Exhibit 1.A.(8)(v)
PARTICIPATION AGREEMENT
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AMONG
[___________________] LIFE INSURANCE COMPANY,
THE GCG TRUST,
AND
DIRECTED SERVICES, INC.
THIS AGREEMENT, dated as of the [_______] of [_____________________], by and
among [___________________] Life Insurance Company (the "Company"), a life
insurance company organized under the laws of the State of [______________], on
its own behalf and on behalf of each separate account of the Company set forth
on Schedule A hereto as may be amended from time to time (such accounts
hereinafter referred to individually as an "Account" and collectively as the
"Accounts"), the GCG Trust (the "Trust"), a management investment company and
business trust organized under the laws of the Commonwealth of Massachusetts,
and Directed Services, Inc.(the "Adviser" and the "Distributor"), a corporation
organized under the laws of the State of New York.
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 for variable life insurance and variable annuity contracts (the
"Variable Insurance Products") to be offered by insurance companies which have
entered into participation agreements with the Trust, Adviser and Distributor
("Participating Insurance Companies");
WHEREAS, the shares of beneficial interest of the Trust are divided into several
series of shares, each designated a "Portfolio" and representing the interest in
a particular managed portfolio of securities and other assets;
WHEREAS, the Trust has obtained an order from the Securities and Exchange
Commission (the "SEC") granting Participating Insurance Companies and variable
annuity and variable life insurance separate accounts exemptions from the
provisions of sections 9(a), 13(a), 15(a), and 15(b) of the Investment Company
Act of 1940, as amended, (the "1940 Act") and Rules 6e-2(b)(15) and
6e-3(T)(b)(15) thereunder, if and to the extent necessary to permit shares of
the Trust to be sold to and held by variable annuity and variable life insurance
separate accounts of both affiliated and unaffiliated life insurance companies
(the "Mixed and Shared Funding Exemptive Order"), and the parties to this
Agreement agree to comply with the conditions or undertakings specified in the
Mixed and Shared Funding Exemptive Order to the extent applicable to each such
party;
WHEREAS, the Trust is registered as an open-end management investment company
under the 1940 Act and shares of the Portfolios are registered under the
Securities Act of 1933, as amended (the "1933 Act");
WHEREAS, the Adviser, which serves as investment adviser to the Trust, is duly
registered as an investment adviser under the federal Investment Advisers Act of
1940, as amended;
WHEREAS, the Company has registered or will register certain variable life
insurance contracts (the "Contracts") under the 1933 Act;
WHEREAS, each Account is a duly organized, validly existing segregated asset
account, established by the Company under the insurance laws of the State of
[____________], to set aside and invest assets attributable to the Contracts;
WHEREAS, the Company has registered the Account as a unit investment trust under
the 1940 Act;
WHEREAS, the Company has issued or will issue certain variable life insurance
contracts supported wholly or partially by the Account (the "Contracts"), and
said Contracts are listed in Schedule A hereto, as it may be amended from time
to time by mutual written agreement;
WHEREAS, the Distributor, which serves as distributor to the Trust, is
registered as a broker dealer with the SEC under the Securities Exchange Act of
1934, as amended (the "1934 Act"), and is a member in good standing of the
National Association of Securities Dealers, Inc. (the "NASD"); and
WHEREAS, to the extent permitted by applicable insurance laws and regulations,
the Company intends to purchase shares in the Portfolios listed in Schedule B
hereto, as it may be amended from time to time by mutual written agreement (the
"Designated Portfolios") on behalf of the Account to fund the aforesaid
Contracts, and the Distributor is authorized to sell such shares to the Account
at net asset value;
NOW, THEREFORE, in consideration of their mutual promises, the Company, the
Trust, the Adviser, and the Distributor agree as follows:
ARTICLE I. SALE OF TRUST SHARES
1.1. The Trust agrees to sell to the Company those shares of the Designated
Portfolios that each Account or the appropriate subaccount of each Account
orders, executing such orders on a daily basis at the net asset value next
computed after receipt and acceptance by the Trust or its designee of the order
for the shares of the Trust. For purposes of this Section 1.1, the Company will
be the designee of the Trust for receipt of such orders from each Account or the
appropriate subaccount of each Account and receipt by such designee will
constitute receipt by the Trust; provided that the Trust receives notice of such
order by 10:00 a.m. Eastern Time on the next following business day ("T+1 ").
"Business Day" will mean any day on which the New York Stock Exchange is open
for trading and on which the Trust calculates its net asset value pursuant to
the rules of the SEC.
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1.2. The Company will pay for Trust shares on T+1 that an order to purchase
Trust shares is made in accordance with Section 1.1 above. Payment will be in
federal funds transmitted by wire. This wire transfer will be initiated by 12:00
p.m. Eastern Time.
1.3. The Trust agrees to make shares of the Designated Portfolios available
indefinitely for purchase at the applicable net asset value per share by
Participating Insurance Companies and their separate accounts on those days on
which the Trust calculates its Designated Portfolio net-asset value pursuant to
rules of the SEC and the Trust shall use reasonable efforts to calculate such
net asset value on each day the New York Stock Exchange is open for trading;
provided, however, that the Board of Trustees of the Trust (the "Trust Board")
may refuse to sell shares of any Portfolio to any person, or suspend or
terminate the offering of shares of any Portfolio if such action is required by
law or by regulatory authorities having jurisdiction or is, in the sole
discretion of the Trust Board, acting in good faith and in light of its
fiduciary duties under federal and any applicable state laws, necessary in the
best interests of the shareholders of such Portfolio.
1.4. On each Business Day on which the Trust calculates its net asset value, the
Company will aggregate and calculate the net purchase or redemption orders for
each Account or the appropriate subaccount of each Account maintained by the
Trust in which contract owner assets are invested. Net orders will only reflect
orders that the Company has received prior to the close of regular trading on
the New York Stock Exchange, Inc. (the "NYSE") (currently 4:00 p.m., Eastern
Time) on that Business Day. Orders that the Company has received after the close
of regular trading on the NYSE will be treated as though received on the next
Business Day. Each communication of orders by the Company will constitute a
representation that such orders were received by it prior to the close of
regular trading on the NYSE on the Business Day on which the purchase or
redemption order is priced in accordance with Rule 22c- I under the 1940 Act.
Other procedures relating to the handling of orders will be in accordance with
the prospectus and statement of information of the relevant Designated Portfolio
or with oral or written instructions that the Distributor or the Trust will
forward to the Company from time to time.
1.5. The Trust agrees that shares of the Trust will be sold only to
Participating Insurance Companies and their separate accounts, qualified pension
and retirement plans or such other persons as are permitted under applicable
provisions of the Internal Revenue Code of 1986, as amended, (the "Internal
Revenue Code"), and regulations promulgated thereunder, the sale to which will
not impair the tax treatment currently afforded the Contracts. No shares of any
Portfolio will be sold to the general public except as set forth in this Section
1.5.
