, Xxxxxx, 00000-0000
7. FORM OF INSTRUCTIONS. Instructions given in accordance with Paragraph 6 shall
be given to us via e-mail in a mutually agreed upon file format. The
instructions in the file must include:
(A) the fund account number;
(B) the Shareholder's TIN, ITIN or GII, if known;
(C) the specific individual Contract owner number or participant account
number (if known) associated with the Shareholder;
(D) the specific restriction(s) to be executed with respect to such
Shareholder, including how long such restriction(s) are to remain in place;
and
(E) a brief written statement that may be provided to the Shareholder,
explaining how the Shareholder's transfer activity violated Fund Policies.
If the TIN is not known, the instructions must include an equivalent identifying
number of the Shareholder(s) or account(s) or other agreed upon information to
which the instruction relates.
8. TIMING OF RESPONSE. We agree to use reasonable efforts to execute
instructions given in accordance with Paragraphs 6 and 7 promptly, but in any
event not later than 10 Business Days after receipt of such instructions. We
will provide written confirmation to you or your designee as soon as reasonably
practicable that instructions have been executed.
9. CONSTRUCTION OF THE AGREEMENT;
FUND PARTICIPATION AGREEMENTS. The parties
have entered into one or more
Fund Participation Agreements between or among
them for the purchase and redemption of shares of the Funds by the Accounts in
connection with the Contracts. This Agreement supplements those Fund
Participation
24
Agreements. To the extent the terms of this Agreement conflict with the terms of
a
Fund Participation Agreement, the terms of this Agreement shall control.
10. DISPUTE RESOLUTION. The parties agree to use their best efforts to seek an
amicable solution to any controversy or dispute arising under this Agreement.
Any unresolved controversy, claim or dispute arising under this Agreement shall
be submitted to nonbinding arbitration in accordance with the Commercial Rules
of the American Arbitration Association and judgment upon any such award may be
entered in and enforced in any court of competent jurisdiction. Arbitration
shall be conducted by a single arbitrator who shall have the authority to grant
any and all appropriate relief, including, but not limited to, injunctive relief
or specific performance; provided, however, the arbitrator shall have no power
to award punitive, consequential or statutory damages and the parties shall not
seek such relief in any other forum. The arbitrator may make an initial
determination of the location of the arbitration or whether proceedings may
ensue based entirely upon documentary evidence. Arbitration costs and expenses
shall be borne equally by the parties. Each party hereby agrees to waive and
suspend enforcement of any and all rights pursuant to this and all related
agreements during the pendency of such arbitration proceedings.
11. TERMINATION. This Agreement will terminate upon the termination of the
Fund
Participation Agreements.
12. AMENDMENT. This Agreement may be modified or amended, and the terms of this
Agreement may be waived, only by a writing signed by the parties.
13. BINDING EFFECT. This Agreement shall be binding upon, and inure to the
benefit of, the parties hereto and their respective successors and assigns.
14. FORCE MAJUERE. We shall be excused from performance under this Agreement and
shall have no liability to any other party hereof or any third person for any
period that we are prevented, hindered or unable to perform any of our
obligations, in whole or in part, as a result of acts of God, strikes, terrorist
activities, power outages (including so-called xxxxx outs), material changes in
circumstances or laws, regulations or interpretations of the same affecting any
of our obligations hereunder, or other causes beyond our reasonable control; and
such non-performance shall not be a default under this Agreement; provided,
however, that if any of the above-enumerated circumstances prevent, hinder or
delay performance of our obligations for more than sixty (60) Business Days, the
Fund may, at its option, terminate this Agreement in accordance with Paragraph
11, above.
15. COUNTERPARTS. This Agreement may be executed in one or more counterparts
each of which, when taken together, shall constitute a single instrument.
16. CONSTRUCTION. The parties mutually acknowledge that this Agreement
represents the collective drafting efforts of each party and therefore any
ambiguity shall not be interpreted against the interests of any party.
25
FORETHOUGHT LIFE INSURANCE COMPANY
FOR AND ON BEHALF OF ITSELF AND THE ACCOUNTS
By:
------------------------------
Name:
Title:
[FUND PARTY]
By:
------------------------------
Name:
Title:
Address for communications:
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26
