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EXHIBIT 8(f)
FUND PARTICIPATION AGREEMENT
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This Agreement is entered into on this 15th day of March, 1994 between UNUM Life
Insurance Company of America ("UNUM"), a life insurance company organized under
the laws of the State of Maine, as sponsor of VA-I Separate Account ("Separate
Account"), a separate account established by UNUM in accordance with the laws of
Maine, and Acacia Capital Corporation, ("ACC"), a management investment company
organized under the laws of the State of Maryland.
ARTICLE I
DEFINITIONS
1.1 "Business Day" shall mean a day on which UNUM and the New York Stock
Exchange are customarily open for business.
1.2 "Contract" shall mean a group variable annuity contract issued by UNUM.
1.3 "Contractholder" shall mean any association, employer or trustee(s) who is
a party to a Contract.
1.4 "Participant" shall mean any employee of an employer or Contractholder who
is enrolled to participate under the Contract.
1.5 "Participating Company" shall mean any insurance company (including UNUM),
that offers variable annuity and/or variable life insurance contracts to
the public and which has entered into an agreement with the Fund similar
hereto for the purpose of making Fund shares available to serve as the
underlying investment medium for the aforesaid contracts.
1.6 "Fund" shall mean a portfolio of investments of ACC having specific
investment objectives, policies and restrictions.
1.7 "Sub-account" shall mean any sub-account of Separate Account set up for the
purpose of investing in a corresponding Fund.
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ARTICLE II
REPRESENTATIONS
2.1 UNUM represents that:
a. UNUM is an insurance company organized under the laws of Maine.
b. Separate Account has been established by UNUM pursuant to the
Maine Insurance Code fo the purpose of serving as a funding medium for
Contracts.
c. Separate Account is registered under the Investment Company Act
of 1940 as a unit investment trust.
d. Contracts offered by UNUM and funded through Spearate Account are
described in a registration statement filed under the Securities Act
of 1933 (the "1933 Act").
e. The income, gains and losses, whether or not realized, from
assets allocated to Separate Account are, in accordance with the
applicable Contracts, to be credited to or charged against such
Separate Account without regard to other income, gains or losses of
UNUM.
f. Separate Account is subdivided into various sub-accounts under
which income, gains and losses, whether or not realized from assets
allocated to each sub-account are, in accordance with applicable
Contracts, to be credited to or charged against such sub-accounts
without regard to other income, gains or losses of other sub-accounts
or of UNUM.
g. UNUM has established Separate Account in such a manner as to
enable it to use Fund shares as the underlying investment medium for a
corresponding Sub-account.
h. UNUM possess and shall maintain all licenses and approvals
required to offer and sell Contracts.
2.2 ACC represents that:
a. ACC is registered with the Securities and Exchange Commission
under the Investment Company Act of 1940 as an open-end, diversified
management investment company and possess, and shall maintain, all
legal and regulatory licenses, approvals, consents and/or exemptions
required for ACC to operate and offer Fund shares as the underlying
investment medium for certain Sub-
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accounts.
b. ACC is currently qualified as a Regulated Investment Company
under Subchapter M of the Internal Revenue Code of 1986, as amended,
and that it intends to maintain such qualification (under Subchapter M
or any successor of similar provision) and that it will notify UNUM
with reasonable promptness after having a reasonable basis for
believing that it has ceased to so qualify or that it might not so
qualify in the future.
c. ACC is divided into various funds, each Fund being subject to
separate investment objectives policies and restrictions which may not
be changed without a majority vote of the shareholders of such Fund.
d. ACC assets shall be managed and invested in a manner that complies
with the requirements of Section 817(h) of the Code.
e. Shares of ACC will be sold only to insurance companies and their
separate accounts that offer variable annuity and/or variable life
insurance contracts. No Fund shares will be offered to the general
public.
f. ACC shall comply with the terms of this Fund Participation
Agreement directly or through its third parties under contracted
obligation to ACC. Such third parties shall be referred herein as
"Agents".
ARTICLE III
SELECTION OF SUB-ACCOUNTS
3.1 The Contracts funded through Separate Account will provide for the
allocation of contributions among the various Sub-accounts. The Sub-
accounts will invest in shares of various registered management
investment companies. The selection of a particular Sub-account is to
be made by a Participant and such selection may be changed in
accordance with the terms of the Contracts. The selection and number
of Sub-accounts available to Participants will be limited by the
Contracts.