1.6. The Trust agrees to redeem for cash, upon the Company's request, any full
or fractional shares of the Trust held by the Company, executing such requests
on a daily basis at the net asset value next computed after receipt and
acceptance by the Trust or its agent of the request for redemption. For purposes
of this Section 1.6, the Company will be the designee of the Trust for receipt
of requests for redemption from each Account or the appropriate subaccount of
each Account and receipt by such designee will constitute receipt by the Trust,
provided the Trust receives notice of request for redemption by 10:00 a.m.
Eastern Time on the next following Business Day. Payment will be in federal
funds transmitted by wire to the Company's account as designated by the Company
in writing from time to time, on the same Business Day the Trust
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receives notice of the redemption order from the Company. The Trust reserves the
right to delay payment of redemption proceeds, but in no event may such payment
be delayed longer than the period permitted by the 1940 Act. The Trust will not
bear any responsibility whatsoever for the proper disbursement or crediting of
redemption proceeds; the Company alone will be responsible for such action. If
notification of redemption is received after 10:00 a.m. Eastern Time, payment
for redeemed shares will be made on the next following Business Day.
1.7. The Company agrees to purchase and redeem the shares of the Designated
Portfolios offered by the then current prospectus of the Trust in accordance
with the provisions of such prospectus.
1.8. Issuance and transfer of the Trust's shares will be by book entry only.
Stock certificates will not be issued to the Company or any Account. Purchase
and redemption orders for Trust shares will be recorded in, an appropriate title
for each Account or the appropriate subaccount of each Account.
1.9. The Trust will furnish same day notice (by telecopier, followed by written
confirmation) to the Company of the declaration of any income, dividends or
capital gain distributions payable on each Designated Portfolio's shares. The
Company hereby elects to receive all such dividends and distributions as are
payable on the Designated Portfolio shares in the form of additional shares of
that Designated Portfolio. The Trust will notify the Company of the number of
shares so issued as payment of such dividends and distributions. The Company
reserves the right to revoke this election upon reasonable prior notice to the
Trust and to receive all such dividends and distributions in cash.
1.10. The Trust will make the net asset value per share for each Designated
Portfolio available to the Company on a daily basis as soon as reasonably
practical after the net asset value per share is calculated and will use its
best efforts to make such net asset value per share available by 6:00 p.m.,
Eastern Time, but in no event later than 7:00 p.m., Eastern Time, each business
day.
1.11. Any error in the calculation of the net asset value, dividend and capital
gain information greater than or equal to $0.01 per share of the Trust's shares,
shall be reported immediately upon discovery to the Company. Any error of a
lesser amount shall be corrected in the next Business Day's net asset value per
share for the Trust. Any. such notice will state for each day for which an error
occurred the incorrect price, the correct price and, to the extent communicated
to the Trust's shareholders, the reason for the price change. The Company may
send this notice or a derivation thereof (so long as such derivation is approved
in advance by the Distributor or the Adviser) to contractowners whose accounts
are affected by the price change. The parties will negotiate in good faith to
develop a reasonable method for effecting such adjustments. The Trust shall
provide the Company, on behalf of the Account or the appropriate subaccount of
each Account, with a prompt adjustment to the number of shares purchased or
redeemed to reflect the correct share net asset value.
1.12.
(a) The parties hereto acknowledge that the arrangement contemplated by this
Agreement is not exclusive; the Trust's shares may be sold to other insurance
companies (subject to Section 1.8 hereof) and the cash value of the Contracts
may be invested in other investment companies,
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provided, however, that until this Agreement is terminated pursuant to Article
X, the Company shall promote the Designated Portfolios on the same basis as
other funding vehicles available under the Contracts and funding vehicles other
than those listed on Schedule B to this Agreement may be available for the
investment of the cash value of the Contracts.
(b) The Company shall not, without prior notice to the Advisor and the
Distributor (unless otherwise required by applicable law), take any action to
operate the Account as a management investment company under the 1940 Act.
(c) The Company shall not, without prior notice to the Advisor and the
Distributor (unless otherwise required by applicable law), induce Contract
owners to change or modify the Trust or change the Trust's distributor or
investment adviser.
(d) The Company shall not, without prior notice to the Trust, induce Contract
owners to vote on any matter submitted for consideration by the shareholders of
the Trust in a manner other than as recommended by the Board of Trustees of the
Trust.
ARTICLE II. REPRESENTATIONS AND WARRANTIES
2.1. The Company represents and warrants that the Contracts are or will be
registered under the 1933 Act; and that the Contracts will be issued and sold in
compliance with all applicable federal and state laws, including state insurance
suitability requirements. The Company further represents and warrants that it is
an insurance company duly organized and in good standing under applicable law
and that it has legally and validly established each Account as a separate
account under applicable state law and has registered each Account as a unit
investment trust in accordance with the provisions of the 1940 Act to serve as a
segregated investment account for the Contracts, and that it will maintain such
registration for so long as any Contracts are outstanding. The Company will
amend the registration statement under the 1933 Act for the Contracts and the
registration statement under the 1940 Act for the Account from time to time as
required in order to effect the continuous offering of the Contracts or as may
otherwise be required by applicable law. The Company will register and qualify
the Contracts for sale in accordance with the securities laws of the various
states only if and to the extent deemed necessary by the Company.
2.2. The Company represents that the Contracts are currently and at the time of
issuance will be treated as endowment or life insurance contracts under
applicable provisions of the Internal Revenue Code, and that it will make every
effort to maintain such treatment and that it will notify the Trust and the
Adviser immediately upon having a reasonable basis for believing that the
Contracts have ceased to be so treated or that they might not be so treated in
the future.
2.3. The Company represents and warrants that it will not purchase shares of the
Designated Portfolios with assets derived from tax-qualified retirement plans
except, indirectly, through Contracts purchased in connection with such plans.
2.4. The Trust and the Adviser represent and warrant that Trust shares of the
Designated Portfolios sold pursuant to this Agreement will be registered under
the 1933 Act and duly authorized for issuance in accordance with applicable law
and that the Trust is and will remain
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registered under the 1940 Act for as long as such shares of the Designated
Portfolios are outstanding. The Trust will amend the registration statement for
its shares under the 1933 Act and the 1940 Act from time to time as required in
order to effect the continuous offering of its shares. The Trust will register
and qualify the shares of the Designated Portfolios for sale in accordance with
the laws of the various states only if and to the extent deemed advisable by the
Trust.
2.5. The Trust and the Adviser represent that the Trust is currently qualified
as a Regulated Investment Company under Subchapter M of the Internal Revenue
Code, and that it will make every effort to maintain such qualification (under
Subchapter M or any successor or similar provision) and that it will notify the
Company immediately upon having a reasonable basis for believing that it has
ceased to so qualify or that it might not so qualify in the future.
2.6. The Trust and the Adviser represent and warrant that in performing the
services described in this Agreement, the Trust will comply with all applicable
laws, rules and regulations. The Trust and the Adviser make no representation as
to whether any aspect of the Trust's operations (including, but not limited to,
fees and expenses and investment policies, objectives and restrictions) complies
with the insurance laws and regulations of any state. The Trust and the
Distributor agree that upon request they will use their best efforts to furnish
the information required by state insurance laws so that the Company can obtain
the authority needed to issue the Contracts in the various states.
