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Exhibit 8 (a)(a)
Participation Agreement Between Canada Life Series Fund
and
Canada Life of New York
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PARTICIPATION AGREEMENT
THIS AGREEMENT, is hereby entered into on this ____ day of ____, 1989,
between Canada Life Insurance Company of New York ("CLNY"), a life insurance
company organized under the laws of the State of New York, for itself and on
behalf of its Variable Annuity Account 1 ("Separate Account"), a separate
account established by CLNY in accordance with the laws of the State of New
York; and the Canada Life of America Series Fund, Inc. ("Fund"), an open-end
management investment company organized under the laws of the State of Maryland.
WITNESSETH:
WHEREAS, the Separate Account has been established by CLYN pursuant to
the New York Insurance Law in connection with certain variable annuity policies
("Policies") proposed to be issued to the public by CLNY; and
WHEREAS, the Separate Account has been registered as a unit investment
trust under the Investment Company Act of 1940 (the "1940 Act"); and
WHEREAS, the income, gains and losses, whether or not realized, from
assets allocated to the Separate Account are, in accordance with the applicable
Policies, to be credited to or charged against such Separate Account without
regard to other income, gains or losses of CLNY; and
WHEREAS, the Separate Account is subdivided into various sub-accounts
("Sub-accounts") under which income, gains and losses, whether or not realized,
from assets allocated to each such Sub-account are, in accordance with the
applicable Policies, to be credited to or charged against such Sub-accounts
without regard to other income, gain or losses of other sub-accounts or of
CLNY; and
WHEREAS, the Fund is registered as an open-end management investment
company organized under the laws of the State of Maryland and will operate in
accordance with the 1940 Act; and
WHEREAS, the Fund is divided into various series ("Series"), each
Series being subject to certain fundamental investment policies and
restrictions which may not be changed without a majority vote of the
shareholders of such Series; and
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WHEREAS, certain Series will serve as the underlying investment medium
for certain Sub-accounts; and
WHEREAS, Canada Life of America Financial Series, Inc., the principal
underwriter for the Policies to be funded by the Separate Account, is a
broker-dealer registered as such under the Securities Exchange Act of 1934;
NOW THEREFORE, in consideration of the foregoing and of mutual
covenants and conditions set forth herein and for other good and valuable
consideration, CLNY, the Separate Account, and the Fund hereby agree as follows:
1. The Policies funded through the Separate Account will provide
for the allocation of premium payments among certain Sub-accounts for
investment in such shares of the Series as may be offered from time to time in
the prospectus of the Policies. The selection of the particular Sub-account is
to be made by the Policy owner and such selection may be changed or the policy
value may be transferred among Sub-accounts in accordance with the terms of the
Policies.
2. No representation is made as to the number or amount of such
Policies to be sold; however, CLNY, through Canada Life of America Financial
Services, Inc., will make reasonable efforts to market such Policies.
3. The Fund agrees to sell to CLNY those shares of the Fund which
the Separate Accounts orders, expecting such orders on a daily basis at the new
asset value next computed after receipt by the Fund or its designee of the
order for the shares of the Fund. For purposes of this Section, CLNY (or its
designated agent) shall be the designee of the Fund for receipt of such orders
from Policy owners and receipt by such designee shall constitute receipt by the
Fund; provided that the Fund receives notice of such order by 9:30 a.m. New
York 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
Fund calculates its new asset value pursuant to the rules of the Securities and
Exchange Commission.
The Fund agrees to make Fund shares available indefinitely for purchase
at the applicable new asset value per share by CLNY and the Separate Account on
those days on which the Fund calculates its new asset value pursuant to rules
of the Securities and Exchange Commission and the Fund shall use reasonable
efforts to calculate such new asset value on each day which the New York Stock
Exchange is open for trading. Notwithstanding the foregoing, the Board of
Directors of the Fund (hereinafter the "Directors") may refuse to sell shares
of any Series to CLNY, or suspend or terminate the offering of share of any
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Series if such action is required by law or by regulatory authorities having
jurisdiction or is, in the sole discretion of the Directors 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 series.
CLNY shall pay for the Fund shares on the next Business Day after an
order to purchase shares is made in accordance with the provisions of this
Section. Payment shall be in federal funds transmitted by wire or by a credit
for any shares redeemed.
4. The Fund agrees to redeem for cash, on CLNY's request, any full
or fractional shares of the Fund held by CLNY, executing such requests on a
daily basis at the net asset value next computed after receipt by the Fund or
its designee of the request for redemption. For purposes of this Section, CLNY
(or its designated agent) shall be the designee of the Fund for receipt of
requests for redemption from Policy owners and receipt by such designee shall
constitute receipt by the Fund; provided that the Fund receives notice of such
request for redemption by 9:30 a.m. New York time on the next following
Business Day.
