October 1, 2002
October
1, 2002
Nationwide
Financial Services, Inc. (“NFS”)
Ladies
and Gentlemen:
This
letter sets forth the agreement (“Agreement”) among NFS on
behalf of certain of its subsidiary life insurance companies
(“you” or
the “Company”), on the one hand, and X. Xxxx Price
Associates, Inc. (“Price Associates”) and X. Xxxx
Price International, Inc. (“TRPI”) (collectively,
“we,” “our” or the “Price
Advisers”) on the other, concerning certain administration services to
be provided by you or your designee, with respect to the X. Xxxx Price Equity
Series, Inc., X. Xxxx Price Fixed Income Series, Inc. and the X. Xxxx Price
International Series, Inc. (the “Fund” and collectively, the
“Funds”).
1. The
Fund. The Fund is a Maryland Corporation registered with the
Securities and Exchange Commission (the “SEC”) under the
Investment Company Act of 1940 (the “Act”) as an open-end
diversified management investment company. The Fund serves as a
funding vehicle for variable annuity contracts and variable life insurance
contracts and, as such, sells its shares to insurance companies and their
separate accounts. With respect to various provisions of the Act, the
SEC requires that owners of variable annuity contracts and variable life
insurance contracts be provided with materials and rights afforded to
shareholders of a publicly-available SEC-registered mutual fund.
2. The
Company. NFS is a holding company duly organized and in good
standing under applicable law. The Company’s life insurance
subsidiaries issue variable annuity and/or variable life insurance contracts
(the “Contracts”) supported by (the “Separate
Accounts”) which are registered with the SEC as a unit investment trust
unless otherwise exempt. The Company has entered into a participation
agreement (the “Participation Agreement”) with the Fund
pursuant to which the Company purchases shares of the Fund for the Separate
Account supporting the Company’s Contracts.
3. Price
Advisers. Price Associates serves as the investment adviser
to the X. Xxxx Price Equity Series, Inc. and X. Xxxx Price Fixed Income Series,
Inc., and TRPI serves as the investment adviser to the X. Xxxx Price
International Series, Inc. The Price Advisers supervise and assist in
the overall management of the Fund’s affairs under respective Investment
Management Agreements with the Fund, subject to the overall authority of the
Fund’s Board of Directors in accordance with Maryland law. Under the
Investment Management Agreements, the Price Advisers are compensated by the
Fund
for providing investment advisory and certain administrative services (either
directly or through its affiliates).
4. Administrative
Services. You or your designee have agreed to assist us
and/or our affiliates, as we may request from time to time, with the provision
of administrative services to the Fund, as they may relate to the investment
in
the Fund by the Separate Account. It is anticipated that such
services may include (but shall not be limited to): the mailing of
Fund reports, notices, proxies and proxy statements and other informational
materials to holders of the Contracts supported by the Separate Account; the
transmission of purchase and redemption requests to the Fund’s transfer agent;
the maintenance of separate records for each holder of the Contracts reflecting
shares purchased and redeemed and share balances; the preparation of various
reports for submission to the Fund Directors; the provision of shareholder
support services with respect to the Portfolios serving as funding vehicles
for
the Company’s Contracts; telephonic support for holders of Contracts with
respect to inquiries about the Fund; and the provision of other administrative
services as shall be mutually agreed upon from time to time. The Company agrees
to monitor its contractholders’ accounts for excessive trading or market timing
activity (as defined in the Fund’s prospectus and as agreed to by NFS) and
agrees to work with the Price Associates to deter or block any future such
activity.
