JANUS ASPEN SERIES
FUND PARTICIPATION AGREEMENT
(Institutional Shares)
THIS AGREEMENT is made this ____ day of March, 2003, between JANUS ASPEN SERIES,
an open-end management investment company organized as a Delaware business trust
(the "Trust"), JANUS DISTRIBUTORS LLC (the "Distributor"), a Delaware limited
liability company, and BUSINESS MEN'S ASSURANCE COMPANY OF AMERICA, a life
insurance company organized under the laws of the State of Missouri (the
"Company"), on its own behalf and on behalf of each segregated asset account of
the Company set forth on Schedule A, as may be amended from time to time (the
"Accounts").
W I T N E S S E T H:
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WHEREAS, the Trust has registered with the Securities and Exchange Commission as
an open-end management investment company under the Investment Company Act of
1940, as amended (the "1940 Act"), and the beneficial interest in the Trust is
divided into several series of shares, each series representing an interest in a
particular managed portfolio of securities and other assets (the "Portfolios");
and
WHEREAS, the Trust has registered the offer and sale of a class of shares
designated the Institutional Shares ("Shares") of each of its Portfolios under
the Securities Act of 1933, as amended (the "1933 Act"); and
WHEREAS, the Trust desires to act as an investment vehicle for separate accounts
established for variable life insurance policies and variable annuity contracts
to be offered by insurance companies that have entered into participation
agreements with the Trust (the "Participating Insurance Companies"); and
WHEREAS, the Trust has received an order from the Securities and Exchange
Commission granting Participating Insurance Companies and their separate
accounts exemptions from the provisions of Sections 9(a), 13(a), 15(a) and 15(b)
of 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 both
affiliated and unaffiliated life insurance companies and certain qualified
pension and retirement plans (the "Exemptive Order"); and
WHEREAS, the Company has registered or will register (unless registration is not
required under applicable law) certain variable life insurance policies and/or
variable annuity contracts under the 1933 Act (the "Contracts"); and
WHEREAS, the Company has registered or will register each Account as a unit
investment trust under the 1940 Act; and
WHEREAS, the Company desires to utilize Shares of one or more Portfolios as an
investment vehicle of the Accounts;
NOW, THEREFORE, in consideration of their mutual promises, the parties agree as
follows:
ARTICLE I
Sale of Trust Shares
1.1 The Trust shall make Shares of its Portfolios available to the Accounts at
the net asset value next computed after receipt of such purchase order by the
Trust (or its agent), as established in accordance with the provisions of the
then current prospectus of the Trust. Shares of a particular Portfolio of the
Trust shall be ordered in such quantities and at such times as determined by the
Company to be necessary to meet the requirements of the Contracts. The Trustees
of the Trust (the "Trustees") may refuse to sell Shares of any Portfolio to any
person, or suspend or terminate the offering of Shares of any Portfolio if such
action is required by law or by regulatory authorities having jurisdiction or
is, in the sole discretion of the Trustees 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. With respect to
payment of purchase price by the Company and of redemption proceeds by the
Trust, the Company and the Trust shall remit gross purchase and sale orders with
respect to each Portfolio and shall transmit one net payment per Portfolio in
accordance with the provisions of this Article I.
1.2 The Trust will redeem any full or fractional Shares of any Portfolio when
requested by the Company on behalf of an Account at the net asset value next
computed after receipt by the Trust (or its agent) of the request for
redemption, as established in accordance with the provisions of the then current
prospectus of the Trust. The Trust shall wire payment for such shares in federal
funds to an account designated by the Company no later than 5:00 p.m. Eastern
Time on the same Business Day the Trust receives notice of the order, provided
that the Trust may delay payment in extraordinary circumstances to the extent
permitted under Section 22(e) of the 0000 Xxx.
1.3 For the purposes of Sections 1.1 and 1.2, the Trust hereby appoints the
Company as its agent for the limited purpose of receiving and accepting purchase
and redemption orders resulting from investment in and payments under the
Contracts. Receipt by the Company shall constitute receipt by the Trust provided
that i) such orders are received by the Company in good order prior to the time
the net asset value of each Portfolio is priced in accordance with its
prospectus and ii) the Trust receives notice of such orders by 10:00 a.m. New
York time on the next following Business Day, except that orders for any funds
subadvised by INTECH, which currently include Risk-Managed Large Cap Core
Portfolio and Risk-Managed Large Cap Growth Portfolio, must be received by 9:00
a.m. "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 Securities and Exchange Commission.
