PARTICIPATION AGREEMENT
By and Among
XXXXX FARGO VARIABLE TRUST
And
RIVERSOURCE LIFE INSURANCE CO. OF NEW YORK
And
RIVERSOURCE DISTRIBUTORS, INC.
And
XXXXX FARGO FUNDS DISTRIBUTOR, LLC
THIS PARTICIPATION AGREEMENT (the "Agreement") supersedes and replaces
the Amended and Restated Participation Agreement made as of October 31, 2005
(the "Prior Agreement") by and among IDS Life Insurance Company of New York,
Xxxxx Fargo Variable Trust, Xxxxx Fargo Funds Distributor, LLC and Ameriprise
Financial Services, Inc. The Prior Agreement is hereby amended and restated in
its entirety to replace Ameriprise Financial Services, Inc. as the Insurance
Underwriter, to reflect the renaming of IDS Life Insurance Company of New York
to RiverSource Life Insurance Co. of New York and to reflect certain other
changes the parties wish to make to the terms of the Prior Agreement.
This Agreement, made and entered into as of this 1st day of January 2007,
by and among RiverSource Life Insurance Co. of New York, a New York
corporation (the "Company"), on its own behalf and on behalf of each separate
account of the Company named in Exhibit A to this Agreement, as may be amended
from time to time (each separate account, a "Separate Account"),
and RiverSource Distributors, Inc. (the "Insurance Underwriter"), a
broker-dealer affiliated with the Company and Xxxxx Fargo Variable Trust, an
open-end diversified management investment company and a statutory trust
organized under the laws of the State of Delaware (the "Trust"), and Xxxxx
Fargo Funds Distributor, LLC, a Delaware limited liability company (the
"Distributor").
WHEREAS, the Trust engages in business as an open-end diversified,
management investment company and was established for the purpose of serving
as the investment vehicle for separate accounts established for variable life
insurance contracts and variable annuity contracts to be offered by insurance
companies which have entered into participation agreements substantially
similar to this Agreement ("Participating Insurance Companies"); and
WHEREAS, beneficial interests in the Trust are divided into several
series of shares, each representing the interest in a particular managed
portfolio of securities and other assets (each, a "Fund"); and
WHEREAS, an order from the U.S. Securities and Exchange Commission (the
"SEC" or "Commission"), dated September 28, 1998 (File No. 812-11158), grants
Participating Insurance Companies and variable annuity separate accounts and
variable life insurance separate accounts relief from the provisions of
Sections 9(a), 13(a), 15(a) and 15(b) of the Investment Company Act of 1940,
as amended (the "1940 Act" ) and Rules 6e-2(b)(15) and 6e-3(T)(b)(15)
thereunder, to the extent necessary to permit shares of the Trust to be sold
to and held by variable annuity separate accounts and variable life insurance
separate accounts of both affiliated and unaffiliated Participating Insurance
Companies and qualified pension and retirement plans ("Mixed and Shared
Funding Order"); and
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WHEREAS, the Trust is registered as an open-end management investment
company under the 1940 Act and its shares are registered under the Securities
Act of 1933, as amended (the "1933 Act"); and
WHEREAS, the Company has registered or will register certain variable
annuity and variable life insurance contracts under the 1933 Act and named in
Exhibit A to this Agreement, as it may be amended from time to time (the
"Contracts"); and
WHEREAS, the Separate Accounts are duly organized, validly existing
segregated asset accounts, established by resolution of the Board of Directors
of the Company under the insurance laws of the State of New York, to set aside
and invest assets attributable to the Contracts; and
WHEREAS, the Company has registered the Separate Accounts as unit
investment trusts under the 1940 Act; and
WHEREAS, the Distributor is registered as a broker-dealer with the SEC
under the Securities Exchange Act of 1934, as amended (the "1934 Act"), and is
a member in good standing of the National Association of Securities Dealers,
Inc. (the "NASD"); and
WHEREAS, to the extent permitted by applicable insurance laws and
regulations, the Company intends to purchase shares in the Funds named in
Exhibit B on behalf of the Separate Accounts to fund the Contracts, and the
Distributor is authorized to sell such shares to unit investment trusts such
as the Separate Accounts at net asset value; and
WHEREAS, the Insurance Underwriter serves as the principal underwriter of
one or more classes of variable annuity contracts and/or variable life
insurance policies issued by affiliated insurers of the Company and is party
to this Agreement for the sole purpose of receiving payments from the
Distributor pursuant to Rule 12b-1 under the Investment Company Act of 1940;
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NOW, THEREFORE, in consideration of their mutual promises, the Company,
the Trust, the Insurance Underwriter and the Distributor agree as follows:
ARTICLE 1. SALE OF TRUST SHARES
--------------------
1.1 The Distributor agrees to sell to the Company those shares of the
Trust which the Company orders on behalf of the Separate Accounts, executing
such orders on a daily basis at the net asset value next computed after
receipt and acceptance by the Trust or its designee of the order for the
shares of the Trust. For purposes of this Section 1.1, the Company shall be
the designee of the Trust for receipt of such orders from each Separate
Account and receipt by such designee shall constitute receipt by the Trust;
provided that the Company shall use its best efforts to provide notice to the
Trust of such order by 9:30 a.m. Eastern Time on the next following Business
Day. "Business Day" shall mean any day on which the New York Stock Exchange is
open for trading and on which the relevant Fund calculates its net asset
value.
1.2 The Trust agrees to make its shares available indefinitely for
purchase at the applicable net asset value per share by Participating
Insurance Companies and their separate accounts on those days on which the
Trust calculates its net asset value pursuant to rules of the SEC; provided,
however, that the Board of Trustees of the Trust (hereinafter the "Trustees")
may refuse to sell shares of any Fund to any person, or suspend or terminate
the offering of shares of any Fund, 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 any Fund.
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1.3 The Trust and the Distributor agree that shares of the Trust will be
sold only to Participating Insurance Companies and their separate accounts,
and to qualified pension and retirement plans. No shares of the Trust will be
sold to the general public.
1.4 The Trust and the Distributor will not sell Trust shares to any
insurance company or separate account unless an agreement containing
provisions substantially the same as Articles 1, 3, 5, 7, and Section 2.8 of
Article 2 of this Agreement are in effect to govern such sales.
1.5 The Trust will not accept a purchase order from a qualified pension
or retirement plan if such purchase would make the plan shareholder an owner
of 10 percent or more of the assets of a Fund unless such plan executes an
agreement with the Trust governing participation in such Fund that includes
the conditions set forth herein to the extent applicable. A qualified pension
or retirement plan will execute an application containing an acknowledgment of
this condition at the time of its initial purchase of shares of any Fund.
1.6 The Trust agrees to redeem for cash, upon the Company's request, any
full or fractional shares of the Trust held by the Company, executing such
requests on a daily basis at the net asset value next computed after receipt
and acceptance by the Trust or its designee of the request for redemption. For
purposes of this Section 1.6, the Company shall be the designee of the Trust
for receipt of requests for redemption from each Separate Account and receipt
by such designee shall constitute receipt by the Trust; provided that the
Company shall use its best efforts to provide notice to the Trust of request
for redemption by 9:30 a.m. Eastern Time on the next following Business Day.
Payment shall be in federal funds transmitted by wire to the Company's account
as designated by the Company in writing from time to time.
1.7 Each purchase, redemption, and exchange order placed by the Company
shall be placed separately for each Fund and shall not be netted with respect
to any Fund. However, with
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respect to payment of the purchase price by the Company, the Company shall net
purchase orders with respect to each Fund and shall transmit one net payment
for all Funds in accordance with Section 1.8; and with respect to payment of
redemption proceeds by the Trust, the Trust shall net redemption orders with
respect to each Fund and shall transmit one net payment for all Funds in
accordance with Section 1.8.
1.8 The Company agrees that purchases and redemptions of Fund shares
offered by the then current prospectus of the Fund shall be made in accordance
with the provisions of such prospectus. The Company agrees that all net
amounts available under the variable life insurance contracts with the form
number(s) which are listed on Schedule A attached hereto and incorporated
herein by this reference, as such Schedule A may be amended from time to time
hereafter by mutual written agreement of all the parties hereto (the
"Contracts") shall be invested in the Funds, in such other Funds managed by
Xxxxx Fargo Bank as may be mutually agreed to in writing by the parties
hereto, in the Company's Guarantee Period Accounts or in the Company's general
account, provided that such amounts may also be invested in an investment
company other than the Trust if (a) such other investment company, or series
thereof, has investment objectives or policies that are substantially
different from the investment objectives and policies of all the Funds of the
Trust which are actually used by the Company to fund the Contracts; or (b) the
Company gives the Fund and the Distributor 30 days written notice of its
intention to make such other investment company available as a funding vehicle
for the Contracts; or (c) such other investment company was available as a
funding vehicle for the Contracts prior to the date of this Agreement and the
Company so informs the Fund and the Distributor prior to their signing this
Agreement (a list of such funds appearing on Schedule C to this Agreement); or
(d) the Fund or the Distributor consents to the use of such other investment
company.
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1.9 In the event of net purchases, the Company shall initiate the wire
transfer for payment of shares by 2:00 p.m. Eastern Time on the next Business
Day after an order to purchase the Shares is deemed to be received in
accordance with the provisions of Section 1.1 hereof. In the event of net
redemptions, the Trust shall pay the redemption proceeds in accordance with
the terms of the then-current prospectus for the Trust. Absent extraordinary
circumstances specified in Section 22(e) of the 1940 Act, the Trust shall make
such payment within five (5) calendar days after the date the redemption order
is placed in order to enable the Company to pay redemption proceeds within the
time period specified in Section 22(e) of the 1940 Act or such shorter period
of time as may be required by law. All such payments shall be in federal funds
transmitted by wire. For purposes of Section 2.4 and Section 2.11, upon
receipt by the Trust of the federal funds so wired, such funds shall cease to
be the responsibility of the Company and shall become the responsibility of
the Fund.
1.10 Issuance and transfer of the Trust's shares will be by book entry
only. Stock certificates will not be issued to the Company or any Separate
Account. Purchase and redemption orders for Trust shares will be recorded in
an appropriate title for each Separate Account or the appropriate subaccount
of each Separate Account.
1.11 The Trust shall furnish same-day notice (by wire or telephone,
followed by written confirmation) to the Company of any income, dividends, or
capital gain distributions payable on the Trust's shares. The Company hereby
elects to receive all such dividends and distributions as are payable on the
Fund shares in the form of additional shares of that Fund. The Company
reserves the right to revoke this election and to receive all such dividends
and distributions in cash. The Trust shall notify the Company of the number of
shares so issued as payment of such dividends and distributions.
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1.12 The Trust shall make the net asset value per share for each Fund
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 5:30 p.m. Central
Time. The Trust shall notify the Company as soon as possible if it is
determined that the net asset value per share will be available after 6:00
p.m. Central Time on any business day, and the Trust and the Company will
mutually agree upon a final deadline for timely receipt of the net asset value
on such business day. Any material errors in the calculation of net asset
value, dividends or capital gain information shall be reported immediately
upon discovery to the Company. The Trust or its agent will promptly correct
any such errors and promptly recalculate transactions made under this
Agreement using the correct net asset value, dividends or capital gains
consistent with the Trust's then current net asset value error correction
policy (including the policy's definition of the term "material"). To the
extent that recalculation of one or more transactions does not make the
Company's account with a Fund "whole," the Distributor shall make such account
"whole." The Distributor shall not be responsible for payment of any costs of
reprocessing transactions in units issued by a Separate Account (or a
sub-account of a Separate Account) under the Contracts arising out of an error
in the calculation of a Fund's net asset value, dividends or capital gains
distributions if such error is discovered and corrected within five business
days.