The Fund ordinarily shall make payment to CLNY for shares on the day
the Fund receives notice from CLNY, but the Fund may delay payment for up to
seven calendar days after the request is received. Payment be in federal funds
transmitted by wire.
5. Transfer of Series shares will be by book entry. No stock
certificates will be issued to the Separate Account unless the Separate Account
so requests. Shares of each Series will be recorded in an appropriate title for
the corresponding Sub-account on the books of CLNY. If, However, state law
requires transfer other than by book entry, then the Series agrees to provide
the required form of transfer.
6. The Fund shall make the net asset value per share for each
Series available to CLNY on a daily basis as soon as reasonably practicable
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 7 p.m. New York
time.
7. The Fund shall furnish notice on the ex-dividend date to CLNY
of any dividend or distribution payable on any share underlying Sub-accounts.
All of such dividends and distributions as are payable on shares of a Series
recorded in the title for the corresponding Sub-account shall be automatically
reinvested in additional shares of that Series. The Fund shall notify CLNY of
the number of shares so issued.
8. The Fund shall pay all its expenses incidental to its
performance under this Agreement. The Fund shall see to it
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that all of its shares are registered and authorized for issue in accordance
with applicable federal and state laws prior to their purchase by CLNY for the
Sub-accounts. The Fund shall bear the expenses for the cost of registration of
its shares, preparation of its prospectus, proxy materials and reports, the
printing and distribution of such items to each Policy owner who has allocated
net amounts to any Sub-account, the preparation of all statements and notices
required by any federal or state law, and taxes imposed upon the fund on the
issue or transfer of the Fund's shares subject to this Agreement. The parties
shall cooperate in the printing of the prospectuses of the Policies and the
Fund. The Fund shall provide CLNY with a reasonable quantity of Fund
prospectuses and reports to be sent to existing Policy owners.
9. CLNY shall make no representations concerning the Fund or its
shares except those contained in the then-current prospectus of the Fund and in
printed information subsequently issued on behalf of the Fund and approved in
writing by the Fund as supplemental to such prospectus, or otherwise approved
by the Fund in writing.
10. The Fund represents that each Series of the Fund shall comply
with Section 817(h) of the Internal Revenue Code of 1986, and the regulations
issued thereunder (Reg. Section 1.817-5), relating to the diversification
requirements for variable annuity, endowment, and life insurance contracts, and
any amendments or other modifications to such Section or regulations.
The Fund represents that each Portfolio of the Fund is currently
qualified or will be qualified as a Regulated Investment Company under
Subchapter M of the Internal Revenue Code of 1986, as amended, (the "Code") and
that every effort will be made to maintain such qualification (under Subchapter
M or any successor or similar provision) and that the Fund will notify CLNY
orally (followed by written notice) or by wire immediately upon having a
reasonable basis for believing that any Series of the Fund has ceased to so
qualify or that any Series might not so qualify in the future.
11. It is understood among the parties to this Agreement that,
subject to obtaining any applicable regulatory approvals which may be
conditioned on the parties complying with certain requirements, shares of the
Series may be offered to separate accounts of various insurance companies in
addition to CLNY and in connection with insurance contracts or policies other
than the Policies. It is also understood among the parties that shares of the
Series only may be offered to the other persons identified in paragraph (f) of
Regulation Section 1.817-5, in order that the Separate Account can rely on the
look-through provisions of said paragraph.
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12. The Fund represents and warrants that all of its officers,
employees, investment advisers, and other individuals or entities dealing with
the money and/or securities of the Fund are and shall continue to be at all
times covered by a blanket fidelity bond or similar coverage for the benefit of
the Fund in an amount not less than the minimal coverage as required currently
by Section 17(g) and Rule 17g-1 of the 1940 Act or related provisions as may be
promulgated from time to time. The aforesaid bond shall include coverage for
larcency and embezzlement and shall be issued by a reputable bonding company.
