JANUS ASPEN SERIES
FUND PARTICIPATION AGREEMENT
THIS AGREEMENT is made this 28 day of September, 1999, between JANUS ASPEN
SERIES, an open-end management investment company organized as a Delaware
business trust (the "Trust"), JANUS DISTRIBUTORS, INC. ("Distributor"), a
Colorado corporation and distributor of the Trust's shares, and HARTFORD LIFE
AND ANNUITY INSURANCE COMPANY, a life insurance company organized under the laws
of the State of Connecticut (the "Company"), on its own behalf and on behalf of
each segregated asset account of the Company set forth on Schedule A, as may be
amended from time to time (the "Accounts").
WITNESSETH:
WHEREAS, the Trust has registered with the Securities and Exchange Commission as
an open-end management investment company under the Investment Company Act of
1940, as amended (the "1940 Act"), and has registered the offer and sale of its
Institutional Shares ("shares") under the Securities Act of 1933, as amended
(the "1933 Act"); and
WHEREAS, the Trust desires to act as an investment vehicle for separate accounts
established for variable life insurance policies and variable annuity contracts
to be offered by insurance companies that have entered into participation
agreements with the Trust (the "Participating Insurance Companies"); and
WHEREAS, the beneficial interest in the Trust is divided into several series of
shares, each series representing an interest in a particular managed portfolio
of securities and other assets (the "Portfolios"); and
WHEREAS, the Trust has received an order from the Securities and Exchange
Commission ("SEC") granting Participating Insurance Companies and their separate
accounts exemptions from the provisions of Sections 9(a), 13(a), 15(a) and 15(b)
of the 1940 Act, and Rules 6e-2(b)(15) and 6e-3(T)(b)(15) thereunder, to the
extent necessary to permit shares of the Trust to be sold to and held by
variable annuity and variable life insurance separate accounts of both
affiliated and unaffiliated life insurance companies and certain qualified
pension and retirement plans (the "Exemptive Order"); and
WHEREAS, the Company has registered or will register (unless registration is not
required under applicable law) certain variable life insurance policies and/or
variable annuity contracts under the 1933 Act (the "Contracts"); and
WHEREAS, the Company has registered or will register each Account as a unit
investment trust under the 1940 Act; and
1
WHEREAS, the Company desires to utilize shares of one or more Portfolios as an
investment vehicle of the Accounts; and
WHEREAS, the Distributor serves as distributor of the Trust's shares;
NOW, THEREFORE, in consideration of their mutual promises, the parties agree as
follows:
ARTICLE I
Sale of Trust Shares
1.1 The Trust shall make shares of its Portfolios available to the Accounts at
the net asset value next computed after receipt of such purchase order by the
Trust (or its agent), as established in accordance with the provisions of the
then current prospectus of the Trust. Shares of a particular Portfolio of the
Trust shall be ordered in such quantities and at such times as determined by the
Company to be necessary to meet the requirements of the Contracts. The Trustees
of the Trust (the "Trustees") may refuse to sell shares of any Portfolio to any
person, or suspend or terminate the offering of shares of any Portfolio if such
action is required by law or by regulatory authorities having jurisdiction or
is, in the sole discretion of the Trustees acting in good faith and in light of
their fiduciary duties under federal and any applicable state laws, necessary in
the best interests of the shareholders of such Portfolio.
1.2 The Trust will redeem any full or fractional shares of any Portfolio when
requested by the Company on behalf of an Account at the net asset value next
computed after receipt by the Trust (or its agent) of the request for
redemption, as established in accordance with the provisions of the then current
prospectus of the Trust. The Trust shall make payment for such shares in the
manner established from time to time by the Trust, but in no event shall payment
be delayed for a greater period than is permitted by the 0000 Xxx.
1.3 For the purposes of Sections 1.1 and 1.2, the Trust hereby appoints the
Company as its agent for the limited purpose of receiving and accepting purchase
and redemption orders resulting from investment in and payments under the
Contracts. Receipt by the Company shall constitute receipt by the Trust provided
that i) such orders are received by the Company in good order prior to the time
the net asset value of each Portfolio is priced in accordance with its
prospectus and ii) the Trust receives notice of such orders by 10:00 a.m. New
York time on the next following Business Day. "Business Day" shall mean any day
on which the New York Stock Exchange is open for trading and on which the Trust
calculates its net asset value pursuant to the rules of the SEC.