ARTICLE IV
FUND SHARES
4.1 ACC agrees to make shares in the Funds listed on Schedule A available to
UNUM to serve as the underlying investment media for certain Sub-accounts.
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4.2 ACC agrees to make additional Fund shares (other than those listed on
Schedule !) available to serve as investment media for Sub-accounts in the
future should UNUM so request.
UNUM shall be permitted to utilize and employ shares of management investment
companies other than ACC as underlying investment media for Sub-accounts.
4.3 ACC shall ensure that Fund shares are registered with applicable
federal and state agencies at all times.
4.2.1 ACC Shall ensure that Fund shares are registered with applicable
federal and state agencies at all times.
4.3 Transfer of Fund shares will be by book entry only. ACC will credit UNUM as
Separate Account sponsor with the appropriate number of shares of each
Fund. No stock certificates will be issued to UNUM. UNUM will record shares
ordered from a particular Fund in an appropriate title for the
corresponding Sub-account.
ARTICLE V
PROCEDURES FOR PLACING ORDERS
5.1 Each business day ACC will telephone closing net asset value, dividend and
capital gain information to UNUM by 5:00 p.p Eastern time, or as soon
thereafter as practicable. UNUM will telephone orders to purchase and/or
redeem Fund shares by 10:00a.m. Eastern time the following business day
directly with ACC or its specified agent.
ACC appoints UNUM as its agent for the limited purpose of accepting orders
for Fund shares for Separate Account. ACC will execute orders at the net
asset value determined as of the close of trading on the day of receipt of
such orders by UNUM acting as agent ("effective trade date"). However, any
orders received by UNUM acting as agent after the close of the New York
Stock Exchange will be executed at the net asset value determined at the
end of the following business day.
5.2 Each business day UNUM shall send ACC a telecopy listing its orders for
purchasing and redeeming Fund Shares (as a follow-up to the earlier
telephonic trade instructions). Later that day ACC shall send UNUM a
telecopy confirming such orders and listing the closing net asset value for
the prior business day.
5.3 UNUM shall provide to ACC a list of persons authorized to place orders for
purchases and redemptions with ACC. ACC shall accept orders on behalf of
UNUM only from persons named on such list. UNUM shall replace such list
with another in the event of changed in authorized persons. UNUM agrees
that any person whose name appears on the list from time to time will be
duly authorized by appropriate corporate action by UNUM.
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ARTICLE VI
SETTLEMENT
6.1 On the day following the effective trade date, payment will be initiated by
electronic funds transfer (ACH transaction) to a custodial account
designated by ACC. For redemption orders, ACC will use best efforts to and
a check payment to UNUM two days following the effective trade date via
overnight courier.
6.2 ACC shall mail to UNUM a copy of a detail transaction report and a
transaction history report following each trade.
ARTICLE VII
DIVIDENDS AND DISTRIBUTIONS
7.1 ACC shall furnish to UNUM notice of any dividend or distribution payable on
its shares at least five (5) business days prior to the ex-dividend date.
On the ex-dividend date or, if not a business day, on the first business
day thereafter, ACC shall furnish to UNUM the actual amount of dividend or
distribution payable per share. All of such dividends and distributions as
are payable on each Fund's shares shall be automatically reinvested in
additional shares of that Fund. Acc shall, on the date of issuance or if
not a business day on the first business day thereafter, notify UNUM of the
number of shares so issued.
ARTICLE VIII
EXPENSES
8.1 All expenses incident to the performance by ACC under this Agreement shall
be paid by ACC including the cost of registration of ACC shares with the
Securities and Exchange Commission and in the states where required. UNUM
shall bear none of the expenses for the registration of ACC's shares,
preparation of ACC's prospectuses, proxy materials notices and periodic
reports, the preparation of any statements and notices required by any
federal or state law, or taxes on the issue or transfer of ACC's shares
subject to this Agreement. However, UNUM shall be responsible for the
expenses of distributing such material from UNUM to Contractholders and
Participants.
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ARTICLE IX
STATEMENTS AND REPORTS
9.1 ACC shall provide monthly statements of account as of the end of each month
for all of UNUM's accounts by the fifteenth (15th) Business Day of the
following month.