13. This Agreement shall terminate:
(a) at any time on six months' written notice by the Fund to CLNY or on
six months' written notice by CLNY to the Fund without the payment of any
penalty (provided, however, if CLNY is not able, acting in good faith, to
obtain suitable substitute investment media within six months, this Agreement
shall terminate one year from the date of the notice of termination); or
(b) at the option of CLNY or of the Fund upon institution of formal
enforcement proceedings against the Fund or the Fund's investment adviser by
the Securities and Exchange Commission, or if CLNY or the Fund is determined by
CLNY or the Fund to have failed to perform its obligations under this Agreement
in a satisfactory manner; or
(c) upon a vote of the holders of a majority of the shares underlying
the Policies having an interest in a particular Sub-account to substitute the
shares of another investment company for the corresponding Fund shares in
accordance with the terms of the Policies for which those shares had been
selected to serve as the underlying investment medium. CLNY will give 60 days'
prior written notice to the Fund upon the occurrence of the earlier of the
following actions taken for the purpose of substituting shares of the Fund:
(1) an application made to the SEC or (2) a proposed Policy owner vote; or
(d) in the event the shares of the Fund are not registered, issued, or
sold in accordance with applicable state and/or federal law prohibits the use
of such shares as an underlying investment for the Policies issued or to be
issued by CLNY. Prompt notice of such an event shall be given by each party to
the other in the event the conditions of this provision occur; or
(e) upon assignment of this Agreement, at the option of any party not
assigning this Agreement.
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14. Each notice required by this Agreement shall be given in writing
and delivered via certified mail -- return receipt requested to:
Xxxxxx X. Xxxxx
Canada Life Insurance Company of New York
0 Xxxxxxxx Xxxx
Xxxxxxxxx, Xxx Xxxx 00000
Xxxxxxx X. Rough
Canada Life of America Series Fund, Inc.
000 Xxxxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxx Xxxxxx X0X 0X0
15. Each party hereto shall cooperate with each other party and all
appropriate governmental authorities 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,
The Fund agrees that all records and other data pertaining to the
Policies are the exclusive property of CLNY and that any such records and other
data shall be furnished to CLNY by the Fund upon termination of this Agreement
for any reason whatsoever. CLNY shall have the right to inspect, audit and copy
all pertinent records pertaining to the Policies. This shall not preclude the
Fund from keeping copies of such data or records for its own files subject to
the provisions of this section.
16. CLNY and the Separate Account agree to look solely to the assets
of the Fund for the satisfaction of any liability of the Fund, with respect to
this Agreement and will not seek recourse against the members of the Board of
Directors of the Fund, or its officers, employees, agents, or shareholders, or
any of them, or any of their personal assets for such satisfaction.
17. The Fund agrees to indemnify and hold harmless CLNY, each member
of its Board of Directors, each of its officers, and any person that controls
CLNY within the meaning of section 15 of the Securities Act of 1933 against
any and all losses, claims, damages, liabilities (including amounts paid in
settlement with the written consent of the Fund) or litigation (including legal
and other expenses) to which CLNY may become subject under any statute, at
common law or otherwise, insofar as such losses, claims, damages, liabilities
or expenses (or actions in respect thereof) or settlements arise as a result of
CLNY'S reliance on any information contained in a then-current prospectus,
Statement of Additional Information, or report of the Fund; or any current
information communicated to CLNY in writing by the Fund.
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The Fund shall, at all times, have the right, but not the obligation,
to take over and conduct, in the name of CLNY and/or the Separate Account, the
investigation and defense of any claim by a third party for which
indemnification may be sought, and in such event, CLNY and/or the Separate
Account shall cooperate in every way with the Fund.
18. CLNY agrees to indemnify and hold harmless the Fund, each member
of its Boards of Directors, each of its officers, and each person that controls
the Fund within the meaning of the Securities Act of 1933 against any and all
losses, claims, damages, liabilites (including amount paid in settlement with
the written consent of CLNY) or litigation (including legal and other expenses)
to which the Fund may become subject under any statute, at common law or
otherwise, insofar as such losses, claims, damages, liabilities or expenses (or
actions in respect thereof) or settlements arise as a result of the Fund's
reliance on any information contained in the then-current prospectus, Statement
of Additional Information, or contract of the Separate Account; or any
information communicated to the Fund in writing by CLNY.
CLNY shall, at all times, have the right, but not the obligation, to
take over and conduct, in the name of the Fund, the investigation and defense
of any claim by a third party for which indemnification may be sought, and in
such event, the Fund shall cooperate in every way with CLNY and/or the Separate
Account.
19. This Agreement shall be construed in accordance with the laws of
the State of Maryland.
20. 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
Securities and Exchange Commission may grant and the terms hereof shall be
interpreted and construed in accordance therewith.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed and attested as of the date first above written.
CANADA LIFE INSURANCE
COMPANY OF NEW YORK ON
BEHALF OF ITSELF AND
VARIABLE ANNUITY ACCOUNT 1
Attest: By:
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CANADA LIFE OF AMERICA SERIES
FUND, INC.
Attest: By:
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