EXHIBIT 9.7
PARTICIPATION AGREEMENT
Among
XXXXXXXX-XXXXXXXXX SERIES TRUST
XXXXXXXX-XXXXXXXXX CAPITAL MANAGEMENT
and
ALIAC LIFE INSURANCE AND ANNUITY COMPANY
THIS AGREEMENT, made and entered into as of this ____ day of January,
1996 by and among ALIAC LIFE INSURANCE AND ANNUITY COMPANY (hereinafter
"ALIAC"), a Connecticut life insurance company, on its own behalf and on
behalf of its Variable Annuity Account B and such additional separate
accounts as may be set forth on Schedule A attached hereto (the
"Accounts"); Xxxxxxxx-Xxxxxxxxx Series Trust, a business trust organized
under the laws of Delaware (hereinafter the "Trust"); and Xxxxxxxx-
Xxxxxxxxx Capital Management, (hereinafter the "Adviser"), a California
limited partnership.
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 policies and/or
variable annuity contracts (collectively, the "Variable Insurance
Products") to be offered by insurance companies which have entered into
participation agreements similar to this Agreement (hereinafter
"Participating Insurance Companies"); and
WHEREAS, the beneficial interest in the Trust is divided into several
series of shares, each designated a "Portfolio" and representing the
interest in a particular managed portfolio of securities and other assets;
and
WHEREAS, the Trust intends to file an application to obtain 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, 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 life insurance companies that may or may not be affiliated
with one another (the "Shared Funding Exemptive Order"); and
WHEREAS, the Trust is registered as an open-end management investment
company under the 1940 Act and shares of the Portfolio(s) are registered
under the Securities Act of 1933, as amended (the "1933 Act"); and
WHEREAS, the Adviser is duly registered as an investment adviser
under the Investment Advisers Act of 1940, as amended, and any applicable
state securities laws; and
WHEREAS, ALIAC has registered or will register certain variable
annuity and variable life insurance contracts supported wholly or
partially by the Account (the "Contracts") under the 1933 Act and said
Contracts are listed in Schedule A hereto, as it may be amended from time
to time by mutual written agreement; and
WHEREAS, each Account is or will be a duly organized, validly
existing segregated asset account, established by resolution of the Board
of Directors of ALIAC, to set aside and invest assets attributable to
variable annuity contracts, including the Contracts; and
WHEREAS, ALIAC has registered or will register the Account as a unit
investment trust under the 1940 Act; and
WHEREAS, to the extent permitted by applicable insurance laws and
regulations, ALIAC intends to purchase shares in the Portfolio(s) listed
in Schedule B hereto, as it may be amended from time to time by mutual
written agreement (the "Designated Portfolio(s)"), on behalf of the
Accounts to fund the aforesaid Contracts, and the Adviser, or an
affiliate, is authorized to sell such shares to unit investment trusts
such as the Account at net asset value; and
NOW, THEREFORE, in consideration of their mutual promises, ALIAC, the
Trust and the Adviser agree as follows:
ARTICLE I. SALE OF TRUST SHARES
1.1. The Adviser, or an affiliate, agrees to sell to ALIAC those
shares of the Designated Portfolio(s) which the Account orders, executing
such orders on a daily basis at the net asset value next computed after
receipt by the Transfer Agent for the Trust or its designee of the order
for the shares of the Portfolios. For purposes of this Section 1.1, ALIAC
shall be the designee of the Transfer Agent of the Trust for receipt of
such orders and receipt by such designee shall constitute receipt by the
Transfer Agent of the Trust, provided that the Transfer Agent of the Trust
receives notice of any such order prior to 9:00 a.m. Eastern Time on the
next following Business Day. "Business Day" shall 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.
1.2. The Trust agrees to make shares of the Designated
Portfolio(s) available for purchase at the applicable net asset value per
share by ALIAC and the Account on those days on which the Trust calculates
its Designated Portfolio(s)' net asset value pursuant to rules of the SEC,
and the Trust shall calculate such net asset value on each day which the
New York Stock Exchange is open for trading. Notwithstanding the
foregoing, the Board of Trustees of the Trust (the "Board") may refuse to
sell shares of any Portfolio to any person, or suspend or terminate the
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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 Board acting in good faith and in light of their
fiduciary duties under federal and any applicable state laws, necessary in
the best interests of the shareholders of such Portfolio.
1.3. The Trust and the Adviser will not sell shares of the
Designated Portfolio(s) to any other insurance company or separate account
and ALIAC will not purchase shares of any investment company under the
Contracts (other than one advised by ALIAC or an affiliate) unless an
agreement containing provisions substantially the same as Sections 2.1,
3.6, 3.7, 3.8, and Article VII of this Agreement is in effect to govern
such sales.
1.4. The Trust agrees to redeem for cash, at ALIAC's request, any
full or fractional shares of the Trust held by ALIAC, executing such
requests on a daily basis at the net asset value next computed after
receipt by the Transfer Agent for the Trust or its designee of the request
for redemption. Requests for redemption identified by ALIAC, or its
agent, as being in connection with surrenders, annuitizations, or death
benefits under the Contracts may be executed within five (5) calendar days
after receipt by the Transfer Agent for the Trust or its designee of the
requests for redemption subject to the right to suspend redemptions
pursuant to the 1940 Act. This Section 1.4 may be amended, in writing, by
the parties consistent with the requirements of the 1940 Act and
interpretations thereof. For purposes of this Section 1.4, ALIAC shall be
the designee of the Transfer Agent for the Trust for receipt of requests
for redemption and receipt by such designee shall constitute receipt by
the Trust, provided that the Trust receives notice of any such request for
redemption by 9:00 a.m. Eastern Time on the next following Business Day.
1.5. 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 1.3 and Article VI hereof).
1.6. ALIAC shall pay for Trust shares by 10:00 a.m. Eastern Time
on the next Business Day after an order to purchase Trust shares is made
in accordance with the provisions of Section 1.1 hereof. Payment shall be
in federal funds transmitted by wire and/or by a credit for any shares
redeemed the same day as the purchase.