2.7. The Trust currently does not intend nor does the Distributor currently
intend for the Trust to make any payments to finance distribution expenses
pursuant to Rule 12b-1 under the 1940 Act, although it reserves the right to
make such payments in the future. To the extent that a decision is made to
finance distribution expenses pursuant to Rule 12b-1 the Trust and the
Distributor undertake to have the Trust Board formulate and approve any plan
under Rule 12b-1 to finance distribution expenses in accordance with the 1940
Act.
2.8. The Distributor represents and warrants that it will distribute the Trust
shares of the Designated Portfolios in accordance with all applicable federal
and state securities laws including, without limitation, the 1933 Act, the 1934
Act and the 0000 Xxx.
2.9. The Trust and the Adviser represent that the Trust is lawfully organized
and validly existing under the laws of the Commonwealth of Massachusetts and
that it does and will comply in all material respects with applicable provisions
of the 0000 Xxx.
2.10. The Distributor represents and warrants that it is and will remain duly
registered under all applicable federal and state securities laws and that it
will perform its obligations for the Trust in accordance in all material
respects with any applicable state and federal securities laws.
2.11. The Trust and the Distributor represent and warrant that all of their
trustees, officers, employees, investment advisers, and other
individuals/entities having access to the funds and/or securities of the Trust
are and continue to be at all times covered by a blanket fidelity bond or
similar coverage for the benefit of the Trust in an amount not less than the
minimal coverage as required currently by Rule 17g-(1) of the 1940 Act or
related provisions as may be promulgated
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from time to time. The aforesaid bond includes coverage for larceny and
embezzlement and is issued by a reputable bonding company.
ARTICLE III. PROSPECTUSES AND PROXY STATEMENTS; VOTING
3.1. The Trust or the Distributor will provide the Company, at the Trust's or
its affiliate's expense, with as many copies of the current Trust prospectus for
the Designated Portfolios as the Company may reasonably request for
distribution, at the Company's expense, to prospective contractowners and
applicants. The Trust or the Distributor will provide, at the Trust's or its
affiliate's expense, as many copies of said prospectus as necessary for
distribution, at the Company's expense, to existing contractowners. The Trust or
the Distributor will provide the copies of said prospectus to the Company or to
its mailing agent. If requested by the Company in lieu thereof, the Trust or the
Distributor will provide such documentation, including a computer diskette or a
final copy of a current prospectus set in type at the Trust's or its affiliate's
expense, and such other assistance as is reasonably necessary in order for the
Company at least annually (or more frequently if the Trust prospectus is amended
more frequently) to have the Trust's prospectus and the prospectuses of other
mutual funds in which assets attributable to the Contracts may be invested
printed together in one document, in which case the Trust or its affiliate will
bear its reasonable share of expenses as described above, allocated based on the
proportionate number of pages of the Trust's and other fund's respective
portions of the document.
3.2. The Trust or the Distributor will provide the Company, at the Trust's or
its affiliate's expense, with as many copies of the statement of additional
information as the Company may reasonably request for distribution, at the
Company's expense, to prospective contractowners and applicants. The Trust or
the Distributor will provide, at the Trust's or its affiliate's expense, as many
copies of said statement of additional information as necessary for
distribution, at the Company's expense, to any existing contractowner who
requests such statement or whenever state or federal law otherwise requires that
such statement be provided. The Trust or the Distributor will provide the copies
of said statement of additional information to the Company or to its mailing
agent.
3.3. The Trust or the Distributor, at the Trust's or its affiliate's expense,
will provide the Company or its mailing agent with copies of its proxy material,
if any, reports to shareholders and other communications to shareholders in such
quantity as the Company will reasonably require. The Company will distribute
this proxy material, reports and other communications to existing contract
owners and tabulate the votes.
3.4. If and to the extent required by law the Company will:
(a) solicit voting instructions from contractowners;
(b) vote the shares of the Designated Portfolios held in the Account in
accordance with instructions received from contractowners; and
(c) vote shares of the Designated Portfolios held in the Account for which no
timely instructions have been received, as well as shares it owns, in the same
proportion as shares of such
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Designated Portfolio for which instructions have been received from the
Company's contractowners;
so long as and to the extent that the SEC continues to interpret the 1940 Act to
require pass-through voting privileges for variable contractowners. Except as
set forth above, the Company reserves the right to vote Trust shares held in any
segregated asset account in its own right, to the extent permitted by law. The
Company will be responsible for assuring that each of its separate accounts
participating in the Trust calculates voting privileges in a manner consistent
with all legal requirements, including the Mixed and Shared Funding Exemptive
Order.
3.5. The Trust will comply with all provisions of the 1940 Act requiring voting
by shareholders, and in particular, the Trust either will provide for annual
meetings (except insofar as the SEC may interpret Section 16 of the 1940 Act not
to require such meetings) or, as the Trust currently intends to comply with
Section 16(c) of the 1940 Act (although the Trust is not one of the trusts
described in Section 16(c) of that Act) as well as with Sections 16(a) and, if
and when applicable, 16(b). Further, the Trust will act in accordance with the
SEC's interpretation of the requirements of Section 16(a) with respect to
periodic elections of trustees and with whatever rules the SEC may promulgate
with respect thereto.
ARTICLE IV. SALES MATERIAL AND INFORMATION
4.1. The Distributor will provide the Company on a timely basis with investment
performance information for each Designated Portfolio in which the Company
maintains a subaccount of the Account, including total return for the preceding
calendar month and calendar quarter, the calendar year to date, and the prior
one-year, five-year, and ten year (or life of the Trust) periods. The Company
may, based on the SEC mandated information supplied by the Distributor, prepare
communications for contractowners ("Contractowner Materials"). The Company will
provide copies of all Contractowner Materials concurrently with their first use
for the Distributor's internal recordkeeping purposes. It is understood that
neither the Distributor nor any Designated Portfolio will be responsible for
errors or omissions in, or the content of, Contractowner Materials except to the
extent that the error or omission resulted from information provided by or on
behalf of the Distributor or the Designated Portfolio. Any printed information
that is furnished to the Company pursuant to this Agreement other than each
Designated Portfolio's prospectus or statement of additional information (or
information supplemental thereto), periodic reports and proxy solicitation
materials is the Distributor's sole responsibility and not the responsibility of
any Designated Portfolio or the Trust. The Company agrees that the Portfolios,
the shareholders of the Portfolios and the officers and governing Board of the
Trust will have no liability or responsibility to the Company in these respects.
4.2. The Company will not give any information or make any representations or
statements on behalf of the Trust or concerning the Trust in connection with the
sale of the Contracts other than the information or representations contained in
the registration statement, prospectus or statement of additional information
for Trust shares, as such registration statement, prospectus and statement of
additional information may be amended or supplemented from time to time, or in
reports or proxy statements for the Trust, or in published reports for the Trust
which are in the public domain or approved by the Trust or the Distributor for
distribution, or in sales literature or other material provided by the Trust,
Adviser or by the Distributor, except with permission of the
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Distributor. Any piece of sales literature or other promotional material
intended to be used by the Company which requires the permission of the
Distributor prior to use will be furnished by Company to the Distributor, or its
designee, at least ten (10) business days prior to its use. No such material
will be used if the Distributor reasonably objects to such use within five (5)
business days after receipt.