1.4 Purchase orders that are transmitted to the Trust in accordance with Section
1.3 shall be paid for no later than 5:00 p.m. New York time on the same Business
Day that the Trust receives notice of the order. Payments shall be made in
federal funds transmitted by wire.
1.5 Issuance and transfer of the Trust's Shares will be by book entry only.
Stock certificates will not be issued to the Company or the Account. Shares
ordered from the Trust will be recorded in the appropriate title for each
Account or the appropriate subaccount of each Account.
1.6 The Trust shall furnish at least two days advance notice to the Company of
an estimate of any income dividends or capital gain distributions payable on the
Trust's Shares. The Company hereby elects to receive all such income dividends
and capital gain distributions as are payable on a Portfolio's Shares in
additional Shares of that Portfolio. The Trust shall notify the Company of the
number of Shares so issued as payment of such dividends and distributions.
1.7 The Trust shall make the net asset value per Share for each Portfolio
available to the Company on a daily basis as soon as 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 p.m. New York time. If the
Trust provides the Company with materially incorrect share net asset value
information, the Trust shall make an adjustment to the number of shares
purchased or redeemed for the Accounts to reflect the correct net asset value
per share. Any material error in the calculation or reporting of net asset value
per share, dividend or capital gains information shall be reported promptly upon
discovery to the Company.
1.8 The Trust agrees that its Shares will be sold only to Participating
Insurance Companies and their separate accounts and to certain qualified pension
and retirement plans as allowed under Section 817(h)(4) of the Internal Revenue
Code of 1986, as amended, and to the extent permitted by the Exemptive Order. No
Shares of any Portfolio will be sold directly to the general public. The Company
agrees that Trust Shares will be used only for the purposes of funding the
Contracts and Accounts listed in Schedule A, as amended from time to time.
1.9 The Trust agrees that all Participating Insurance Companies shall have the
obligations and responsibilities regarding pass-through voting and conflicts of
interest corresponding to those contained in Section 2.8 and Article IV of this
Agreement.
1.10 All orders accepted by the Company shall be subject to the terms of the
then current prospectus of each Portfolio, including without limitation,
policies regarding minimum account sizes, market timing and excessive trading.
The Company shall use its best efforts, and shall reasonably cooperate with, the
Trust to enforce stated prospectus policies regarding transactions in Shares,
particularly those related to market timing. The Company acknowledges that the
Trust may reject orders accepted by the Company in violation of the Trust's
stated policies and that the Trust shall not be responsible for any losses
incurred by the Company or Contract or Account as a result of such rejection.
In addition, the Company acknowledges that the Trust has the right to refuse any
purchase order for any reason, particularly if the Trust determines that a
Portfolio would be unable to invest the money effectively in accordance with its
investment policies or would otherwise be adversely affected due to the size of
the transaction, frequency of trading by the account or other factors.
ARTICLE II
Obligations of the Parties
2.1 The Trust shall prepare and be responsible for filing with the Securities
and Exchange Commission and any state regulators requiring such filing all
shareholder reports, notices, proxy materials (or similar materials such as
voting instruction solicitation materials), prospectuses and statements of
additional information of the Trust. The Trust shall bear the costs of
registration and qualification of its shares, preparation and filing of the
documents listed in this Section 2.1 and all taxes to which an issuer is subject
on the issuance and transfer of its shares.
2.2 At the option of the Company, the Trust shall either (a) provide the Company
(at the Company's expense) with as many copies of the Trust's Shares' current
prospectus, annual report, semi-annual report and other shareholder
communications, including any amendments or supplements to any of the foregoing,
as the Company shall reasonably request; or (b) provide the Company with a
camera ready copy of such documents in a form suitable for printing. The
expenses of such printing will be apportioned between the Company and the Trust
in proportion to the number of pages of contract and prospectus taking account
of other relevant factors affecting the expenses of printing such as covers,
columns, graphs and charts, the Trust to bear the costs of printing the Trust's
prospectus portion of such document for distribution only to owners of existing
Contracts funded by the fund shares and the Company to bear the expense of
printing the portion of such documents relating to the Account; provided,
however, the Company shall bear all printing expenses of such combined documents
where used for distribution to prospective purchasers. The Trust shall use best
efforts to provide camera-ready or diskette copies of annual and semi-reports to
the Company no later than 45 days (and in no event later than 50 days) after the
end of the Fund's reporting period. The Trust shall provide the Company with a
copy of its statement of additional information in a form suitable for
duplication by the Company. The Trust (at its expense) shall provide the Company
with copies of any Trust-sponsored proxy materials in such quantity as the
Company shall reasonably require for distribution to Contract owners.