1.7. The Trust shall pay and transmit the proceeds of redemptions
of Trust shares by 10:00 a.m. Eastern Time on the next Business Day after
a redemption order is received in accordance with Section 1.4 hereof
subject to the right to suspend redemptions pursuant to the 1940 Act.
Payment shall be in federal funds transmitted by wire and/or a credit for
any shares purchased the same day as the redemption.
1.8. Issuance and transfer of the Trust's shares will be by book
entry only. Stock certificates will not be issued to ALIAC or to the
Account. Shares ordered from the Trust will be recorded in an appropriate
title for the Account or in the appropriate sub-account of the Account.
1.9. The Trust or its designee shall furnish same day notice (by
wire or telephone, followed by written confirmation) to ALIAC of any
income, dividends or
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capital gain distributions payable on the Designated Portfolio(s)' shares.
ALIAC hereby elects to receive all such income dividends and capital gain
distributions as are payable on the Portfolio shares in additional shares
of that Portfolio. The Trust shall notify ALIAC by the end of the
following Business Day of the number of shares so issued as payment of
such dividends and distributions.
1.10. The Trust or its designee shall make the net asset value per
share for each Designated Portfolio available to ALIAC on a daily basis as
soon as is reasonably practical after the net asset value per share is
calculated and shall use its best efforts to make such net asset value per
share available by 6:00 p.m. Eastern Time. If the Trust or its designee
provides ALIAC with incorrect per share net asset value information or
incorrect information regarding dividend or capital gains distributions,
for any Designated Portfolio through no fault of ALIAC, ALIAC, on behalf
of the Accounts, shall be entitled to an adjustment to the number of
shares purchased or redeemed to reflect (as of the date the incorrect net
asset value per share or dividend or capital gains distribution
information was provided) the correct net asset value per share or
dividend or capital gains distribution only, if and to the extent
necessary, ALIAC is required to make adjustments to the number of units
credited and/or unit values for the Contracts for the periods affected.
In addition, to the extent that such adjustment in the number of shares to
reflect the correct net asset value per share or dividend or capital gains
distribution is not sufficient to compensate ALIAC for reasonable and
necessary expenses and/or losses it has incurred in making required
adjustments to owners of Contracts as a result of incorrect per share net
asset value or dividend or capital gains distribution information, the
Trust or its designee shall assume and/or compensate ALIAC for any such
reasonable and necessary expenses and/or losses, provided that such
incorrect per share net asset value or dividend or capital gains
distribution information did not arise out of or result from ALIAC's
misfeasance, bad faith, negligence, or disregard of its duties under this
Agreement. In such circumstances, the Trust will request that ALIAC
provide adequate supporting data. Any error in the calculation or
reporting of net asset value per share, dividend or capital gains
information greater than or equal to $.01 per share shall be reported
immediately upon discovery to ALIAC. Any error of a lesser amount shall
be corrected as soon as practicable.
1.11. The Trust and the Adviser shall use their reasonable best
efforts to enable each Designated Portfolio(s) to remain in compliance
with the insurance and other applicable laws of the State of Connecticut
and any other applicable state to the extent required to perform this
Agreement. The Trust shall register and qualify the shares for sale in
accordance with the laws of the various states if and to the extent
required by applicable law.
ARTICLE II. REPRESENTATIONS AND WARRANTIES
2.1. ALIAC represents and warrants that each Account is or will be
registered as a unit investment trust under the 1940 Act and the Contracts
are or will be registered under the 1933 Act; that the Contracts will be
issued and sold in compliance in all material respects with all applicable
federal and state laws and that the sale of the Contracts shall comply in
all material respects with state insurance
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suitability requirements. ALIAC further represents and warrants that it
is an insurance company duly organized and in good standing under
applicable law and that it has or will have legally and validly
established each Account prior to any issuance or sale thereof as a
segregated asset account under applicable state insurance law and has
registered or will register 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.
2.2. The Trust represents and warrants that Designated Portfolio
shares sold pursuant to this Agreement are registered under the 1933 Act,
duly authorized for issuance and sold in compliance with all applicable
federal securities laws including without limitation the 1933 Act, the
Securities Exchange Act of 1934 ("1934 Act"), and the 1940 Act and that
the Trust is and shall remain registered under the 1940 Act. The Trust
shall 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.
2.3. The Trust reserves the right to adopt a plan pursuant to Rule
12b-1 under the 1940 Act and to impose an asset-based or other charge to
finance distribution expenses as permitted by applicable law and
regulation. In any event, the Trust and Adviser agree to comply with
applicable provisions and SEC staff interpretations of the 1940 Act to
assure that the investment advisory or management fees paid to the Adviser
by the Trust are legitimate and not excessive. To the extent that the
Trust decides to finance distribution expenses pursuant to Rule 12b-1, the
Trust undertakes to have a Board, a majority of whom are not interested
persons of the Trust, formulate and approve any plan pursuant to
Rule 12b-1 under the 1940 Act to finance distribution expenses.
2.4. The Trust represents and warrants that it is lawfully
organized and validly existing under the laws of the State of Delaware and
that it does and will comply in all material respects with the 1940 Act.
2.5. The Adviser represents and warrants that it is and shall
remain duly registered under all applicable federal and state securities
laws and that it shall perform its obligations for the Trust in compliance
in all material respects with the laws of the State of California and any
applicable state and federal securities laws.
2.6. The Trust and the Adviser represent and warrant that all of
their officers, employees, investment advisers, and other individuals or
entities dealing with the money and/or securities of the Trust are, and
shall 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 required by Section 17g-(1) of the 1940 Act or
related provisions as may be promulgated from time to time. The aforesaid
bond shall include coverage for larceny and embezzlement and shall be
issued by a reputable bonding company.
2.7. The Trust will provide ALIAC with as much advance notice as
is reasonably practicable of any material change affecting the Designated
Portfolio(s) (including, but not limited to, any material change in its
registration statement or
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prospectus affecting the Designated Portfolio(s) and any proxy
solicitation affecting the Designated Portfolio(s)) and consult with ALIAC
in order to implement any such change in an orderly manner, recognizing
the expenses of changes and attempting to minimize such expenses by
implementing them in conjunction with regular annual updates of the
prospectus for the Contracts.