1.13 (a) The Company acknowledges the Trust has adopted policies designed
to prevent frequent purchases and redemptions of any Fund shares in quantities
great enough to disrupt orderly management of the corresponding Fund's
investment portfolio ("Disruptive Trading Policies"). These policies are
disclosed in the Trust's prospectus. From time to time, the Trust and the
Distributor implement procedures reasonably designed to enforce the Trust's
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disruptive trading policies and shall provide a written description of such
procedures (and revisions thereto) to the Company. Such procedures may include
the imposition of redemption fees. The Trust and Distributor agree to give
Company prompt written notice of material changes to the Trust's disruptive
trading policies and procedures (and revisions thereto).
(b) The Trust and the Distributor acknowledge that the Company, on behalf
of its Separate Account(s), has adopted policies and procedures reasonably
designed to detect and deter frequent transfers of Contract value among the
subaccounts of the Separate Account(s) including those investing in Fund
Shares which are available as investment options under the Contracts. These
policies and procedures are described in the current prospectuses of the
Separate Account(s) through which the Contracts are offered. Company shall
provide a written description of any revisions of such policies and procedures
to the Trust in accordance with Section 4.8 of this Agreement.
(c) The Company will cooperate with the Trust and the Distributor's
reasonable requests in taking steps to deter and detect such transfers by any
Contractholder. Subject to applicable law and the terms of each Contract, the
Company will provide promptly upon request by the Trust, directly or through
its designee, the following information:
o the Taxpayer Identification Number, International Taxpayer
Identification Number or other government issued
identifier (collectively "TIN") of all Contractholders
that purchased, redeemed, transferred, or exchanged Trust
shares held under a Contract; and
o the amount and dates of such Contractholders' purchases,
redemptions, transfers and exchanges in subaccounts
available under the Contract which invest in Trust shares.
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Requests must set forth a specific period, not to exceed ninety (90) days from
the date of the request, for which transaction information is sought. The
Trust may request transaction information older than ninety (90) days from the
date of the request as it deems necessary to investigate compliance with the
Trust's Disruptive Trading Policies.
The Company agrees to transmit the requested information that is on its
books and records to the Trust or its designee promptly, but in any event, not
later than five (5) business days after receipt of a request. If the requested
information is not on the Company's books and records, the Company agrees to
use reasonable efforts to: (i) promptly obtain and transmit the requested
information; (ii) obtain assurances from the Contractholder that the requested
information will be provided directly to the Trust promptly; or (iii) if
directed by the Trust, block further purchases of Trust shares by such
Contractholder. In such instance, Company agrees to inform the Trust whether
it plans to perform (i), (ii) or (iii). Responses required by this paragraph
must be communicated in writing and in a format mutually agreed upon by the
parties. To the extent practicable, the format for any transaction information
provided to the Trust should be consistent with the NSCC Standardized Data
Reporting Format.
The Trust agrees that all information received from the Company under
this Section 1.13 is subject to the confidentiality standards set forth in
Section 12.2 of this Agreement.
Company agrees to execute written instructions from the Trust to restrict
or prohibit further purchases or exchanges of subaccounts available under the
Contract which invest in shares of the Trust by a Contractholder that has been
identified by the Trust as having engaged in transactions in the Trust's
shares (directly or indirectly through the Company's separate Account) that
violate the Trust's Disruptive Trading Policies.
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Instructions must include the TIN and the specific restriction(s) to be
executed. If the TIN is not known, the Trust or its designee will contact the
Company and the Company will again provide the Trust with the TIN.
Company agrees to execute instructions as soon as reasonably practicable,
but not later than five (5) business days after receipt of the instructions by
the Company.
Company must provide written confirmation to the Trust that instructions
have been executed. Company agrees to provide confirmation as soon as
reasonably practicable, but not later than ten (10) business days after the
instructions have been executed.
When the Trust or its designee has given the Company a written
instruction pursuant to this Section 1.13 to restrict or prohibit further
purchases by a Contractholder of the Trust's shares, the Trust or its designee
may request and the Company will provide the Trust or its designee with the
name or other identifier of any investment professional who is listed on the
Company's records as the agent of record for the restricted Contract if the
investment professional is employed by a broker dealer affiliate of the
Company. If the restricted Contract was sold by a broker dealer unaffiliated
with the Company, the Company will provide the Trust or its designee with the
name of the selling broker dealer firm.
The parties shall negotiate in good faith such additional terms and
conditions regarding implementation of the foregoing obligations of the
parties under Rule 22c-2 as any party may wish to address.
1.14 The Company and the Insurance Underwriter shall comply with all
applicable laws and regulations designed to prevent money laundering including
without limitation the International Money Laundering Abatement and
Anti-Terrorist Financing Act of 2001 (Title III of the USA PATRIOT Act), and
if required by such laws or regulations, to share with the Trust
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and the Distributor information about individuals, entities, organizations and
countries suspected of possible terrorist or money laundering activities in
accordance with Section 314(b) of the USA PATRIOT Act.
The Trust and the Distributor shall comply with all applicable laws and
regulations designed to prevent money laundering including without limitation
the International Money Laundering Abatement and Anti-Terrorist Financing Act
of 2001 (Title III of the USA PATRIOT Act), and if required by such laws or
regulations, to share with the Company and Insurance Underwriter information
about individuals, entities, organizations and countries suspected of possible
terrorist or money laundering activities in accordance with Section 314(b) of
the USA PATRIOT Act.
ARTICLE 2. REPRESENTATIONS AND WARRANTIES
------------------------------
2.1 The Company represents and warrants that the Contracts are or will be
registered under the 1933 Act, unless exempt therefrom, and that the Contracts
will be issued and sold in compliance with all applicable federal and state
laws and that the sale of the Contracts shall comply in all material respects
with state insurance suitability requirements. The Company further represents
and warrants that: (i) it is an insurance company duly organized and in good
standing under applicable law; (ii) it has or shall have legally and validly
established each Separate Account as a segregated asset account under
applicable state law and has or shall have registered each Separate Account as
a unit investment trust in accordance with the provisions of the 1940 Act,
unless exempt therefrom, to serve as segregated investment accounts for the
Contracts; and (iii) it will maintain such registration, if required, for so
long as any Contracts are outstanding. The Company shall amend any
registration statement under the 1933 Act for the Contracts and any
registration statement under the 1940 Act for the Separate Accounts from time
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to time as required in order to effect the continuous offering of the
Contracts or as may otherwise be required by applicable law. The Company shall
register and qualify the Contracts for sale in accordance with the securities
laws of the various states only if, and to the extent, deemed necessary by the
Company.
2.2 Subject to Article 6 hereof, the Company represents that the
Contracts are currently and at the time of issuance will be treated as life
insurance, endowment or annuity contracts under applicable provisions of the
Internal Revenue Code and that it will make every effort to maintain such
treatment and that it will notify the Trust and the Distributor immediately
upon having a reasonable basis for believing that the Contracts have ceased to
be so treated or that they might not be so treated in the future.
2.3 The Company represents that any prospectuses offering life insurance
Contracts that could become "modified endowment contracts," as that term is
defined in Section 7702A of the Internal Revenue Code describe "modified
endowment contracts" and the Company will notify a Contract owner if his or
her Contract is or will become a modified endowment contract (or policy).
2.4 The Company represents and warrants that all of its directors,
officers, employees, investment advisers, and other individuals/entities
dealing with the money and/or securities of the Trust are covered by a blanket
fidelity bond or similar coverage in an amount not less than $5 million. The
Company agrees that any amounts received under such bond in connection with
claims that derive from arrangements described in this Agreement will be held
by the Company for the benefit of the Trust. The Company agrees to see that
this bond or another bond containing these provisions is always in effect, and
agrees to notify the Trust and the Distributor
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in the event that such coverage no longer applies. The aforesaid includes
coverage for larceny and embezzlement and is issued by a reputable bonding
company.
2.5 The Trust represents and warrants that Trust shares sold pursuant to
this Agreement shall be registered under the 1933 Act and duly authorized for
issuance in accordance with applicable law, and that the Trust is and shall
remain registered under the 1940 Act for as long as the Trust shares are sold.
The Trust shall amend the registration statement for its shares under the 1933
and the 1940 Acts from time to time as required in order to effect the
continuous offering of its shares. The Trust shall register and qualify the
shares for sale in accordance with the laws of the various states only if, and
to the extent, deemed advisable by the Trust or the Distributor.
2.6 The Trust represents that it is currently qualified as a Regulated
Investment Company under Subchapter M of the Internal Revenue Code, and that
it will make every effort to maintain such qualification (under Subchapter M
or any successor or similar provision) and that it will notify the Company
immediately upon having a reasonable basis for believing that it has ceased to
qualify or that it might not so qualify in the future.
2.7 The Trust makes no representations as to whether any aspect of its
operations, including but not limited to, investment policies, fees and
expenses, complies with the insurance and other applicable laws of the various
states, except that the Trust represents that it is and shall at all times
remain in compliance with the laws of the state of Delaware to the extent
required to perform this Agreement. The Trust agrees that it will furnish the
information required by state insurance laws so that the Company can obtain
the authority needed to issue the Contracts in the various states.
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2.8 The Trust currently intends for one or more classes of shares (each,
a "Class") to make payments to finance its distribution expenses, including
service fees, pursuant to a plan ("Plan") adopted under Rule 12b-1 under the
1940 Act ("Rule 12b-1"), although it may determine to discontinue such
practice in the future. To the extent that any Class of a Fund finances its
distribution expenses pursuant to a Plan adopted under Rule 12b-1, the Trust
undertakes to comply with any then current SEC interpretations concerning Rule
12b-1 or any successor provisions.
2.9 The Trust represents that it is lawfully organized and validly
existing under the laws of Delaware and that it does and will comply with
applicable provisions of the 0000 Xxx.
2.10 The Trust represents and warrants that all of its trustees,
officers, employees and other individuals/entities having access to the funds
and/or securities of the Trust are and continue to be at all times covered by
a blanket fidelity bond or similar coverage for the benefit of the Trust in an
amount not less than the minimal coverage as required currently by Rule 17g-1
of the 1940 Act or 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.
2.11 The Distributor represents and warrants that it is a member in good
standing of the NASD and is registered as a broker-dealer with the SEC. The
Distributor further represents that it will sell and distribute the Trust's
shares in accordance with all applicable federal and state securities laws,
including without limitation the 1933 Act, the 1934 Act, and the 0000 Xxx. The
Distributor represents and warrants that the Trust's investment manager, Xxxxx
Fargo Funds Management, LLC, is registered as an investment adviser under all
applicable federal and state
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securities laws and that the investment manager will perform its obligations
to the Trust in accordance with any applicable state and federal securities
laws.
ARTICLE 3. PROSPECTUSES AND PROXY STATEMENTS; VOTING
-----------------------------------------
3.1 The Distributor shall provide the Company, at the Company's expense,
with as many copies of the Trust's current prospectus as the Company may
reasonably request. If requested by the Company in lieu thereof, the Trust
shall provide, at the Trust's expense, such documentation including a final
copy of a current prospectus set in type, a computer disc or other medium
agreed to by the parties and other assistance as is reasonably necessary in
order for the Company to print the prospectus annually (or more frequently if
the Trust's prospectus is amended more frequently), in which case the Trust
shall reimburse the Company for the cost of printing and distributing such
prospectus to existing Contract owners or participants. The Company shall bear
the cost of printing and distributing such prospectus to prospective Contract
owners or participants.
3.2 The Trust's prospectus shall state that the statement of additional
information for the Trust is available from the Distributor (or, in the
Trust's discretion, the Prospectus shall state that such statement is
available from the Trust).
3.3 The Trust, at its expense, shall provide the Company with copies of
its proxy material, if any, reports to shareholders and other communications
to shareholders in such quantity as the Company shall reasonably require. If
requested by the Company in lieu thereof, the Trust shall provide, at the
Trust's expense, such documentation, including final copies of current reports
to shareholders and other communications to shareholders set in type, or a
computer disc or in another medium agreed to by the parties and other
assistance as is reasonably necessary in order for the Company to print the
reports to shareholders and other
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communications to shareholders, in which case the Trust shall reimburse the
Company for the cost of printing such materials. The Trust shall bear the cost
of distributing proxy material, reports to shareholders and other
communications to existing Contract owners or participants.
3.4 The Trust hereby notifies the Company that it is appropriate to
include in the prospectuses pursuant to which the Contracts are offered
disclosure cross-referencing the discussion in the Trust's prospectus on the
potential risks of mixed and shared funding.
3.5 To the extent required by law the Company shall:
(a) assist in the solicitation of voting instructions from Contract
owners or participants;
(b) vote the Trust shares held in each Separate Account in
accordance with instructions received from Contract owners or participants;
and
(c) vote Trust shares held in each Separate Account for which no
timely instructions have been received, in the same proportion as Trust shares
of such Fund for which instructions have been received from the Company's
Contract owners or participants;
for so long as and to the extent that the SEC continues to interpret the 1940
Act to require pass-through voting privileges for variable contract owners.
The Company reserves the right to vote Trust shares held in any segregated
asset account in its own right, to the extent permitted by law. Participating
Insurance Companies shall be responsible for assuring that each of their
separate accounts participating in the Trust calculates voting privileges in a
manner consistent with other Participating Insurance Companies and as required
by the Mixed and Shared Funding Order. The Trust will notify the Company of
any changes of interpretation or amendment to the Mixed and Shared Funding
Order.
3.6 The Trust will comply with all provisions of the 1940 Act requiring
voting by shareholders, and in particular, the Trust will either provide for
annual meetings (except to the extent that the Commission may interpret
Section 16 of the 1940 Act not to require such
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meetings) or comply with Section 16(c) of the 1940 Act (although the Trust is
not one of the trusts described in Section 16(c) of that Act) as well as with
Sections 16(a) and, if and when applicable, 16(b) of the 1940 Act. Further,
the Trust will act in accordance with the Commission's interpretation of the
requirements of Section 16(a) with respect to periodic elections of Trustees
and with whatever rules the Commission may promulgate with respect thereto.
ARTICLE 4. SALES MATERIAL AND INFORMATION
------------------------------
4.1 The Company shall furnish, or shall cause to be furnished, to the
Trust or the Distributor, each piece of sales literature or other promotional
material in which the Trust or the Trust's investment manager, sub-advisers or
the Distributor is named, at least five business days prior to its use. No
such material shall be used if the Trust or the Distributor reasonably objects
in writing to such use within five business days after receipt of such
material.
4.2 The Company represents and agrees that sales literature for the
Contracts prepared by the Company or its affiliates will be consistent with
every law, rule, and regulation of any regulatory agency or self-regulatory
agency that applies to the Contracts or to the sale of the Contracts,
including, but not limited to, NASD Conduct Rule 2210 and IM-2210-2
thereunder.
4.3 The Company shall not give any information or make any
representations or statements on behalf of the Trust or concerning the Trust
in connection with the sale of the Contracts other than the information or
representations contained in the registration statement, prospectus or
statement of additional information for the Trust shares as such registration
statement, prospectus or statement of additional information may be amended or
supplemented from time to time, or in reports or proxy statements for the
Trust, or in sales literature or other promotional material approved by the
Trust, or by the Distributor or in published reports for the
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Trust which are in the public domain or approved by the Trust or the
Distributor for distribution, except with the permission of the Trust or the
Distributor. The Trust and the Distributor agree to respond to any request for
approval on a prompt and timely basis. The Company shall adopt and implement
procedures reasonably designed to ensure that information concerning the
Trust, the Distributor, or any of their affiliates which is intended for use
by brokers or agents selling the Contracts (i.e., information that is not
intended for distribution to Contract owners or prospective Contract owners)
is so used, and neither the Trust, the Distributor, nor any of their
affiliates shall be liable for any losses, damages, or expenses relating to
the improper use of such broker only materials by agents of the Company or its
affiliates who are unaffiliated with the Trust or the Distributor. The parties
hereto agree that this Section 4.3 is not intended to designate or otherwise
imply that the Company is an underwriter or distributor of the Trust's shares.
Nothing in this Section 4.3 shall be construed as preventing the Company or
its employees or agents from giving advice on investment in the Trust.
4.4 The Trust or the Distributor shall furnish, or shall cause to be
furnished, to the Company or its designee, each piece of sales literature or
other promotional material in which the Company, its Separate Account, or the
Contracts are named, at least five business days prior to its use. No such
material shall be used if the Company reasonably objects in writing to such
use within five business days after receipt of such material.
4.5 The Trust represents and agrees that sales literature for the Trust
prepared by the Trust or its affiliates in connection with the sale of the
Contracts will be consistent with every law, rule, and regulation of any
regulatory agency or self regulatory agency that applies to the Trust or to
the sale of Trust shares, including, but not limited to, NASD Conduct Rule
2210 and IM-2210-2 thereunder.
19
4.6 The Trust and the Distributor shall not give any information or make
any representations on behalf of the Company or concerning the Company, each
Separate Account, or the Contracts other than the information or
representations contained in a registration statement, prospectus or statement
of additional information for the Contracts, as such registration statement,
prospectus or statement of additional information may be amended or
supplemented from time to time, or in published reports for each Separate
Account which are in the public domain or approved by the Company for
distribution to Contract owners or participants, or in sales literature or
other promotional material approved by the Company, or in published reports
for the Separate Account or the Contracts which are in the public domain or
approved by the Company for distribution, except with the permission of the
Company. The Company agrees to respond to any request for approval on a prompt
and timely basis. The Trust and the Distributor shall xxxx information
produced by or on behalf of the Trust "FOR BROKER USE ONLY" which is intended
for use by brokers or agents selling the Contracts (i.e., information that is
not intended for distribution to Contract owners or prospective Contract
owners) is so used, and neither the Company nor any of its affiliates shall be
liable for any losses, damages, or expenses arising on account of the use by
brokers of such information with third parties in the event that is not so
marked.
4.7 The Trust will provide to the Company at least one complete copy of
all registration statements, prospectuses, statements of additional
information, reports, proxy statements, sales literature and other promotional
materials, applications for exemptions, requests for no-action letters, and
all amendments to any of the above, that relate to the Trust or its shares,
contemporaneously with the filing of such document with the SEC or other
regulatory authorities.
20
4.8 The Company will provide to the Trust at least one complete copy of
all registration statements, prospectuses, statements of additional
information, reports, solicitations for voting instructions, sales literature
and other promotional materials, applications for exemptions, requests for no
action letters, and all amendments to any of the above, that relate to the
Contracts or each Separate Account, contemporaneously with the filing of such
document with the SEC or other regulatory authorities. The Company shall
promptly inform the Trust of the results of any examination by the SEC (or
other regulatory authorities) that relates to the Trust, and the Company shall
provide the Trust with a copy of relevant portions of any "deficiency letter"
or other correspondence or written report regarding such examination.
4.9 For purposes of this Article 4, 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), 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 NASD Conduct Rules, the 1940 Act or the 0000 Xxx.
4.10 The Distributor shall be responsible for calculating the performance
information for the Trust. The Company shall be responsible for calculating
the performance information for
21
the Contracts. The Trust and/or the Distributor agree to provide the Company
with performance information for the Trust on a timely basis to enable the
Company to calculate performance information for the Contracts in accordance
with applicable state and federal law.
ARTICLE 5. FEES AND EXPENSES
-----------------
5.1 The Trust and Distributor shall pay no fee or other compensation to
the Insurance Underwriter under this Agreement, except as provided on Schedule
D.
5.2 Each party, however, shall, in accordance with the allocation of
expenses specified in this Agreement, reimburse other parties for expenses
initially paid by one party but allocated to another party. In addition,
nothing herein shall prevent the parties hereto from otherwise agreeing to
perform, and arranging for appropriate compensation for, other services
relating to the Trust and/or to the Separate Accounts.
5.3 All expenses incident to performance by the Trust of this Agreement
shall be paid by the Trust to the extent permitted by law. All Trust shares
will be duly authorized for issuance and registered in accordance with
applicable federal law and to the extent deemed advisable by the Trust, in
accordance with applicable state law, prior to sale. The Trust shall bear the
expenses for the cost of registration and qualification of the Trust's shares,
preparation and filing of the Trust's prospectus and registration statement,
Trust proxy materials and reports, printing proxy materials and annual reports
for existing Contract owners, setting in type the Trust's prospectuses, the
preparation of all statements and notices required by any federal or state
law, all taxes on the issuance or transfer of the Trust's shares, and any
expenses permitted to be paid or assumed by the Trust pursuant to any Rule
12b-1 Plan under the 1940 Act duly adopted by the Trust. In the event that the
Trust initiates (i) a reorganization of a Fund as defined by Section 2 of the
1940 Act, or (ii) a change in the name of a Fund or the Trust, the Trust shall
reimburse the
22
Company for the Company's internal and out-of-pocket costs associated with the
aforementioned actions. The Company agrees to use its best efforts to minimize
any costs incurred under this Section and shall provide the Trust with
acceptable documentation of any such costs incurred.
5.4 The Company shall bear the expenses of printing and distributing the
Trust prospectuses and shareholder reports. The Company shall bear all
expenses associated with the registration, qualification, and filing of the
Contracts under applicable federal securities and state insurance laws; the
cost of preparing, printing, and distributing the Contracts' prospectuses and
statements of additional information; and the cost of printing and
distributing annual individual account statements for Contract owners as
required by state insurance laws.
ARTICLE 6. DIVERSIFICATION
---------------
6.1 The Trust will make every effort to at all times invest money from
the Contracts in such a manner as to ensure that the Contracts will be treated
as variable contracts under the Internal Revenue Code and the regulations
issued thereunder. Without limiting the scope of the foregoing, the Trust will
comply with Section 817(h) of the Internal Revenue Code and Treasury
Regulation 1.817-5, relating to the diversification requirements for variable
annuity, endowment, or life insurance contracts and any amendments or other
modifications to such Section or Regulations or successors thereto.
ARTICLE 7. POTENTIAL CONFLICTS
-------------------
7.1 If and to the extent that the Trust engages in mixed and shared
funding as contemplated by exemptive relief provided by the SEC and applicable
to the Trust, this Article VII shall apply.
7.2 The Board of Trustees of the Trust (the "Trust Board") will monitor
the Trust for the existence of any material irreconcilable conflict among the
interests of the Contract owners of
23
all separate accounts investing in the Trust. A material irreconcilable
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 Fund are being managed; (e) a difference in
voting instructions given by variable annuity contract owners, variable life
insurance contract owners, and trustees of qualified pension or retirement
plans; (f) a decision by a Participating Insurance Company to disregard the
voting instructions of Contract owners; or (g) if applicable, a decision by a
qualified pension or retirement plan to disregard the voting instructions of
plan participants. The Trust Board shall promptly inform the Company if it
determines that a material irreconcilable conflict exists and the implications
thereof. A majority of the Trust Board shall consist of Trustees who are not
"interested persons" of the Trust.
7.3 The Company has reviewed a copy of the Mixed and Shared Funding
Order, and in particular, has reviewed the conditions to the requested relief
set forth therein. The Company agrees to assist the Trust Board in carrying
out its responsibilities under the Mixed and Shared Funding Order, by
providing the Trust Board with all information reasonably necessary for the
Trust Board to consider any issues raised. This includes, but is not limited
to, an obligation by the Company to inform the Trust Board whenever Contract
owner voting instructions are disregarded. The Trust Board shall record in its
minutes or other appropriate records, all reports received by it and all
action with regard to a conflict.
7.4 If it is determined by a majority of the Trust Board, or a majority
of its disinterested Trustees, that a material irreconcilable conflict exists,
the Company shall, at its
24
expense and to the extent reasonably practicable (as determined by a majority
of the disinterested Trustees), take whatever steps are necessary to remedy or
eliminate the material irreconcilable conflict, up to and including: (a)
withdrawing the assets allocable to some or all of the Separate Accounts from
the relevant Fund and reinvesting such assets in a different investment
medium, including another Fund, or in the case of insurance company
participants submitting the question as to whether such segregation should be
implemented by a vote of all affected Contract owners and, as appropriate,
segregating the assets of any appropriate group (i.e., annuity Contract owners
or life insurance Contract owners of one or more Participating Insurance
Companies) that votes in favor of such segregation, or offering to the
affected Contract owners the option of making such a change; and (b)
establishing a new registered management investment company or managed
separate account.
7.5 If the Company's disregard of voting instructions could conflict with
the majority of Contract owner voting instructions, and the Company's judgment
represents a minority position or would preclude a majority vote, the Company
may be required, at the Trust's election, to withdraw the Separate Account's
investment in the Trust and terminate this Agreement with respect to such
Separate Account, and no charge or penalty will be imposed as a result of such
withdrawal. Any such withdrawal and termination shall take place within six
months after written notice is given that this provision is being implemented,
subject to applicable law but in any event consistent with the terms of the
Mixed and Shared Funding Order. Until such withdrawal and termination is
implemented, the Distributor and the Trust shall continue to accept and
implement orders by the Company for the purchase and redemption of shares of
the Trust. Such withdrawal and termination shall be limited to the extent
required by the foregoing material irreconcilable conflict as determined by a
majority of disinterested Trustees.
25
7.6 If a particular state insurance regulator's decision applicable to
the Company conflicts with the majority of other state insurance regulators,
then the Company will withdraw the Separate Account's investment in the Trust
and terminate this Agreement with respect to such Separate Account within six
months after the Trust informs the Company of a material irreconcilable
conflict, subject to applicable law but in any event consistent with the terms
of the Mixed and Shared Funding Order. Until such withdrawal and termination
is implemented, the Distributor and the Trust shall continue to accept and
implement orders by the Company for the purchase and redemption of shares of
the Trust. Such withdrawal and termination shall be limited to the extent
required by the foregoing material irreconcilable conflict as determined by a
majority of disinterested Trustees.
7.7 For purposes of Sections 7.3 through 7.6 of this Agreement, a
majority of the disinterested members of the Trust Board shall determine
whether any proposed action adequately remedies any material irreconcilable
conflict but in no event will the Trust or the Distributor be required to
establish a new funding medium for the Contracts. The Company shall not be
required by Section 7.3 to establish a new funding medium for the Contracts if
an offer to do so has been declined by vote of a majority of Contract owners
materially adversely affected by the material irreconcilable conflict.
7.8 The Trust Board's determination of the existence of a material
irreconcilable conflict and its implication will be made known in writing to
the Company.
7.9 The Company shall at least annually submit to the Trust Board such
reports, materials, or data as the Trust Board may reasonably request so that
the Trustees may fully carry out the duties imposed upon the Trust Board by
the Mixed and Shared Funding Order, and said
26
reports, materials and data shall be submitted more frequently if deemed
appropriate by the Trust Board.
7.10 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 Mixed and Shared Funding Order) on terms and
conditions materially different from those contained in the Mixed and Shared
Funding Order, the Trust and/or the Company, 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 8. INDEMNIFICATION
---------------
8.1 INDEMNIFICATION BY THE COMPANY
------------------------------
(a) The Company agrees to indemnify and hold harmless the Trust, the
Distributor, and each person, if any, who controls or is associated with the
Trust or the Distributor within the meaning of such terms under the federal
securities laws and each director, officer, employee, or agent of the
foregoing (collectively, the "indemnified parties" for purposes of this
Section 8.1) against any and all losses, claims, damages, liabilities
(including amounts paid in settlement with the written consent of the
Company), or litigation (including 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, liabilities or expenses (or actions in respect thereof or
settlements:
(1) arise out of or are based upon any untrue statements or
alleged untrue statements of any material fact contained in the
registration statements, prospectuses or statements of additional
information for the Contracts or contained in the Contracts, or
sales literature or other promotional material for the Contracts (or
any amendment or supplement to any of the foregoing), or arise out
27
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 in light of the
circumstances in which they were made; provided that this agreement
to indemnify shall not apply as to any indemnified party if such
statement or omission or such alleged statement or omission was made
in reliance upon and in conformity with information furnished to the
Company by or on behalf of the Trust for use in the registration
statement, prospectus or statement of additional information for the
Contracts, or in the Contracts or sales literature (or any amendment
or supplement) or otherwise for use in connection with the sale of
the Contracts or Trust shares; or
(2) arise out of or as a result of statements or
representations by or on behalf of the Company (other than
statements or representations contained in the Trust registration
statement, Trust prospectus, statement of additional information or
sales literature or other promotional material of the Trust not
supplied by the Company or persons under its control) or wrongful
conduct of the Company or persons under its control, with respect to
the sale or distribution of the Contracts or Trust shares; or
(3) arise out of any untrue statement or alleged untrue
statement of a material fact contained in the Trust's registration
statement, prospectus, statement of additional information, or sales
literature or other promotional material of the Trust or any
amendment thereof, or supplement thereto or the omission or alleged
omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading
in light of the circumstances in which they were made, if such a
statement or omission was made in reliance upon and in conformity
with information furnished to the Trust by or on behalf of the
Company or persons under its control; or
(4) arise as a result of any failure by the Company or persons
under its control or subject to its authorization to provide the
services and furnish the materials or to make any payments under the
terms of this Agreement; or
(5) arise out of 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 by the Company of this
Agreement;
except to the extent provided in Section 8.1(b). This indemnification shall be
in addition to any liability which the Company may otherwise have.
28
(b) No party shall be entitled to indemnification by the Company if
such loss, claim, damage, liability or litigation is due to the willful
misfeasance, bad faith, gross negligence, or reckless disregard of duty by the
party seeking indemnification.
(c) The indemnified parties will promptly notify the Company of the
commencement of any litigation, proceedings, complaints or actions against
them in connection with the issuance or sale of the Trust shares or the
Contracts or the operation of the Trust.
8.2 INDEMNIFICATION BY THE TRUST
----------------------------
(a) The Trust agrees to indemnify and hold harmless the Company and
each person, if any, who controls or is associated with the Company within the
meaning of such terms under the federal securities laws and each director,
officer, employee, or agent of the foregoing (collectively, the "indemnified
parties" for purposes of this Section 8.2) against any and all losses, claims,
damages, liabilities (including amounts paid in settlement with the written
consent of the Trust), or litigation (including 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, liabilities or expenses (or actions in respect thereof) or
settlements are related to the operations of the Trust and:
(1) arise out of or are based upon any untrue statements or
alleged untrue statements of any material fact contained in the
registration statements, prospectuses or statements of additional
information for the Trust, or sales literature or other promotional
material for the Trust (or any amendment or supplement to any of the
foregoing), or arise out of or are based upon the omission or the
alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not
misleading in light of the circumstances in which they were made;
provided that this agreement to indemnify shall not apply as to any
indemnified party if such statement or omission or such alleged
statement or omission was made in reliance upon and in conformity
with information furnished to the Trust by or on behalf of the
Company for use in the Trust's registration statement, prospectus or
statement of additional information, or in the Trust's sales
literature (or any amendment or
29
supplement) or otherwise for use in connection with the sale of the
Trust shares; or
(2) arise out of or as a result of statements or
representations by or on behalf of the Trust (other than statements
or representations contained in the Contract registration statement,
Contract prospectus, statement of additional information or sales
literature or other promotional material of the Contracts not
supplied by the Trust or persons under its control) or wrongful
conduct of the Trust or persons under its control, with respect to
the sale or distribution of the Trust shares;
(3) arise as a result of any failure by the Trust to provide
the services and furnish the materials under the terms of this
Agreement (including, but not limited to, a failure, whether
unintentional or in good faith or otherwise, to comply with the
diversification requirements and procedures related thereto
specified in Article 6 of this Agreement); or
(4) arise out of or result from any material breach of any
representation and/or warranty made by the Trust in this Agreement
or arise out of or result from any other material breach of this
Agreement by the Trust; or
(5) arise out of or result from any negligent act or omission
of the Trust or its agents;
except to the extent provided in Section 8.2(b). This indemnification shall be
in addition to any liability, which the Trust may otherwise have.
(b) No party shall be entitled to indemnification by the Trust if
such loss, claim, damage, liability or litigation is due to the willful
misfeasance, bad faith, gross negligence, or reckless disregard of duty by the
party seeking indemnification.
(c) The indemnified parties will promptly notify the Trust of the
commencement of any litigation, proceedings, complaints or actions against
them in connection with the issuance or sale of the Contracts or the operation
of each Separate Account.
8.3. INDEMNIFICATION PROCEDURE
-------------------------
Any person obligated to provide indemnification under this Article 8
("indemnifying party" for the purpose of this Section 8.3) shall not be liable
under the indemnification provisions
30
of this Article 8 with respect to any claim made against a party entitled to
indemnification under this Article 8 ("indemnified party" for the purpose of
this Section 8.3) unless such indemnified party shall have notified the
indemnifying party in writing within a reasonable time after the summons or
other first legal process giving information of the nature of the claim shall
have been served upon such indemnified party (or after such party shall have
received notice of such service on any designated agent), but failure to
notify the indemnifying party of any such claim shall not relieve the
indemnifying party from any liability which it may have to the indemnified
party against whom such action is brought under the indemnification provision
of this Article 8, except to the extent that the failure to notify results in
the failure of actual notice to the indemnifying party and such indemnifying
party is damaged solely as a result of failure to give such notice. In case
any such action is brought against the indemnified party, the indemnifying
party will be entitled to participate, at its own expense, in the defense
thereof. The indemnifying party also shall be entitled to assume the defense
thereof, with counsel satisfactory to the party named in the action. After
notice from the indemnifying party to the indemnified party of the
indemnifying party's election to assume the defense thereof, the indemnified
party shall bear the fees and expenses of any additional counsel retained by
it, and the indemnifying party will not be liable to such party under this
Agreement for any legal or other expenses subsequently incurred by such party
independently in connection with the defense thereof other than reasonable
costs of investigation, unless (i) the indemnifying party and the indemnified
party shall have mutually agreed to the retention of such counsel or (ii) the
named parties to any such proceeding (including any impleaded parties) include
both the indemnifying party and the indemnified party and representation of
both parties by the same counsel would be inappropriate due to actual or
potential differing interests between them. The indemnifying party shall not
be liable for any
31
settlement of any proceeding effected without its written consent but if
settled with such consent or if there be a final judgment for the plaintiff,
the indemnifying party agrees to indemnify the indemnified party from and
against any loss or liability by reason of such settlement or judgment.
A successor by law of the parties to this Agreement shall be entitled to
the benefits of the indemnification contained in this Article 8. The
indemnification provisions contained in this Article 8 shall survive any
termination of this Agreement.
ARTICLE 9. APPLICABLE LAW AND RELATIONSHIP OF THE PARTIES
----------------------------------------------
9.1 This Agreement shall be construed and the provisions hereof
interpreted under and in accordance with the laws of the State of Delaware
without giving effect to conflicts of laws provisions thereof.
9.2 This Agreement shall be subject to the provisions of the 1933, 1934,
and 1940 Acts, and the rules, regulations, and rulings thereunder, including
such exemptions from those statutes, rules and regulations as the SEC may
grant (including, but not limited to, the Mixed and Shared Funding Order) and
the terms hereof shall be interpreted and construed in accordance therewith.
9.3 RELATIONSHIP OF PARTIES. The Company is an independent contractor
-----------------------
vis-a-vis the Trust, the Distributor, or any of their affiliates for all
purposes hereunder and will have no authority to act for or represent any of
them (except to the limited extent the Company acts as agent of the Trust
pursuant to this Agreement). In addition, no officer or employee of the
Company will be deemed to be an employee or agent of the Trust, Distributor,
or any of their affiliates. The Company will not act as an "underwriter" or
"distributor" of Trust shares, as those terms variously are used in the 1940
Act and the 1933 Act. Likewise, the Company is not a "transfer agent" of the
Trust as that term is used in the 1934 Act. The Company agrees to
32
cooperate with the Trust in the Trust's efforts to comply with Rule 38a-1,
including, but not limited to:
o adopting and implementing written compliance policies and
procedures reasonably designed to prevent the Company from
violating the federal securities laws (as defined in the Rule)
in its provision of services to the Trust pursuant to this
Agreement, and
o providing access to the Chief Compliance Officer of the
Separate Accounts who will confer as needed with the Chief
Compliance Officer of the Trust regarding the written
compliance policies and procedures of the Separate Accounts.
ARTICLE 10. TERMINATION
-----------
10.1 This Agreement shall terminate automatically in the event of its
assignment, unless made with written consent of each party; or:
(a) at the option of any party upon ninety (90) days' advance
written notice to the other parties or, if later, upon receipt of any required
exemptive relief to orders from the SEC, unless otherwise agreed in a separate
written agreement among the parties; or
(b) at the option of the Company if shares of the Funds delineated
in Exhibit B are not reasonably available to meet the requirements of the
Contracts as determined by the Company; or
(c) at the option of the Trust upon institution of formal
proceedings against the Company by the NASD, the SEC, the insurance commission
of any state or any other regulatory body, which would have a material adverse
effect on the Company's ability to perform its obligations under this
Agreement; or
33
(d) at the option of the Company upon institution of formal
proceedings against the Trust or the Distributor by the NASD, the SEC, or any
state securities or insurance department or any other regulatory body, which
would have a material adverse effect on the Distributor's or the Trust's
ability to perform its obligations under this Agreement; or
(e) at the option of the Trust or the Distributor by written notice
to the Company, if the Company gives the Trust and the Distributor the written
notice specified in Section 1.8(b) hereof and at the time such notice was
given there was no notice of termination outstanding under any other provision
of this Agreement; provided, however, any termination under this Section
10.1(e) shall be effective sixty (60) days after the notice specified in
Section 1.8(b) was given; or
(f) at the option of the Company or the Trust upon a determination
by a majority of the Trust Board, or a majority of the disinterested Trustees,
that a material irreconcilable conflict exists among the interests of (i) all
contract owners of variable insurance products of all separate accounts, or
(ii) the interests of the Participating Insurance Companies investing in the
Trust as delineated in Article 7 of this Agreement; or
(g) at the option of the Company if the Trust ceases to qualify as a
Regulated Investment Company under Subchapter M of the Internal Revenue Code,
or under any successor or similar provision, or if the Company reasonably
believes that the Trust may fail to so qualify; or
(h) at the option of the Company if the Trust fails to meet the
diversification requirements specified in Article 6 hereof or if the Company
reasonably believes that the Trust will fail to meet such requirements; or
34
(i) at the option of any party to this Agreement, upon another
party's material breach of any provision of this Agreement; or
(j) at the option of the Company, if the Company determines in its
sole judgment exercised in good faith, that either the Trust or the
Distributor has suffered a material adverse change in its business,
operations, or financial condition since the date of this Agreement or is the
subject of material adverse publicity which is likely to have a material
adverse impact upon the business and operations of the Company or the
Contracts (including the sale thereof); or
(k) at the option of the Trust or the Distributor, if the Trust or
the Distributor respectively, shall determine in its sole judgment exercised
in good faith, that the Company has suffered a material adverse change in its
business, operations, or financial condition since the date of this Agreement
or is the subject of material adverse publicity which is likely to have a
material adverse impact upon the business and operations of the Trust or the
Distributor; or
(l) subject to the Trust's compliance with Article 6 hereof, at the
option of the Trust in the event any of the Contracts are not issued or sold
in accordance with applicable requirements of federal and/or state law.
10.2 NOTICE REQUIREMENT
------------------
(a) In the event that any termination of this Agreement is based
upon the provisions of Article 7, such prior written notice shall be given in
advance of the effective date of termination as required by such provisions.
(b) In the event that any termination of this Agreement is based
upon the provisions of Sections 10.1(b)-(d), 10.1(g)-(i) or 10.1(l) prompt
written notice of the election to terminate this Agreement for cause shall be
furnished by the party terminating the Agreement to
35
the non-terminating parties, with said termination to be effective upon
receipt of such notice by the non-terminating parties.
(c) In the event that any termination of this Agreement is based
upon the provisions of Sections 10.1(j) or 10.1(k), prior written notice of
the election to terminate this Agreement for cause shall be furnished by the
party terminating this Agreement to the non-terminating parties. Such prior
written notice shall be given by the party terminating this Agreement to the
non-terminating parties at least 30 days before the effective date of
termination.
10.3 It is understood and agreed that the right to terminate this
Agreement pursuant to Section 10.1(a) may be exercised for any reason or for
no reason.
10.4 EFFECT OF TERMINATION
---------------------
(a) Notwithstanding any termination of this Agreement pursuant to
Section 10.1 of this Agreement and subject to Section 1.3 of this Agreement,
the Company may require the Trust and the Distributor to continue to make
available additional shares of the Trust for so long after the termination of
this Agreement as the Company desires pursuant to the terms and conditions of
this Agreement as provided in paragraph (b) below, for all Contracts in effect
on the effective date of termination of this Agreement (hereinafter referred
to as "Existing Contracts"). Specifically, without limitation, the owners of
the Existing Contracts shall be permitted to reallocate investments in the
Trust, redeem investments in the Trust and/or invest in the Trust upon the
making of additional purchase payments under the Existing Contracts. The
parties agree that this Section 10.4 shall not apply to any terminations under
Article 7 and the effect of such Article 7 terminations shall be governed by
Article 7 of this Agreement.
(b) If shares of the Trust continue to be made available after
termination of this Agreement pursuant to this Section 10.4, the provisions of
this Agreement shall remain in
36
effect except for Section 10.1(a) and thereafter the Trust, the
Distributor, or the Company may terminate the Agreement, as so continued
pursuant to this Section 10.4, upon written notice to the other party, such
notice to be for a period that is reasonable under the circumstances but need
not be for more than 90 days or, if later, upon receipt of any required
exemptive relief to orders from the SEC.
10.5 The Company shall not redeem Fund shares attributable to the
Contracts (as opposed to Fund shares attributable to the Company's assets held
in the Account) except (i) as necessary to implement Contract Owner initiated
or approved transactions, or (ii) as required by state and/or federal laws or
regulations or judicial or other legal precedent of general application
(hereinafter referred to as a "Legally Required Redemption"). Upon request,
the Company will promptly furnish to the Trust and the Distributor the opinion
of counsel for the Company (which counsel shall be reasonably satisfactory to
the Trust and the Distributor) to the effect that any redemption pursuant to
clause (ii) above is a Legally Required Redemption. Furthermore, except in
cases where permitted under the terms of the Contracts, the Company shall not
prevent Contract Owners from allocating payments to a Fund that was otherwise
available under the Contracts without first giving the Trust or the
Distributor 90 days notice of its intention to do so.
ARTICLE 11. NOTICES
-------
Any notice shall be deemed duly given only if sent by hand, evidenced by
written receipt or by certified mail, return receipt requested or by any other
method agreed to by the parties, 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. All notices shall be deemed given
three business days after the date received or rejected by the addressee.
If to the Company: RiverSource Life Insurance Co. of
New York
37
0000 Xxxxxxxxxx Xxxxxxxxx Xxxxxx
Xxxxxxxxxxx, XX 00000
Attention: Vice President
If to Insurance Underwriter: RiverSource Distributors, Inc.
00000 Xxxxxxxxxx Xxxxxxxxx Xxxxxx
Xxxxxxxxxxx, XX 00000
Attention: Chief Counsel
If to the Trust or the Distributor: National Accounts
Xxxxx Fargo Advantage Funds
000 Xxxxxx Xxxxxx, 00xx Xxxxx
MAC X0000-000
Xxx Xxxxxxxxx, XX 00000
ARTICLE 12. MISCELLANEOUS
-------------
12.1 All persons dealing with the Trust must look solely to the property
of the Trust for the enforcement of any claims against the Trust as neither
the Trustees, officers, agents nor shareholders assume any personal liability
for obligations entered into on behalf of the Trust.
12.2 USE AND DISCLOSURE OF CONFIDENTIAL INFORMATION
----------------------------------------------
Notwithstanding anything to the contrary contained in this Agreement, and
in addition to and not in lieu of other provisions in this Agreement:
(a) Confidential Information includes without limitation all
information regarding the customers of the Company or the customers of any of
the Company's subsidiaries, affiliates or licensees; or the accounts, account
numbers, names, addresses, social security numbers or any other personal
identifier of customers of any of the foregoing information derived therefrom.
(b) Neither the Trust nor the Distributor may use or disclose
Confidential Information for any purpose other than to carry out the purpose
for which Confidential Information was provided to the Trust and/or the
Distributor as set forth in this Agreement, and
38
agree to cause any party to whom the Trust and/or the Distributor may provide
access to or disclose Confidential Information to limit the use and disclosure
of Confidential Information to that purpose.
(c) The Trust and the Distributor agree to implement appropriate
measures designed to ensure the security and confidentiality of Confidential
Information, to protect such information against any anticipated threats or
hazards to the security or integrity of such information, and to protect
against unauthorized access to, or use of, Confidential Information that could
result in substantial harm or inconvenience to any of the customers of the
Company or the customers of any of the Company's subsidiaries affiliates or
licensees; the Trust and the Distributor further agree to cause any party to
whom the Trust and/or the Distributor may provide access to or disclose
Confidential Information to implement appropriate measures designed to meet
the objectives set forth in this paragraph.
12.3 The captions in this Agreement are included for convenience of
reference only and in no way define or delineate any of the provisions hereof
or otherwise affect their construction or effect.
12.4 This Agreement may be executed simultaneously in two or more
counterparts, each of which taken together shall constitute one and the same
instrument.
12.5 If any provision of this Agreement shall be held or made invalid by
a court decision, statute, rule or otherwise, the remainder of the Agreement
shall not be affected thereby.
12.6 This Agreement shall not be assigned by any party hereto without the
prior written consent of all the parties.
12.7 Each party hereto shall cooperate with each other party and all
appropriate governmental authorities (including without limitation the SEC,
the NASD, and state insurance
39
regulators) and shall permit each other and such authorities reasonable access
to its books and records in connection with any investigation or inquiry
relating to this Agreement or the transactions contemplated hereby.
12.8 Each party represents that the execution and delivery of this
Agreement and the consummation of the transactions contemplated herein have
been duly authorized by all necessary corporate or trust action, as
applicable, by such party and when so executed and delivered this Agreement
will be the valid and binding obligation of such party enforceable in
accordance with its terms.
12.9 The parties to this Agreement may amend the schedules to this
Agreement from time to time to reflect changes in or relating to the
Contracts, the Separate Accounts or the Funds of the Trust or may amend other
applicable terms of this Agreement.
40
12.10 The Trust has filed a Certificate of Trust with the Secretary of
State of the State of
Delaware. The Company acknowledges that the obligations
of or arising out of the Trust's Declaration of Trust are not binding upon any
of the Trust's Trustees, officers, employees, agents or shareholders
individually, but are binding solely upon the assets and property of the Trust
in accordance with its proportionate interest hereunder. The Company further
acknowledges that the assets and liabilities of each Fund are separate and
distinct and that the obligations of or arising out of this instrument are
binding solely upon the assets or property of the Fund on whose behalf the
Trust has executed this instrument. The Company also agrees that the
obligations of each Fund hereunder shall be several and not joint, in
accordance with its proportionate interest hereunder, and the Company agrees
not to proceed against any Fund for the obligations of another Fund.
12.11 Except as otherwise expressly provided in this Agreement, neither
the Trust nor the Distributor nor any affiliate thereof shall use any
trademark, trade name, service xxxx or logo of the Company or any of its
affiliates, or any variation of any such trademark, trade name service xxxx or
logo, without the Company's prior consent, the granting of which shall be at
the Company's sole option. Except as otherwise expressly provided in this
Agreement, neither the Company nor any affiliate thereof shall use any
trademark, trade name, service xxxx or logo of the Trust or of the
Distributor, or any variation of any such trademark, trade name, service xxxx
or logo, without the prior consent of either the Trust or of the Distributor,
as appropriate, the granting of which shall be at the sole option of the Trust
or of the Distributor, as applicable.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK.]
41
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
this 1st day of January, 2007.
XXXXX FARGO FUNDS DISTRIBUTOR, LLC
By: /s/ Xxxx Xxxx
------------------------------------
Name: Xxxx Xxxx
Title: President
Date: January 29, 2007
XXXXX FARGO VARIABLE TRUST
By: /s/ C. Xxxxx Xxxxxxx
------------------------------------
Name: C. Xxxxx Xxxxxxx
Title: Secretary
Date: January 30, 2007
RIVERSOURCE LIFE INSURANCE CO. OF Attest:
NEW YORK
By: /s/ Xxxxxxx X. Xxxxx III By: /s/ Xxxxx Xxxxxx
------------------------------------ -------------------------------
Name: Xxxxxxx X. Xxxxx III Name: Xxxxx Xxxxxx
Title: Vice President Title: Assistant Secretary
Date: February 5, 2007
RIVERSOURCE DISTRIBUTORS, INC. Attest:
By: /s/ Xxxxxxx X. Xxxxx III By: /s/ Xxxxx Xxxxxx
------------------------------------ -------------------------------
Name: Xxxxxxx X. Xxxxx III Name: Xxxxx Xxxxxx
Title: Vice President Title: Assistant Secretary
Date: February 5, 2007
42
SCHEDULE A
SEPARATE ACCOUNTS AND CONTRACTS
SUBJECT TO THE
PARTICIPATION AGREEMENT
--------------------------------------
Separate Account:
RiverSource of New York Variable Annuity Account
Established April 17, 1996;
RiverSource of New York Account 4 Established March 29,
2001; and
RiverSource of New York Account 8 Established September
12, 1985.
Contracts: RiverSource Retirement Advisor 4 Advantage(SM) Variable
Annuity; Contract Form Number 139482
RiverSource Retirement Advisor 4 Select(SM) Variable
Annuity; Contract Form Number 139483
RiverSource Retirement Advisor 4 Access(SM) Variable
Annuity Contract Form Number 139484
RiverSource Retirement Advisor Advantage Plus Variable
Annuity; Contract Form Number 31053A.
RiverSource Retirement Advisor Select Plus Variable
Annuity; Contract Form Number 139035A.
RiverSource Retirement Advisor Select(R) Variable Annuity;
Contract Form Numbers 139035, 139036, 139037, 139038.
RiverSource Retirement Advisor Advantage(R) Variable
Annuity (New York); Contract Form Numbers 31053, 31054,
31055-SEP, 31056-XXX.
RiverSource Retirement Advisor Variable Annuity (R) (New
York); Contract Form Numbers 31053, 31054, 31055-SEP,
31056-XXX.
IDS Life of New York Variable Retirement and Combination
Retirement Annuities; Contract Form Numbers 38379, 39182,
39183, 39181.
IDS Life of New York Employee Benefit Annuity; Contract
Form Numbers 38607 and 38611.
IDS Life of New York Flexible Annuity; Contract Form
Numbers 39191, 39192, and 39193.
43
IDS Life of New York Variable Universal Live IV and IDS
Life of New York Variable Universal Life IV - Estate
Series; Contract Form Number 39061C.
IDS Life of New York Succession Select(SM) Variable Life
Insurance; Contract Form Number 39090C.
44
SCHEDULE B
FUNDS SUBJECT TO THE
PARTICIPATION AGREEMENT
--------------------------------------------
Xxxxx Fargo Advantage Asset Allocation Fund
Xxxxx Fargo Advantage International Core Fund (previously Xxxxx Fargo VT
International Equity fund)
Xxxxx Fargo Advantage Opportunity Fund (successor to Strong Opportunity II,
Investor and Advisor Class)
Xxxxx Fargo Advantage Small Cap Growth Fund
45
SCHEDULE C
OTHER FUNDS AVAILABLE UNDER THE CONTRACTS
-----------------------------------------
RIVERSOURCE RETIREMENT ADVISOR 4 ADVANTAGE(SM) VARIABLE ANNUITY
RIVERSOURCE RETIREMENT ADVISOR 4 SELECT(SM) VARIABLE ANNUITY
RIVERSOURCE RETIREMENT ADVISOR 4 ACCESS(SM) VARIABLE ANNUITY
AIM V.I. Capital Appreciation Fund, Series II Shares
AIM V.I. Capital Development Fund, Series II Shares
AIM V.I. Financial Services Fund, Series II Shares
AIM V.I. Global Health Care Fund, Series II Shares
AIM V.I. International Growth Fund, Series II Shares
AllianceBernstein VPS Global Technology Portfolio (Class B)
AllianceBernstein VPS Growth and Income Portfolio (Class B)
AllianceBernstein VPS International Value Portfolio (Class B)
AllianceBernstein VPS Large Cap Growth Portfolio (Class B)
American Century VP Mid Cap Value, Class II
American Century VP Ultra(R), Class II
American Century VP Value, Class II
Columbia High Yield Fund, Variable Series, Class B
Columbia Xxxxxxx Growth Fund, Variable Series
Columbia Xxxxxxx International Opportunities Fund, Variable Series
Credit Suisse Trust - Commodity Return Strategy Portfolio
Dreyfus Variable Investment Fund International Equity Portfolio, Service
Shares
Dreyfus Variable Investment Fund International Value Portfolio, Service Shares
Xxxxx Xxxxx VT Floating-Rate Income Fund
Evergreen VA Fundamental Large Cap Fund - Class 2
Evergreen VA International Equity Fund - Class 2
Fidelity(R) VIP Contrafund(R) Portfolio Service Class 2
Fidelity(R) VIP Mid Cap Portfolio Service Class 2
Fidelity(R) VIP Overseas Portfolio Service Class 2
FTVIPT Franklin Real Estate Fund - Class 2
FTVIPT Franklin Small Cap Value Securities Fund - Class 2
FTVIPT Mutual Shares Securities Fund - Class 2
Xxxxxxx Xxxxx VIT Structured U.S. Equity Fund
Xxxx Xxxxx Partners Variable Small Cap Growth Portfolio, Class II
MFS(R) Investors Growth Stock Series - Service Class
MFS(R) Total Return Series - Service Class
MFS(R) Utilities Series - Service Class
Xxxxxxxxx Xxxxxx Advisers Management Trust International Portfolio (Class S)
Xxxxxxxxx Xxxxxx Advisers Management Trust Socially Responsive Portfolio
(Class S)
Xxxxxxxxxxx Global Securities Fund/VA, Service Shares
Xxxxxxxxxxx Main Street Small Cap Fund/VA, Service Shares
Xxxxxxxxxxx Strategic Bond Fund/VA, Service Shares
46
Xxxxxxxxxxx Value Fund/VA, Service Shares
PIMCO VIT All Asset Portfolio, Advisor Share Class
RiverSource Variable Portfolio - Balanced Fund
RiverSource Variable Portfolio - Cash Management Fund
RiverSource Variable Portfolio - Core Bond Fund
RiverSource Variable Portfolio - Diversified Bond Fund
RiverSource Variable Portfolio - Diversified Equity Income Fund
RiverSource Variable Portfolio - Emerging Markets Fund
RiverSource Variable Portfolio - Fundamental Value Fund
RiverSource Variable Portfolio - Global Bond Fund
RiverSource Variable Portfolio - Global Inflation Protected Securities Fund
RiverSource Variable Portfolio - Growth Fund
RiverSource Variable Portfolio - High Yield Bond Fund
RiverSource Variable Portfolio - Income Opportunities Fund
RiverSource Variable Portfolio - International Opportunity Fund
RiverSource Variable Portfolio - Large Cap Equity Fund
RiverSource Variable Portfolio - Large Cap Value Fund
RiverSource Variable Portfolio - Mid Cap Growth Fund
RiverSource Variable Portfolio - Mid Cap Value Fund
RiverSource Variable Portfolio - S&P 500 Index Fund
RiverSource Variable Portfolio - Select Value Fund
RiverSource Variable Portfolio - Short Duration U.S. Government Fund
RiverSource Variable Portfolio - Small Cap Advantage Fund
RiverSource Variable Portfolio - Small Cap Value Fund
Xxx Xxxxxx Life Investment Trust Xxxxxxxx Portfolio, Class II Shares
Xxx Xxxxxx UIF Global Real Estate Portfolio, Class II
Shares Xxx Xxxxxx UIF Mid Cap Growth Portfolio - Class II
Shares Xxxxxx International Small Cap
Xxxxxx U.S. Smaller Companies
RIVERSOURCE RETIREMENT ADVISOR SELECT PLUS(R) VARIABLE ANNUITY
RIVERSOURCE RETIREMENT ADVISOR ADVANTAGE PLUS(R) VARIABLE ANNUITY
AIM V.I. Capital Appreciation Fund, Series II Shares
AIM V.I. Capital Development Fund, Series II Shares
AIM V.I. Financial Services Fund, Series I Shares (Previously INVESCO VIF -
Financial Services Fund, Series I Shares)
AIM V.I. Technology Fund, Series I Shares (Previously INVESCO VIF - Technology
Fund, Series I Shares)
AllianceBernstein VP Growth and Income Portfolio (Class B)
AllianceBernstein VP International Value Portfolio (Class B)
American Century(R) VP International, Class II
American Century(R) VP Value, Class II
Xxxxxxx Variable Series, Inc. Social Balanced Portfolio
Columbia High Yield Fund, Variable Series, Class B
Evergreen VA International Equity Fund - Class 2
47
Fidelity(R) VIP Growth & Income Portfolio Service Class 2
Fidelity(R) VIP Mid Cap Portfolio Service Class 2
Fidelity(R) VIP Overseas Portfolio Service Class 2
FTVIPT Franklin Real Estate Fund - Class 2
FTVIPT Franklin Small Cap Value Securities Fund - Class 2
FTVIPT Mutual Shares Securities Fund - Class 2
Xxxxxxx Xxxxx VIT CORE(SM) U.S. Equity Fund
Xxxxxxx Xxxxx VIT Mid Cap Value Fund
Lazard Retirement International Equity Portfolio
MFS(R) Investors Growth Stock Series - Service Class
MFS(R) New Discovery Series - Service Class
MFS(R) Total Return Series - Service Class
MFS(R) Utilities Series - Service Class
Xxxxxxxxxxx Global Securities Fund/VA, Service Shares
Xxxxxxxxxxx Main Street Small Cap Fund/VA, Service Shares
Xxxxxxxxxxx Strategic Bond Fund/VA, Service Shares
Xxxxxx VT Health Sciences Fund - Class IB Shares
Xxxxxx VT International Equity Fund - Class IB Shares
Xxxxxx VT Vista Fund - Class IB Shares
RiverSource(SM) Variable Portfolio - Balanced Fund
RiverSource(SM) Variable Portfolio - Cash Management Fund
RiverSource(SM) Variable Portfolio - Core Bond Fund
RiverSource(SM) Variable Portfolio - Diversified Bond Fund
RiverSource(SM) Variable Portfolio - Diversified Equity Income Fund
RiverSource(SM) Variable Portfolio - Emerging Markets Fund
RiverSource(SM) Variable Portfolio - Global Bond Fund
RiverSource(SM) Variable Portfolio - Global Inflation Protected Securities
Fund
RiverSource(SM) Variable Portfolio - Growth Fund
RiverSource(SM) Variable Portfolio - High Yield Bond Fund
RiverSource(SM) Variable Portfolio - Income Opportunities Fund
RiverSource(SM) Variable Portfolio - International Opportunity Fund
RiverSource(SM) Variable Portfolio - Large Cap Equity Fund
RiverSource(SM) Variable Portfolio - Large Cap Value Fund
RiverSource(SM) Variable Portfolio - Mid Cap Growth Fund
RiverSource(SM) Variable Portfolio - New Dimensions Fund(R)
RiverSource(SM) Variable Portfolio - S&P 500 Index Fund
RiverSource(SM) Variable Portfolio - Select Value Fund
RiverSource(SM) Variable Portfolio - Short Duration U.S. Government Fund
RiverSource(SM) Variable Portfolio - Small Cap Advantage Fund
RiverSource(SM) Variable Portfolio - Small Cap Value Fund
RiverSource(SM) Variable Portfolio - Strategy Aggressive Fund
Xxx Xxxxxx Life Investment Trust Xxxxxxxx Portfolio, Class II Shares
Xxxxxx International Small Cap
Xxxxxx U.S. Smaller Companies
48
RIVERSOURCE RETIREMENT ADVISOR ADVANTAGE(R) VARIABLE ANNUITY
RIVERSOURCE RETIREMENT ADVISOR SELECT VARIABLE ANNUITY(R)
AIM V.I. Capital Appreciation Fund, Series II Shares
AIM V.I. Capital Development Fund, Series II Shares
AIM V.I. Dynamics Fund, Series I Shares (previously INVESCO VIF -Dynamics
Fund, Series I Shares)
AIM V.I. Financial Services Fund, Series I Shares (previously INVESCO VIF -
Financial Services Fund, Series I Shares)
AIM V.I. Technology Fund, Series I Shares (previously INVESCO VIF - Technology
Fund, Series I Shares)
AllianceBernstein VP Growth and Income Portfolio (Class B)
AllianceBernstein VP International Value Portfolio (Class B)
American Century(R) VP International, Class II
American Century(R) VP Value, Class II
Xxxxxxx Variable Series, Inc. Social Balanced Portfolio
Evergreen VA Fundamental Large Cap Fund - Class 2 (previously Evergreen VA
Growth and Income Fund - Class 2)
Fidelity(R) VIP Growth & Income Portfolio Service Class 2
Fidelity(R) VIP Mid Cap Portfolio Service Class 2
Fidelity(R) VIP Overseas Portfolio Service Class 2
FTVIPT Franklin Real Estate Fund - Class 2
FTVIPT Franklin Small Cap Value Securities Fund - Class 2
FTVIPT Mutual Shares Securities Fund - Class 2
Xxxxxxx Xxxxx VIT CORE(SM) U.S. Equity Fund
Xxxxxxx Xxxxx VIT Mid Cap Value Fund
Janus Aspen Series Global Technology Portfolio: Service Shares
Janus Aspen Series International Growth Portfolio: Service Shares
Lazard Retirement International Equity Portfolio
MFS(R) Investors Growth Stock Series - Service Class
MFS(R) New Discovery Series - Service Class
MFS(R) Utilities Series - Service Class
Xxxxxxxxxxx Global Securities Fund/VA, Service Shares
Xxxxxxxxxxx Main Street Small Cap Fund/VA, Service Shares
Xxxxxxxxxxx Strategic Bond Fund/VA, Service Shares
Pioneer Equity Income VCT Portfolio - Class II Shares
Pioneer Europe VCT Portfolio - Class II Shares
Xxxxxx VT Health Sciences Fund - Class IB Shares
Xxxxxx VT International Equity Fund - Class IB Shares
Xxxxxx VT Vista Fund - Class IB Shares
RiverSource(SM) Variable Portfolio - Balanced Fund
RiverSource(SM) Variable Portfolio - Cash Management Fund
RiverSource(SM) Variable Portfolio - Core Bond Fund
RiverSource(SM) Variable Portfolio - Diversified Bond Fund
RiverSource(SM) Variable Portfolio - Diversified Equity Income Fund
RiverSource(SM) Variable Portfolio - Emerging Markets Fund
49
RiverSource(SM) Variable Portfolio - Global Bond Fund
RiverSource(SM) Variable Portfolio - Global Inflation Protected Securities
Fund
RiverSource(SM) Variable Portfolio - Growth Fund
RiverSource(SM) Variable Portfolio - High Yield Bond Fund
RiverSource(SM) Variable Portfolio - Income Opportunities Fund
RiverSource(SM) Variable Portfolio - International Opportunity Fund
RiverSource(SM) Variable Portfolio - Large Cap Equity Fund
RiverSource(SM) Variable Portfolio - Large Cap Value Fund
RiverSource(SM) Variable Portfolio - Mid Cap Growth Fund
RiverSource(SM) Variable Portfolio - Mid Cap Value Fund
RiverSource(SM) Variable Portfolio - New Dimensions Fund(R)
RiverSource(SM) Variable Portfolio - S&P 500 Index Fund
RiverSource(SM) Variable Portfolio - Select Value Fund
RiverSource(SM) Variable Portfolio - Short Duration U.S. Government Fund
RiverSource(SM) Variable Portfolio - Small Cap Advantage Fund
RiverSource(SM) Variable Portfolio - Small Cap Value Fund
RiverSource(SM) Variable Portfolio - Strategy Aggressive Fund
Xxxxxx International Small Cap
Xxxxxx U.S. Smaller Companies
RIVERSOURCE RETIREMENT ADVISOR VARIABLE ANNUITY(R)
AIM V.I. Capital Appreciation Fund, Series I Shares
AIM V.I. Capital Development Fund, Series I Shares
AllianceBernstein VP Growth and Income Portfolio (Class B)
AllianceBernstein VP International Value Portfolio (Class B)
American Century(R) VP International, Class I
American Century(R) VP Value, Class I
Xxxxxxx Variable Series, Inc. Social Balanced Portfolio
Credit Suisse Trust - Mid-Cap Growth Portfolio
Fidelity(R) VIP Growth & Income Portfolio Service Class
Fidelity(R) VIP Mid Cap Portfolio Service Class
Fidelity(R) VIP Overseas Portfolio Service Class
FTVIPT Franklin Real Estate Fund - Class 2
FTVIPT Franklin Small Cap Value Securities Fund - Class 2
FTVIPT Xxxxxxxxx Foreign Securities Fund - Class 2
Xxxxxxx Sachs VIT CORE(SM) Small Cap Equity Fund
Xxxxxxx Xxxxx VIT CORE(SM) U.S. Equity Fund
Xxxxxxx Xxxxx VIT Mid Cap Value Fund
Janus Aspen Series Global Technology Portfolio: Service Shares
Janus Aspen Series International Growth Portfolio: Service Shares
Janus Aspen Series Mid Cap Growth Portfolio: Service Shares
Lazard Retirement International Equity Portfolio
MFS(R) Investors Growth Stock Series - Service Class
MFS(R) New Discovery Series - Service Class
MFS(R) Utilities Series - Service Class
50
Xxxxxxxxxxx Global Securities Fund/VA, Service Shares
Xxxxxxxxxxx Main Street Small Cap Fund/VA, Service Shares
Xxxxxxxxxxx Strategic Bond Fund/VA, Service Shares
Xxxxxx VT International New Opportunities Fund - Class IB Shares
Xxxxxx VT Vista Fund - Class IB Shares