9.2 ACC will provide to UNUM at least one complete copy of all registration
statements, prospectuses, statements of additional information, reports,
proxy statements, sales literature and other promotional materials,
applications for exemptions, requests for no-action letters, and all
amendments to any of the above, that related to the Fund or its shares,
contemporaneously with the filing of such document with the Commission or
other regulatory authorities.
ARTICLE X
VOTING OF FUND SHARES
10.1 ACC shall ensure that each Fund complies with all provisions of the
Investment Company Act of 1940 with respect to voting by shareholders and
with all rules and valid interpretations fo the Securities and Exchange
Commission with respect thereto.
10.2 ACC, at its expense, shall provide UNUM with copies of its proxy material
in such quantity as UNUM shall reasonable require for distributing to
Contractholders and Participants.
10.3 UNUM shall provide pass-through voting privileges to all Contractholders
so long as the Securities and Exchange Commission continues to interpret
the Investment Company Act of 1940 as requiring pass-through voting
privileges for variable contract owners. It shall be the responsibility of
UNUM to assure that it and the separate accounts of the other Participating
Companies participating in any Fund calculate voting privileges in a
consistent manner.
10.4 UNUM will distribute to Contractholders all proxy material furnished by
ACC and will vote shares in accordance with instructions received from
those Contractholders with contract value allocated to ACC shares. UNUM
shall vote
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ACC shares for which no instructions have been received in the same
proportion as shares for which instructions have been received from
Contractholders. UNUM and its agents will in no way recommend action in
connection with or oppose or interfere with the solicitaion of proxies for
ACC shares held for such Contractholders.
ARTICLE XI
MARKETING AND REPRESENTATIONS
11.1 ACC xxxxx periodically furnish UNUM with the following printed
materials in reasonably sufficient quantities for UNUM to distribute
to each Contractholder and Participant and to support UNUM's Contract
marketing efforts:
a. Current Fund Prospectuses and any supplement thereto;
b. Current Statement of Additional Information;
c. Current proxy materials;
d. Current annual and semiannual reports and supplements thereto;
e. Current quarterly Fund performance reports;
f. Other marketing materials.
Such materials will be furnished to UNUM in time for UNUM to comply with
its regulatory responsibilities under the federal securities laws.
11.2 UNUM shall designate certain persons or entities which shall have the
requisite licenses to solicit applications for the sale of Contracts.
No representation is made as to the number or amount of Contracts
that are to be sold by UNUM. UNUM shall make reasonable efforts to
market the Contracts and shall comply with all applicable federal and
state laws in connection therewith.
11.3 UNUM shall make no representation concerning Fund shares except those
contained in a current Fund prospectus, in printed information
supplemental to such prospectus, and in materials which have received
the prior approval of ACC.
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ARTICLE XII
POTENTIAL CONFLICTS
12.1 UNUM has reviewed a copy of an application for exemptive relief, as
amended, filed by ACC on [ }, 19 , with the Securities and Exchange
Commission and, in particular, has reviewed the conditions to the
requested relief set forth therein. As set forth in such application, the
Board of Directors of ACC ("the Board") will monitor ACC for the
existence of any material irreconcilable conflict between the interest of
the Contractholders of all separate accounts investing in ACC. An
irreconcilable material conflict may arise for a variety of reasons,
including: (a) an action by any state insurance regulatory authority; (b)
a change in applicable federal or state insurance, tax, or securities
laws or regulations, or a public ruling, private letter ruling, no-action
or interpretative letter, or any similar action by insurance, tax, or
securities regulatory authorities; (c) and administrative or Judicial
decision in any relevant proceeding; (d) the manner in which the
investments of any portfolio are being managed; (e) a difference in
voting instructions given by variable annuity contractholders and
variable life insurance contractholders; or (f) a decision by an insurer
to disregard the voting instructions of contractholders. The Board shall
promptly inform UNUM if it determines that an irreconcilable material
conflict exists and the implications thereof.
12.2 UNUM will report any potential or existing conflicts of which it is aware
to the Board. UNUM will assist the Board in carrying out its
responsibilities under the shared funding Exemptive Order, by providing
the Board with all information reasonably necessary for the Board to
consider any issues raised. This includes, but is not limited to, an
obligation by UNUM to inform the Board whenever Contractholder voting
instructions are disregarded.