1.4 Purchase orders that are transmitted to the Trust in accordance with
Section 1.3 shall be paid for no later than 12:00 noon New York time on the same
Business Day that the Trust receives notice of the order. Payments shall be made
in federal funds transmitted by wire.
2
1.5 Issuance and transfer of the Trust's shares will be by book entry only.
Stock certificates will not be issued to the Company or the Account. Shares
ordered from the Trust will be recorded in the appropriate title for each
Account or the appropriate subaccount of each Account.
1.6 The Trust shall furnish the Company with advance notice of any income
dividends or capital gain distributions payable on the Trust's shares. The
Company hereby elects to receive all such income dividends and capital gain
distributions as are payable on a Portfolio's shares in additional shares of
that Portfolio. The Trust shall notify the Company of the number of shares so
issued as payment of such dividends and distributions. The Company reserves the
right to revoke this election and to receive all such dividends and capital
gains distributions in cash.
1.7 The Trust shall make the net asset value per share for each Portfolio
available to the Company on a daily basis as soon as reasonably practical after
the net asset value per share is calculated and shall use its best efforts to
make such net asset value per share available by 6 p.m. New York time. If the
Trust provides materially incorrect share net asset value information through no
fault of the Company, the Separate Account shall be entitled to an adjustment
with respect to the Fund shares purchased or redeemed to reflect the correct net
asset value per share. The determination of the materiality of any net asset
value pricing error shall be based on the SEC's recommended guidelines regarding
these errors. The correction of any such errors will be made pursuant to the
SEC's recommended guidelines. Any material error in the calculation or reporting
of net asset value per share, dividend or capital gain information shall be
reported promptly to the Company upon discovery.
1.8 The Trust agrees that its shares will be sold only to Participating
Insurance Companies and their separate accounts and to certain qualified pension
and retirement plans to the extent permitted by the Exemptive Order. No shares
of any Portfolio will be sold directly to the general public. The Company agrees
that Trust shares will be used only for the purposes of funding the Contracts
and Accounts listed in Schedule A, as amended from time to time.
1.9 The Trust agrees that all Participating Insurance Companies shall have the
obligations and responsibilities regarding pass-through voting and conflicts of
interest corresponding to those contained in Section 2.8 and Article IV of this
Agreement.
ARTICLE II
Obligations of the Parties
2.1 The Trust shall prepare and be responsible for filing with the SEC and any
state regulators requiring such filing all shareholder reports, notices, proxy
materials (or similar materials such as voting instruction solicitation
materials), prospectuses and statements of additional information of the Trust.
The Trust shall bear the costs of registration and
3
qualification of its shares, preparation and filing of the documents listed in
this Section 2.1 and all taxes to which an issuer is subject on the issuance and
transfer of its shares.
2.2 At the option of the Company, the Trust shall either (a) provide the
Company (at the Company's expense) with as many copies of the Trust's current
prospectus, annual report, semi-annual report and other shareholder
communications, including any amendments or supplements to any of the foregoing,
as the Company shall reasonably request; or (b) provide the Company with a
camera ready copy of such documents in a form suitable for printing. The Trust
shall provide the Company with a copy of its statement of additional information
in a form suitable for duplication by the Company. The Trust (at its expense)
shall provide the Company with copies of any Trust-sponsored proxy materials in
such quantity as the Company shall reasonably require for distribution to
Contract owners.
2.3 (a) The Company shall bear the costs of printing and distributing the
Trust's prospectus, statement of additional information, shareholder reports and
other shareholder communications to owners of and applicants for policies for
which the Trust is serving or is to serve as an investment vehicle. The Company
shall bear the costs of distributing proxy materials (or similar materials such
as voting solicitation instructions) to Contract owners. The Company assumes
sole responsibility for ensuring that such materials are delivered to Contract
owners in accordance with applicable federal and state securities laws.
(b) If the Company elects to include any materials provided by the Trust,
specifically prospectuses, SAIs, shareholder reports and proxy materials, on its
web site or in any other computer or electronic format, the Company assumes sole
responsibility for maintaining such materials in the form provided by the Trust
and for promptly replacing such materials with all updates provided by the
Trust.
2.4 (a) The Company agrees and acknowledges that the Trust's adviser, Janus
Capital Corporation ("Janus Capital"), is the sole owner of the name and xxxx
"Xxxxx" and that all use of any designation comprised in whole or part of Janus
(a "Xxxxx Xxxx") under this Agreement shall inure to the benefit of Janus
Capital. Except as provided in Section 2.5, the Company shall not use any Xxxxx
Xxxx on its own behalf or on behalf of the Accounts or Contracts in any
registration statement, advertisement, sales literature or other materials
relating to the Accounts or Contracts without the prior written consent of Janus
Capital. Upon termination of this Agreement for any reason, the Company shall
cease all use of any Xxxxx Xxxx(s) as soon as reasonably practicable.