5. Payment
for Administrative Services. In consideration of the administrative
services to be provided by the Company or its designee, we shall make payments
to the Company on a monthly basis (“Payments”), from our
assets, including our bonafide profits as an investment adviser to
the Fund, an amount equal to ___ basis points (___%) per annum for average
aggregate net asset value of shares of the Fund held by the Separate Accounts
under the Participation Agreement provided, however, that such Payments
shall only be payable for each calendar month during which the aggregate dollar
value of shares of the Funds purchased pursuant to the Participation Agreement
by the Company in the aggregate exceeds $________ at all times during that
month. Further, this amount shall be increased to ___ basis points
(___%) per annum of the average aggregate net asset value of shares of the
Fund
held by the Separate Accounts under the Participation Agreement,
provided, however, that such increased Payments shall only be
payable with respect to the Fund for each calendar month during which the
aggregate dollar value of shares exceeds $__________ at all times during that
month. Subject to the terms of Paragraph 6 hereof, each Price Adviser
shall be responsible for payments due pursuant to this Paragraph 5 with respect
to the purchase of shares of a Fund managed by that Price
Adviser. For purposes of computing the Payments to the Company
contemplated under this Paragraph 5, the average aggregate net asset value
of
shares of the Funds held by the Separate Accounts over a monthly period shall
be
computed by totaling each Separate Account’s aggregate investment (share net
asset value multiplied by total number of shares held by the Separate Account)
on each business day during the calendar month, and dividing by the total number
of business days during the month. The Payments contemplated by this
Paragraph 5 shall be calculated by Price Associates at the end of each calendar
month and will be paid to each Company within 30 calendar days
thereafter.
6. Nature
of Payments. The parties to this Agreement recognize and
agree that Price Advisers’ Payments to the Company under this Agreement
represent compensation for administrative services only and do not constitute
payment in any manner for investment advisory services or for costs of
distribution of the Contracts or of Fund shares; and further, that these
payments are not otherwise related to investment advisory or distribution
services or expenses, or administrative services which Price Advisers is
required to provide to owners of the Contracts pursuant to the terms
thereof. You represent that you may legally receive the payments
contemplated by this Agreement.
7. Term. This
Agreement shall remain in full force and effect for an initial term of one
year,
and shall automatically renew for successive one-year periods unless either
party notifies the other upon 60-days written notice of its intent not to
continue this agreement. Notwithstanding, the parties agree that the
Payments will continue to be paid to the Company according to the Agreement
as
long as shares of such Funds are held by the Separate Accounts. This
Provision will survive termination of this Agreement and the termination of
the
related Fund Participation Agreement.
8. Amendment. This
Agreement may be amended only upon mutual agreement of the parties hereto in
writing.
9. Counterparts. This
Agreement may be executed in counterparts, each of which shall be deemed an
original but all of which shall together constitute one and the same
instrument.
If
this
Agreement is consistent with your understanding of the matters we discussed
concerning your administration services, kindly sign below and return a signed
copy to us.
Very
truly yours,
X.
XXXX
PRICE ASSOCIATES, INC.
By:
Name: [Xxxxx
X. Xxxxxxx]
Title: [Vice
President]
X.
XXXX
PRICE INTERNATIONAL, INC.
By:
Name: [Xxxxx
X. Xxxxxxx]
Title: [Vice
President]
Acknowledged
and Agreed to:
NATIONWIDE
FINANCIAL SERVICES, INC.
By:
Name: [Xxxxxxx
X.
Xxxxxx]
Title:
JL/wpdata\VIPFunds\AFPLetters\Nationwide-AFP-3
14 2003
SUPPLEMENT
FOR DISTRIBUTION SERVICES
This
Agreement is between Nationwide Investment Services Corporation
("Company") and X. Xxxx Price Investment Services, Inc., (the
"Distributor"), and is intended to supplement the
Administrative Services Agreement dated October 1, 2002 by, between and
among Nationwide Financial Services, Inc. (NFS), X. Xxxx Price
Associates, Inc. ("Price Associates") and X. Xxxx Price
International, Inc. ("TRPI"), (collectively, the "Price
Advisers"). All terms herein, unless otherwise defined,
shall have the same meaning as used in the Administrative Services
Agreement.