2.3 (a) The Company shall bear the costs of distributing the Trust's Shares'
prospectus, statement of additional information, shareholder reports and other
shareholder communications to owners of and applicants for policies for which
Shares of the Trust is serving or is to serve as an investment vehicle. The
Trust shall bear the costs of distributing proxy materials (or similar materials
such as voting solicitation instructions) to Contract owners. The Company
assumes sole responsibility for ensuring that such materials are delivered to
Contract owners in accordance with applicable federal and state securities laws.
(b) If the Company elects to include any materials provided by the Trust,
specifically prospectuses, SAIs, shareholder reports and proxy materials, on its
web site or in any other computer or electronic format, the Company assumes sole
responsibility for maintaining such materials in the form provided by the Trust
and for promptly replacing such materials with all updates provided by the
Trust.
2.4 The Company agrees and acknowledges that the Trust's adviser, Janus Capital
Management LLC or its affiliates ("Janus Capital"), is the sole owner of the
name and xxxx "Xxxxx" and that all use of any designation comprised in whole or
part of Janus (a "Xxxxx Xxxx") under this Agreement shall inure to the benefit
of Janus Capital. Except as provided in Section 2.5, the Company shall not use
any Xxxxx Xxxx on its own behalf or on behalf of the Accounts or Contracts in
any registration statement, advertisement, sales literature or other materials
relating to the Accounts or Contracts without the prior written consent of Janus
Capital. All references contained in this Agreement to "the name or xxxx
`Xxxxx'" shall include but not be limited to the Janus logo, the website
xxx.xxxxx.xxx and any and all electronic links relating to such website. The
Company will make no use of the name or xxxx "Xxxxx" except as expressly
provided in this Agreement or expressly authorized by Janus Capital in writing.
All goodwill associated with the name and xxxx "Xxxxx" shall inure to the
benefit of Janus Capital or its affiliates. Upon termination of this Agreement
for any reason, the Company shall cease any and all use of any Xxxxx Xxxx(s) as
soon as practicable.
2.5 The Company shall furnish, or cause to be furnished, to the Trust or its
designee, a copy of each Contract prospectus or statement of additional
information in which the Trust or its investment adviser is named
contemporaneously with the filing of such document with the Securities and
Exchange Commission. The Company shall furnish, or shall cause to be furnished,
to the Trust or its designee, each piece of sales literature or other
promotional material in which the Trust or its investment adviser is named, at
least ten Business Days prior to its use or such shorter period as the parties
hereto may, from time to time, agree upon. No such material shall be used if the
Trust or its designee reasonably objects to such use within ten Business Days
after receipt of such material.
2.6 The Company shall not give any information or make any representations or
statements on behalf of the Trust or concerning the Trust or its investment
adviser in connection with the sale of the Contracts other than information or
representations contained in and accurately derived from the registration
statement or prospectus for the Trust Shares (as such registration statement and
prospectus may be amended or supplemented from time to time), reports of the
Trust, Trust-sponsored proxy statements, or in sales literature or other
promotional material approved by the Trust or its designee, except as required
by legal process or regulatory authorities or with the written permission of the
Trust or its designee, such permission not to be unreasonably withheld.
2.7 The Trust shall not give any information or make any representations or
statements on behalf of the Company or concerning the Company, the Accounts or
the Contracts other than information or representations contained in and
accurately derived from the registration statement or prospectus for the
Contracts (as such registration statement and prospectus may be amended or
supplemented from time to time), or in materials approved by the Company for
distribution including sales literature or other promotional materials, except
as required by legal process or regulatory authorities or with the written
permission of the Company.