(b) The Trust and Distributor agree and acknowledge that the Company is the
sole owner of the name and xxxx "Hartford" and that all use of any designation
comprised in whole or part of Hartford (a "Xxxxxxxx Xxxx") under this Agreement
shall inure to the benefit of the Company. Except as provided in Section 2.5,
neither the Trust nor the Distributor will use any Xxxxxxxx Xxxx in any
registration statement, advertisement, sales literature or other materials
relating to the Trust without the prior written consent of Hartford. Upon
removal of the
4
Portfolios from the Accounts for any reason, the Trust and the Distributor shall
cease all use of any Xxxxxxxx Xxxx(s) as soon as reasonably practicable.
2.5 The Company shall furnish, or cause to be furnished, to the Trust or its
designee, a copy of each Contract prospectus or statement of additional
information in which the Trust or its investment adviser is named prior to the
filing of such document with the Securities and Exchange Commission. The Company
shall furnish, or shall cause to be furnished, to the Trust or its designee,
each piece of sales literature or other promotional material in which the Trust
or its investment adviser is named, at least ten Business Days prior to its use.
No such material shall be used if the Trust or its designee reasonably objects
to such use within ten Business Days after receipt of such material.
2.6 The Company shall not give any information or make any representations or
statements on behalf of the Trust or concerning the Trust or its investment
adviser in connection with the sale of the Contracts other than information or
representations contained in and accurately derived from the registration
statement or prospectus for the Trust shares (as such registration statement and
prospectus may be amended or supplemented from time to time), reports of the
Trust, Trust-sponsored proxy statements, or in sales literature or other
promotional material approved by the Trust or its designee, except as required
by legal process or regulatory authorities or with the written permission of the
Trust or its designee.
2.7 Neither the Trust nor the Distributor shall give any information or make
any representations or statements on behalf of the Company or concerning the
Company, the Accounts or the Contracts other than information or representations
contained in and accurately derived from the registration statement or
prospectus for the Contracts (as such registration statement and prospectus may
be amended or supplemented from time to time), or in materials approved by the
Company for distribution including sales literature or other promotional
materials, except as required by legal process or regulatory authorities or with
the written permission of the Company.
2.8 So long as, and to the extent that the SEC interprets the 1940 Act to
require pass-through voting privileges for variable policyowners, the Company
will provide pass-through voting privileges to owners of policies whose cash
values are invested, through the Accounts, in shares of the Trust. The Trust
shall require all Participating Insurance Companies to calculate voting
privileges in the same manner and the Company shall be responsible for assuring
that the Accounts calculate voting privileges in the manner established by the
Trust. With respect to each Account, the Company will vote shares of the Trust
held by the Account and for which no timely voting instructions from
policyowners are received as well as shares it owns that are held by that
Account, in the same proportion as those shares for which voting instructions
are received. The Company and its agents will in no way recommend or oppose or
interfere with the solicitation of proxies for Trust shares held by Contract
owners without the prior written consent of the Trust, which consent may be
withheld in the Trust's sole discretion.
5
ARTICLE III
Representations and Warranties
3.1 The Company represents and warrants that it is an insurance company duly
organized and in good standing under the laws of the State of Connecticut and
that it has legally and validly established each Account as a segregated asset
account under such law on the date set forth in Schedule A.
3.2 The Company represents and warrants that each Account has been registered
or, prior to any issuance or sale of the Contracts, will be registered as a unit
investment trust in accordance with the provisions of the 0000 Xxx.
3.3 The Company represents and warrants that the Contracts or interests in the
Accounts (1) are or, prior to issuance, will be registered as securities under
the 1933 Act or, alternatively (2) are not registered because they are properly
exempt from registration under the 1933 Act or will be offered exclusively in
transactions that are properly exempt from registration under the 1933 Act. The
Company further represents and warrants that the Contracts will be issued and
sold in compliance in all material respects with all applicable federal and
state laws; and the sale of the Contracts shall comply in all material respects
with state insurance requirements.