2.8. ALIAC represents, assuming that the Trust complies with
Article VI of this Agreement, that the Contracts are currently treated as
annuity contracts or life insurance contracts, as applicable, under
applicable provisions of the Internal Revenue Code of 1986, as amended
(the "Code"), and that it will make every effort to maintain such
treatment and that it will notify the Adviser and the Trust immediately
upon having a reasonable basis for believing that the Contracts have
ceased to be so treated or that they might not be so treated in the
future.
2.9. ALIAC represents and warrants that it will not purchase Trust
shares with assets derived from tax-qualified retirement plans except
indirectly, through Contracts purchased in connection with such plans.
ARTICLE III. PROSPECTUSES AND PROXY STATEMENTS; VOTING
3.1(a). At least annually, the Trust shall provide ALIAC, at ALIAC's
expense with camera ready copy of the Trust's prospectus for the
Designated Portfolios or as many copies of the Trust's current prospectus
for the Designated Portfolio(s) as ALIAC may reasonably request for
marketing purposes (including distribution to Contract owners with respect
to new sales of a Contract). If requested by ALIAC in lieu thereof, the
Adviser or Trust shall provide such documentation (including a final copy
of the new prospectus for the Designated Portfolio(s)) and other
assistance as is reasonably necessary in order for ALIAC once each year
(or more frequently if the prospectus for the Designated Portfolio(s) are
amended) to have the prospectus for the Contracts and the Trust's
prospectus for the Designated Portfolio(s) printed together in one
document.
3.2. If applicable state or federal laws or regulations require
that the Statement of Additional Information ("SAI") for the Trust be
distributed to all Contract purchasers, then the Trust shall provide
ALIAC, at ALIAC's expense, with the Trust's SAI or camera ready
documentation thereof for the Designated Portfolio(s) in such quantities
as ALIAC may reasonably request for marketing purposes (including
distribution to Contract owners with respect to new sales of a Contract).
3.3. The Trust shall also provide such SAI to ALIAC or any owner
of a Contract or prospective owner who requests such SAI (although it is
anticipated that such requests will be made to ALIAC).
3.4. The Trust shall provide ALIAC, at ALIAC's expense, with
copies of its prospectus, SAI, and other communications to stockholders
for the Designated Portfolio(s) in such quantity as ALIAC shall reasonably
require for mailing or distribution to Contract owners. In addition,
Adviser shall assume all printing expenses in connection with printing a
sufficient number of copies for all Contract
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owners with respect to all proxy solicitations materials, voting
instruction materials and semi-annual and annual reports that are required
to be provided to Contract owners. In the event that ALIAC, at the
request of the Adviser, prints such materials and reports upon the receipt
of camera ready copy or other mutually acceptable electronic format from
the Adviser, the Adviser will reimburse ALIAC for all reasonable printing
expenses. ALIAC shall assume all postage and mailing expenses incurred in
connection with providing such materials and reports to Contract owners,
provided that, if the Adviser is printing such materials, ALIAC receives
such materials in a timely manner from the Adviser.
3.5. It is understood and agreed that, except with respect to
information regarding ALIAC provided in writing by that party, ALIAC is
not responsible for the content of the prospectus or SAI for the
Designated Portfolio(s). It is also understood and agreed that, except
with respect to information regarding the Trust, Adviser or the Designated
Portfolio(s) provided in writing by the Trust or the Adviser (including,
in particular, expense information about the Designated Portfolios that is
intended to be included in the fee table portion of the Prospectus for the
Contracts), neither the Trust nor the Adviser are responsible for the
content of the prospectus or SAI for the Contracts.
3.6. If and to the extent required by law, ALIAC shall:
(i) solicit voting instructions from Contract owners;
(ii) vote the Designated Portfolio shares in accordance
with instructions received from Contract owners: and
(iii) vote Designated Portfolio shares for which no
instructions have been received in the same proportion
as Designated Portfolio shares for which instructions
have been received from Contract owners, so long as
and to the extent that the SEC continues to interpret
the 1940 Act to require pass-through voting privileges
for variable contract owners. ALIAC reserves the
right to vote Trust shares held in any segregated
asset account in its own right, to the extent
permitted by it by law. The Adviser reserves the
right to vote Trust shares acquired in order to
provide "seed money" for the Portfolios, to the extent
permitted by law.
3.7. ALIAC shall be responsible for assuring that each of its
separate accounts holding shares of a Designated Portfolio calculates
voting privileges in the manner required by any Shared Funding Exemptive
Order that may be obtained in the future by the Trust. The Trust agrees
to promptly notify ALIAC of any changes of interpretations or amendments
to any Shared Funding Exemptive Order obtained by the Trust.
3.8. The Trust will comply with all provisions of the 1940 Act
requiring voting by shareholders, and in particular the Trust will either
provide for annual meetings (except insofar as the SEC may interpret
Section 16 of the 1940 Act not to
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require such meetings) or, as the Trust currently intends, 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 Commission may promulgate with respect thereto.
ARTICLE IV. SALES MATERIAL AND INFORMATION
4.1. ALIAC shall furnish, or shall cause to be furnished, to
Xxxxxxxx-Xxxxxxxxx Securities, an affiliated broker-dealer of the Adviser,
as distributor of the Trust, for its written approval, at least ten (10)
Business Days prior to its use, a copy of each piece of sales literature
or other promotional material that ALIAC develops or proposes to use.
Such promotional, sales, advertising and training material shall be
prepared and reviewed in light of all applicable laws, rules and
regulations. All such material shall be approved in writing by Xxxxxxxx-
Xxxxxxxxx Securities. Xxxxxxxx-Xxxxxxxxx Securities, as distributor of
the Trust, agrees to respond to requests for such approval on a prompt and
timely basis, not exceeding ten (10) Business Days for the initial review
of such materials, and five (5) Business Days for any subsequent review of
such materials.