12.3 If a majority of the Board, or majority of Disinterested Board Members,
determines that a material irreconcilable conflict exists with
Participating Companies. If the Board determines that UNUM is responsible
for causing or creating said conflict, UNUM shall at its sole cost and
expense, and to the extent reasonably practicable (as determined by at
its sole cost and expense, and to the extent reasonably practicable (as
determined by a majority of the Disinterested Board Members), take such
action as in necessary to remedy or eliminate the irreconcilable material
conflict. Such necessary action may include, but shall not be limited to:
a. Withdrawing the assets allocable to the Separate Account from the
Fund and reinvesting such assets in different investment medium, or
submitting the question of whether such segregation should be
implemented to a vote of all affect Contractholders and, as
appropriate, segregating the assets of any appropriate group (i.e.,
annuity contract owners, life insurance contract owners, or variable
contract owners of one or more Participating Companies) that votes in
favor or such segregation, or offering to the affected
Contractholders the option of making such a change; and/or
b. Establishing a new registered management investment company or
managed separate account.
12.4 If a material irreconcilable conflict arises as a result of a decision by
UNUM to disregard Contractholder voting instructions and said decision
represents a minority position or would preclude a majority vote by all
Contractholders having an interest in
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ACC, UNUM at UNUM's sole cost, may be required, at the Board's election,
to withdraw the Separate Account's investment in ACC and terminate this
agreement; provided, however that such withdrawal and termination shall
be limited to the extent required by the foregoing material
irreconcilable conflict as determined by a majority of the disinterested
members of the Board.
12.5 For the purpose of this Article, a majority of the Disinterested Board
Members shall determine whither or not any proposed action adequately
remedies any irreconcilable material conflict, but in no event will the
Fund be required to establish a new funding medium for any Contract. UNUM
shall not be required by this Article to establish a new funding medium
for any Contract of an offer to do so has been declined by vote of a
majority of the Contractholders materially adversely affected by the
irreconcilable material conflict.
ARTICLE XIII
INDEMNIFICATION
13.1 UNUM shall indemnify and hold harmless ACC and each of its directors,
officers, employees, agent and each person, if any, who controls ACC within the
meaning of the 1933 Act against any losses, claims, damages or liabilities to
which the Fund or any such director, officer, employee, agent or controlling
person may become subject, insofar as such losses, claims, damages or
liabilities (or actions in respect to thereof) arise out of or are based upon
any untrue statement or alleged untrue statement of any material fact contained
in information furnished by UNUM for use in a Fund's registration statement or
prospectus or sales literature or advertisements of the Fund, or arise out of or
are based upon the omission or the alleged omission to state therein a material
fact required to be state therein or necessary to make the statements therein
not mislieading, or arise out of or as a result of conduct, statements or
representations (other than statements or representations contained in the
Fund's prospectus and sales literature) of UNUM or its agents, with respect to
the sale and distribution of Contracts for which Fund shares are an underlying
investment; and UNUM will reimburse any legal or other expenses reasonably
incurred by ACC or any such director, officer, employee, agent, or controlling
person in connection with investigating or defending any such loss, claim,
damage, liability or action. This indemnity agreement will be in addition to
any liability which UNUM may otherwise have.
13.2 ACC shall indemnify and hold harmless UNUM and each of its directors
officers, employees, agents and each person, if any, who controls UNUM within
the meaning of the 1933 Act against any losses, claims, damages or liabilities
to which UNUM or any such director, officer, employee, agent or controlling
person may become subject, insofar as such losses, claims, damages or
liabilities (or actions in respect to thereof) arise out of or are based upon
any untrue statement or alleged untrue statement of any material fact contained
in a Fund's registration statement or prospectus or sales literature or arise
out of or are based upon the omission or the alleged omission to state therein a
material fact required to be state therein or necessary to make the statements
therein not misleading;
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and ACC will reimburse any legal or other expenses reasonably incurred by UNUM
or any such director, officer, employee, agent, or controlling person may become
subject insofar as such losses, claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon any untrue statement or alleged
untrue statement of any material fact contained in the registration statement or
prospectus or sales literature or advertisements with respect to the Separate
Account or the Contracts and such statements were based on information provided
to UNUM by the Fund; and the Fund will reimburse any legal or other exopenses
reasonably incurred by UNUM or any such director, officer, employee, agent or
controlling person in connection with investigating or defending any such loss,
claim, damage, liability or action; provided, however, that ACC will not be
liable in any such case to the extent that any such loss, claim, damage or
liability arises out of or is based upon an untrue statement or omission or
alleged omission made in such Registration Statement or prospectus in conformity
with written information furnished to ACC by UNUM specifically for use therein..