3.4 The Company states that (1) the Year 2000 Approach Document attached to
this Agreement as Schedule B is an accurate and complete description of its Y2K
program as of February 1999 and (2) as stated in such document, Company's
internal systems are now substantially "Year 2000 Ready." This means that
Company will be substantially capable of processing data with dates prior to,
during or after the calendar year 2000 by hardware and software products,
programs, files and databases, individually or in combination. Processing
includes performing comparisons, arithmetic operations (including correct leap
year calculations) and sorting of date fields.
3.5 The Trust represents and warrants that it is duly organized and validly
existing under the laws of the State of Delaware.
3.6 The Trust represents and warrants that the Trust shares offered and sold
pursuant to this Agreement will be registered under the 1933 Act and the
regulations thereunder to the extent required and the Trust is and shall remain
registered under the 1940 Act and the regulations thereunder to the extent
required prior to any issuance or sale of such shares. The Trust shall amend its
registration statement under the 1933 Act and the 1940 Act from time to time as
required in order to effect the continuous offering of its shares. The Trust
shall register and qualify its shares for sale in accordance with the laws of
the various states only if and to the extent deemed advisable by the Trust.
Trust shares shall be duly authorized for issuance in accordance with the laws
of each jurisdiction which shares will be offered. Trust shares shall be sold in
compliance with all applicable federal state securities laws and regulations.
6
3.7 The Trust represents and warrants that the investments of each Portfolio
will comply with the diversification requirements for variable annuity,
endowment or life insurance contracts, set forth in Section 817(h) of the
Internal Revenue Code of 1986, as amended, and the rules and regulations
thereunder. In the event the Portfolios cease to qualify, the Trust will take
reasonable steps (i) to notify the Company immediately of such event and (ii) to
adequately diversify the Portfolios so as to achieve compliance within the grace
period afforded by Regulation 817-5.
3.8 The Distributor represents and warrants that it is registered as a
broker-dealer under the Securities Exchange Act of 1934.
ARTICLE IV
Potential Conflicts
4.1 The parties acknowledge that the Trust's shares may be made available for
investment to other Participating Insurance Companies. In such event, the
Trustees will monitor the Trust for the existence of any material irreconcilable
conflict between the interests of the contract owners of all Participating
Insurance Companies. An irreconcilable material conflict may arise for a variety
of reasons, including: (a) an action by any state insurance regulatory
authority; (b) a change in applicable federal or state insurance, tax, or
securities laws or regulations, or a public ruling, private letter ruling,
no-action or interpretative letter, or any similar action by insurance, tax, or
securities regulatory authorities; (c) an administrative or judicial decision in
any relevant proceeding; (d) the manner in which the investments of any
Portfolio are being managed; (e) a difference in voting instructions given by
variable annuity contract and variable life insurance contract owners; or (f) a
decision by an insurer to disregard the voting instructions of contract owners.
The Trustees shall promptly inform the Company if they determine that an
irreconcilable material conflict exists and the implications thereof.
4.2 The Company agrees to promptly report any potential or existing material
irreconcilable conflicts of which it is aware to the Trustees. The Company will
assist the Trustees in carrying out their responsibilities under the Exemptive
Order by providing the Trustees with all information reasonably necessary for
the Trustees to consider any issues raised including, but not limited to,
information as to a decision by the Company to disregard Contract owner voting
instructions.
4.3 If it is determined by a majority of the Trustees, or a majority of its
disinterested Trustees, that a material irreconcilable conflict exists that
affects the interests of Contract owners, the Company shall, in cooperation with
other Participating Insurance Companies whose contract owners are also affected,
at its expense and to the extent reasonably practicable (as determined by the
Trustees) take whatever steps are necessary to remedy or eliminate the
irreconcilable material conflict, which steps could include: (a) withdrawing the
assets allocable to some or all of the Accounts from the Trust or any Portfolio
and reinvesting such assets in a different investment medium, including (but not
limited to) another Portfolio of the Trust, or submitting the question
7
of whether or not such segregation should be implemented to a vote of all
affected Contract owners and, as appropriate, segregating the assets of any
appropriate group (i.e., annuity contract owners, life insurance contract
owners, or variable contract owners of one or more Participating Insurance
Companies) that votes in favor of such segregation, or offering to the affected
Contract owners the option of making such a change; and (b) establishing a new
registered management investment company or managed separate account.
4.4 If a material irreconcilable conflict arises because of a decision by the
Company to disregard Contract owner voting instructions and that decision
represents a minority position or would preclude a majority vote, the Company
may be required, at the Trust's election, to withdraw the affected Account's
investment in the Trust and terminate this Agreement with respect to such
Account; provided, however that such withdrawal and termination shall be limited
to the extent required by the foregoing material irreconcilable conflict as
determined by a majority of the disinterested Trustees. Any such withdrawal and
termination must take place within six (6) months after the Trust gives written
notice that this provision is being implemented. Until the end of such six (6)
month period, the Trust shall continue to accept and implement orders by the
Company for the purchase and redemption of shares of the Trust.