4.2. ALIAC shall not give any information or make any
representations or statements on behalf of the Trust or the Adviser or
concerning the Trust or the Adviser in connection with the sale of the
Contracts other than the information or representations contained in the
registration statement or prospectus for the Trust shares, as such
registration statement and prospectus may be amended or supplemented from
time to time, or in reports or proxy statements for the Trust, or in sales
literature or other promotional material approved by the Trust or its
designee or by the Adviser, except with the written permission of the
Trust or Xxxxxxxx-Xxxxxxxxx Securities.
4.3. Xxxxxxxx-Xxxxxxxxx Securities, as distributor of the Trust,
shall furnish, or shall cause to be furnished, to ALIAC, at least ten (10)
Business Days prior to its use, a copy of each piece of sales literature
or other promotional material that Adviser or Xxxxxxxx-Xxxxxxxxx
Securities develops or proposes to use in connection with the sale of the
Contracts. Such promotional, sales, advertising and training material
shall be prepared and reviewed in light of all applicable laws, rules and
regulations. All such material shall be approved in writing by ALIAC, and
ALIAC agrees to respond to requests for such approval on a prompt and
timely basis, not exceeding ten (10) Business Days for the initial review
of such materials, and five (5) Business Days for any subsequent review of
such materials.
4.4. The Trust, the Adviser and Xxxxxxxx-Xxxxxxxxx Securities
shall not give any information or make any representations on behalf of
ALIAC or concerning ALIAC, the Account, or the Contracts other than the
information or representations contained in a registration statement or
prospectus for the Contracts, as such registration statement and
prospectus may be amended or supplemented from time to
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time, or in reports for the Account, or in sales literature or other
promotional material approved by ALIAC or its designee, except with the
written permission of ALIAC.
4.5. The Trust will provide to ALIAC at least one complete copy of
all registration statements, prospectuses, SAIs, 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 Designated Portfolio(s),
contemporaneously with the filing of such document(s) with the SEC or the
National Association of Securities Dealers, Inc. ("NASD") or other
regulatory authorities.
4.6. ALIAC will provide to the Trust at least one complete copy of
all registration statements, prospectuses, SAIs, 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 the
Account (as it relates to the Contracts), contemporaneously with the
filing of such document(s) with the SEC, the NASD, or other regulatory
authorities.
4.7. For purposes of this Article IV, the phrase "sales literature
and 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, including electronic media), sales literature
(I.E., any written communication distributed or made generally available
to customers or the public, including brochures, circulars, research
reports, market letters, form letters, seminar texts, reprints or excerpts
of any other advertisement, sales literature, or published article),
educational or training materials or other communications distributed or
made generally available to some or all agents or employees and
shareholder reports. However, it is anticipated that materials provided
solely (a) internally to ALIAC's or the Adviser's own employees or counsel
or (b) to certain designated third parties and that are not designed to be
provided or communicated in any manner to the general public (e.g.
training materials provided to distributors or agents) will not be filed
with the NASD or any state securities or insurance regulatory authorities,
although such materials will be prepared in accordance with applicable
laws.
4.8. At the request of any party to this Agreement, each other
party will make available to the requesting party's independent auditors
and/or representatives of the appropriate regulatory agencies, all
records, data and access to operating procedures that may be reasonably
requested in connection with compliance and regulatory requirements
related to this Agreement or any party's obligations under this Agreement.
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ARTICLE V. FEES AND EXPENSES
5.1. The Trust and the Adviser shall pay no fee or other
compensation to ALIAC under this Agreement, and ALIAC shall pay no fee or
other compensation to the Trust or the Adviser under this Agreement.
5.2. All expenses incident to performance by the Trust or the
Adviser under this Agreement shall be paid by them. The Trust shall see
to it that all shares of the Designated Portfolio(s) are duly registered
and authorized for issuance in accordance with applicable federal law and,
if and to the extent required, in accordance with applicable state laws
prior to their sale.
5.3. All expenses incident to performance by ALIAC under this
Agreement shall be paid by ALIAC. In this regard, ALIAC shall bear the
expenses of routine annual distribution of the Trust's prospectus and
distributing the Trust's proxy materials and reports to owners of
Contracts offered by ALIAC.
ARTICLE VI. DIVERSIFICATION AND QUALIFICATION
6.1. The Trust shall use their best efforts to sell its shares and
invest its assets in such a manner as to ensure that the Contracts will be
treated as annuity contracts under the Code, and the regulations issued
thereunder. The Trust and the Adviser agree that shares of the Designated
Portfolio(s) will be sold only to Participating Insurance Companies and
their separate accounts, unless and until the parties otherwise agree in
writing.
6.2. No shares of the Trust will be sold to the general public.
However, shares of the Trust may be sold to ALIAC or the Adviser to
provide initial seed money to the Portfolios, provided the holding of such
shares by ALIAC or the Adviser is in compliance with Section 817(h) of the
Code and the regulations thereunder.
6.3. The Trust and Adviser represent and warrant that the Trust
and each Designated Portfolio intends to qualify as a Regulated Investment
Company under Subchapter M of the Code, and that the Trust and the Adviser
will expend their best efforts to maintain such qualification (under
Subchapter M or any successor or similar provisions) as long as this
Agreement is in effect.
6.4. The Trust or Adviser will notify ALIAC immediately upon
having a reasonable basis for believing that the Trust or any Portfolio
has ceased to comply with the aforesaid Section 817(h) diversification or
Subchapter M qualification requirements or might not so comply in the
future.
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ARTICLE VII. POTENTIAL CONFLICTS AND COMPLIANCE WITH ANY
SHARED FUNDING EXEMPTIVE ORDER OBTAINED
7.1. The 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 Designated Portfolio are being managed; (e) a
difference in voting instructions given by variable annuity contract and
variable life insurance contract owners; or (f) a decision by a
Participating Insurance Company to disregard the voting instructions of
contract owners. The Trust shall promptly inform ALIAC if the Board
determines that an irreconcilable material conflict exists and the
implications thereof.