Whereas,
certain portfolios of the X. Xxxx Price Equity Series, Inc. (the “Equity
Fund”) are authorized to issue a class of shares (“VIP II
Class" or“Class”) with respect to which the Equity
Fund has adopted a plan (“12b-1 Plan”) for purposes of paying
for distribution services under Rule 12b-1 of the Investment Company Act
of 1940
with respect to VIP II Class shares;
Whereas,
NFS's subsidiary life insurance companies intend to issue Contracts that
will be
funded by an investment in the VIP II Class shares; and
Whereas,
the Company or its designee is interested in performing distribution services
for the Distributor with respect to VIP II Class shares in exchange for the
receipt of fees pursuant to the 12b-1 Plan.
In
consideration of the foregoing and the mutual covenants set forth below the
Company and the Distributor agree as follows:
1. Distributor. The
Distributor is a broker-dealer registered under the Securities
Exchange
Act of 1934 and with the National Association of Securities Dealers, Inc.
and
serves as the principal underwriter of the Equity Fund. The
Distributor is affiliated with the Price Advisers.
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2.
|
Services.
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(a)
Distribution Services. The Company or its designee has agreed to assist
Distributor, as it may request from time to time, with the provision of
distribution services to the Equity Fund, as they may relate to the investment
in the VIP II Class by the Separate Accounts. It is anticipated that such
services shall include any activities primarily intended to result in the
sale
of shares of the VIP II Class, including (but not limited to): (i) distribution
of Fund reports, prospectuses, and SAIs for the Class to other than existing
holders of Contracts; (ii) the preparation and distribution of sales literature
and advertising material for the Class; (iii) continuing education and training
of insurance agents and other representatives of the Company or its designee
with respect to the Class and the Fund’s portfolios offering the Class and
serving as funding vehicles for the Contracts; (iv) the provision of
distribution support services by insurance agents and other representatives
of
the Company or its designee who will provide personal service and attention
to
the foregoing; and (v) other distribution services in respect of the Class
as
mutually agreed upon from time to time.
(b)
Other Services. The Company or its designee agrees to
monitor its Contractholders’ accounts for excessive trading or market timing
activity (as defined in the Fund’s prospectus and as agreed to by NFS) and
agrees to work with the Distributor to deter or block any future such
activity.
3.Payment
for Distribution Services. In consideration of the
distribution
services
to be provided by the Company and its agents, the Distributor, in accordance
with the 12b-1 Plan, shall pay to the Company a fee with respect to the Class
of
each portfolio of Equity Fund equal to __ basis points (___%) per annum of
the
average aggregate net asset value of the shares of each Class held by the
Separate Accounts under the Participation Agreement. For purposes of computing
the payment to the Company contemplated under this Paragraph 3, the average
aggregate net asset value of shares of each Class held by the Separate Accounts
over a quarterly period shall be computed by totaling each Separate Account's
aggregate investment (share net asset value multiplied by total number of
shares
held by the Separate Account) on each business day during the calendar quarter,
and dividing by the total number of business days during each
quarter. The Payments contemplated by this Paragraph 3 shall be
calculated by the Equity Fund at the end of each calendar quarter and will
be
paid to each Company within 30 business days thereafter.
4. Term. The
term of this Agreement shall run concurrently with the term of the
Administrative Services Agreement.
5. Relationship
to Other Agreements. This Agreement is intended to
supplement the Administrative Services Agreement and not intended to conflict
with or supersede the provisions of the Administrative Services Agreement
or the
Participation Agreement (“Prior Agreements”). All representations and
warranties made by the parties in the Prior Agreements are
incorporated into this Agreement and shall be deemed to have been made in
connection with this Agreement.
X.
XXXX PRICE INVESTMENT
SERVICES, INC.
By:_________________________________________
Name:___________[Xxxxx
X.
Xxxxxxx]_____________
Title:____________[Vice
President] ________________
NATIONWIDE
INVESTMENT SERVICES CORPORATION
By:_________________________________________
Name:__________[Xxxxxxx
X. Xxxxxx]____________
Title:___________[Senior
Vice President]__________
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Funds\VIP II\Nationwide-12b-1-3 14 2003