4.5 If a material irreconcilable conflict arises because a particular state
insurance regulator's decision applicable to the Company conflicts with the
majority of other state regulators, then the Company will withdraw the affected
Account's investment in the Trust and terminate this Agreement with respect to
such Account within six (6) months after the Trustees inform the Company in
writing that it has determined that such decision has created an irreconcilable
material conflict; provided, however, that such withdrawal and termination shall
be limited to the extent required by the foregoing material irreconcilable
conflict as determined by a majority of the disinterested Trustees. Until the
end of such six (6) month period, the Trust shall continue to accept and
implement orders by the Company for the purchase and redemption of shares of the
Trust.
4.6 For purposes of Sections 4.3 through 4.6 of this Agreement, a majority of
the disinterested Trustees shall determine whether any proposed action
adequately remedies any irreconcilable material conflict, but in no event will
the Company be required to establish a new funding medium for the Contracts if
an offer to do so has been declined by vote of a majority of Contract owners
materially adversely affected by the irreconcilable material conflict. In the
event that the Trustees determine that any proposed action does not adequately
remedy any irreconcilable material conflict, then the Company will withdraw the
Account's investment in the Trust and terminate this Agreement within six (6)
months after the Trustees inform the Company in writing of the foregoing
determination; provided, however, that such withdrawal and termination shall be
limited to the extent required by any such material irreconcilable conflict as
determined by a majority of the disinterested Trustees.
4.7 The Company shall at least annually submit to the Trustees such reports,
materials or data as the Trustees may reasonably request so that the Trustees
may fully carry out the duties
8
imposed upon them by the Exemptive Order, and said reports, materials and data
shall be submitted more frequently if deemed appropriate by the Trustees.
4.8 If and to the extent that Rule 6e-2 and Rule 6e-3(T) are amended, or Rule
6e-3 is adopted, to provide exemptive relief from any provision of the 1940 Act
or the rules promulgated thereunder with respect to mixed or shared funding (as
defined in the Exemptive Order) on terms and conditions materially different
from those contained in the Exemptive Order, then the Trust and/or the
Participating Insurance Companies, as appropriate, shall take such steps as may
be necessary to comply with Rules 6e-2 and 6e-3(T), as amended, and Rule 6e-3,
as adopted, to the extent such rules are applicable.
ARTICLE V
Indemnification
5.1 Indemnification by the Company
(a) Company agrees to indemnify and hold harmless the Trust, the Distributor,
and each of their Directors, Trustees, officers, employees and agents and each
person, if any, who controls the Trust within the meaning of Section 15 of the
1933 Act (collectively, the "Non-Company Indemnified Parties") against any and
all losses, claims, damages, liabilities (including amounts paid in settlement
with the written consent of Company) or litigation (including 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 sale or acquisition of the Portfolio shares or the Contracts and:
(i) Arise out of or are based upon any untrue statement or alleged
untrue statement of any material fact contained in the
registration statement or prospectus for the Contracts or
contained in the Contracts or sales literature for the Contracts,
or any amendment or supplement to any of the foregoing, or arise
out of or are based upon the omission or the alleged omission to
state therein a material fact required to be stated therein or
necessary to make the statement therein not misleading, provided
that this agreement to indemnify shall not apply as to any
Non-Company 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 or
prospectus 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 Portfolio shares;
or
(ii) Arise out of or as a result of statements or representations
(other than statements or representations contained in the
registration statement, prospectus or sales literature of the
Trust not supplied by the Company or persons
9
under its control, and other than statements or representations
authorized by the Trust) or unlawful conduct of the Company or
persons under its control, with respect to the sale or
distribution of the Contracts or Portfolio shares; or
(iii) Arise out of or as a result of any untrue statement or alleged
untrue statement of a material fact contained in a registration
statement, prospectus, or sales literature 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, if such 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
(iv) Arise as a result of any failure by the Company to provide the
services and furnish the materials under the terms of this
Agreement; or
(v) Arise out of or result from any material breach of any
representation and/or warranty made by the Company in this
Agreement or arise out of or result from any other material breach
of this Agreement by the Company.