7.2. ALIAC and the Adviser will report any potential or existing
conflicts of which it is aware to the Board. ALIAC and the Adviser will
assist the Board in carrying out its responsibilities under any Shared
Funding Exemptive Order obtained by the Trust, 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 ALIAC to
inform the Board whenever contract owner voting instructions are to be
disregarded. Such responsibilities shall be carried out by ALIAC with a
view only to the interests of its Contract owners.
7.3. If it is determined by a majority of the Board, or a majority
of its trustees who are not interested persons of the Trust, the Adviser
or any sub-adviser to any of the Designated Portfolios (the "Independent
Trustees"), that a material irreconcilable conflict exists, ALIAC and
other Participating Insurance Companies shall, at their expense and to the
extent reasonably practicable (as determined by a majority of the
Independent Trustees), take whatever steps are necessary to remedy or
eliminate the irreconcilable material conflict, up to and including: (a)
withdrawing the assets allocable to some or all of the separate accounts
from the Trust or any Designated Portfolio and reinvesting such assets in
a different investment medium, including (but not limited to) another
Designated 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 of such segregation, or offering to the affected
Contract owners the option of making such a change; and (b) establishing a
new registered management investment company or managed separate account.
7.4. If a material irreconcilable conflict arises because of a
decision by ALIAC to disregard Contract owner voting instructions and that
decision represents a minority position or would preclude a majority vote,
ALIAC may be required, at the Trust's election, to withdraw the Account's
investment in the Trust and terminate this
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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 Independent Trustees. 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 (6) month period, the Adviser
and the Trust shall continue to accept and implement orders by ALIAC 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 ALIAC
conflicts with the majority of other state regulators, then ALIAC will
withdraw the Account's investment in the Trust and terminate this
Agreement within six (6) months after the Board informs ALIAC 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 Independent
Trustees. Until the end of the foregoing six (6) month period, the
Adviser and the Trust shall continue to accept and implement orders by
ALIAC for the purchase (and redemption) of shares of the Trust.
7.6. For purposes of Sections 7.3 through 7.6 of this Agreement, a
majority of the Independent Trustees 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. ALIAC shall not be required by Section 7.3 to establish a new
funding medium for the Contracts 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 Board determines
that any proposed action does not adequately remedy any irreconcilable
material conflict, then ALIAC will withdraw the Account's investment in
the Trust and terminate this Agreement within six (6) months after the
Board informs ALIAC 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 Independent Trustees.
7.7. If and to the extent that Rule 6e-2 and Rule 6e-3(T) under
the 1940 Act 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 on terms and conditions
materially different from those contained in the 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) under the 1940 Act, as amended, and Rule 6e-3, as
adopted, to the extent such rules are applicable: and (b) Sections 3.6,
3.7, 3.8, 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.
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ARTICLE VIII. INDEMNIFICATION
8.1. INDEMNIFICATION BY ALIAC
8.1(a). ALIAC agrees to indemnify and hold harmless each of
the Trust, the Adviser, and any sub-advisers and their officers and
partners and each member of their Board(s) and each person, if any, who
controls any such person within the meaning of the Section 15 of the 1933
Act (each an "Indemnified Party" and 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 ALIAC) or litigation (including
legal and other expenses) to which such Indemnified Party may become
subject under any statute or regulation, at common law or otherwise,
insofar as such losses, claims, damages, liabilities or expenses (or
actions in respect thereof) or settlements are related to the sale or
acquisition of the Trust's shares or the Contracts and:
(i) 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 SAI for the
Contracts or contained in the Contracts or sales literature
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 therein or necessary to make the
statements therein not misleading, PROVIDED that this
agreement to indemnify shall not apply as to any Indemnified
Party if such statement or omission or such alleged statement
or omission was made in reliance upon and in conformity with
information furnished in writing to ALIAC by or on behalf of
the Trust or the Adviser for use in the registration
statement or prospectus 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
(ii) arise out of or as a result of statements or representations
(other than statements or representations contained in the
registration statement, prospectus or sales literature of the
Trust not supplied by ALIAC or persons under its control) or
wrongful conduct of ALIAC or persons under its control, with
respect to the sale or distribution of the Contracts or Trust
Shares; or
(iii) arise out of any untrue statement or alleged untrue statement
of a material fact contained in a registration statement,
prospectus, or sales literature of the Trust or any amendment
thereof or supplement thereto or the omission or alleged
omission to state therein a material fact required to be
stated therein or necessary to make the statements therein
not misleading if such a statement or omission was made in
reliance upon information furnished in writing to the Trust
by or on behalf of ALIAC; or
-13-
(iv) arise as a result of any failure by ALIAC to provide the
services and furnish the materials under the terms of this
Agreement; or
(v) arise out of or result from any material breach of any
representation and/or warranty made by ALIAC in this
Agreement or arise out of or result from any other material
breach of this Agreement by ALIAC;
as limited by and in accordance with the provisions of Sections 8.1(b) and
8.1(c) hereof.
8.1(b). ALIAC shall not be liable under this
indemnification provision with respect to any losses, claims, expenses,
damages, liabilities or litigation to which an Indemnified Party would
otherwise be subject by reason of such Indemnified Party's willful
misfeasance, bad faith, or gross negligence in the performance of such
Indemnified Party's duties or by reason of such Indemnified Party's
reckless disregard of obligations or duties under this Agreement or to the
Trust, whichever is applicable.
8.1(c). ALIAC shall not be liable under this
indemnification provision with respect to any claim made against an
Indemnified Party unless such Indemnified Party shall have notified ALIAC
in writing within a reasonable time after the summons or other first legal
process giving information of the nature of the claim shall have been
served upon such Indemnified Party (or after such Indemnified Party shall
have received notice of such service on any designated agent), but failure
to notify ALIAC of any such claim shall not relieve ALIAC from any
liability which it may have to the Indemnified Party against whom such
action is brought otherwise than on account of this indemnification
provision, except to the extent that ALIAC has been prejudiced by such
failure to give notice. In case any such action is brought against an
Indemnified Party, ALIAC shall be entitled to participate, at its own
expense, in the defense of such action. ALIAC also shall be entitled to
assume the defense thereof, with counsel satisfactory to the party named
in the action. After notice from ALIAC to such party of ALIAC's election
to assume the defense thereof, the Indemnified Party shall bear the fees
and expenses of any additional counsel retained by it, and ALIAC 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.