Nothing in this Section 4.2 will be construed as preventing the Company or its
employees or agents from giving advice on investment in the Trust.
4.3. The Trust, the Adviser or the Distributor will furnish or will cause to be
furnished, to the Company or its designee, each piece of sales literature or
other promotional material in which the Company or its Account is named, at
least ten (10) business days prior to its use. No such material will be used if
the Company reasonably objects to such use within five (5) business days after
receipt of such material.
4.4. The Trust, the Adviser and the Distributor will not give any information or
make any representations or statements on behalf of the Company or concerning
the Company, each Account, or the Contracts other than the information or
representations contained in a registration statement, prospectus or statement
of additional information for the Contracts, as such registration statement,
prospectus and statement of additional information may be amended or
supplemented from time to time, or in published reports for each Account or the
Contracts which are in the public domain or approved by the Company for
distribution to contractowners, or in sales literature or other material
provided by the Company, except with permission of the Company. The Company
agrees to respond to any request for approval on a prompt and timely basis.
4.5. The Trust will provide to the Company at least one complete copy of all
registration statements, prospectuses, statements of additions 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 relate to the Trust or its shares, contemporaneously
with the filing of such document with the SEC, the NASD or other regulatory
authority.
4.6. The Company will provide to the Trust at least one complete copy of all
registration statements, prospectuses or statements of additional information,
reports, solicitations for voting instructions, sales literature and other
promotional materials, applications for exemptions, requests for no action
letters, and all amendments to any of the above, that relate to the Contracts or
each Account, contemporaneously with the filing of such document with the SEC,
the NASD or other regulatory authority.
4.7. For purposes of this Article IV, 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 or tape recording, videotape display,
signs or billboards, motion pictures, or other public media, (e.g., on-line
networks such as the Internet or other electronic messages), sales literature
(i.e., any written communication distributed or made generally available to
customers or the public, including
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brochures, circulars, research reports, market letters, form letters, seminar
texts, reprints or excerpts of any other advertisements sales literature, or
published article), educational or training materials or other communications
distributed or made generally available to some or all agents or employees,
registration statements, prospectuses, statements of additional information,
shareholder reports, and proxy materials and any other material constituting
sales literature or advertising under the NASD rules, the 1933 Act or the 0000
Xxx.
4.8. The Trust and the Distributor hereby consent to the Company's use of the
names The GCG Trust, Directed Services, Inc., the portfolio names designated on
Schedule B or other designated names as may be used from time to time in
connection with the marketing of the Contracts, subject to the terms of Sections
4.1 and 4.2 of this Agreement. Such consent will terminate with the termination
of this Agreement.
ARTICLE V. FEES AND EXPENSES
5.1. The Trust, the Adviser and the Distributor will pay no fee or other
compensation to the Company under this Agreement except if the Trust or any
Designated Portfolio adopts and implements a plan pursuant to Rule 12b-1 under
the 1940 Act to finance distribution expenses, then, subject to obtaining any
required exemptive orders or other regulatory approvals, the Trust may make
payments to the Company or to the underwriter for the Contracts if and in such
amounts agreed to by the Trust in writing.
5.2. All expenses incident to performance by the Trust of this Agreement will be
paid by the Trust to the extent permitted by law. The Trust will bear the
expenses for the cost of registration and qualification of the Trust's shares;
preparation and filing of the Trust's prospectus, statement of additional
information and registration statement, proxy materials and reports; setting in
type and printing the Trust's prospectus; setting in type and printing proxy
materials and reports by it to contractowners (including the costs of printing a
Trust prospectus that constitutes an annual report); the preparation of all
statements and notices required by any federal or state law; all taxes on the
issuance or transfer of the Trust's shares; any expenses permitted to be paid or
assumed by the Trust pursuant to a plan, if any, under Rule 12b-1 under the 1940
Act; and all other expenses set forth in Article III of this Agreement. All
expenses incident to the distribution and tabulation of the Trust's proxy
materials will be paid by the Trust, except postage which will be paid by the
Company.
ARTICLE VI. DIVERSIFICATION AND QUALIFICATION
6.1. The Adviser will ensure that the Trust will at all times invest money from
the Contracts in such a manner as to ensure that the Contracts will be treated
as variable insurance contracts under the Internal Revenue Code and the
regulations issued thereunder. Without limiting the scope of the foregoing, the
Trust will comply with Section 817(h) of the Internal Revenue Code and Treasury
Regulation 1.817-5, as amended from time to time, relating to the
diversification requirements for variable insurance, endowment, or life
insurance contracts and any amendments or other modifications to such Section or
Regulation. In the event of a breach of this Article VI by the Trust, it will
take all reasonable steps: (a) to notify the Company of such breach; and (b) to
adequately diversify the Trust so as to achieve compliance within the grace
period afforded by Treasury Regulation 1.817-5.
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6.2. The Trust and the Adviser represent that the Trust is or will be qualified
as a Regulated Investment Company under Subchapter M of the Internal Revenue
Code, and that it will make every effort to maintain such qualification (under
Subchapter M or any successor or similar provisions) and that it will notify the
Company immediately upon having a reasonable basis for believing that it has
ceased to so qualify or that it might not so qualify in the future.
6.3. The Company represents that the Contracts are currently, and at the time of
issuance shall be, treated as life insurance contracts, under applicable
provisions of the Internal Revenue Code, and that it will make every effort to
maintain such treatment, and that it will notify the Trust and the Distributor
immediately upon having a reasonable basis for believing the Contracts have
ceased to be so treated or that they might not be so treated in the future. The
Company agrees that any prospectus offering a contract that is a "modified
endowment contract" as that term is defined in Section 7702A of the Internal
Revenue Code (or any successor or similar provision), shall identify such
contract as a modified endowment contract.
ARTICLE VII. POTENTIAL CONFLICTS
7.1. The Trust Board will monitor the Trust for the existence of any material
irreconcilable conflict between the interests of the Contract owners of all
separate accounts investing in the Trust. An irreconcilable material conflict
may arise for a variety of reasons, including: (a) an action by any state
insurance regulatory authority; (b) a change in applicable federal or state
insurance, tax, or securities laws or regulations, or a public ruling, private
letter ruling, no-action or interpretative letter, or any similar action by
insurance, tax, or securities regulatory authorities; (c) an administrative or
judicial decision in any relevant proceeding; (d) the manner in which the
investments of any Portfolio are being managed; (e) a difference in voting
instructions given by variable life insurance contract owners; or (f) a decision
by an insurer to disregard the voting instructions of contract owners. The Trust
Board shall promptly inform the Company if it determines that an irreconcilable
material conflict exists and the implications thereof.
7.2. The Company will report any potential or existing conflicts of which it is
aware to the Trust Board. The Company will assist the Trust Board in carrying
out its responsibilities under the Mixed and Shared Funding Exemptive Order, by
providing the Trust Board with all information reasonably necessary for the
Trust Board to consider any issues raised. This includes, but is not limited to,
an obligation by the Company to inform the Trust Board whenever Contract owner
voting instructions are disregarded.