2.8 So long as, and to the extent that the Securities and Exchange Commission
interprets the 1940 Act to require pass-through voting privileges for variable
policyowners, the Company will provide pass-through voting privileges to owners
of policies whose cash values are invested, through the Accounts, in shares of
the Trust. The Trust shall require all Participating Insurance Companies to
calculate voting privileges in the same manner and the Company shall be
responsible for assuring that the Accounts calculate voting privileges in the
manner established by the Trust. With respect to each Account, the Company will
vote Shares of the Trust held by the Account and for which no timely voting
instructions from policyowners are received as well as Shares it owns that are
held by that Account, in the same proportion as those Shares for which voting
instructions are received. The Company and its agents will in no way recommend
or oppose or interfere with the solicitation of proxies for Trust shares held by
Contract owners without the prior written consent of the Trust, which consent
may be withheld in the Trust's sole discretion.
2.9 The Company has determined that the investment restrictions set forth in the
current Trust prospectus are sufficient to comply with all investment
restrictions under state insurance laws that are currently applicable to the
Portfolios as a result of the Accounts' investment therein. The Company shall
notify the Trust of any additional applicable state insurance laws that restrict
the Portfolios' investments or otherwise affect the operation of the Trust after
the date of this Agreement.
ARTICLE III
Representations and Warranties
3.1 The Company represents and warrants that it is an insurance company duly
organized and in good standing under the laws of the State of Missouri and that
it has legally and validly established each Account as a segregated asset
account under such law on the date set forth in Schedule A.
3.2 The Company represents and warrants that each Account has been registered
or, prior to any issuance or sale of the Contracts, will be registered as a unit
investment trust in accordance with the provisions of the 0000 Xxx.
3.3 The Company represents and warrants that the Contracts or interests in the
Accounts (1) are or, prior to issuance, will be registered as securities under
the 1933 Act or, alternatively (2) are not registered because they are properly
exempt from registration under the 1933 Act or will be offered exclusively in
transactions that are properly exempt from registration under the 1933 Act. The
Company further represents and warrants that the Contracts will be issued and
sold in compliance in all material respects with all applicable federal and
state laws; and the sale of the Contracts shall comply in all material respects
with state insurance suitability requirements.
3.4 The Trust represents and warrants that it is duly organized and validly
existing under the laws of the State of Delaware, and has full corporate power,
authority, and legal right to execute, deliver, and perform its duties and
comply with the obligations under this Agreement.
3.5 The Trust represents and warrants that the Trust Shares offered and sold
pursuant to this Agreement will be registered under the 1933 Act and the Trust
shall be registered under the 1940 Act prior to any issuance or sale of such
Shares. The Trust shall amend its registration statement under the 1933 Act and
the 1940 Act from time to time as required in order to effect the continuous
offering of its Shares. The Trust shall register and qualify its shares for sale
in accordance with the laws of the various states only if and to the extent
deemed advisable by the Trust.
3.6 The Trust represents and warrants that the investments of each Portfolio
will comply with the diversification requirements set forth in Section 817(h) of
the Internal Revenue Code of 1986, as amended, and the rules and regulations
thereunder including without limitation Treasury Regulation 1.817-5, and will
notify the Company immediately upon having a reasonable basis for believing any
Portfolio has ceased to so comply and will immediately take all reasonable steps
to diversify the Portfolio to achieve compliance.
3.7 The Trust represents and warrants that each Portfolio invested in by the
Separate Account will qualify as a "regulated investment company" under
Subchapter M of the Internal Revenue Code of 1986, as amended, and that it will
maintain such qualification and will notify the Company immediately upon the
reasonable likelihood that it will cease to so qualify or might not so qualify
in the future.
ARTICLE IV
Potential Conflicts
4.1 The parties acknowledge that the Trust's shares may be made available for
investment to other Participating Insurance Companies. In such event, the
Trustees will monitor the Trust for the existence of any material irreconcilable
conflict between the interests of the contract owners of all Participating
Insurance Companies. An irreconcilable material conflict may arise for a variety
of reasons, including: (a) an action by any state insurance regulatory
authority; (b) a change in applicable federal or state insurance, tax, or
securities laws or regulations, or a public ruling, private letter ruling,
no-action or interpretative letter, or any similar action by insurance, tax, or
securities regulatory authorities; (c) an administrative or judicial decision in
any relevant proceeding; (d) the manner in which the investments of any
Portfolio are being managed; (e) a difference in voting instructions given by
variable annuity contract and variable life insurance contract owners; or (f) a
decision by an insurer to disregard the voting instructions of contract owners.
The Trustees shall promptly inform the Company if they determine that an
irreconcilable material conflict exists and the implications thereof.
4.2 The Company agrees to promptly report any potential or existing conflicts of
which it is aware to the Trustees. The Company will assist the Trustees in
carrying out their responsibilities under the Exemptive Order by providing the
Trustees with all information reasonably necessary for the Trustees to consider
any issues raised including, but not limited to, information as to a decision by
the Company to disregard Contract owner voting instructions.
4.3 If it is determined by a majority of the Trustees, or a majority of its
disinterested Trustees, that a material irreconcilable conflict exists that
affects the interests of Contract owners, the Company shall, in cooperation with
other Participating Insurance Companies whose contract owners are also affected,
at its expense and to the extent reasonably practicable (as determined by the
Trustees) take whatever steps are necessary to remedy or eliminate the
irreconcilable material conflict, which steps could include: (a) withdrawing the
assets allocable to some or all of the Accounts from the Trust or any Portfolio
and reinvesting such assets in a different investment medium, including (but not
limited to) another Portfolio of the Trust, or submitting the question of
whether or not 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.
4.4 If a material irreconcilable conflict arises because of a decision by the
Company to disregard Contract owner voting instructions and that decision
represents a minority position or would preclude a majority vote, the Company
may be required, at the Trust's election, to withdraw the affected Account's
investment in the Trust and terminate this Agreement with respect to such
Account; provided, however that such withdrawal and termination shall be limited
to the extent required by the foregoing material irreconcilable conflict as
determined by a majority of the disinterested 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. Until the end of such six (6)
month period, the Trust shall continue to accept and implement orders by the
Company for the purchase and redemption of shares of the Trust.
4.5 If a material irreconcilable conflict arises because a particular state
insurance regulator's decision applicable to the Company conflicts with the
majority of other state regulators, then the Company will withdraw the affected
Account's investment in the Trust and terminate this Agreement with respect to
such Account within six (6) months after the Trustees inform the Company in
writing that it has determined that such decision has created an irreconcilable
material conflict; provided, however, that such withdrawal and termination shall
be limited to the extent required by the foregoing material irreconcilable
conflict as determined by a majority of the disinterested Trustees. Until the
end of such six (6) month period, the Trust shall continue to accept and
implement orders by the Company for the purchase and redemption of shares of the
Trust.
4.6 For purposes of Sections 4.3 through 4.6 of this Agreement, a majority of
the disinterested Trustees shall determine whether any proposed action
adequately remedies any irreconcilable material conflict, but in no event will
the Company be required 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 Trustees determine that any proposed action does not adequately
remedy any irreconcilable material conflict, then the Company will withdraw the
Account's investment in the Trust and terminate this Agreement within six (6)
months after the Trustees inform the Company in writing of the foregoing
determination; provided, however, that such withdrawal and termination shall be
limited to the extent required by any such material irreconcilable conflict as
determined by a majority of the disinterested Trustees.
4.7 The Company shall at least annually submit to the Trustees such reports,
materials or data as the Trustees may reasonably request so that the Trustees
may fully carry out the duties imposed upon them by the Exemptive Order, and
said reports, materials and data shall be submitted more frequently if deemed
appropriate by the Trustees.
4.8 If and to the extent that Rule 6e-2 and Rule 6e-3(T) are amended, or Rule
6e-3 is adopted, to provide exemptive relief from any provision of the 1940 Act
or the rules promulgated thereunder with respect to mixed or shared funding (as
defined in the Exemptive Order) on terms and conditions materially different
from those contained in the Exemptive Order, then the Trust and/or the
Participating Insurance Companies, as appropriate, shall take such steps as may
be necessary to comply with Rules 6e-2 and 6e-3(T), as amended, and Rule 6e-3,
as adopted, to the extent such rules are applicable.
ARTICLE V
Indemnification
5.1 Indemnification By the Company. The Company agrees to indemnify and hold
harmless the Trust and each of its Trustees, officers, employees and agents and
each person, if any, who controls the Trust within the meaning of Section 15 of
the 1933 Act (collectively, the "Indemnified Parties" for purposes of this
Article V) against any and all losses, claims, damages, liabilities (including
amounts paid in settlement with the written consent of the Company) or expenses
(including the reasonable costs of investigating or defending any alleged loss,
claim, damage, liability or expense and reasonable legal counsel fees incurred
in connection therewith) (collectively, "Losses"), to which the Indemnified
Parties may become subject under any statute or regulation, or at common law or
otherwise, insofar as such Losses:
(a) arise out of or are based upon any untrue statements or alleged untrue
statements of any material fact contained in a registration statement or
prospectus for the Contracts or in the Contracts themselves or in sales
literature generated or approved by the Company on behalf of the Contracts or
Accounts (or any amendment or supplement to any of the foregoing) (collectively,
"Company Documents" for the purposes of this Article V), 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 indemnity 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 was accurately derived from written information
furnished to the Company by or on behalf of the Trust for use in Company
Documents or otherwise for use in connection with the sale of the Contracts or
Trust Shares; or
(b) arise out of or result from statements or representations (other than
statements or representations contained in and accurately derived from Trust
Documents as defined in Section 5.2(a)) or wrongful conduct of the Company or
persons under its control, with respect to the sale or acquisition of the
Contracts or Trust Shares; or
(c) arise out of or result from any untrue statement or alleged untrue statement
of a material fact contained in Trust Documents as defined in Section 5.2(a) 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 statement or omission was made in reliance upon and accurately derived from
written information furnished to the Trust by or on behalf of the Company; or
(d) arise out of or result from any failure by the Company to provide the
services or furnish the materials required under the terms of this Agreement; or
(e) arise out of or result from any material breach of any representation and/or
warranty made by the Company in this Agreement or arise out of or result from
any other material breach of this Agreement by the Company.
5.2 Indemnification By the Trust. The Trust agrees to indemnify and hold
harmless the Company and each of its directors, officers, employees and agents
and each person, if any, who controls the Company within the meaning of Section
15 of the 1933 Act (collectively, the "Indemnified Parties" for purposes of this
Article V) against any and all losses, claims, damages, liabilities (including
amounts paid in settlement with the written consent of the Trust) or expenses
(including the reasonable costs of investigating or defending any alleged loss,
claim, damage, liability or expense and reasonable legal counsel fees incurred
in connection therewith) (collectively, "Losses"), to which the Indemnified
Parties may become subject under any statute or regulation, or at common law or
otherwise, insofar as such Losses:
(a) arise out of or are based upon any untrue statements or alleged untrue
statements of any material fact contained in the registration statement or
prospectus for the Trust (or any amendment or supplement thereto),
(collectively, "Trust Documents" for the purposes of this Article V), 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 indemnity 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 was accurately derived from written
information furnished to the Trust by or on behalf of the Company for use in
Trust Documents or otherwise for use in connection with the sale of the
Contracts or Trust Shares; or
(b) arise out of or result from statements or representations (other than
statements or representations contained in and accurately derived from Company
Documents) or wrongful conduct of the Trust or persons under its control, with
respect to the sale or acquisition of the Contracts or Trust Shares; or
(c) arise out of or result from any untrue statement or alleged untrue statement
of a material fact contained in Company Documents 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 statement or
omission was made in reliance upon and accurately derived from written
information furnished to the Company by or on behalf of the Trust; or
(d) arise out of or result from any failure by the Trust to provide the services
or furnish the materials required under the terms of this Agreement; or
(e) 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.
5.3 Indemnification by the Distributor. The Distributor agrees to indemnify and
hold harmless the Company and each of its directors, officers, employees and
agents and each person, if any, who controls the Company within the meaning of
Section 15 of the 1933 Act (collectively, the "Indemnified Parties" for purposes
of this Article V) against any and all losses, claims, damages, liabilities
(including amounts paid in settlement with the written consent of the
Distributor) or expenses (including the reasonable costs of investigating or
defending any alleged loss, claim, damage, liability or expense and reasonable
legal counsel fees incurred in connection therewith) (collectively, "Losses"),
to which the Indemnified Parties may become subject under any statute or
regulation, or at common law or otherwise, insofar as such Losses:
(a) arise out of or are based upon any untrue statements or alleged untrue
statements of any material fact contained in the registration statement or
prospectus for the Trust (or any amendment or supplement thereto),
(collectively, "Trust Documents" for the purposes of this Article V), 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 indemnity 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 was accurately derived from written
information furnished to the Trust by or on behalf of the Company for use in
Trust Documents or otherwise for use in connection with the sale of the
Contracts or Trust Shares; or
(b) arise out of or result from statements or representations (other than
statements or representations contained in and accurately derived from Company
Documents) or wrongful conduct of the Distributor or persons under its control,
with respect to the sale or acquisition of the Contracts or Trust Shares; or
(c) arise out of or result from any untrue statement or alleged untrue statement
of a material fact contained in Company Documents 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 statement or
omission was made in reliance upon and accurately derived from written
information furnished to the Company by or on behalf of the Distributor; or
(d) arise out of or result from any failure by the Distributor to provide the
services or furnish the materials required under the terms of this Agreement; or
(e) arise out of or result from any material breach of any representation and/or
warranty made by the Distributor or the Trust in this Agreement or arise out of
or result from any other material breach of this Agreement by the Distributor or
the Trust.
5.4 Neither the Company, the Trust, nor the Distributor shall be liable under
the indemnification provisions of Sections 5.1, 5.2 or 5.3 as applicable, with
respect to any Losses incurred or assessed against an Indemnified Party that
arise from such Indemnified Party's willful misfeasance, bad faith or 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.
5.5 Neither the Company, the Trust, nor the Distributor shall be liable under
the indemnification provisions of Sections 5.1, 5.2 or 5.3, as applicable, with
respect to any claim made against an Indemnified Party unless such Indemnified
Party shall have notified the other party in writing within a reasonable time
after the summons, or other first written notification, giving information of
the nature of the claim shall have been served upon or otherwise received by
such Indemnified Party (or after such Indemnified Party shall have received
notice of service upon or other notification to any designated agent), but
failure to notify the party against whom indemnification is sought of any such
claim shall not relieve that party from any liability which it may have to the
Indemnified Party in the absence of Sections 5.1, 5.2, and 5.3.
5.6 In case any such action is brought against the Indemnified Parties, the
indemnifying party shall be entitled to participate, at its own expense, in the
defense of such action. The indemnifying party also shall be entitled to assume
the defense thereof, with counsel reasonably satisfactory to the party named in
the action. After notice from the indemnifying party to the Indemnified Party of
an election to assume such defense, the Indemnified Party shall bear the fees
and expenses of any additional counsel retained by it, and the indemnifying
party will not be liable to the Indemnified 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.
ARTICLE VI
Termination
6.1 This Agreement may be terminated by either party for any reason by one
hundred eighty (180) days advance written notice delivered to the other party.
6.2 The Agreement shall also terminate in accordance with the following
provisions:
(a) At the option of the Company, upon the institution of formal proceedings
against the Trust by the SEC, the NASD or any other regulatory body, the
expected or anticipated ruling, judgment or outcome of which would, in the
Company's reasonable judgment, materially impair the Trust's ability to meet and
perform the Trust's obligations and duties hereunder. Termination shall be
effective upon notice to the Trust;
(b) In the event the Trust's shares are not registered, issued or sold in
accordance with applicable state insurance or federal law, or such law precludes
the use of such shares as the underlying investment medium of the Contracts
issued by the Company. Termination shall be effective upon such occurrence
without notice;
(c) At the option of either the Company or the Trust, upon the other party's
breach of any material provision of the Agreement, which breach has not been
cured to the reasonable satisfaction of the non-breaching party within ten days
after written notice of such breach is delivered to the Trust;
(d) At the option of the Company or the Trust, if such party shall determine, in
its sole judgment reasonably exercised in good faith, that the other party is
the subject of material adverse publicity which has had a material adverse
impact on the sale of contracts and/or the operations or business reputation of
the terminating party, the terminating party shall have notified the other party
in writing of such determination and its intent to terminate the Agreement, and
after consideration of the actions taken by the other party and any other
changes in circumstances since the giving of such notice, the determination of
the terminating party shall continue to apply on the sixtieth (60th) day since
giving of such notice, which sixtieth (60th) day shall be the effective date of
termination.
6.3 Notwithstanding any termination of this Agreement, the Trust shall, at the
option of the Company, continue to make available additional shares of the Trust
(or any Portfolio) pursuant to the terms and conditions of this Agreement for
all Contracts in effect on the effective date of termination of this Agreement,
provided that the Company continues to pay the costs set forth in Section 2.3.
6.4 The provisions of Article V shall survive the termination of this Agreement,
and the provisions of Article IV and Section 2.8 shall survive the termination
of this Agreement.
ARTICLE VII
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:
Janus Aspen Series
000 Xxxxxxxx Xxxxxx
Xxxxxx, Xxxxxxxx 00000
Attention: General Counsel
If to the Company:
Business Men's Assurance Company of America
000 Xxxxxx Xxxx.
Xxxxxx Xxxx, Xxxxxxxx 00000
Attention: Xxxxxxx Xxxxxxxxx
Senior Vice President
ARTICLE VIII
Miscellaneous
8.1 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.
8.2 This Agreement may be executed simultaneously in two or more counterparts,
each of which taken together shall constitute one and the same instrument.
8.3 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.
8.4 This Agreement shall be construed and the provisions hereof interpreted
under and in accordance with the laws of State of Colorado.
8.5 The parties to this Agreement acknowledge and agree that all liabilities of
the Trust arising, directly or indirectly, under this Agreement, of any and
every nature whatsoever, shall be satisfied solely out of the assets of the
Trust and that no Trustee, officer, agent or holder of shares of beneficial
interest of the Trust shall be personally liable for any such liabilities.
8.6 Each party shall cooperate with each other party and all appropriate
governmental authorities (including without limitation the Securities and
Exchange Commission, the National Association of Securities Dealers, Inc., and
state 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.
8.7 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.
8.8 The parties to this Agreement acknowledge and agree that this Agreement
shall not be exclusive in any respect.
8.9 Neither this Agreement nor any rights or obligations hereunder may be
assigned by either party without the prior written approval of the other party.
8.10 No provisions of this Agreement may be amended or modified in any manner
except by a written agreement properly authorized and executed by both parties.
8.11 In the event the Trust intends to terminate the existence of a
Portfolio(s), the Distributor shall be liable for the payment of all expenses
incurred in connection with any fund substitution undertaken by the Company as a
result of such termination. Such expenses shall include but not be limited to
legal and accounting costs.
8.12 Subject to the requirements of legal process and regulatory authority, each
party hereto shall treat as confidential any "non-public personal information"
about any "consumer" of another party as such terms are defined in SEC
Regulation S-P, and shall not disclose or use such information without the
express written consent of such party. Such written consent shall specify the
purposes for which such information may be disclosed or used, which disclosure
or use shall be consistent with SEC Regulation S-P.
IN WITNESS WHEREOF, the parties have caused their duly authorized officers to
execute this Participation Agreement as of the date and year first above
written.
JANUS ASPEN SERIES
By:
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Name: Xxxxxx X. Xxxx
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Title: Vice President
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JANUS DISTRIBUTORS LLC
By:
-----------------------------------------------
Name: Xxxxxx X. Xxxx
--------------------------------------------
Title: Vice President
-------------------------------------------
BUSINESS MEN'S ASSURANCE COMPANY OF AMERICA
By:
-----------------------------------------------
Name:
---------------------------------------------
Title:
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Schedule A
Separate Accounts and Associated Contracts
Name of Separate Account and Contracts Funded
Date Established by Board of Directors By Separate Account
BMA Variable Annuity VA 20
Account A (Individual Flexible Payment
September 9, 1996 Deferred Variable Annuity)
VA 21
(Individual Flexible Payment
Deferred Variable Annuity)
BMA Variable Life VL 50
Account A (Flexible Premium Adjustable
September 9, 1996 Variable Life Insurance Policy)
VL51
(Last Survivor Flexible Premium
Adjustable Life Insurance Policy)
VL 52
(Flexible Premium Adjustable
Variable Life Insurance Policy)
VL 54
(Flexible Premium Adjustable
Variable Life Insurance Policy)