8.1(d). The Indemnified Parties will promptly notify ALIAC
of the commencement of any litigation or proceedings 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
8.2(a). The Adviser agrees to indemnify and hold harmless
ALIAC and its directors and officers and each person, if any, who controls
ALIAC within the meaning of Section 15 of the 1933 Act (each an
"Indemnified Party" and 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 legal and
other expenses) to which the Indemnified Parties may become subject under
any statute or regulation, at
-14-
common law or otherwise, insofar as such losses, claims, expenses,
damages, liabilities (or actions in respect thereof) or litigation are
related to the sale or acquisition of the Trust's shares or the Contracts
and:
(i) 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 SAI or sales
literature of the Trust (or any amendment or supplement to
any of the foregoing), or arise out of or are based upon the
omission or the alleged omission to state therein a material
fact required to be stated therein or necessary to make the
statements therein not misleading, PROVIDED that this
agreement to indemnify shall not apply as to any Indemnified
Party if such statement or omission or such alleged statement
or omission was made in reliance upon and in conformity with
information furnished in writing to the Trust or the Adviser
by or on behalf of ALIAC for use in the Registration
Statement or prospectus for the Trust or in sales literature
(or any amendment or supplement) or otherwise for use in
connection with the sale of the Contracts or Trust shares; or
(ii) arise out of or as a result of statements or representations
(other than statements or representations contained in the
registration statement, prospectus or sales literature for
the Contracts not supplied by the Adviser or persons under
its control) or wrongful conduct of the Trust or Adviser or
persons under their control, with respect to the sale or
distribution of the Contracts or Trust shares; or
(iii) arise out of any untrue statement or alleged untrue statement
of a material fact contained in a registration statement,
prospectus or sales literature covering the Contracts, or any
amendment thereof or supplement thereto, or the omission or
alleged omission to state therein a material fact required to
be stated therein or necessary to make the statement or
statements therein not misleading, if such statement or
omission was made in reliance upon information furnished in
writing to ALIAC by or on behalf of the Trust or the Adviser;
or
(iv) arise as a result of any failure by the Trust or the Adviser
to provide the services and furnish the materials required to
be provided or furnished by the Trust or the Adviser under
the terms of this Agreement (including a failure to comply
with the diversification and other qualification requirements
specified in Article VI of this Agreement); or
(v) arise out of or result from any material breach of any
representation and/or warranty made by the Trust or Adviser
in this Agreement or arise out of or result from any other
material breach of this Agreement by the Adviser;
as limited by and in accordance with the provisions of Sections 8.2(b) and
8.2(c) hereof.
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8.2(b). The Adviser shall not be liable under this
indemnification provision with respect to any losses, claims, expenses,
damages, liabilities or litigation to which an Indemnified Party would
otherwise be subject by reason of such Indemnified Party's willful
misfeasance, bad faith, or gross negligence in the performance of such
Indemnified Party's duties or by reason of such Indemnified Party's
reckless disregard of obligations and duties under this Agreement or to
ALIAC or the Account, whichever is applicable.
8.2(c). The Adviser shall not be liable under this
indemnification provision with respect to any claim made against an
Indemnified Party unless such Indemnified Party shall have notified the
Adviser in writing within a reasonable time after the summons or other
first legal process giving information of the nature of the claim shall
have been served upon such Indemnified Party (or after such Indemnified
Party shall have received notice of such service on any designated agent),
but failure to notify the Adviser of any such claim shall not relieve the
Adviser from any liability which it may have to the Indemnified Party
against whom such action is brought otherwise than on account of this
indemnification provision, except to the extent that the Adviser has been
prejudiced by such failure to give notice. In case any such action is
brought against an Indemnified Party, the Adviser will be entitled to
participate, at its own expense, in the defense of such action. The
Adviser also shall be entitled to assume the defense thereof, with counsel
reasonably satisfactory to the party named in the action. After notice
from the Adviser to such party of the Adviser's election to assume the
defense thereof, the Indemnified Party shall bear the fees and expenses of
any additional counsel retained by it, and the Adviser will not be liable
to such party under this Agreement for any legal or other expenses
subsequently incurred by such party independently in connection with the
defense thereof other than reasonable costs of investigation.
8.2(d). ALIAC agrees promptly to notify the Adviser of the
commencement of any litigation or proceedings against it or any of its
officers or directors in connection with the issuance or sale of the
Contracts or the operation of the Account.
8.3. INDEMNIFICATION BY THE TRUST
8.3(a). The Trust agrees to indemnify and hold harmless
ALIAC and its directors and officers and each person, if any, who controls
ALIAC within the meaning of Section 15 of the 1933 Act (each individually
an "Indemnified Party" and 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
the written consent of the Trust) or litigation (including legal and other
expenses) to which the Indemnified Parties may become subject under any
statute or regulation, at common law or otherwise, insofar as such losses,
claims, expenses, damages, liabilities or expenses (or actions in respect
thereof) or settlement, are related to the operations of the Trust and:
(i) 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, whether unintentional
-16-
or in good faith or otherwise, to comply with the
diversification and other qualification requirements
specified in Article VI of this Agreement); or
(ii) arise out of or result from any material breach of any
representation and/or warranty made by the Trust in this
Agreement or arise out of or result from any other material
breach of this Agreement by the Trust; or
as limited by and in accordance with the provisions of Sections 8.3(b) and
8.3(c) hereof.
8.3(b). The Trust shall not be liable under this
indemnification provision with respect to any losses, claims, expenses,
damages, liabilities or litigation to which an Indemnified Party would
otherwise be subject by reason of such Indemnified Party's willful
misfeasance, bad faith, or gross negligence in the performance of such
Indemnified Party's duties or by reason of such Indemnified Party's
reckless disregard of obligations and duties under this Agreement or to
ALIAC, the Trust, the Adviser or the Account, whichever is applicable.