This indemnity agreement will be in addition to any liability which ACC may
otherwise have.
13.3 ACC shall indemnify and hold harmless UNUM against any and all liability,
loss, damages, costs or expenses which UNUM may incur, suffer or be required to
pay due to ACC's or its Agent's (1) incorrect calculation of the daily net asset
value, dividend rate or capital gain distribution rate; (2) incorrect reporting
of the daily net asset value, dividend rate or capital gain distribution ratel
and/or (3) untimely reporting of the net asset value, dividend rate or capital
gain distribution rate.
13.4 Promptly after receipt by an indemnified party under this paragraph of
notices of the commencement of action, such indemnified party will, if a claim
in repect thereof is to be made against the indemnifying party under this
paragraph, promptly notify the indemnifying party of the commencement thereof.
In case any such action is brought against any indemnified party, and it
notified the indemnifying party of the commencement thereof, the indemnifying
party will be entitled to participate therein and, to the extent that it may
wish, assume the defense thereof, with counsel satisfactory to such indemnified
party.
ARTICLE XIV
COMMENCEMENT AND TERMINATION
14.1 This Agreement shall be effective as of the date set forth in the first
paragraph of this Agreement and shall continue in force until terminated in
accordance with the provisions herein.
14.2 This Agreement shall terminate as to the sale and issuance of new
Contracts:
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a. At the option of UNUM or ACC upon six months advance written notice to the
other party;
b. At the option of UNUM, if any Fund shares are not reasonably available to
meet the requirements of the Contracts as determined by UNUM. Prompt notice
of election to terminate shall be furnished by UNUM, said termination to be
effective ten days after receipt of notice unless ACC makes available a
sufficient number of shares to meet the requirements of the Contracts with
said ten-day period;
c. At the option of UNUM, upon the institution of formal proceedings against
ACC by the Securities and Exchange Commission, National Association of
Securities Dealers or any other regulatory body, the expected or
anticipated ruling, judgment, or outcome of which may, in UNUM's reasonable
judgment, materially impact ACC's ability to meet and perform its
obligations and duties hereunder. Prompt notice of election to terminate
shall be furnished by UNUM with said termination to be effective upon
receipt of notice.
d. In the event a Fund's shares are not registered, issued or sold in
accordance with applicable state and/or federal law, or such law precludes
the use of such shares as the underlying investment medium of Contracts
issued or to be issued by UNUM. Termination shall be effective immediately
upon such occurrence without notice;
e. Upon assignment of this Agreement unless made with the written consent of
each party.
ARTICLE XV
AMENDMENTS
15.1 This Agreement shall automatically be amended to comply with any
amendment to the Investment Company Act of 1940 or rule of any regulatory
authority which affects in any manner the actions and relationships authorized
hereunder.
15.2 Any other changes in the terms of this Agreement, including adding or
deleting Funds to or from Schedule A, shall be made by agreement in writing
between all parties.
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ARTICLE XVI
NOTICE
16.1 Each notice required by this Agreement shall be given by certified mail,
return receipt request, to the appropriate parties at the following
addresses:
UNUM UNUM Life Insurance Company of America
Attn: Legal Department - Retirement Services
0000 Xxxxxxxx Xxxxxx
Xxxxxxxx, Xxxxx 00000
ACC Acacia Capital Corporation
c/x Xxxxxxx Group - Legal Department
0000 Xxxxxxxxxx Xxxxxx, 00xx Xxxxx
Xxxxxxxx, XX 00000
Notice shall be deemed to be given on the date of receipt by addressee as
evidenced by the return receipt.
ARTICLE XVII
LAW
17.1 This Agreement shall be contrued in accordance with the laws of the State
of Maine.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement to be duly
executed and attested as of the date first above written.
UNUM Life Insurance Company of America
Attest: /s/ Xxxxx X. Xxxxxxxx By: /s/ Xxxxx X. Xxxxx
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Its: Vice President
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Acacia Capital Corporation
Attest: /s/ Xxxxxxxxx Xxxxx By: /s/ Xxxxxxx X. Tartehoff
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Its: Vice President
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SCHEDULE A
TO
FUND PARTICIPATION AGREEMENT
DATED
Funds of ACC to be made available to UNUM Life Insurance Company of America as
the sponsor of the VA-I Separate Account:
