Ex-8 (i)
PARTICIPATION AGREEMENT
BY AND AMONG
CITICORP LIFE INSURANCE COMPANY and
FIRST CITICORP LIFE INSURANCE COMPANY
ON BEHALF OF THEMSELVES AND
THEIR SEPARATE ACCOUNTS
AND
SALOMON BROTHERS ASSET MANAGEMENT INC
AND
SALOMON BROTHERS VARIABLE SERIES FUNDS INC
PARTICIPATION AGREEMENT
THIS AGREEMENT, made and entered into as of April 1, 1999 ("Agreement"), by
and among Salomon Brothers Variable Series Funds Inc, a Maryland corporation
(the "Fund"), Salomon Brothers Asset Management Inc, a Delaware Corporation (the
"Adviser") and Citicorp Life Insurance Company and First Citicorp Life Insurance
Company, an Arizona life insurance company and a New York life insurance
company, respectively, (collectively referred to herein as "CITICORP"), on
behalf of themselves and each of their segregated asset accounts listed in
Schedule A hereto, as the parties hereto may amend from time to time (each, an
"Account," and collectively, the "Accounts").
WITNESSETH THAT:
WHEREAS, the Fund is registered with the Securities and Exchange Commission
("SEC") as an open-end management investment company under the Investment
Company Act of 1940, as amended (the "1940 Act");
WHEREAS, the Fund is available to the extent set forth herein to act as the
investment vehicle for separate accounts established for variable life insurance
policies and variable annuity contracts to be offered by insurance companies
which have entered into participation agreements with the Fund and
("Participating Insurance Companies");
WHEREAS, the Fund currently consists of seven separate investment
portfolios which issue shares ("Shares") registered under the Securities Act of
1933, as amended (the "1933 Act");
WHEREAS, the Fund will make Shares of each investment portfolio listed on
Schedule A hereto (each, a "Portfolio" and collectively, the "Portfolios") as
the Parties hereto may amend from time to time available for purchase by the
Accounts;
WHEREAS, the Fund has received an order (the "Order") from the SEC to
permit 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 1940 Act and Rules 6e-2(b)(15) and 6e-3(T)(b)(15)
thereunder, to the extent necessary to permit shares of the Fund to be sold to
and held by variable annuity and variable life insurance separate accounts of
both affiliated and unaffiliated life insurance companies;
WHEREAS, CITICORP will be the issuer of certain variable annuity contracts
and variable life insurance policies (collectively, the "Contracts") as set
forth on Schedule A hereto, as the Parties hereto may amend from time to time,
which Contracts, if required by applicable law, will be registered under the
1933 Act;
WHEREAS, CITICORP will, to the extent set forth herein, fund the variable
life insurance policies and variable annuity contracts through the Accounts,
each of which may be divided into two or more subaccounts ("Subaccounts";
reference herein to an "Account" includes reference to each Subaccount thereof
to the extent the context requires);
WHEREAS, CITICORP will serve as the depositor of the Accounts, each of
which is registered as a unit investment trust under the 1940 Act (or exempt
therefrom), and the security interests deemed to be issued by the Accounts under
the Contracts will be registered as securities under the 1933 Act (or exempt
therefrom);
WHEREAS, to the extent permitted by applicable insurance laws and
regulations, CITICORP intends to purchase Shares in one or more of the
Portfolios on behalf of the Accounts to fund the Contracts; and
NOW, THEREFORE, in consideration of the mutual benefits and promises
contained herein, the Parties hereto agree as follows:
SECTION 1. AVAILABLE PORTFOLIOS
1.1 AVAILABLE PORTFOLIOS
The Fund will make Shares of each Portfolio listed on Schedule A available
to CITICORP for purchase and redemption at net asset value next computed after
the Fund's receipt of a purchase or redemption order and with no sales charges,
in accordance with the Fund's then current prospectus and subject to the terms
and conditions of this Agreement. The Board of Directors of the Fund 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 if, 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, such action is deemed in the best
interests of the shareholders of such Portfolio.
1.2 ADDITION, DELETION OR MODIFICATION OF PORTFOLIOS.
The Parties hereto may agree, from time to time, to add other Portfolios to
provide additional funding alternatives for the Contracts, or to delete or
modify existing Portfolios, by amending Schedule A hereto. Upon such amendment
to Schedule A, any applicable reference to a Portfolio, the Fund, or its Shares
herein shall include a reference to all Portfolios set forth on Schedule A as
then amended. Schedule A, as amended from time to time, is incorporated herein
by reference and is a part hereof.
1.3 NO SALES TO THE GENERAL PUBLIC.
The Fund represents that shares of the Portfolios will be sold only to
Participating Insurance Companies, their separate accounts and qualified pension
and retirement plans ("Plans") and that no Shares of any Portfolio have been or
will be sold to the general public.
SECTION 2. PROCESSING TRANSACTIONS
2.1 PLACING ORDERS.
(a) The Fund or its designated agent will use its best effort to provide
CITICORP with the net asset value per Share for each Portfolio by 6:30 p.m.
Eastern Time on each Business Day.
As used herein, "Business Day" shall mean any day on which (i) the New York
Stock Exchange is open for regular trading, and (ii) the Fund calculates the
Portfolios' net asset value.
(b) CITICORP will use the data provided by the Fund each Business Day
pursuant to paragraph (a) immediately above to calculate Account unit values and
to process transactions that receive that same Business Day's Account unit
values. CITICORP will perform such Account processing the same Business Day, and
will use its best efforts to place corresponding orders to purchase or redeem
Shares with the Fund by 10:00 a.m. Eastern Time the following Business Day.
(c) With respect to payment of the purchase price by CITICORP and of
redemption proceeds by the Fund, CITICORP and the Fund shall net purchase and
redemption orders with respect to each Portfolio and shall transmit one net
payment per Portfolio in accordance with Section 2.2, below.
(d) If the Fund provides materially incorrect Share net asset value
information (as determined under SEC guidelines), CITICORP shall be entitled to
an adjustment to the number of Shares purchased or redeemed 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 gain information
shall be reported promptly upon discovery to CITICORP.
2.2 PAYMENTS
(a) CITICORP shall pay for Shares of each Portfolio on the same day that it
notifies the Fund of a purchase request for such Shares. Payment for Shares
shall be made in federal funds transmitted to the Fund by wire by 3:00 P.M.
Eastern Time on the day the Fund is notified of the purchase request for Shares.
If payment in federal funds for any purchase is not received, or is received by
the Fund after 3:00 p.m. Eastern Time on such Business Day, CITICORP shall
promptly, upon the Fund's request in writing, reimburse the Fund for any
charges, costs, fees, interest or other expenses incurred by the Fund in
connection with any advances to, or borrowings or overdrafts by, the Fund, or
any similar expenses incurred by the Fund, as a result of non-payment or late
payment.
(b) The Fund will wire payment in federal funds for net redemptions to an
account designated by CITICORP by 3:00 p.m. Eastern Time on the business day
succeeding the day the order is placed, to the extent practicable, but in any
event within five (5) calendar days after the date the order is placed in order
to enable CITICORP to pay redemption proceeds within the time specified in
Section 22(e) of the 0000 Xxx. The Fund shall not bear any responsibility
whatsoever for the proper disbursement or crediting of redemption proceeds by
CITICORP.
2.3 APPLICABLE PRICE
(a) Share purchase payments and redemption orders that result from purchase
payments, premium payments, surrenders and other transactions under Contracts
(collectively, "Contract transactions") and that CITICORP receives prior to the
close of regular trading on the New York Stock Exchange on a Business Day will
be executed at the net asset values of the appropriate Portfolios next computed
after receipt by the Fund or its designated agent of the orders. For purposes of
this Section 2.3(a), CITICORP shall be the designated agent of the Fund for
receipt of orders relating to Contract transactions on each Business Day and
receipt by such designated
agent shall constitute receipt by the Fund; provided that the Fund receives
notice of such orders by 10:00 a.m. Eastern Time on the following Business Day.
(b) All other Share purchases and redemptions by CITICORP will be effected
at the net asset values of the appropriate Portfolios next computed after
receipt by the Fund or its designated agent of the order therefor, and such
orders will be irrevocable.
2.4 DIVIDENDS AND DISTRIBUTIONS
The Fund will furnish notice by wire or telephone (followed by written
confirmation) on or prior to the payment date to CITICORP of any income
dividends or capital gain distributions payable on the Shares of any Portfolio.
CITICORP hereby elects to reinvest all dividends and capital gains distributions
in additional Shares of the corresponding Portfolio at the ex-dividend date net
asset values until CITICORP otherwise notifies the Fund in writing, it being
agreed by the Parties that the ex-dividend date and the payment date with
respect to any dividend or distribution will be the same Business Day. CITICORP
reserves the right to revoke this election and to receive all such income
dividends and capital gain distributions in cash. Any such revocation will take
effect with respect to the next income dividend or capital gain distribution
following receipt by the Fund of such notification from CITICORP.
2.5 BOOK ENTRY
Issuance and transfer of Portfolio Shares will be by book entry only. Stock
certificates will not be issued to CITICORP. Shares ordered from the Fund will
be recorded in an appropriate title for CITICORP, on behalf of its Accounts.
SECTION 3. COSTS AND EXPENSES
3.1 GENERAL
(a) Except as otherwise specifically provided herein, each party will bear
all expenses incident to its performance under this Agreement.
(b) The Fund shall pay no fee or other compensation to CITICORP under this
agreement, except that if the Fund or any Portfolio adopts and implements a plan
pursuant to Rule 12b-1 to finance distribution expenses, then the Fund may make
payments to CITICORP or to the underwriter for the Contracts if and in amounts
agreed to by the Fund in writing. Presently, no such payments are contemplated.
3.2 REGISTRATION
(a) The Fund will bear the cost of its registering as a management
investment company under the 1940 Act and registering its Shares under the 1933
Act, and keeping such registrations current and effective; including, without
limitation, the preparation of and filing with the SEC of Forms N-SAR and Rule
24f-2 Notices with respect to the Fund and its Shares and payment of all
applicable registration or filing fees with respect to any of the foregoing.
(b) CITICORP will bear the cost of registering, to the extent required,
each Account as a unit investment trust under the 1940 Act and registering units
of interest under the Contracts
under the 1933 Act and keeping such registrations current and effective;
including, without limitation, the preparation and filing with the SEC of Forms
N-SAR and Rule 24f-2 Notices with respect to each Account and its units of
interest and payment of all applicable registration or filing fees with respect
to any of the foregoing.
3.3 FUND EXPENSES
The Fund will bear, or arrange for others to bear, the costs of preparing
and filing with the SEC the Fund's prospectus, statement of additional
information and any amendments or supplements thereto (collectively, the "Fund
Prospectus") and setting the Fund Prospectus for printing. In addition, the Fund
will bear the costs of printing and distributing the Fund's Prospectus, the
Fund's periodic reports to shareholders, the Fund proxy material and other
shareholder communications to existing Contract owners on whose behalf the
Accounts hold Shares to the extent required by law or as deemed appropriate by
the Fund.
3.4 CITICORP EXPENSES
CITICORP will bear the costs of preparing, filing with the SEC and printing
each Account's prospectus, statement of additional information and any
amendments or supplements thereto (collectively, the "Account Prospectus"), any
periodic reports to Contract owners, annuitants, insureds or participants (as
appropriate) under the Contracts (collectively, "Participants"), voting
instruction solicitation material and other Participant communications to the
extent required by law or as deemed appropriate by CITICORP. In addition,
CITICORP will bear the costs of printing in quantity and distributing the Fund
Prospectus to be delivered to prospective Participants. CITICORP may elect to
receive such prospectuses in camera ready or computer diskette format.
3.5 PARTIES TO COOPERATE
Each party agrees to cooperate with the other, in arranging to print, mail
and/or deliver, in a timely manner, combined or coordinated prospectuses or
other materials of the Fund and the Accounts.
SECTION 4. LEGAL COMPLIANCE
4.1 TAX LAWS
(a) The Fund represents and warrants that it will elect to be qualified as
a regulated investment company ("RIC") under Subchapter M of the Internal
Revenue Code of 1986, as amended (the "Code"), and represents that it will
qualify and maintain its qualification as a RIC and to comply with the
diversification requirements set forth in Section 817(h) of the Code and the
regulations thereunder. The Fund will notify CITICORP immediately upon having a
reasonable basis for believing that it has ceased to so qualify or so comply, or
that it might not so qualify or so comply in the future.
(b) CITICORP represents and warrants that the Contracts currently are and
will be treated as annuity contracts or life insurance contracts under
applicable provisions of the Code and that it will maintain such treatment;
CITICORP will notify the Fund immediately upon having a reasonable basis for
believing that any of the Contracts have ceased to be so treated or that they
might not be so treated in the future.
(c) CITICORP represents and warrants that each Account is a "segregated
asset account" and that interests in each Account are offered exclusively
through the purchase of or transfer into a "variable contract," within the
meaning of such terms under Section 817 of the Code and the regulations
thereunder. CITICORP will continue to meet such definitional requirements, and
it will notify the Fund immediately upon having a reasonable basis for believing
that such requirements have ceased to be met or that they might not be met in
the future.
4.2 INSURANCE AND CERTAIN OTHER LAWS
(a) CITICORP represents and warrants that (i) each is an insurance company
duly organized, validly existing and in good standing under all applicable laws
and has full corporate power, authority and legal right to execute, deliver and
perform its duties and comply with its obligations under this Agreement, (ii)
each has legally and validly established and maintains each Account as a
segregated asset account under all applicable laws and regulations, and (iii)
the Contracts comply in all material respects with all applicable federal and
state laws and regulations.
(b) The Fund represents and warrants that it is a corporation duly
organized, validly existing, and in good standing under the laws of the State of
Maryland and has full corporate power, authority, and legal right to execute,
deliver, and perform its duties and comply with its obligations under this
Agreement. Notwithstanding the foregoing, the Fund, makes no representations as
to whether any aspect of its operations (including, but not limited to, fees and
expenses and investment policies) otherwise complies with the insurance laws or
regulations of any state.
(c) The Adviser represents that it is and warrants that it shall remain
duly registered as an investment adviser under all applicable federal and state
securities laws and agrees that it shall perform its obligations to the Fund in
accordance in all material respects with such laws.
(d) CITICORP acknowledges and agrees that it is the responsibility of
CITICORP and other Participating Insurance Companies to determine investment
restrictions under state insurance law applicable to any Portfolio, and that the
Fund shall bear no responsibility to CITICORP, for any such determination or the
correctness of such determination. CITICORP has determined that the investment
restrictions set forth in the current Fund 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.
CITICORP shall inform the Fund of any additional investment restrictions imposed
by state insurance law after the date of this agreement that may become
applicable to the Fund or any Portfolio from time to time as a result of the
Accounts' investment therein. Upon receipt of any such information from CITICORP
or any other Participating Insurance Company, the Fund shall determine whether
it is in the best interests of shareholders to comply with any such
restrictions. If the Fund determines that it is not in the best interests of
shareholders to comply with a restriction determined to be applicable by
CITICORP, the Fund shall so inform CITICORP, and the Fund and CITICORP shall
discuss alternative accommodations in the circumstances.
4.3 SECURITIES LAWS
(a) CITICORP represents and warrants that (i) interests in each Account
pursuant to the Contracts will be registered under the 1933 Act to the extent
required by the 1933 Act, (ii) the Contracts will be duly authorized for
issuance and sold in compliance with all applicable federal and state laws,
including, without limitation, the 1933 Act, the 1934 Act, the 1940 Act and
applicable state law, (iii) each Account is and will remain registered under the
1940 Act, to the extent required by the 1940 Act, (iv) each Account does and
will comply in all material respects with the requirements of the 1940 Act and
the rules thereunder, to the extent required, (v) each Account's 1933 Act
registration statement relating to the Contracts, together with any amendments
thereto, will at all times comply in all material respects with the requirements
of the 1933 Act and the rules thereunder, (vi) CITICORP will amend the
registration statement for its Contracts under the 1933 Act and for its Accounts
under the 1940 Act from time to time as required in order to effect the
continuous offering of its Contracts or as may otherwise be required by
applicable law, (vii) each Account Prospectus will at all times comply in all
material respects with the requirements of the 1933 Act and the rules
thereunder, (viii) all of its directors, officers, employees, investment
advisers, and other individuals/entities having access to the funds and/or
securities of any Portfolio are and continue to be at all times covered by a
blanket fidelity bond or similar coverage covering such risks and in such amount
as is customary for companies engaged in similar businesses in similar
industries. The aforesaid bond includes coverage for larceny and embezzlement
and is issued by a reputable bonding company.
(b) The Fund represents and warrants that (i) Shares sold pursuant to this
Agreement will be registered under the 1933 Act to the extent required by the
1933 Act and will be duly authorized for issuance and sold in compliance with
Maryland law, (ii) the Fund is and will remain registered under the 1940 Act to
the extent required by the 1940 Act, (iii) the Fund will amend the 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, (iv) the Fund does and
will comply in all material respects with the requirements of the 1940 Act and
the rules thereunder, (v) the Fund's 1933 Act registration statement, together
with any amendments thereto, will at all times comply in all material respects
with the requirements of the 1933 Act and rules thereunder, (vi) the Fund's
Prospectus will at all times comply in all material respects with the
requirements of the 1933 Act and the rules thereunder and (vii) all of its
directors, officers, employees, investment advisers, and other
individuals/entities having access to the funds and/or securities of any
Portfolio are and 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 Rule 17g-(1) of the 1940 Act of
related provisions as may be promulgated from time to time. The aforesaid bond
includes coverage for larceny and embezzlement and is issued by a reputable
bonding company.
(c) The Fund will at its expense register and qualify its Shares for sale
in accordance with the laws of any state or other jurisdiction if and to the
extent reasonably deemed advisable by the Fund.
4.4 NOTICE OF CERTAIN PROCEEDINGS AND OTHER CIRCUMSTANCES.
(a) The Fund will immediately notify CITICORP of (i) the issuance by any
court or regulatory body of any stop order, cease and desist order, or other
similar order with respect to the Fund's registration statement under the 1933
Act or the Fund Prospectus, (ii) any request by
the SEC for any amendment to such registration statement or the Fund Prospectus
that may affect the offering of Shares of any Portfolio, (iii) the initiation of
any proceedings for that purpose or for any other purpose relating to the
registration or offering of Shares of any Portfolio, or (iv) any other action or
circumstances that may prevent the lawful offer or sale of Shares of any
Portfolio in any state or jurisdiction, including, without limitation, any
circumstances in which such Shares are not registered and are not, in all
material respects, issued and sold in accordance with applicable state and
federal law. The Fund will make every reasonable effort to prevent the issuance
of any such stop order, cease and desist order or similar order and, if any such
order is issued, to obtain the lifting thereof at the earliest possible time.
(b) CITICORP will immediately notify the Fund of (i) the issuance by any
court or regulatory body of any stop order, cease and desist order, or other
similar order with respect to each Account's registration statement under the
1933 Act relating to the Contracts or each Account Prospectus, (ii) any request
by the SEC for any amendment to such registration statement or Account
Prospectus that may affect the offering of Shares of any Portfolio, (iii) the
initiation of any proceedings for that purpose or for any other purpose relating
to the registration or offering of each Account's interests pursuant to the
Contracts, or (iv) any other action or circumstances that may prevent the lawful
offer or sale of said interests in any state or jurisdiction, including, without
limitation, any circumstances in which said interests are not registered and are
not, in all material respects, issued and sold in accordance with applicable
state and federal law. CITICORP will make every reasonable effort to prevent the
issuance of any such stop order, cease and desist order or similar order and, if
any such order is issued, to obtain the lifting thereof at the earliest possible
time.
4.5 DOCUMENTS PROVIDED BY CITICORP; INFORMATION ABOUT THE FUND
(a) CITICORP will provide to the Fund or its designated agent at least one
(1) complete copy of all SEC registration statements, Account Prospectuses,
reports, any preliminary and final voting instruction solicitation material,
applications for exemptions, requests for no-action letters, and all amendments
to any of the above, that relate to each Account or the Contracts,
contemporaneously with the filing of such document with the SEC or other
regulatory authorities.
(b) CITICORP will provide to the Fund or its designated agent at least one
(1) complete copy of each piece of sales literature or other promotional
material in which any Portfolio, the Fund or any of its affiliates is named, at
least ten (10) 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 Fund or its designated agent objects to such use within ten (10)
Business Days after receipt of such material or such shorter period as the
Parties hereto may, from time to time, agree upon.
(c) Neither CITICORP nor any of its affiliates, will give any information
or make any representations or statements on behalf of or concerning any
Portfolio, the Fund or its affiliates in connection with the sale of the
Contracts other than (i) the information or representations contained in the
then current registration statement, including the Fund Prospectus contained
therein, relating to Shares, as such registration statement and the Fund
Prospectus may be amended from time to time; (ii) in reports or proxy materials
for the Fund; (iii) in published reports for the Fund that are in the public
domain and approved by the Fund for distribution by CITICORP; or (iv) in sales
literature or other promotional material approved by the Fund for use by
CITICORP, except with the express written permission of the Fund.
(d) CITICORP shall adopt and implement procedures reasonably designed to
ensure that information concerning the Fund and its affiliates that is intended
for use only by brokers or agents selling the Contracts (i.e., information that
is not intended for distribution to Participants) ("broker only materials") is
so used, and neither the Fund nor any of its affiliates shall be liable for any
losses, damages or expenses relating to the improper use of such broker only
materials.
(e) For the purposes of this Section 4.5, the phrase "sales literature or
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 (e.g., on-
line networks such as the Internet or other electronic messages)), 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, registration statements,
prospectuses, statements of additional information, shareholder reports, and
proxy materials and any other material constituting sales literature or
advertising under the NASD rules, the 1933 Act or the 1940 Act.
4.6 DOCUMENTS PROVIDED BY FUND; INFORMATION ABOUT CITICORP.
(a) The Fund will provide to CITICORP at least one (1) complete copy of all
SEC registration statements, Fund Prospectuses, reports, any preliminary and
final proxy material, applications for exemptions, requests for no-action
letters, and all amendments to any of the above, that relate to the Fund or the
Shares of a Portfolio, contemporaneously with the filing of such document with
the SEC or other regulatory authorities.
(b) The Fund will provide to CITICORP copies of all Fund prospectuses, and
printed copies of all statements of additional information, proxy materials,
periodic reports to shareholders and other materials required by law to be sent
to Participants who have allocated any Contract value to a Portfolio. The Fund
will provide such copies to CITICORP in a timely manner so as to enable CITICORP
to print and distribute such materials within the time required by law to be
furnished to Participants.
(c) The Fund will provide to CITICORP or its designated agent at least one
(1) complete copy of each piece of sales literature or other promotional
material in which CITICORP, or any of its respective affiliates is named, or
that refers to the Contracts, at least ten (10) 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 CITICORP or its designated agent reasonably
objects to such use within ten (10) Business Days after receipt of such material
or such shorter period as the Parties hereto may, from time to time, agree upon.
(d) Neither the Fund nor any of its affiliates will give any information or
make any representations or statements on behalf of or concerning CITICORP, each
Account, or the Contracts other than (i) the information or representations
contained in the registration statement, including each Account Prospectus
contained therein, relating to the Contracts, as such registration statement and
Account Prospectus may be amended from time to time; (ii) in published reports
for the Account or the Contracts that are in the public domain and approved by
CITICORP for distribution; or (iii) in sales literature or other promotional
material approved by CITICORP or its affiliates, except with the express written
permission of CITICORP.
(e) The Fund shall cause its principal underwriter to adopt and implement
procedures reasonably designed to ensure that information concerning CITICORP,
and its respective affiliates that is intended for use only by brokers or agents
selling the Contracts (i.e., information that is not intended for distribution
to Participants) ("broker only materials") is so used, and neither CITICORP, nor
any of its respective affiliates shall be liable for any losses, damages or
expenses relating to the improper use of such broker only materials.
(f) For purposes of this Section 4.6, the phrase "sales literature or 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 (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, registration statements, prospectuses, statements of additional
information, shareholder reports, and proxy materials and any other material
constituting sales literature or advertising under the NASD rules, the 1933 Act
or the 1940 Act.
SECTION 5. MIXED AND SHARED FUNDING
CITICORP acknowledges that the Fund has received an order from the SEC
granting relief from various provisions of the 1940 Act and the rules thereunder
to the extent necessary to permit Fund shares to be sold to and held by variable
annuity and variable life insurance separate accounts of both affiliated and
unaffiliated Participating Insurance Companies, as well as by Plans. Any
conditions or undertakings that are imposed on CITICORP and the Fund by virtue
of such order are incorporated herein by reference as though set forth herein in
full, and the parties to this Agreement shall comply with such conditions and
undertakings to the extent applicable to each such party.
SECTION 6. TERMINATION
6.1 EVENTS OF TERMINATION
Subject to Section 6.4 below, this Agreement will terminate as to a
Portfolio:
(a) at the option of any party, with or without cause, upon one (1) year
advance written notice to the other parties; or
(b) at the option of CITICORP if shares of a Portfolio are not reasonably
available to meet the requirements of the Contracts as determined by CITICORP
provided, however, that such a termination shall apply only to the Portfolio(s)
not available. Prompt written notice of the election to terminate for such cause
shall be furnished by CITICORP to the Fund;
(c) at the option of the Fund upon institution of formal processing against
CITICORP or
its affiliates by the NASD, the SEC, any state insurance regulator or any other
regulatory body regarding CITICORP'S obligations under this Agreement or related
to the sale of the Contracts, the operation of each Account, or the purchase of
Shares, if, in each case, the Fund reasonably determines that such proceedings,
or the facts on which such proceedings would be based, have a material
likelihood of imposing material adverse consequences on the Portfolio with
respect to which the Agreement is to be terminated; or
(d) at the option of CITICORP upon institution of formal proceedings
against the Fund, its principal underwriter, or its investment adviser by the
NASD, the SEC, or any state insurance regulator or any other regulatory body
regarding the Fund's obligations under this Agreement or related to the
operation or management of the applicable Portfolio or the purchase of the
applicable Portfolios, if, in each case, CITICORP reasonably determines that
such proceedings, or the facts on which such proceedings would be based, have a
material likelihood of imposing material adverse consequences on CITICORP, or
the Subaccount corresponding to the Portfolio with respect to which the
Agreement is to be terminated; or
(e) at the option of any party in the event that (i) a Portfolio's Shares
are not registered and, in all material respects, issued and sold in accordance
with any applicable federal or state law, or (ii) such law precludes the use of
such Shares as an underlying investment medium of the Contracts issued or to be
issued by CITICORP; or
(f) at the option of CITICORP if the applicable Portfolio ceases to qualify
as a RIC under Subchapter M of the Code or under successor or similar provisions
or fails to comply with the diversification requirements of Section 817(h) of
the Code or such requirements under successor or similar provisions or if
CITICORP reasonably believes the applicable Portfolio may so cease to qualify or
comply and, in each case, the Fund upon written request fails to provide
reasonable assurance that it will take action to cure or correct such failure;
or
(g) at the option of the Fund if the Contracts issued by CITICORP cease to
qualify as annuity contracts or life insurance contracts under the Code or if
Fund reasonably believes the applicable Contracts may so cease to qualify, or if
interests in an Account under the Contracts are not registered, where required,
and, in all material respects, are not issued or sold in accordance with any
applicable federal or state law and, in each case, CITICORP upon written request
fails to provide reasonable assurance that it will take action to cure or
correct such failure; or
(h) at the option of the Fund by written notice to CITICORP, if the Fund
shall determine in its sole judgment exercised in good faith, that CITICORP
and/or its affiliated companies has suffered a material adverse change in its
business, operations, financial condition or prospects since the date of this
Agreement or is the subject of material adverse publicity; or
(i) at the option of CITICORP by written notice to the Fund, if CITICORP
shall determine in its sole judgment exercised in good faith, that the Fund
and/or its affiliated companies has suffered a material adverse change in its
business, operations, financial condition or prospects since the date of this
Agreement or is the subject of material adverse publicity; or
(j) at the option of CITICORP by written notice to the Fund, if CITICORP
shall determine in its sole judgment exercised in good faith, that the Adviser
and/or its affiliated companies has suffered a material adverse change in its
business operations, financial condition or prospects since the date of this
Agreement or is the subject of material adverse publicity; or
(k) at the option of either party upon a determination by a majority of the
Fund's Board of Directors, or a majority of the Fund's disinterested directors,
that an irreconcilable material conflict exists among the interests of: (1) all
contract owners of variable insurance products of all separate accounts; or (2)
the interests of the Participating Insurance Companies investing in the Fund; or
(l) at the option of any party upon another party's material breach of any
provision of this Agreement; or
(m) with respect to any Account, upon requisite vote of the Contract owners
having an interest in that Account (or any subaccount) or upon the receipt of a
substitution order by the SEC to substitute the shares of another investment
company for the corresponding Fund shares in accordance with the terms of the
Contracts for which those Fund shares had been selected to serve as the
underlying investment media. CITICORP will give at least 30 days' prior written
notice to the Fund of the date of any proposed vote to replace the Fund's
shares; or
(n) at the option of the Fund if it suspends or terminates the offering of
Shares of the applicable Portfolio to all Participating Insurance Companies or
only designated Participating Insurance Companies, if such action is required by
law or by regulatory authorities having jurisdiction or if, in the sole
discretion of the Fund acting in good faith, suspension or termination is
necessary in the best interests of the shareholders of the applicable Portfolio
(it being understood that "shareholders" for this purpose shall mean
Participants), such notice effective immediately upon receipt of written notice,
it being understood that a lack Participating Insurance Companies interest in
the applicable Portfolio may be grounds for a suspension or termination as to
such Portfolio.
6.2 NOTICE REQUIREMENT FOR TERMINATION
No termination of this Agreement will be effective unless and until the
party terminating this Agreement gives prior written notice to the other party
to this Agreement of its intent to terminate, and such notice shall set forth
the basis for such termination. Furthermore:
(a) in the event that any termination is based upon the provisions of
Section 6.1(a) hereof, such prior written notice shall be given at least one
(1) year in advance of the effective date of termination unless a shorter time
is agreed to by the Parties hereto;
(b) in the event that any termination is based upon the provisions of
Section 6.1(b), 6.1(c), 6.1(d), 6.1(e), 6.1(f), 6.1(g), 6.1(h), 6.1(i), 6.1(j),
6.1(k), 6.1(l), 6.1(m), or 6.1(n) hereof, such prior written notice shall be
given at least 30 days in advance of the effective date of termination unless a
shorter time is agreed to by the Parties hereto; and
6.3 FUND TO REMAIN AVAILABLE
Notwithstanding any termination of this Agreement, the Fund will, at the
option of CITICORP, continue to make available additional shares of a Portfolio
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 will be permitted to reallocate investments in
Portfolios of the
Fund (as in effect on such date), redeem investments in Portfolios of the Fund
and/or invest in Portfolios of the Fund upon the making of additional purchase
payments under the Existing Contracts. Notwithstanding any termination of this
Agreement, CITICORP agrees to distribute to holders of Existing Contracts all
materials required by law to be distributed to such holders (including, without
limitation, prospectuses, statements of additional information, proxy materials
and periodic reports). The parties agree that this Section 6.3 will not apply to
any terminations under the conditions of the Order and the effect of such
terminations will be governed by the Order.
6.4 SURVIVAL OF WARRANTIES AND INDEMNIFICATIONS
All warranties and indemnifications will survive the termination of this
Agreement.
SECTION 7. PARTIES TO COOPERATE RESPECTING TERMINATION
Subject to the provisions of Section 6.3 hereof, the Parties hereto agree
to cooperate and give reasonable assistance to one another in taking all
necessary and appropriate steps for the purpose of ensuring that an Account owns
no Shares of the applicable Portfolio after the Final Termination Date with
respect thereto, or, in the case of a termination pursuant to Section 6.1(a),
the termination date specified in the notice of termination. Such steps may
include combining the affected Account with another Account, substituting other
mutual fund shares for those of the affected Portfolio, or otherwise terminating
participation by the Contracts in such Portfolio.
SECTION 8. ASSIGNMENT
This Agreement may not be assigned by any party, except with the prior
written consent of all the Parties.
SECTION 9. NOTICES
Notices and communications required or permitted by Section 9 hereof will
be given by means mutually acceptable to the Parties concerned. Each other
notice or communication required or permitted by this Agreement will be given to
the following persons at the following addresses and facsimile numbers, or such
other persons, addresses or facsimile numbers as the party receiving such
notices or communications may subsequently direct in writing:
CITICORP INSURANCE COMPANY
FIRST CITICORP LIFE INSURANCE COMPANY
c/o Traveler Insurance Company
X.X. Xxx 0000
Xxxxx, Xxxxxxxx 00000
Attn.: General Counsel
SALOMON BROTHERS VARIABLE SERIES FUNDS INC.
0 Xxxxx Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Facsimile: (000)000-0000
Attn.: Secretary
SECTION 10. VOTING PROCEDURES
Subject to the cost allocation procedures set forth in Section 3 hereof,
CITICORP will distribute all proxy material furnished by the Fund to
Participants to whom pass-through voting privileges are required to be extended
and will solicit voting instructions from Participants. CITICORP will vote
Shares in accordance with timely instructions received from Participants.
CITICORP will vote Shares that are (a) not attributable to Participants to whom
pass-through voting privileges are extended, or (b) attributable to
Participants, but for which no timely instructions have been received, in the
same proportion as Shares for which said instructions have been received from
Participants, so long as and to the extent that the SEC continues to interpret
the 1940 Act to require pass through voting privileges for Participants. Neither
CITICORP nor any of its affiliates will in any way recommend action in
connection with or oppose or interfere with the solicitation of proxies for the
Shares held for such Participants. CITICORP reserves the right to vote shares
held in any Account in its own right, to the extent permitted by law. CITICORP
shall be responsible for assuring that each of its Accounts holding Shares
calculates voting privileges in the manner required by the Order obtained by the
Fund. The Fund will notify CITICORP of any amendments to the Order it has
obtained.
SECTION 11. INDEMNIFICATION
11.1 OF THE FUND BY CITICORP
(a) Except to the extent provided in Sections 11.1(b) and 11.1(c), below,
CITICORP agrees to indemnify and hold harmless the Fund, its affiliates, and
each person, if any, who controls the Fund or its affiliates within the meaning
of Section 15 of the 1933 Act and each of their respective directors and
officers (collectively, the "Indemnified Parties" for purposes of this Section
11.1) against any and all losses, claims, damages, costs, expenses, liabilities
(including amounts paid in settlement with the written consent of CITICORP)or
actions in respect thereof (including, to the extent reasonable, legal and other
expenses), to which the Indemnified Parties may become subject under any
statute, regulation, at common law or otherwise insofar as such losses, claims,
damages, costs, expenses, liabilities or actions;
(i) arise out of or are based upon any untrue statement or alleged untrue
statement of any material fact contained in any Account's 1933 Act
registration statement, any Account Prospectus, the Contracts, or sales
literature or advertising 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 written
information furnished to CITICORP by or on behalf of the Fund for use in
any Account's 1933 Act registration statement, any Account Prospectus, the
Contracts, or sales literature or advertising (or any amendment or
supplement to any of the foregoing); or
(ii) arise out of or as a result of any other statements or representations
(other than statements or representations contained in the Fund's 1933 Act
registration statement, the Fund Prospectus, sales literature or
advertising of the Fund, or any amendment or supplement to any of the
foregoing, not supplied for use therein by or on behalf of
CITICORP, or its affiliates and on which such persons have reasonably
relied) or negligent, illegal or fraudulent conduct of CITICORP, or its
respective affiliates or persons under their control (including, without
limitation, their employees and "Associated Persons," as that term is
defined in paragraph (m) of Article I of the NASD's By-Laws) or subject to
its authorization, including without limitation, broker-dealers or agents
authorized to sell the Contracts, in connection with the sale, marketing or
distribution of the Contracts or Shares; or
(iii) arise out of or are based upon any untrue statement or alleged untrue
statement of any material fact contained in the Fund's 1933 Act
registration statement, the Fund Prospectus, sales literature or
advertising of the Fund, or any amendment or supplement to any of the
foregoing, 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 and in conformity with information furnished to the Fund or its
affiliates by or on behalf of CITICORP or its affiliates for use in the
Fund's 1933 Act registration statement, the Fund Prospectus, sales
literature or advertising of the Fund, or any amendment or supplement to
any of the foregoing; or
(iv) arise as a result of any failure by CITICORP or persons under its
control (or subject to its authorization) to perform the obligations,
provide the services and furnish the materials required under the terms of
this Agreement, or any material breach of any representation and/or
warranty made by CITICORP in this Agreement or arise out of or result from
any other material breach of this Agreement by CITICORP or persons under
its control (or subject to its authorization); or
(v) arise as a result of failure to transmit a request for purchase or
redemption of Shares or payment therefor within the time period specified
herein and otherwise in accordance with the procedures set forth in this
Agreement; or
(vi) arise as a result of any unauthorized use of the trade names of the
Fund to the extent such use is not required by applicable law or
regulation.
(b) This indemnification is in addition to any liability that CITICORP may
otherwise have. CITICORP shall not be liable under this Section 11.1 with
respect to any losses, claims, damages, costs, expenses, liabilities or actions
to which an Indemnified Party would otherwise be subject by reason of willful
misfeasance, bad faith, or gross negligence in the performance by that
Indemnified Party of its duties or by reason of that Indemnified Party's
reckless disregard of obligations or duties (i) under this Agreement, or (ii) to
the Fund.
(c) CITICORP shall not be liable under this Section 11.1 with respect to
any action against an Indemnified Party unless the Fund shall have notified
CITICORP in writing promptly after the summons or other first legal process
giving information of the nature of the action 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 CITICORP shall be relieved of
liability under this Section 11.1 only to the extent the indemnifying party is
damaged solely by reason of such party's failure to so notify and failure to
notify CITICORP of any such action shall not relieve CITICORP from any liability
which they may have to the Indemnified Party against whom such action is brought
otherwise than on account of this Section 11.1. Except as otherwise
provided herein, in case any such action is brought against an Indemnified
Party, CITICORP shall be entitled to participate, at its own expense, in the
defense of such action and also shall be entitled to assume the defense thereof,
with counsel approved by the Indemnified Party named in the action, which
approval shall not be unreasonably withheld. After notice from CITICORP to such
Indemnified Party of CITICORP' election to assume the defense thereof, the
Indemnified Party will cooperate fully with CITICORP and shall bear the fees and
expenses of any additional counsel retained by it, and CITICORP will not be
liable to such Indemnified Party under this Agreement for any legal or other
expenses subsequently incurred by such Indemnified Party independently in
connection with the defense thereof, other than reasonable costs of
investigation.
11.2 OF CITICORP BY THE FUND
(a) Except to the extent provided in Sections 11.2(b) and 11.2(c) below,
the Fund agrees to indemnify and hold harmless CITICORP, its affiliates, and
each person, if any, who controls CITICORP or its affiliates within the meaning
of Section 15 of the 1933 Act and each of their respective directors and
officers (collectively, the "Indemnified Parties" for purposes of this Section
11.2) against any and all losses, claims, damages, costs, expenses, liabilities
(including amounts paid in settlement with the written consent of the Fund) or
actions in respect thereof (including, to the extent reasonable, legal and other
expenses), to which the Indemnified Parties may become subject under any
statute, regulation, at common law, or otherwise; insofar as such losses,
claims, damages, costs, expenses, liabilities or actions:
(i) arise out of or are based upon any untrue statement or alleged untrue
statement of any material fact contained in the Fund's 1933 Act
registration statement, Prospectus or sales literature or advertising of
the Fund (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 to any Indemnified Party if such statement or
omission or such alleged statement or omission was made in reliance upon
and in conformity with written information furnished to the Fund or its
affiliates by or on behalf of CITICORP or its affiliates for use in the
Fund's 1933 Act registration statement, the Fund Prospectus, or in sales
literature or advertising or Otherwise for use in connection with the sale
of Contracts or Shares (or any amendment or supplement to any of the
foregoing); or
(ii) arise out of or as a result of any other statements or representations
(other than statements or representations contained in any Account's 1933
Act registration statement, any Account Prospectus, sales literature or
advertising for the Contracts, or any amendment or supplement to any of the
foregoing, not supplied for use therein by or on behalf of the Fund or its
affiliates and on which such persons have reasonably relied) or the
negligent, illegal or fraudulent conduct of the Fund or its affiliates or
persons under its control (including, without limitation, their employees
and "Associated Persons" as that Term is defined in Section (n) of Article
1 of the NASD By-Laws), in connection with the sale, marketing or
distribution of Fund Shares; or
(iii) arise out of or are based upon any untrue statement or alleged untrue
statement of any material fact contained in any Account's 1933 Act
registration statement, any Account Prospectus, sales literature or
advertising covering the Contracts, or any amendment or supplement to any
of the foregoing, 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 in conformity with written information furnished to
CITICORP, or its affiliates by or on behalf of the Fund for use in any
Account's 1933 Act registration statement, any Account Prospectus, sales
literature or advertising covering the Contracts, or any amendment or
supplement to any of the foregoing; or
(iv) arise as a result of any failure by the Fund to perform the
obligations, provide the services and furnish the materials required of it
under the terms of this Agreement, including, without limitation, any
failure of the Fund or its designated agent to inform CITICORP of the
correct net asset values per share for each Portfolio on a timely basis
sufficient to ensure the timely execution of all purchase and redemption
orders at the correct net asset value per share, or any material breach of
any representation and/or warranty made by the Fund in this Agreement or
arise out of or result from any other material breach of this Agreement by
the Fund.
(b) This indemnification is in addition to any liability that the Fund may
otherwise have. The Fund shall not be liable under this Section 11.2 with
respect to any losses, claims, damages, costs, expenses, liabilities or actions
to which an Indemnified Party would otherwise be subject by reason of willful
misfeasance, bad faith, or gross negligence in the performance by that
Indemnified Party of its duties or by reason of such Indemnified Party's
reckless disregard of its obligations and duties (i) under this Agreement, or
(ii) to CITICORP, each Account or Participants.
(c) The Fund shall not be liable under this Section 11.2 with respect to
any action against an Indemnified Party unless the Indemnified Party shall have
notified the Fund in writing promptly after the summons or other first legal
process giving information of the nature of the action 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 the Fund shall be relieved
of liability under this Section 11.2 only to the extent the indemnifying party
is damaged solely by reason of such party's failure to so notify and failure to
notify the Fund of any such action shall not relieve the Fund from any liability
which it may have to the Indemnified Party against whom such action is brought
otherwise than on account of this Section 11.2. Except as otherwise provided
herein, in case any such action is brought against an Indemnified Party, the
Fund will be entitled to participate, at its own expense, in the defense of such
action and also shall be entitled to assume the defense thereof (which shall
include, without limitation, the conduct of any ruling request and closing
agreement or other settlement proceeding with the IRS), with counsel approved by
the Indemnified Party named in the action, which approval shall not be
unreasonably withheld. After notice from the Fund to such Indemnified Party of
the Fund's election to assume the defense thereof, the Indemnified Party will
cooperate fully with the Fund and shall bear the fees and expenses of any
additional counsel retained by it, and the Fund will not be liable to such
Indemnified Party under this Agreement for any legal or other expenses
subsequently incurred by such Indemnified Party independently in connection with
the defense thereof, other than reasonable costs of investigation.
11.3 OF CITICORP BY THE ADVISER
(a) Except to the extent provided in Sections 11.3(b) and 11.3(c) below,
the Adviser agrees to indemnify and hold harmless CITICORP, its affiliates, and
each person, if any, who
controls CITICORP or its affiliates within the meaning of Section 15 of the 1933
Act and each of their respective directors and officers (collectively, the
"Indemnified Parties" for purposes of this Section 11.2) against any and all
losses, claims, damages, costs, expenses, liabilities (including amounts paid in
settlement with the written consent of the Fund) or actions in respect thereof
(including, to the extent reasonable, legal and other expenses), to which the
Indemnified Parties may become subject under any statute, regulation, at common
law, or otherwise; insofar as such losses, claims, damages, costs, expenses,
liabilities or actions:
(i) arise out of or are based upon any untrue statement or alleged untrue
statement of any material fact contained in the Fund's 1933 Act
registration statement, Prospectus or sales literature or advertising of
the Fund (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 to any Indemnified Party if such statement or
omission or such alleged statement or omission was made in reliance upon
and in conformity with written information furnished to the Adviser, the
Fund or their affiliates by or on behalf of CITICORP or its affiliates for
use in the Fund's 1933 Act registration statement, the Fund Prospectus, or
in sales literature or advertising or otherwise for use in connection with
the sale of Contracts or Shares (or any amendment or supplement to any of
the foregoing); or
(ii) arise out of or as a result of any other statements or representations
(other than statements or representations contained in any Account's 1933
Act registration statement, any Account Prospectus, sales literature or
advertising for the Contracts, or any amendment or supplement to any of the
foregoing, not supplied for use therein by or on behalf of the Adviser, the
Fund or their affiliates and on which such persons have reasonably relied)
or the negligent, illegal or fraudulent conduct of the Adviser, the Fund or
their affiliates or persons under their control (including, without
limitation, their employees and "Associated Persons" as that Term is
defined in Section (n) of Article 1 of the NASD By-Laws), in connection
with the sale, marketing or distribution of Fund Shares; or
(iii) arise out of or are based upon any untrue statement or alleged untrue
statement of any material fact contained in any Account's 1933 Act
registration statement, any Account Prospectus, sales literature or
advertising covering the Contracts, or any amendment or supplement to any
of the foregoing, 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 in conformity with written information furnished to
CITICORP, or its affiliates by or on behalf of the Adviser or the Fund for
use in any Account's 1933 Act registration statement, any Account
Prospectus, sales literature or advertising covering the Contracts, or any
amendment or supplement to any of the foregoing; or
(iv) arise as a result of any failure by the Adviser or the Fund to perform
the obligations, provide the services and furnish the materials required of
it under the terms of this Agreement, including, without limitation, any
failure of the Fund or its designated agent to inform CITICORP of the
correct net asset values per share for each Portfolio on a timely basis
sufficient to ensure the timely execution of all purchase and redemption
orders at the correct net asset value per share, or any material breach of
any representation and/or
warranty made by the Adviser or the Fund in this Agreement or arise out of
or result from any other material breach of this Agreement by the Adviser.
(b) This indemnification is in addition to any liability that the Adviser
may otherwise have. The Adviser shall not be liable under this Section 11.3 with
respect to any losses, claims, damages, costs, expenses, liabilities or actions
to which an Indemnified Party would otherwise be subject by reason of willful
misfeasance, bad faith, or gross negligence in the performance by that
Indemnified Party of its duties or by reason of such Indemnified Party's
reckless disregard of its obligations and duties (i) under this Agreement, or
(ii) to CITICORP, each Account or Participants.
(c) The Adviser shall not be liable under this Section 11.3 with respect to
any action against an Indemnified Party unless the Indemnified Party shall have
notified the Adviser in writing promptly after the summons or other first legal
process giving information of the nature of the action 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 the Adviser shall be
relieved of liability under this Section 11.3 only to the extent the
indemnifying party is damaged solely by reason of such party's failure to so
notify and failure to notify the Adviser of any such action 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 Section
11.3. Except as otherwise provided herein, 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 and also shall be entitled to
assume the defense thereof (which shall include, without limitation, the conduct
of any ruling request and closing agreement or other settlement proceeding with
the IRS), with counsel approved by the Indemnified Party named in the action,
which approval shall not be unreasonably withheld. After notice from the Adviser
to such Indemnified Party of the Adviser's election to assume the defense
thereof, the Indemnified Party will cooperate fully with the Fund and shall bear
the fees and expenses of any additional counsel retained by it, and the Adviser
will not be liable to such Indemnified Party under this Agreement for any legal
or other expenses subsequently incurred by such Indemnified Party independently
in connection with the defense thereof, other than reasonable costs of
investigation.
11.4 EFFECT OF NOTICE
Any notice given by the indemnifying party to an Indemnified Party referred
to in Sections ll.l(c), 11.2(c) or 11.3(c) above of participation in or control
of any action by the indemnifying party will in no event be deemed to be an
admission by the indemnifying party of liability, culpability or responsibility,
and the indemnifying party will remain free to contest liability with respect to
the claim among the Parties or otherwise.
11.5 SUCCESSORS
A successor by law of any party shall be entitled to the benefits of the
indemnification contained in this Section 11.
11.6 OBLIGATIONS OF THE FUND.
All persons dealing with the Fund must look solely to the property of the
applicable Portfolio for the enforcement of any claims against the Fund as
neither the Board, Officers, agents
or shareholders assume any personal liability for obligations entered into on
behalf of the Fund.
SECTION 12. APPLICABLE LAW
(a) This Agreement will be construed and the provisions hereof interpreted
under and in accordance with New York law, without regard for that state's
principles of conflict of laws.
(b) This Agreement shall be subject to the provisions of the 1933 Act, 1934
and 1940 acts, and the rules and regulations and rulings thereunder, including
such exemptions from those statutes, rules and regulations as the SEC may grant
(including, but not limited to, the Order) and the terms hereof shall be
interpreted and construed in accordance therewith.
SECTION 13. EXECUTION IN COUNTERPARTS
This Agreement may be executed simultaneously in two or more counterparts,
each of which taken together with constitute one and the same instrument.
SECTION 14. SEVERABILITY
If any provision of this Agreement is held or made invalid by a court
decision, statute, rule or otherwise, the remainder of this Agreement will not
be affected thereby.
SECTION 15. RIGHTS CUMULATIVE
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, that the Parties are entitled to under federal and state
laws.
SECTION 16. HEADINGS
The Table of Contents and headings used in this Agreement are for purposes
of reference only and shall not limit or define the meaning of the provisions of
this Agreement.
SECTION 17. CONFIDENTIALITY
Subject to the requirements of legal process and regulatory authority, each
party hereto shall treat as confidential the names and addresses of customers of
the other party and all information reasonably identified as confidential in
writing by any other party hereto and, except as permitted by this Agreement,
shall not, without the express written consent of the affected party, disclose,
disseminate or utilize such names and addresses and other confidential
information until such time as it may come into the public domain.
SECTION 18. TRADEMARKS AND FUND NAMES
(a) Salomon Brothers Asset Management Inc, the adviser to the Fund and its
affiliates, own all right, title and interest in and to the names, trademarks
and service marks "Salomon" and "Salomon Brothers" and such other tradenames,
trademarks and service marks as may be identified to CITICORP from time to time
(the "Salomon licensed marks"). Upon termination of this Agreement CITICORP and
its affiliates shall cease to use the Salomon licensed marks, except to the
extent required by law or regulation.
(b) CITICORP and its affiliates, own all right, title and interest in and
to the names, trademarks and service marks "Citicorp" and such other tradenames,
trademarks and service marks as may be identified to the Adviser and/or the Fund
from time to time (the "Citicorp" licensed marks). Upon termination of this
Agreement the Fund, the Adviser and their affiliates shall cease to use the
Citicorp licensed marks, except to the extent required by law or regulation.
SECTION 19. PARTIES TO COOPERATE
Each party to this Agreement will cooperate with each other party and all
appropriate governmental authorities (including, without limitation, the SEC,
the NASD and state insurance regulators) and will permit each other and such
authorities reasonable access to its books and records (including copies
thereof) in connection with any investigation or inquiry relating to this
Agreement or the transactions contemplated hereby.
SECTION 20. COUNTERPARTS
This Agreement may be executed by facsimile signature and it may be
executed in one or more counterparts, each of which shall be deemed an original,
but all of which together shall constitute one and the same instrument.
IN WITNESS WHEREOF, the Parties have caused this Agreement to be
executed in their names and on their behalf by and through their duly authorized
officers signing below.
SALOMON BROTHERS VARIABLE SERIES
FUNDS INC
Attest: /s/ Xxxxxx X. Xxxx By: /s/ XXXXX XXXXX
----------------------------- ------------------------------------
Name: Xxxxxx Xxxx Name: XXXXX XXXXX
Title: Notary Public Title: Executive Vice President
XXXXXX X. XXXX
Notary Public, State of New York
No.00-0000000, Richmond County
Certificate Filed in New York County
Commission Expires January 19, 2000
SALOMON BROTHERS ASSET MANAGEMENT INC
Attest: /s/ Xxxxxx X. Xxxx By: /s/ XXXXX XXXXX
----------------------------- ------------------------------------
Name: Xxxxxx Xxxx Name: XXXXX XXXXX
Title: Notary Public Title: Managing Director
XXXXXX X. XXXX
Notary Public, State of New York
No.00-0000000, Richmond County
Certificate Filed in New York County
Commission Expires January 19, 2000
CITICORP LIFE INSURANCE COMPANY and
FIRST CITICORP LIFE INSURANCE COMPANY
on behalf of themselves and their
separate accounts
Attest: /s/ Xxxxxxx X. Xxxxxxxxx By: /s/ Xxxxxxx X. Xxxxxxx, XX
----------------------------- ------------------------------------
Name: Xxxxxxx X. Xxxxxxxxx Name: Xxxxxxx X. Xxxxxxx, XX
Title: Secretary Title: Senior Vice President
SCHEDULE A
PORTFOLIOS AVAILABLE UNDER THE CONTRACTS
Salomon Brothers Variable Capital Fund
Salomon Brothers Variable High Yield Bond Fund
Salomon Brothers Variable Investors Fund
Salomon Brothers Variable Total Return Fund
SEPARATE ACCOUNTS UTILIZING THE FUNDS
SEPARATE ACCOUNTS OF
CITICORP LIFE INSURANCE COMPANY
SEPARATE ACCOUNT DATE ESTABLISHED SEC REGISTRATION NUMBER
---------------- ---------------- -----------------------
Citicorp Life Variable Annuity 7/6/94 333-71379
Separate Account 811-08628
SEPARATE ACCOUNTS OF
FIRST CITICORP LIFE INSURANCE COMPANY
SEPARATE ACCOUNT DATE ESTABLISHED SEC REGISTRATION NUMBER
---------------- ---------------- -----------------------
First Citicorp Life Variable 7/6/94 333-71377
Annuity Separate Account 811-08732
CONTRACTS FUNDED BY THE SEPARATE ACCOUNTS
VARIABLE ANNUITY CONTRACTS
ISSUED BY CITICORP LIFE INSURANCE COMPANY
CONTRACT REPRESENTATIVE FORM NUMBER
-------- --------------------------
CitiElite 63-1106(1-99)
VARIABLE ANNUITY CONTRACTS
ISSUED BY FIRST CITICORP LIFE INSURANCE COMPANY
CONTRACT REPRESENTATIVE FORM NUMBER
-------- --------------------------
CitiElite 63-5101C
63-5102C
63-5103C