8.3(c). The Trust shall not be liable under this
indemnification provision with respect to any claim made against an
Indemnified Party unless such Indemnified Party shall have notified the
Trust in writing within a reasonable time after the summons or other first
legal process giving information of the nature of the claim shall have
been served upon such Indemnified Party (or after such Indemnified Party
shall have received notice of such service on any designated agent), but
failure to notify the Trust of any such claim shall not relieve the Trust
from any liability which it may have to the Indemnified Party against whom
such action is brought otherwise than on account of this indemnification
provision, except to the extent that the Trust has been prejudiced by such
failure to give notice. In case any such action is brought against an
Indemnified Party, the Trust will be entitled to participate in the
defense or to defend against such action and 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.
8.3(d). ALIAC agrees promptly to notify the Trust of the
commencement of any litigation or proceeding against it or any of its
officers or directors in connection with the Agreement, the issuance or
sale of the Contracts, the operation of the Account, or the sale or
acquisition of shares of the Trust.
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
California, except the California conflict of laws provisions.
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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 laws, rules and
regulations as the SEC may grant (including, but not limited to, any
Shared Funding Exemptive Order obtained by the Trust) and the terms hereof
shall be interpreted and construed in accordance therewith.
ARTICLE X. TERMINATION
10.1. This Agreement shall terminate:
(a) at the option of any party, with or without cause, with
respect to some or all Designated Portfolios, upon six (6)
months advance written notice delivered to the other parties;
provided, however, that such notice shall not be given
earlier than July 31, 1998; or
(b) at the option of ALIAC, by thirty (30) days written
notice to the other parties with respect to any Designated
Portfolio based upon ALIAC's determination that shares of
such Portfolio are not reasonably available to meet the
requirements of the Contracts; or
(c) at the option of ALIAC, by thirty (30) days written
notice to 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 ALIAC; or
(d) at the option of the Trust, upon thirty (30) days
written notice, in the event that formal administrative
proceedings are instituted against ALIAC or the principal
underwriter of the Contracts by the NASD, the SEC, the
Insurance Commissioner or like official of any state or any
other regulatory body regarding ALIAC's duties under this
Agreement or related to the sale of the Contracts, the
operation of any Account, or the purchase of the Trust
shares, provided, however, that the Trust determines, in its
sole judgment exercised in good faith, that any such
administrative proceeding will have a material adverse effect
upon the ability of ALIAC to perform its obligations under
this Agreement; or
(e) at the option of ALIAC, upon thirty (30) days written
notice, in the event that formal administrative proceedings
are instituted against the Trust or Adviser by the SEC, the
NASD, or any state securities or insurance department or any
other regulatory body, provided, however, that ALIAC
determines, in its sole judgment exercised in good faith,
that any such administrative proceeding will have a material
adverse effect upon the ability of the Trust or Adviser to
perform its obligations under this Agreement; or
-18-
(f) at the option of ALIAC, by written notice to the Trust
and the Adviser with respect to any Designated Portfolio if
ALIAC reasonably believes that the Portfolio will fail to
meet the Section 817(h) diversification requirements or
Subchapter M qualifications specified in Article VI hereof;
or
(g) at the option of either the Trust or the Adviser, if (i)
the Trust or the Adviser, respectively, shall determine, in
its sole judgement reasonably exercised in good faith, that
ALIAC has suffered a material adverse change in its business
or financial condition or is the subject of material adverse
publicity and that material adverse change or publicity will
have a material adverse impact on ALIAC's ability to perform
its obligations under this Agreement, (ii) the Trust or the
Adviser notifies ALIAC of that determination and its intent
to terminate this Agreement, AND (iii) after considering the
actions taken by ALIAC and any other changes in circumstances
since the giving of such a notice, the determination of the
Trust or Adviser shall continue to apply, in its sole
judgment exercised in good faith, on the sixtieth (60th) day
following the giving of that notice, which sixtieth day shall
be the effective date of termination; or
(h) at the option of ALIAC, if (i) ALIAC shall determine, in
its sole judgement reasonably exercised in good faith, that
either the Trust or the Adviser has suffered a material
adverse change in its business or financial condition or is
the subject of material adverse publicity and that material
adverse change or publicity will have a material adverse
impact on the Trust's or the Adviser's ability to perform its
obligations under this Agreement, (ii) ALIAC notifies the
Trust or the Adviser, as appropriate, of that determination
and its intent to terminate this Agreement, AND (iii) after
considering the actions taken by the Trust or the Adviser and
any other changes in circumstances since the giving of such a
notice, the determination of ALIAC shall continue to apply,
in its sole judgment exercised in good faith, on the sixtieth
(60th) day following the giving of that notice, which
sixtieth (60th) day shall be the effective date of
termination.
10.2. NOTICE REQUIREMENT. No termination of this Agreement shall
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 shall set forth the basis for the termination.
10.3. EFFECT OF TERMINATION. Notwithstanding any termination of
this Agreement or any other agreement between the parties, the Trust and
the Adviser shall 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 shall be permitted to
reallocate investments in the Trust, redeem investments in the Trust
and/or invest in the Trust upon the making of additional purchase payments
under the
-19-
Existing Contracts. The parties agree that this Section 10.3 shall not
apply to any terminations under Article VII and the effect of such Article
VII terminations shall be governed by Article VII of this Agreement.
10.4 RESTRICTIONS ON REDEMPTION OF SHARES. ALIAC shall not redeem
Trust shares attributable to the Contracts (as opposed to Trust shares
attributable to the ALIAC assets held in the Account) except: (a) as
necessary to implement Contract owner initiated transactions, (b) as
required by with state and/or federal laws or regulations or judicial or
other legal precedent of general application (a "Legally Required
Redemption") or (c) as permitted by an order of the SEC pursuant to
Xxxxxxx 00(x) xx xxx 0000 Xxx (xx and to the extent that the SEC continues
to require the receipt of such an order or any other order of the SEC in
order for ALIAC to redeem Trust shares attributable to the Contracts).