(b) The Company shall not be liable under this indemnification provision with
respect to any losses, claims, damages, liabilities or litigation incurred or
assessed against a Non-Company Indemnified Party as such may arise from such
Non-Company Indemnified Party's willful malfeasance or negligence in the
performance of such Non-Company Indemnified Party's duties or by reason of such
Non-Company Indemnified Party's failure to fulfill its obligations or duties
under this Agreement.
(c) The Company shall not be liable under this indemnification provision with
respect to any claim made against a Non-Company Indemnified Party unless such
Non-Company Indemnified Party shall have notified the Company 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
Non-Company Indemnified Party (or after such Non-Company Indemnified Party shall
have received notice of such service on any designated agent) but failure to
notify the Company of any such claim shall not relieve the Company from any
liability which it may have to the Non-Company Indemnified Party against whom
such action is brought otherwise than on account of this indemnification
provision. In case any such action is brought against the Non-Company
Indemnified Parties, the Company shall be entitled to participate, at its own
expense, in the defense of such action. The Company shall also be entitled to
assume the defense thereof, with counsel satisfactory to the party named in the
action .After notice from the Company to such party of the Company's election to
assume the defense thereof, the Non-Company Indemnified Party shall bear the
fees and expenses under this Agreement for any additional counsel retained by
it, and the Company 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.
10
(d) The Non-Company Indemnified Parties will promptly notify the Company of the
commencement of any litigation or proceedings against them in connection with
the issuance or sale of the Portfolio shares or the Contracts or the operation
of the Trust or the Company's failure to perform any of its obligations
hereunder if Non-Company Indemnified Party intends to seek indemnification
hereunder.
5.2 Indemnification by the Trust.
(a) The Trust agrees to indemnify and hold harmless the Company and its
directors and officers and each person, if any, who controls the Company within
the meaning of Section 15 of the 1933 Act (collectively the "Company Indemnified
Parties") against any and all losses, claims, damages, liabilities (including
amounts paid in settlement with the written consent of the Trust) or litigation
(including 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, claim, damages, liabilities or expenses (or actions in respect
thereof) or settlements are related to the operations of the Trust and:
(i) Arise out of or are based upon any untrue statement or alleged
untrue statement of any material fact contained in the
registration statement or prospectus or sales literature of 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 statement therein not
misleading, provided that this agreement to indemnify shall not
apply as to any Company 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 registration
statement or prospectus for the Trust or in sales literature (or
any amendment or supplement) or otherwise for use in connection
with the sale of the Contracts or Portfolio shares; or
(ii) Arise out of or as a result of statements or representations
(other than statements or representations contained in the
registration statement, prospectus or sales literature for the
Contracts not supplied by the Trust or persons under its control
and other than statements or representations authorized by the
Company) or unlawful conduct of the Trust or persons under its
control, with respect to the sale or distribution of the
Contracts or Portfolio shares; or
(iii) Arise out of or as a result of any untrue statement or alleged
untrue statement of a material fact contained in a registration
statement, prospectus, or sales literature covering the
Contracts, 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 statement
or statements
11
therein not misleading, if such statement or omission was made in
reliance upon information furnished to the Company by or on
behalf of the Trust; or
(iv) Arise as a result of any failure by the Trust to provide the
services and furnish the materials under the terms of this
Agreement; or
(v) 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.
(b) The Trust shall not be liable under this indemnification provision with
respect to any losses, claims, damages, liabilities or litigation incurred or
assessed against Company Indemnified Party as may arise from such Company
Indemnified Party's willful malfeasance or negligence in the performance of such
Company Indemnified Party's duties or by reason of such Company Indemnified
Party's failure to fulfill its obligations and duties under this Agreement.
(c) The Trust shall not be liable under this indemnification provision with
respect to any claim made against a Company Indemnified Party unless such
Company Indemnified Party shall have notified the Trust 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 Company
Indemnified Party (or after such Company Indemnified Party shall have received
notice of such service on any designated agent), but failure to notify the Trust
of any such claim shall not relieve the Trust from any liability which it may
have to the Company Indemnified Party against whom such action is brought
otherwise than on account of this indemnification provision. In case any such
action is brought against the Company Indemnified Parties, the Trust shall be
entitled to participate, at its own expense, in the defense of such action. The
Trust also shall be entitled to assume the defense thereof, with counsel
satisfactory to the party named in the action. After notice from the Trust to
such party of the Trust's election to assume the defense thereof, the Company
Indemnified Party shall bear the fees and expenses of any additional counsel
retained by it, and the Trust 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.
(d) The Company will promptly notify the Trust of the commencement of any
litigation or proceedings against it or any of its officers or directors in
connection with this Agreement, with the issuance or sale of the Contracts, with
respect to the operation of each Separate Account, with the sale or acquisition
of shares of the Portfolios or with the failure of the Trust to perform any of
its obligations hereunder.
5.3 Indemnification by the Distributor.
(a) The Distributor agrees to indemnify and hold harmless the Company and its
directors and officers and each person, if any, who controls the Company within
the meaning
12
of Section 15 of the 1933 Act (collectively the "Company Indemnified Parties")
against any and all losses, claims, damages, liabilities (including amounts paid
in settlement with the written consent of the Distributor) or litigation
(including 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, claim, damages, liabilities or expenses (or actions in respect
thereof) or settlements are related to the operations of the Distributor and:
(i) Arise out of or are based upon any untrue statement or alleged
untrue statement of any material fact contained in the
registration statement or prospectus or sales literature of 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 statement therein not misleading,
provided that this agreement to indemnify shall not apply as to
any Company 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 registration statement or
prospectus for the Trust or in sales literature (or any amendment
or supplement) or otherwise for use in connection with the sale of
the Contracts or Portfolio shares; or
(ii) Arise out of or as a result of statements or representations
(other than statements or representations contained in the
registration statement, prospectus or sales literature for the
Contracts not supplied by the Distributor or persons under its
control and other than statements or representations authorized by
the Company) or unlawful conduct of the Distributor or persons
under its control, with respect to the sale or distribution of the
Contracts or Portfolio shares; or
(iii) Arise out of or as a result of any untrue statement or alleged
untrue statement of a material fact contained in a registration
statement, prospectus, or sales literature covering the
Contracts, 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 statement
or statements therein not misleading, if such statement or
omission was made in reliance upon information furnished to the
Company by or on behalf of the Distributor; or
(iv) Arise as a result of any failure by the Distributor to provide the
services and furnish the materials under the terms of this
Agreement; or
(v) Arise out of or result from any material breach of any
representation and/or warranty made by the Distributor in this
Agreement or arise out of or result from any other material breach
of this Agreement by the Distributor.
13
(b) The Distributor shall not be liable under this indemnification provision
with respect to any losses, claims, damages, liabilities or litigation incurred
or assessed against Company Indemnified Party as may arise from such Company
Indemnified Party's willful malfeasance or negligence in the performance of such
Company Indemnified Party's duties or by reason of such Company Indemnified
Party's failure to fulfill its obligations and duties under this Agreement.
(c) The Distributor shall not be liable under this indemnification provision
with respect to any claim made against a Company Indemnified Party unless such
Company Indemnified Party shall have notified the Trust 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 Company
Indemnified Party (or after such Company Indemnified Party shall have received
notice of such service on any designated agent), but failure to notify the
Distributor of any such claim shall not relieve the Distributor from any
liability which it may have to the Company Indemnified Party against whom such
action is brought otherwise than on account of this indemnification provision.
In case any such action is brought against the Company Indemnified Parties, the
Distributor shall be entitled to participate, at its own expense, in the defense
of such action. The Distributor also shall be entitled to assume the defense
thereof, with counsel satisfactory to the party named in the action. After
notice from the Distributor to such party of the Distributor's election to
assume the defense thereof, the Company Indemnified Party shall bear the fees
and expenses of any additional counsel retained by it, and the Distributor 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.
(d) The Company will promptly notify the Distributor of the commencement of any
litigation or proceedings against it or any of its officers or directors in
connection with this Agreement, with the issuance or sale of the Contracts, with
respect to the operation of each Separate Account, with the sale or acquisition
of shares of the Portfolios or with the failure of the Distributor to perform
any of its obligations hereunder.
ARTICLE VI
Termination
6.1 This Agreement may be terminated by
(a) any party for any reason by six months advance written notice delivered to
the other parties;
(b) immediately, 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 if the
Company shall determine, in its sole judgment exercised in good faith, that the
Trust has suffered a material adverse change in its
14
business, operations, financial condition, or prospectus since the date of this
Agreement or is the subject of material adverse publicity;
(c) immediately, at the option of the Trust or Distributor upon institution of
formal proceedings against the Company by the NASD, the SEC, or any state
securities or insurance department or any other regulatory body if the Trust or
Distributor shall determine, in its sole judgments exercised in good faith, that
the Company has suffered a material adverse change in its business, operations,
financial condition, or prospects since the date of this Agreement or is the
subject of material adverse publicity;
(d) immediately, at the option of any party to the Agreement upon a
determination by a majority of the Trustees of the Trust, or a majority of
disinterested Trustees, that an irreconcilable material conflict exists;
(e) immediately, at the option of the Company upon a material breach of this
Agreement or of any representation or warranty herein by the Trust, or at the
option of the Trust or upon a material breach of this Agreement or any
representation or warranty herein by the Company.