7.3. If it is determined by a majority of the Trust Board, or a majority of its
disinterested members, that a material irreconcilable conflict exists, the
Company and other Participating Insurance Companies shall, at their expense and
to the extent reasonably practicable (as determined by a majority of the
disinterested Trust Board members), take whatever steps are necessary to remedy
or eliminate the irreconcilable material conflict, up to and including: (1)
withdrawing the assets allocable to some or all of the separate accounts from
the Trust or any Portfolio and reinvesting such assets in a different investment
medium, including (but not limited to) another Portfolio of the Trust, or
submitting the question whether such segregation should be implemented to a vote
of all affected contract owners 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 Insurance
Companies) that votes in favor
11
of such segregation, or offering to the affected contract owners the option of
making such a change; and (2) establishing a new registered management
investment company or managed separate account.
7.4. If a material irreconcilable conflict arises because of a decision by the
Company to disregard Contract owner voting instructions and that decision
represents a minority position or would preclude a majority vote ; `the Company
may be required, at the Trust's election, to withdraw the Account's investment
in the Trust and terminate this Agreement with respect to each Account;
provided, however, that such withdrawal and termination shall be limited to the
extent required by the foregoing material irreconcilable conflict as determined
by a majority of the disinterested members of the Trust Board. Any such
withdrawal and termination must take place within six (6) months after the Trust
gives written notice that this provision is being implemented, and until the end
of that six month period the Trust shall continue to accept and implement orders
by the Company for the purchase (and redemption) of shares of the Trust.
7.5. If a material irreconcilable conflict arises because a particular state
insurance regulator's decision applicable to the Company conflicts with the
majority of other state regulators, then the Company will withdraw the affected
Account's investment in the Trust and terminate this Agreement with respect to
such Account within six months after the Trust Board informs the Company in
writing that it has determined that such decision has created an irreconcilable
material conflict; provided, however, that such withdrawal, and termination
shall be limited to the extent required by the foregoing material irreconcilable
conflict as determined by a majority of the disinterested members of the Trust
Board. Until the end of the foregoing six month period, the Trust shall continue
to accept and implement orders by the Company for the purchase (and redemption)
of shares of the Trust.
7.6. For purposes of Section 7.3 through 7.6 of this Agreement, a majority of
the disinterested members of the Trust Board shall determine whether any
proposed action adequately remedies any irreconcilable material conflict, but in
no event will the Trust be required to establish a new funding medium for the
Contracts. The Company shall not be required by Section 7.3 to establish a new
funding medium for the Contract if an offer to do so has been declined by vote
of a majority of Contract owners materially adversely affected by the
irreconcilable material conflict. In the event that the Trust Board determines
that any proposed action does not adequately remedy any irreconcilable material
conflict, then the Company will withdraw the Account's investment in the Trust
and terminate this Agreement within six (6) months after the Trust Board informs
the Company in writing of the foregoing determination; provided, however, that
such withdrawal and termination shall be limited to the extent required by any
such material irreconcilable conflict as determined by a majority of the
disinterested members of the Trust Board.
7.7. If and to the extent the Mixed and Shared Funding Exemption Order or any
amendment thereto contains terms and conditions different from Sections 3.4,
3.5, 3.6, 7.1, 7.2, 7.3, 7.4, and 7.5 of this Agreement, then the Trust and/or
the Participating Insurance Companies, as appropriate, shall take such steps as
may be necessary to comply with the Mixed and Shared Funding Exemptive Order,
and Sections 3.4, 3.5, 3.6, 7.1, 7.2, 7.3, 7.4 and 7.5 of this Agreement shall
continue in effect only to the extent that terms and conditions substantially
identical to such
12
Sections are contained in the Mixed and Shared Funding Exemptive Order or any
amendment thereto. If and to the extent that Rule 6e-2 and Rule 6e-3(T) are
amended, or Rule 6e-3 is adopted, to provide exemptive relief from any provision
of the 1940 Act or the rules promulgated thereunder with respect to mixed or
shared funding (as defined in the Mixed and Shared Funding Exemptive Order) on
terms and conditions materially different from those contained' in the Mixed and
Shared Funding Exemptive Order, then (a) the Trust and/or the Participating
Insurance Companies, as appropriate, shall take such steps as may be necessary
to comply with Rules 6e-2 and 6e-3(T), as amended, and Rule 6e-3, as adopted, to
the extent such rules are applicable; and (b) Sections 3.5, 3.6, 7.1., 7.2, 7.3,
7.4, and 7.5 of this Agreement shall continue in effect only to the extent that
terms and conditions substantially identical to such Sections are contained in
such Rule(s) as so amended or adopted.
ARTICLE VIII. INDEMNIFICATION
8.1. INDEMNIFICATION BY THE COMPANY
(a) The Company agrees to indemnify and hold harmless the Trust, the Adviser,
the Distributor, and each person, if any, who controls or is associated with the
Trust, the Adviser or the Distributor within the meaning of such terms under the
federal securities laws and any director, trustee, officer, partner, employee or
agent of the foregoing (collectively, the "Indemnified Parties" for purposes of
this Section 8.1) against any and all losses, claims, expenses, damages,
liabilities (including amounts paid in settlement with the written consent of
the Company) or litigation (including reasonable legal and other expenses), to
which the Indemnified Parties may become subject under any statute, regulation,
at common law or otherwise, insofar as such losses, claims, damages, liabilities
or expenses (or actions in respect thereof) or settlements:
(1) arise out of or are based upon any untrue statements or alleged untrue
statements of any material fact contained in the registration statement,
prospectus or statement of additional information for the Contracts or contained
in the Contracts or sales literature or other promotional material for the
Contracts (or any amendment or supplement to any of the foregoing), or arise out
of or are based upon the omission or the alleged omission to state therein a
material fact required to be stated or necessary to make such statements not
misleading in light of the circumstances in which they were made; provided that
this agreement to indemnify will not apply as to any Indemnified Party if such
statement or omission or such alleged statement or omission was made in reliance
upon and in conformity with written information furnished to the Company by the
Trust, the Adviser or the Distributor for use in the registration statement,
prospectus or statement of additional information for the Contracts or in the
Contracts or sales literature (or any amendment or supplement) or otherwise for
use in connection with the sale of the Contracts or Trust shares; or
(2) arise out of or as a result of statements or representations by or on behalf
of the Company or wrongful conduct of the Company or persons under its control,
with respect to the sale or distribution of the Contracts or Trust shares; or
(3) arise out of any untrue statement or alleged untrue statement of a material
fact contained in the Trust registration statement, prospectus, statement of
additional information or sales literature or other promotional material of the
Trust (or amendment or supplement) or the omission or alleged omission to state
therein a material fact required to be stated therein or
13
necessary to make such statements not misleading in light of the circumstances
in which they were made, if such a statement or omission was made in reliance
upon and in conformity with information furnished to the Trust by or on behalf
of the Company or persons under its control; or
(4) arise as a result of any failure by the Company to provide the services and
furnish the materials under the terms of this Agreement; or
(5) arise out of 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 by the Company of this Agreement;
except to the extent provided in Sections 8.1(b) and 8.3 hereof. This
indemnification will be in addition to any liability that the Company otherwise
may have.