RiverSource(SM) Variable Portfolio - Balanced Fund
RiverSource(SM) Variable Portfolio - Cash Management Fund
RiverSource(SM) Variable Portfolio - Core Bond Fund
RiverSource(SM) Variable Portfolio - Diversified Bond Fund
RiverSource(SM) Variable Portfolio - Diversified Equity Income Fund
RiverSource(SM) Variable Portfolio - Emerging Markets Fund
RiverSource(SM) Variable Portfolio - Global Bond Fund
RiverSource(SM) Variable Portfolio - Global Inflation Protected Securities
Fund
RiverSource(SM) Variable Portfolio - Growth Fund
RiverSource(SM) Variable Portfolio - High Yield Bond Fund
RiverSource(SM) Variable Portfolio - Income Opportunities Fund
RiverSource(SM) Variable Portfolio - International Opportunity Fund
RiverSource(SM) Variable Portfolio - Large Cap Equity Fund
RiverSource(SM) Variable Portfolio - Large Cap Value Fund
RiverSource(SM) Variable Portfolio - Mid Cap Growth Fund
RiverSource(SM) Variable Portfolio - Mid Cap Value Fund
RiverSource(SM) Variable Portfolio - New Dimensions Fund(R)
RiverSource(SM) Variable Portfolio - S&P 500 Index Fund
RiverSource(SM) Variable Portfolio - Select Value Fund
RiverSource(SM) Variable Portfolio - Short Duration U.S. Government Fund
RiverSource(SM) Variable Portfolio - Small Cap Advantage Fund
RiverSource(SM) Variable Portfolio - Strategy Aggressive Fund
Royce Micro-Cap Portfolio
Third Avenue Value Portfolio
Xxxxxx International Small Cap
Xxxxxx U.S. Smaller Companies
IDS LIFE OF NEW YORK VARIABLE UNIVERSAL LIFE IV
IDS LIFE OF NEW YORK VARIABLE UNIVERSAL LIFE IV - ESTATE SERIES
IDS LIFE OF NEW YORK SUCCESSION SELECT VARIABLE LIFE INSURANCE
AIM V.I. Capital Appreciation Fund, Series II Shares
AIM V.I. Capital Development Fund, Series II Shares
AIM V.I. Dynamics Fund, Series I Shares (Previously INVESCO VIF -Dynamics
Fund, Series I Shares)
AIM V.I. Financial Services Fund, Series I Shares (Previously INVESCO VIF -
Financial Services Fund, Series I Shares)
AIM V.I. Technology Fund, Series I Shares (Previously INVESCO VIF - Technology
Fund, Series I Shares)
AllianceBernstein VP Growth and Income Portfolio (Class B)
AllianceBernstein VP International Value Portfolio (Class B)
51
American Century(R) VP International, Class II
American Century(R) VP Value, Class II
Xxxxxxx Variable Series, Inc. Social Balanced Portfolio
Evergreen VA Fundamental Large Cap Fund - Class 2 (previously Evergreen VA
Growth and Income Fund - Class 2)
Fidelity(R) VIP Growth and Income Portfolio Service Class 2
Fidelity(R) VIP Mid Cap Portfolio Service Class 2
Fidelity(R) VIP Overseas Portfolio Service Class 2
FTVIPT Franklin Real Estate Fund - Class 2
FTVIPT Franklin Small Cap Value Securities Fund - Class 2
FTVIPT Mutual Shares Securities Fund - Class 2
Xxxxxxx Xxxxx VIT CORE(SM) U.S. Equity Fund
Xxxxxxx Xxxxx VIT Mid Cap Value Fund
Janus Aspen Series Global Technology Portfolio: Service Shares
Janus Aspen Series International Growth Portfolio: Service Shares
Lazard Retirement International Equity Portfolio
MFS(R) Investors Growth Stock Series - Service Class
MFS(R) New Discovery Series - Service Class
MFS(R) Utilities Series - Service Class
Pioneer Equity Income VCT Portfolio - Class II Shares
Pioneer Europe VCT Portfolio - Class II Shares
Xxxxxx VT Health Sciences Fund - Class IB Shares
Xxxxxx VT International Equity Fund - Class IB Shares
Xxxxxx VT Vista Fund - Class IB Shares
RiverSource(SM) Variable Portfolio - Balanced Fund
RiverSource(SM) Variable Portfolio - Cash Management Fund
RiverSource(SM) Variable Portfolio - Diversified Bond Fund
RiverSource(SM) Variable Portfolio - Diversified Equity Income Fund
RiverSource(SM) Variable Portfolio - Emerging Markets Fund
RiverSource(SM) Variable Portfolio - Global Bond Fund
RiverSource(SM) Variable Portfolio - Growth Fund
RiverSource(SM) Variable Portfolio - High Yield Bond Fund
RiverSource(SM) Variable Portfolio - International Opportunity Fund
RiverSource(SM) Variable Portfolio - Large Cap Equity Fund
RiverSource(SM) Variable Portfolio - Mid Cap Growth Fund
RiverSource(SM) Variable Portfolio - New Dimensions Fund(R)
RiverSource(SM) Variable Portfolio - S&P 500 Index Fund
RiverSource(SM) Variable Portfolio - Short Duration U.S. Government Fund
RiverSource(SM) Variable Portfolio - Small Cap Advantage Fund
RiverSource(SM) Variable Portfolio - Small Cap Value Fund
RiverSource(SM) Variable Portfolio - Strategy Aggressive Fund
Xxxxxx International Small Cap
Xxxxxx U.S. Smaller Companies
IDS LIFE OF NEW YORK VARIABLE RETIREMENT AND COMBINATION RETIREMENT ANNUITIES
52
IDS LIFE OF NEW YORK EMPLOYEE BENEFIT ANNUITY
IDS LIFE OF NEW YORK FLEXIBLE ANNUITY
AllianceBernstein VP Growth and Income Portfolio (Class B)
RiverSource(SM) Variable Portfolio - Balanced Fund
RiverSource(SM) Variable Portfolio - Cash Management Fund
RiverSource(SM) Variable Portfolio - Diversified Bond Fund
RiverSource(SM) Variable Portfolio - Diversified Equity Income Fund
RiverSource(SM) Variable Portfolio - Global Bond Fund
RiverSource(SM) Variable Portfolio - Growth Fund
RiverSource(SM) Variable Portfolio - High Yield Bond Fund
RiverSource(SM) Variable Portfolio - International Opportunity Fund
RiverSource(SM) Variable Portfolio - Large Cap Equity Fund
RiverSource(SM) Variable Portfolio - Mid Cap Growth Fund
RiverSource(SM) Variable Portfolio - New Dimensions Fund(R)
RiverSource(SM) Variable Portfolio - Strategy Aggressive Fund
53
SCHEDULE D
RULE 12b-1 PLAN
---------------
COMPENSATION SCHEDULE
---------------------
Each Fund named below shall pay the following amounts pursuant to the
terms and conditions referenced below under the Xxxxx Fargo Variable Trust
Distribution Plan adopted under Rule 12b-1, stated as a percentage per year of
the average daily net assets represented by Eligible Shares (defined below)
held by the Company for its Separate Accounts.
VARIABLE TRUST FUNDS 12b-1 FEE
-------------------- ---------
Xxxxx Fargo Advantage Asset Allocation Fund 0.25%
Xxxxx Fargo Advantage International Core Fund 0.25%
Xxxxx Fargo Advantage Opportunity Fund 0.25%
Xxxxx Fargo Advantage Small Cap Growth Fund 0.25%
AGREEMENT PROVISIONS
--------------------
If the Company, on behalf of any Separate Account, purchases Fund shares
("Eligible Shares") which are subject to a Rule 12b-1 plan adopted under the
1940 Act (the "Plan"), the Company may participate in the Plan.
To the extent the Company or its affiliates (including without
limitation, Insurance Underwriter), agents or designees (collectively "you")
provide any activity or service which is primarily intended to assist in the
promotion, distribution or account servicing of Eligible Shares ("Rule 12b-1
Services") or variable contracts offering Eligible Shares, the Distributor,
the Trust or their affiliates (collectively, "we") shall pay Insurance
Underwriter a Rule 12b-1 fee at the rate set forth above. "Rule 12b-1
Services" may include, but are not limited to, printing of prospectuses and
reports used for sales purposes, preparing and distributing sales literature
and related expenses, advertisements, education of dealers and their
representatives, and similar distribution-related expenses, furnishing
personal services to owners of Contracts which may invest in Eligible Shares
("Contract Owners"), education of Contract Owners, answering routine inquiries
regarding a Fund, coordinating responses to Contract Owner inquiries regarding
the Funds, maintaining such accounts or providing such other enhanced services
as a Fund or Contract may require, or providing other services eligible for
service fees as defined under NASD rules. Your acceptance of such compensation
is your acknowledgment that eligible services have been rendered. All Rule
12b-1 fees shall be based on the value of Eligible Shares owned by the Company
on behalf of its Separate Accounts, and shall be calculated on the basis and
at the rates set forth in the Compensation Schedule stated above. The Rule
12b-1 fee will be paid to Insurance Underwriter monthly within thirty (30)
days after Distributor's receipt of your invoice.
54
You shall furnish us with such information as shall reasonably be
requested by the Trust's Boards of Trustees ("Trustees") with respect to the
Rule 12b-1 fees paid to you pursuant to the Plans. We shall furnish to the
Trustees, for their review on a quarterly basis, a written report of the
amounts expended under the Plans and the purposes for which such expenditures
were made.
The Plan and provisions of any agreement relating to such Plan must be
approved annually by a vote of the Trustees, including the Trustees who are
not interested persons of the Trust and who have no direct or indirect
financial interest in the Plan or any related agreement ("Qualified
Trustees"). Each Plan may be terminated at any time by the vote of a majority
of the Qualified Trustees, or by a vote of a majority of the outstanding
shares as provided in the Plan, on sixty (60) days' written notice, without
payment of any penalty. Continuation of the Plan is conditioned on Qualified
Trustees being ultimately responsible for selecting and nominating any new
Qualified Trustees. Under Rule 12b-1, the Trustees have a duty to request and
evaluate, and persons who are party to any agreement related to the Plan have
a duty to furnish such information as may reasonably be necessary to an
informed determination of whether the Plan or any agreement should be
implemented or continued. Under Rule 12b-1, the Trust is permitted to
implement or continue the Plan or the provisions of any agreement relating to
such Plan from year-to-year only if, based on certain legal considerations,
the Trustees (including a majority of the Qualified Trustees) are able to
conclude that the Plan will benefit each affected Fund and class. Absent such
yearly determination, the Plan must be terminated as set forth above. In the
event of the termination of the Plan for any reason, the provisions of this
Schedule D relating to the Plan will also terminate. In accordance with the
terms of the Agreement to which this Schedule D is attached, and subject to
the continuation of the Plan, this fee will continue to be due and payable
notwithstanding termination of the Agreement with respect to shares
attributable to Existing Contracts as defined in Section 10.4 of the
Agreement.
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