Upon request, ALIAC will promptly furnish to the Trust and the Adviser an
opinion of counsel for ALIAC (which counsel shall be reasonably
satisfactory to the Trust and the Adviser) to the effect that any
redemption pursuant to clause (b) above is a Legally Required Redemption
or any redemption pursuant to clauses (a), (b) or (c) is permitted without
first obtaining an order of the SEC pursuant to Section 26(b) of the 1940
Act. Furthermore, ALIAC may prevent Contract owners from allocating
payments to a Portfolio that was otherwise available under the Contracts
provided that ALIAC first gives the Trust or the Adviser ninety (90) days
notice of its intention to do so.
10.5. SURVIVING PROVISIONS. Notwithstanding any termination of
this Agreement, each party's obligations under Article VIII to indemnify
other parties shall survive and not be affected by any termination of this
Agreement. In addition, with respect to Existing Contracts, all
provisions of this Agreement shall also survive and not be affected by any
termination of this Agreement.
ARTICLE XI. NOTICES
Any notice shall be sufficiently given when sent by registered or
certified mail to the other party at the address of such party set forth
below or at such other address as such party may from time to time specify
in writing to the other party.
If to the Trust:
Xxxxxxxx-Xxxxxxxxx Series Trust
000 Xxxx Xxxxxxxx, 00xx Xxxxx,
Xxx Xxxxx, Xxxxxxxxxx 00000
Attn: Secretary
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If to the Adviser:
Xxxxxxxx-Xxxxxxxxx Capital Management
000 Xxxx Xxxxxxxx, 00xx Xxxxx,
Xxx Xxxxx, Xxxxxxxxxx 00000
Attn: General Counsel
If to AETNA:
AETNA Life Insurance and Annuity Company
000 Xxxxxxxxxx Xxxxxx
Xxxxxxxx, Xxxxxxxxxxx 00000
Attention: Xxxxx Xxxxxxxx, Esq.
with a simultaneous copy to:
Xxxxx X. XxXxxx, Esq.
AETNA Life Insurance and Annuity Company
000 Xxxxxxxxxx Xxxxxx
Xxxxxxxx, Xxxxxxxxxxx 00000
or such other address as such party may hereafter specify in writing or by
facsimile. Each such notice to a party shall be either hand delivered or
transmitted by registered or certified United States mail with return
receipt requested, and shall be effective upon delivery.
ARTICLE XII. MISCELLANEOUS
12.1. Subject to the requirements of legal process and regulatory
authority, each party hereto shall treat as confidential the names and
addresses of the owners of the Contracts and all information reasonably
identified as confidential in writing by any other party hereto and,
except as permitted by this Agreement, shall not disclose, disseminate or
utilize such names and addresses and other confidential information
without the express written consent of the affected party until such time
as such information may come into the public domain. Without limiting the
foregoing, no party hereto shall disclose any information that such party
has been advised is proprietary, except such information that such party
is required to disclose by any appropriate governmental authority
(including without limitation the SEC, the NASD and state securities or
insurance regulators).
12.2. The captions in this Agreement are included for convenience
of reference only and in no way define or delineate any of the provisions
hereof or otherwise affect their construction or effect.
12.3. This Agreement may be executed simultaneously in two or more
counterparts, each of which taken together shall constitute one and the
same instrument.
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12.4. This Agreement constitutes the whole agreement between the
parties hereto with respect to the subject matter hereof, and supersedes
all prior oral or written understandings, agreements or negotiations
between the parties with respect to such subject matter, except as
otherwise agreed to in writing by the parties. No prior writings by or
between the parties with respect to the subject matter hereof shall be
used by either party in connection with the interpretation of any
provision of this Agreement. If any provision of this Agreement shall be
held or made invalid by a court decision, statute, rule or otherwise, the
remainder of the Agreement shall not be affected thereby.
12.5. Each party hereto shall cooperate with each other party and
all appropriate governmental authorities (including without limitation the
SEC, the NASD and state securities or insurance regulators) and shall
permit 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.
12.6. Any controversy or claim arising out of or relating to this
Agreement, or breach thereof, shall be settled by arbitration in a forum
jointly selected by the relevant parties (but if applicable law requires
some other forum, then such other forum) in accordance with the Commercial
Arbitration Rules of the American Arbitration Association, and judgment
upon the award rendered by the arbitrators may be entered in any court
having jurisdiction thereof.
12.7. The rights, remedies and obligations contained in this
Agreement are cumulative and are in addition to any and all rights,
remedies and obligations, at law or in equity, which the parties hereto
are entitled to under state and federal laws.
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12.8. This Agreement or any of the rights and obligations hereunder
may not be assigned by any party without the prior written consent of all
parties hereto.
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.
AETNA LIFE INSURANCE AND ANNUITY COMPANY
By its authorized officer
SEAL By: _____________________________
Title: ____________________________
Date: ____________________________
XXXXXXXX-XXXXXXXXX SERIES TRUST
By its authorized officer
SEAL By: _______________________________
E. Xxxxx Xxxxx, Jr.
Title: Secretary
Date:_______________________________
XXXXXXXX-XXXXXXXXX CAPITAL MANAGEMENT
SEAL By: ______________________________
E. Xxxxx Xxxxx, Jr.
Title:
Date: ____________________________
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SCHEDULE A
CONTRACTS AND
SEPARATE ACCOUNTS FORM NUMBERS
Variable Annuity Account B 1. G-CDA-IC (IR) using the
Xxxxxxxx-Xxxxxxxxx/ ALIAC
Schedule Page.
2. G-CDA-IC (NA) using the
Xxxxxxxx-Xxxxxxxxx/ALIAC
Schedule Page.
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SCHEDULE B
DESIGNATED PORTFOLIOS
Xxxxxxxx-Xxxxxxxxx Series Trust:
1. Core Growth Series
2. Emerging Growth Series
3. International Growth Series
4. Value Series
5. Diversified Income Series
6. International Fixed Income Series
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