SELECT/EXHIBIT 99.(h)(3)
XXXXXX XXXXXXX DISTRIBUTORS INC.
SHAREHOLDER SERVICE AGREEMENT
This SHAREHOLDER SERVICE AGREEMENT ("Agreement") is made and
entered into as of this 23rd day of October, 2003, by and between Xxxxxx
Xxxxxxx Distributors Inc. (the "Distributor"), Hartford Life Insurance
Company ("HLIC") and Hartford Life and Annuity Insurance Company ("HL&AIC")
(together HLIC and HL&AIC are referred to as the "Companies" and
individually, a "Company").
WHEREAS, the Distributor is the principal underwriter of Xxxxxx
Xxxxxxx Select Dimensions Investment Series (the "Fund"), an open-end investment
Companies that serves as an investment vehicle for separate accounts established
by insurance companies; and
WHEREAS, the Fund has entered into a participation agreement with the
Companies, dated May 31, 1997, as amended and restated on __________2003, as may
be amended from time to time (the "Participation Agreement"), providing for the
purchase by the Companies of shares of certain series of the Fund ("Portfolios")
on behalf of its separate account(s) to fund certain variable life and annuity
contracts ("Contracts"), each as specified in the Participation Agreement; and
WHEREAS, the Fund has adopted a Plan of Distribution pursuant to Rule
12b-1 under the Investment Companies Act of 1940, as amended, relating to Class
Y Shares of the Portfolios (the "Plan"), as described in the Portfolios' Class Y
Shares Prospectus and Statement of Additional Information; and
WHEREAS, the Plan authorizes the Distributor to enter into shareholder
service agreements (such as this Agreement) with organizations selected by the
Distributor (such as the Companies) whereby the Distributor may make payments to
the Companies at a specified rate in consideration of shareholder services
rendered.
NOW, THEREFORE, in consideration of their mutual promises, and other
good and valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the Distributor and the Companies agree as follows:
1. The Distributor agrees to pay a fee to the Companies with respect
to Class Y Shares of a Portfolio, in accordance with Section 2 below, for
providing shareholder services in connection with Contract owner accounts (the
"Service Activities") as described in the Plan. The Service Activities may
include, without limitation: (a) education of agents concerning Portfolios of
the Fund, (b) compensation of agents, and (c) servicing of Contract Owners,
including, without limitation: (i) responding to customer inquiries; (ii)
providing information to customers
with respect to their investment in Class Y Shares of a Portfolio; and (iii)
servicing the account of each client or customer who has an investment in Class
Y Shares of a Portfolio. The Companies acknowledges that it is responsible for
all costs and expenses associated with the provision of the Service Activities
hereunder.
2. Subject to the Companies' continuing compliance with its
obligations pursuant to Section 1 above, the Distributor will pay a fee to the
Companies for providing the Service Activities, during the term of the
Participation Agreement, at an annual rate of 0.25% of the average daily net
assets invested in Class Y Shares of the then offered Portfolios under the
Contracts identified in the Participation Agreement (excluding all assets
invested during the right to cancel (free look) periods available under the
Contracts) (the "Service Fee").
Payment will be made on a monthly basis during the month following the
end of each month and shall be prorated for any portion of such period during
which this Agreement is in effect for less than the full month. The Service Fee
will be calculated based on the average daily net assets invested in Class Y
Shares of the applicable Portfolio(s) under the Contracts over a month (which
shall be computed by totaling daily balances during the month and dividing such
total by the actual days in the month). The Distributor will not be required to
pay the Service Fee with respect to assets invested in Class Y Shares of a
Portfolio upon the termination of the Plan with respect to Class Y Shares of the
Portfolio. If, at any time, the fee payable by the Fund under the Plan with
respect to Class Y Shares of the Portfolio is reduced, the Distributor will not
be required to pay the Service Fee to the extent of the reduction.
3. It is understood and agreed that the Distributor, acting
reasonably and in good faith, may make final and binding determinations as to
the Companies' continuing compliance under Section 1 above and as to the
specific amount of the Companies' assets invested in Class Y Shares of the
Portfolios that will be considered in determining the Service Fee.
4. The Companies and the Distributor acknowledge that the Fund
maintains the right, at any time and without notice to the Companies, to amend
its current Prospectus, Statement of Additional Information or the Plan subject
to the terms thereof. The Distributor agrees to provide notice to the Companies
of the termination of the Plan or reduction in the fees payable by the Fund to
the Companies under the Plan promptly once the Distributor has actual knowledge
of such termination or reduction in fees. In the event the Plan is terminated or
the fee payable by the Fund to the Companies under the Plan is reduced, the
parties agree to discuss, in good faith, alternative fee arrangements.
5. Each Company represents and agrees that it will maintain and
preserve all records as required by law to be maintained and preserved in
connection with providing the Service Activities, and will otherwise comply with
all laws, rules and regulations applicable to such Service Activities.
6. The Companies agree to provide copies of all historical records
relating to the
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Companies' provision of the Service Activities in accordance with this
Agreement, and all written communications and other related materials regarding
the Fund or a Portfolio to or from Contract owners, as reasonably requested by
the Distributor or its representatives (which representatives may include,
without limitation, the auditors or legal counsel of the Fund or the
Distributor) to enable the Distributor, the Fund or their respective
representatives to monitor and review the Service Activities provided by the
Companies, or comply with any request of the Board of Trustees or
"disinterested" Trustees of the Fund, or a governmental body or a
self-regulatory organization.
7. The Companies agree that they will permit the Distributor, the
Fund or their respective representatives to have reasonable access to the
Companies' personnel and records in order to facilitate the monitoring of the
quality of the Service Activities.
8. The Companies hereby agree to notify the Distributor promptly if
for any reason they are unable to perform fully and promptly any of their
obligations under this Agreement.
9. This Agreement may be amended only by mutual consent of the
parties hereto in writing and will terminate: (i) upon mutual agreement of the
parties hereto, (ii) upon thirty (30) days advance written notice by either
party delivered to the other party, or (iii) automatically upon the termination
of the Participation Agreement except with respect to Existing Contracts, as
defined in and consistent with the provisions of Section 17(c) of the
Participation Agreement, investing in Class Y Shares of the Portfolios, provided
that the Companies continue to perform the Service Activities with respect to
such Existing Contracts.
10. The provisions, construction, validity and effect of this
Agreement will be construed in accordance with and governed by the laws of
NewYork.
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 above.
HARTFORD LIFE INSURANCE COMPANY
By: /s/ Xxxxxxx X. Xxxxxx
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Name: Xxxxxxx X. Xxxxxx
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Title: Vice President, Actuary
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Tax ID: 00-0000000
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Companies Address: 000 Xxxxxxxxx Xxxxxx
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Xxxx, Xxxxx, Zip: Xxxxxxxx, XX 00000
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HARTFORD LIFE AND ANNUITY INSURANCE COMPANY
By: /s/ Xxxxxxx X. Xxxxxx
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Name: Xxxxxxx X. Xxxxxx
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Title: Vice President, Actuary
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Tax ID: 00-0000000
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Companies Address: 000 Xxxxxxxxx Xxxxxx
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Xxxx, Xxxxx, Zip: Xxxxxxxx, XX 00000
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XXXXXX XXXXXXX DISTRIBUTORS INC.
By: /s/ Xxxx X. Xxxx III
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Xxxx X. Xxxx III, PRESIDENT
c/o Morgan Xxxxxxx Investment Management Inc.
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
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