(b) No party will be entitled to indemnification under Section 8.1(a) to the
extent such loss, claim, damage, liability or litigation is due to the willful
misfeasance, bad faith, or gross negligence in the performance of such party's
duties under this Agreement, or by reason of such party's reckless disregard of
its obligations or duties under this Agreement by the party seeking
indemnification.
(c) The Indemnified Parties promptly will notify the Company of the commencement
of any litigation, proceedings, complaints or actions by regulatory authorities
against them in connection with the issuance or sale of the Trust shares or the
Contracts or the operation of the Trust.
8.2. INDEMNIFICATION BY THE ADVISER AND THE DISTRIBUTOR
(a) The Adviser and the Distributor, in each case solely to the extent relating
to such party's responsibilities hereunder, agree to indemnify and hold harmless
the Company and each person, if any, who controls or is associated with the
Company within the meaning of such terms under the federal securities laws and
any director, trustee, officer, partner, employee or agent of the foregoing
(collectively, the "Indemnified Parties" for purposes of this Section 8.2)
against any and all losses, claims, expenses, damages, liabilities (including
amounts paid in settlement with the written consent of the Adviser) or
litigation (including reasonable legal and other expenses) to which the
Indemnified Parties may become subject under any statute, regulation, at common
law or otherwise, insofar as such losses, claims, damages, liabilities or
expenses (or actions in respect thereof) or settlements:
(1) arise out of or are based upon any untrue statement or alleged untrue
statement of any material fact contained in the registration statement,
prospectus or statement of additional information for the Trust or sales
literature or other promotional material of the Trust (or any amendment or
supplement to any of the foregoing), or arise out of or are based upon the
omission or the alleged omission to state therein a material fact required to be
stated or necessary to make such statements not misleading in light of the
circumstances in which they were made; provided that this agreement to indemnify
will not apply as to any Indemnified Party if such statement or omission or such
alleged statement or omission was made in reliance upon and in
14
conformity with information furnished to the Adviser, the Distributor or the
Trust by or on behalf of the Company for use in the registration statement,
prospectus or statement of additional information for the Trust or in sales
literature of the Trust (or any amendment or supplement thereto) or otherwise
for use in connection with the sale of the Contracts or Trust shares; or
(2) arise out of or as a result of statements or representations or wrongful
conduct of the Adviser or the Distributor or persons under the control of the
Adviser or the Distributor respectively, with respect to the sale of the Trust
shares; or
(3) arise out of any untrue statement or alleged untrue statement of a material
fact contained in a registration statement, prospectus or statement of
additional information or sales literature or other promotional material
covering the Contracts (or any amendment or supplement thereto), or the omission
or alleged omission to state therein a material fact required to be stated or
necessary to make such statement or statements not misleading in light of the
circumstances in which they were made, if such statement or omission was made in
reliance upon and in conformity with written information furnished to the
Company by the Adviser, the Trust or the Distributor or persons under the
control of the Adviser or the Distributor; or
(4) arise as a result of any failure by the Adviser or the Distributor to
provide the services and furnish the materials under the terms of this Agreement
(including a failure, whether unintentional or in good faith or otherwise, to
comply with the diversification requirements and procedures related thereto
specified in Article VI of this Agreement); or
(5) arise out of or result from any material breach of any representation and/or
warranty made by the Adviser or the Distributor in this Agreement, or arise out
of or result from any other material breach of this Agreement by the Adviser the
Trust or the Distributor;
except to the extent provided in Sections 8.2(b) and 8.4 hereof. This
indemnification will be in addition to any liability that the Adviser or the
Distributor otherwise may have.
(b) No party will be entitled to indemnification under Section 8.2(a) to the
extent such loss, claim, damage, liability or litigation is due to the willful
misfeasance, bad faith, or gross negligence in the performance of such party's
duties under this Agreement, or by reason of such party's reckless disregard of
its obligations or duties under this Agreement by the party seeking
indemnification.
(c) The Indemnified Parties will promptly notify the Adviser and the Distributor
of the commencement of any litigation, proceedings, complaints or actions by
regulatory authorities against them in connection with the issuance or sale of
the Contracts or the operation of the account.
8.3. INDEMNIFICATION BY THE TRUST
(a) The Trust agrees to indemnify and hold harmless the Company and each of its
directors and officers and each person, if any, who controls the Company within
the meaning of section 15 of the 1933 Act (collectively, the "Indemnified
Parties" for purposes of this section 8.3) against any and all losses, claims,
expenses, damages, liabilities (including amounts paid in settlement with
15
the written consent of the Trust's Board of Trustees), or litigation (including
reasonable legal and other expenses) to which the Indemnified Parties may become
subject under any statute, regulation, at common law or otherwise, insofar as
such losses, claims, damages, liabilities or expenses (or actions in respect
thereof) or settlements:
(1) arise as a result of any failure by the Trust to provide the services and
furnish the materials required to be provided or furnished by it under the terms
of this Agreement (including a failure to comply with the diversification and
other qualification requirements applicable to the Trust specified in Article
VI); or
(2) 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.
(b) No party will be entitled to indemnification under Section 8.3(a) to the
extent such loss, claim, damage, liability or litigation is due to the willful
misfeasance, bad faith, or gross negligence in the performance of such party's
duties under this Agreement, or by reason of such party's reckless disregard of
its obligations or duties under this Agreement by the party seeking
indemnification.
(c) The Indemnified Parties will promptly notify the Trust of the commencement
of any litigation, proceedings, complaints or actions by regulatory authorities
against them in connection with the issuance or sale of the Contracts or the
operation of the account.
8.4. INDEMNIFICATION PROCEDURE
Any person obligated to provide indemnification under this Article VIII
("Indemnifying Party" for the purpose of this Section 8.4) will not be liable
under the indemnification provisions of this Article VIII with respect to any
claim made against a party entitled to indemnification under this Article VIII
("Indemnified Party" for the purpose of this Section 8.4) unless such
Indemnified Party will have notified the Indemnifying Party in writing within a
reasonable time after the summons or other first legal process giving
information of the nature of the claim will have been served upon such
Indemnified Party (or after such party will have received notice of such service
on any designated agent), but failure to notify the Indemnifying Party of any
such claim will not relieve the Indemnifying Party from any liability which it
may have to the Indemnified Party against whom such action is brought otherwise
than on account of the indemnification provision of this Article VIII, except to
the extent that the failure to notify results in the failure of actual notice to
the Indemnifying Party and such Indemnifying Party is damaged solely as a result
of failure to give such notice. In case any such action is brought against the
Indemnified Party, the Indemnifying Party will be entitled to participate, at
its own expense, in the defense thereof. The Indemnifying Party also will be
entitled to assume the defense thereof, with counsel satisfactory to the party
named in the action. After notice from the Indemnifying Party to the Indemnified
Party of the Indemnifying Party's election to assume the defense thereof, the
Indemnified Party will bear the fees and expenses of any additional counsel
retained by it, and the Indemnifying Party 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, unless: (a) the Indemnifying Party and the
Indemnified
16
Party will have mutually agreed to the retention of such counsel; or (b) the
named parties to any such proceeding (including any impleaded parties) include
both the Indemnifying Party and the Indemnified Party and representation of both
parties by the same counsel would be inappropriate due to actual or potential
differing interests between them. The Indemnifying Party will not be liable for
any settlement of any proceeding effected without its written consent but if
settled with such consent or if there is a final judgment for the plaintiff, the
Indemnifying Party agrees to indemnify the Indemnified Party from and against
any loss or liability by reason of such settlement or judgment. A successor by
law of the parties to this Agreement will be entitled to the benefits of the
indemnification contained in this Article VIII The indemnification provisions
contained in this Article VIII will survive any termination of this Agreement.
ARTICLE IX. APPLICABLE LAW
9.1. This Agreement shall be construed and the provisions hereof interpreted
under and in accordance with the laws of the State of Delaware.
9.2. This Agreement shall be subject to the provisions of the 1933, 1934 and
1940 Acts, and the rules and regulations and rulings thereunder, including such
exemptions from those statutes, rules and regulations as the SEC may grant
(including, but not limited to, any Mixed and Shared Funding Exemptive Order)
and the terms hereof shall be interpreted and construed in accordance therewith.
If, in the future, the Mixed and Shared Funding Exemptive Order should no longer
be necessary under applicable law, then Article VII shall no longer apply.
ARTICLE X. TERMINATION
10.1. This Agreement will terminate:
(a) at the option of any party, with or without cause, with respect to some or
all of the Designated Portfolios, upon sixty (60) days' advance written notice
to the other parties or, if later, upon receipt of any required exemptive relief
or orders from the SEC, unless otherwise agreed in a separate written agreement
among the parties; or
(b) at the option of the Company, upon receipt of the Company's written notice
by the other parties, with respect to any Designated Portfolio if shares of the
Designated Portfolio are not reasonably available to meet the requirements of
the Contracts as determined in good faith by the Company; or
(c) at the option of the Company, upon receipt of the Company's written notice
by the other parties, with respect to any Designated Portfolio in the event any
of the Designated Portfolio'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 media of the Contracts issued or
to be issued by Company; or
(d) at the option of the Trust, upon receipt of the Trust's written notice by
the other parties, upon institution of formal proceedings against the Company by
the NASD, the SEC, the insurance commission of any state or any other regulatory
body regarding the Company's duties under this Agreement or related to the sale
of the Contracts, the administration of the Contracts, the operation of the
Account, or the purchase of the Trust shares, provided that the Trust determines
17
in its sole judgment, exercised in good faith, that any such proceeding would
have a material adverse effect on the Company's ability to perform its
obligations under this Agreement; or
(e) at the option of the Company, upon receipt of the Company's written notice
by the other parties upon institution of formal proceedings against the Trust,
Adviser or the Distributor by the NASD, the SEC, or any state securities or
insurance department or any other regulatory body, provided that the Company
determines in its sole judgment, exercised in good faith, that any such
proceeding would have a material adverse effect on the Trust's or the
Distributor's ability to perform its obligations under this Agreement; or
(f) at the option of the Company, upon receipt of the Company's written notice
by the other parties, if the Trust ceases to qualify as a Regulated Investment
Company under Subchapter M of the Internal Revenue Code, or under any successor
or similar provision, or if the Company reasonably and in good faith believes
that the Trust may fail to so qualify; or
(g) at the option of the Company, upon receipt of the Company's written notice
by the other parties, with respect to any Designated Portfolio if the Trust
fails to meet the diversification requirements specified in Article V1 hereof or
if the Company reasonably and in good faith believes the Trust may fail to meet
such requirements; or
(h) at the option of any party to this Agreement, upon written notice to the
other parties, upon another party's material breach of any provision of this
Agreement which material breach is not cured within thirty (30) days of said
notice; or
(i) at the option of the Company, if the Company determines in its sole judgment
exercised in good faith, that either the Trust, the Adviser or the Distributor
has suffered a material adverse change in its business, operations or financial
condition since the date of this Agreement or is the subject of material adverse
publicity which is likely to have a material adverse impact upon the business
and operations of the Company, such termination to be effective sixty (60) days'
after receipt by the other parties of written notice of the election to
terminate; or
(j) at the option of the Trust or the Distributor, if the Trust or the
Distributor respectively, determines in its sole judgment exercised in good
faith, that the Company has suffered a material adverse change in its business,
operations or financial condition since the date of this Agreement or is the
subject of material adverse publicity which is likely to have a material adverse
impact upon the business and operations of the Trust or the Adviser, such
termination to be effective sixty (60) days' after receipt by the other parties
of written notice of the election to terminate; or
(k) at the option of the Company or the Trust upon receipt of any necessary
regulatory approvals and/or the vote of the contractowners having an interest in
the Account (or any subaccount) to substitute the shares of another investment
company for the corresponding Designated Portfolio shares of the Trust in
accordance with the terms of the Contracts for which those Designated Portfolio
shares had been selected to serve as the underlying investment media.
The Company will give sixty (60) days' prior written notice to the Trust of the
date of any proposed vote or other action taken to replace the Trust's shares;
or
18
(1) at the option of the Company or the Trust upon a determination by a majority
of the Trust Board, or a majority of the disinterested Trust Board members, that
an irreconcilable material conflict exists among the interests of: (1) all
contractowners of variable insurance products of all separate accounts; or (2)
the interests of the Participating Insurance Companies investing in the Trust as
set forth in Article VII of this Agreement; or
(m) at the option of the Trust in the event any of the Contracts are not issued
or sold in accordance with applicable federal and/or state law. Termination will
be effective immediately upon such occurrence without notice.
10.2. NOTICE REQUIREMENT. No termination of this Agreement will be effective
unless and until the party terminating this Agreement gives prior written notice
to all other parties of its intent to terminate, which notice will set forth the
basis for the termination.
10.3. EFFECT OF TERMINATION. Notwithstanding any termination of this Agreement,
the Trust and the Distributor will, at the option of the Company, continue to
make available additional shares of the Trust pursuant to the terms and
conditions of this Agreement, for all Contracts in effect on the effective date
of termination of this Agreement ( hereinafter referred to as "Existing
Contracts.") . Specifically, without limitation, the owners of the Existing
Contracts will be permitted to reallocate investments in the Portfolios (as in
effect on such date), redeem investments in the Portfolios and/or invest in the
Portfolios upon the making of additional purchase payments under the Existing
Contracts.
10.4. SURVIVING PROVISIONS. Notwithstanding any termination this Agreement, each
party's obligations under Article VIII to indemnify other parties will survive
and not be affected by any termination of this Agreement. In addition, each
party's obligations under Section 12.7 will survive and not be affected by any
termination of this Agreement. Finally, with respect to Existing Contracts, all
provisions of this Agreement also will survive and not be affected by any
termination of this Agreement.
ARTICLE XI. NOTICES
11.1. 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: The GCG Trust
c/o Xxxxx Xxxxxxx, Secretary
0000 Xxxxxxxx Xxxxx
Xxxx Xxxxxxx, XX 00000-0000
If to the Company: [________________] Life Insurance Company
[_________________________]
[_________________________]
[_________________________]
[_________________________]
19
If to Adviser and/or: Directed Services, Inc.
The Distributor c/o Xxxxx Xxxxxxx, Executive Vice President
and General Counsel
0000 Xxxxxxxx Xxxxx
Xxxx Xxxxxxx, XX 193 80-1479
ARTICLE XII. MISCELLANEOUS
12.1. All persons dealing with the Trust must look solely to the property of the
Trust for the enforcement of any claims against the Trust as neither the
directors, trustees, officers, partners, employees, agents or shareholders
assume any personal liability for obligations entered into on behalf of the
Trust. No Portfolio or series of the Trust will be liable for the obligations or
liabilities of any other Portfolio or series.
12.2. The Trust, the Adviser and the Distributor acknowledge that the identities
of the customers of the Company or any of its affiliates (collectively the
"Company Protected Parties" for purposes of this Section 12.2), information
maintained regarding those customers, and all computer programs and procedures
or other information developed or used by the Company Protected Parties or any
of their employees or agents in connection with the Company's performance of its
duties under this Agreement are the valuable property of the Company Protected
Parties. The Trust, the Adviser and the Distributor agree that if they come into
possession of any list or compilation of the identities of or other information
about the Company Protected Parties' customers, or any other information or
property of the Company Protected Parties, other than such information as is
publicly available or as may be independently developed or compiled by the
Trust, the Adviser or the Distributor from information supplied to them by the
Company Protected Parties' customers who also maintain accounts directly with
the Trust, the Adviser or the Distributor, the Trust, the Adviser and the
Distributor will hold such information or property in confidence and refrain
from using, disclosing or distributing any of such information or other property
except: (a) with the Company's prior written consent; or (b) as required by law
or judicial process. The Company acknowledges that the identities of the
customers of the Trust, the Adviser, the Distributor or any of their affiliates
(collectively the "Adviser Protected Parties" for purposes of this Section
12.2), information maintained regarding those customers, and all computer
programs and procedures or other information developed or used by the Adviser
Protected Parties or any of their employees or agents in connection with the
Trust's, the Adviser's or the Distributor's performance of their respective
duties under this Agreement are the valuable property of the Adviser Protected
Parties. The Company agrees that if it comes into possession of any list or
compilation of the identities of or other information about the Adviser
Protected Parties' customers, or any other information or property of the
Adviser Protected Parties, other than such information as is publicly available
or as may be independently developed or compiled by the Company from information
supplied to them by the Adviser Protected Parties' customers who also maintain
accounts directly with the Company, the Company will hold such information or
property in confidence and refrain from using, disclosing or distributing any of
such information or other property except: (a) with the Trust's, the Adviser's
or the Distributor's prior written consent; or (b) as required by law or
judicial process. Each party acknowledges that any breach of the agreements in
this Section 12.2 would result in immediate and irreparable harm to the other
parties for which there would be no adequate
20
remedy at law and agree that in the event of such a breach, the other parties
will be entitled to equitable relief by way of temporary and permanent
injunctions, as well as such other relief as any court of competent jurisdiction
deems appropriate.
12.3. 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.
12.4. This Agreement may be executed simultaneously in two or more counterparts,
each of which taken together will constitute one and the same instrument.
12.5. If any provision of this Agreement will be held or made invalid by a court
decision, statute, rule or otherwise, the remainder of the Agreement will not be
affected thereby.
12.6. This Agreement will not be assigned by any party hereto without the prior
written consent of all the parties.
12.7. Each party to this Agreement will maintain all records required by law,
including records detailing the services it provides. Such records will be
preserved, maintained and made available to the extent required by law and in
accordance with the 1940 Act and the rules thereunder. Each party to this
Agreement will cooperate with each other party and all appropriate governmental
authorities (including without limitation the SEC, the NASD and state insurance
regulators) and will permit each other and such authorities reasonable access to
its books and records in connection with any investigation or inquiry relating
to this Agreement or the transactions contemplated hereby. Upon request by the
Trust or the Distributor, the Company agrees to promptly make copies or, if
required, originals of all records pertaining to the performance of services
under this Agreement available to the Trust or the Distributor, as the case may
be. The Trust agrees that the Company will have the right to inspect, audit and
copy all records pertaining to the performance of services under this Agreement
pursuant to the requirements of any state insurance department. Each party also
agrees to promptly notify the other parties if it experiences any difficulty in
maintaining the records in an accurate and complete manner. This provision will
survive termination of this Agreement.
12.8. Each party represents that the execution and delivery of this Agreement
and the consummation of the transactions contemplated herein have been duly
authorized by all necessary corporate or board action, as applicable, by such
party and when so executed and delivered this Agreement will be the valid and
binding obligation of such party enforceable in accordance with its terms.
12.9. The parties to this Agreement may amend the schedules to this Agreement
from time to time to reflect changes in or relating to the Contracts, the
Accounts or the Designated Portfolios of the Trust or other applicable terms of
this Agreement.
12.10. The rights, remedies and obligations contained in this Agreement are
cumulative and are in addition to any and all rights.
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12.11. If Trust is a Massachusetts Business Trust - The parties to this
Agreement acknowledge and agree that all liabilities of the Trust arising,
directly or indirectly, under this agreement, will be satisfied solely out of
the assets of the Trust and that no trustee, officer, agent or holder of shares
of beneficial interest of the Trust will be personally liable for any such
liabilities.
IN WITNESS WHEREOF, each of the parties hereto has caused this Agreement to be
executed in its name and on its behalf by its duly authorized representative and
its seal to be hereunder affixed hereto as of the date specified below:
[___________________] LIFE INSURANCE COMPANY
By: _________________________
Name: [________________________]
Title: [________________________]
Date: [________________________]
THE GCG TRUST
By: _________________________
Name: [________________________]
Title: [________________________]
Date: [________________________]
DIRECTED SERVICES, INC.
By: _________________________
Name: [________________________]
Title: [________________________]
Date: [________________________]
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SCHEDULE A
[___________________] LIFE INSURANCE COMPANY
CONTRACT(S) AND SEPARATE ACCOUNT(S)
SEPARATE ACCOUNT(S)
CONTRACT(S):
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SCHEDULE B
THE GCG TRUST
DESIGNATED PORTFOLIOS
PORTFOLIOS:
Liquid Asset Series
Limited Maturity Bond Series
Core Bond Series
Fully Managed Series
Asset Allocation Growth
Total Return Series
Equity Income Series
Investors Series
Value Equity Series
Diversified Mid-Cap Series
Rising Dividends Series
Managed Global Series
Large Cap Value Series
All Cap Series Research Series
Growth and Income Series
Capital Appreciation Series
Capital Growth Series
Special Situations Series
Strategic Equity Series
Mid-Cap Growth Series
Small Cap Series
Growth Series
Real Estate Series
Hard Assets Series
Developing World Series
International Series
Emerging Markets Series
Schedule Date: [_______________], 2001
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