6.2 (a) Notwithstanding any termination of this Agreement, the Trust shall, at
the option of the Company, continue to make available additional shares of the
Trust (or any Portfolio) pursuant to the terms and conditions of this Agreement
for all Contracts in effect on the effective date of termination of this
Agreement (the "Existing Contracts"), provided that the Company continues to pay
the costs set forth in Section 2.3 unless such further sale of Trust shares is
proscribed by law, regulation or applicable regulatory body. Specifically,
without limitation, the owners of the Existing Contracts will be permitted to
direct allocation and reallocation of investments in the Portfolios, redeem
investments in the Trust and invest in the Trust through additional purchase
payments.
(b) The Company agrees not to redeem Trust shares attributable to the Contracts
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 or (iii) as permitted
by an order of the SEC. Upon request, the Company will promptly furnish to the
Trust the opinion of counsel for the Company to the effect that any redemption
pursuant to clause (ii) above is a legally required redemption.
6.3 The provisions of Article V shall survive the termination of this
Agreement, and the provisions of Article IV and Section 2.8 shall survive the
termination of this Agreement as long as shares of the Trust are held on behalf
of Contract owners in accordance with Section 6.2.
15
ARTICLE VII
Notices
Any notice shall be sufficiently given when sent by registered or certified mail
to the other party at the address of such party set forth below or at such other
address as such party may from time to time specify in writing to the other
party.
If to the Trust:
Janus Aspen Series
000 Xxxxxxxx Xxxxxx
Xxxxxx, Xxxxxxxx 00000
Attention: General Counsel
If to the Distributor:
Janus Distributors, Inc.
000 Xxxxxxxx Xxxxxx
Xxxxxx, Xxxxxxxx 00000
Attention: General Counsel
If to the Company:
Hartford Life and Annuity Insurance Company
000 Xxxxxxxxx Xx.
Xxxxxxxx, XX 00000
Attention: Xxxxxx Xxxxx, Executive Vice President
with a copy to:
International Corporate Marketing Group
000 Xxxxxx Xxxxx, Xxxxx 000
Xxxxxxx Xxxx, XX 00000-0000
Attention: President
ARTICLE VIII
Miscellaneous
8.1 The captions in this Agreement are included for convenience of reference
only and in no way define or delineate any of the provisions hereof or otherwise
affect their construction or effect.
16
8.2 This Agreement may be executed simultaneously in two or more counterparts,
each of which taken together shall constitute one and the same instrument.
8.3 If any provision of this Agreement shall be held or made invalid by a court
decision, statute, rule or otherwise, the remainder of the Agreement shall not
be affected thereby.
8.4 This Agreement shall be construed and the provisions hereof interpreted
under and in accordance with the laws of State of Colorado.
8.5 The parties to this Agreement acknowledge and agree that all liabilities of
the Trust arising, directly or indirectly, under this Agreement, of any and
every nature whatsoever, shall be satisfied solely out of the assets of the
Trust and that no Trustee, officer, agent or holder of shares of beneficial
interest of the Trust shall be personally liable for any such liabilities.
8.6 Each party shall cooperate with each other party and all appropriate
governmental authorities (including without limitation the SEC, the National
Association of Securities Dealers, Inc., and state insurance regulators) and
shall permit such authorities reasonable access to its books and records in
connection with any investigation or inquiry relating to this Agreement or the
transactions contemplated hereby.
8.7 The rights, remedies and obligations contained in this Agreement are
cumulative and are in addition to any and all rights, remedies and obligations,
at law or in equity, which the parties hereto are entitled to under state and
federal laws.
8.8 The parties to this Agreement acknowledge and agree that this Agreement
shall not be exclusive in any respect.
8.9 Neither this Agreement nor any rights or obligations hereunder may be
assigned by either party without the prior written approval of the other party.
8.10 No provisions of this Agreement may be amended or modified in any manner
except by a written agreement properly authorized and executed by duly
authorized officers of both parties.
8.11 This Agreement, its terms and definitions, shall be subject to the
provisions of the 1933 Act, the Securities Exchange Act of 1934 and the 1940
Act, and the rules and regulations and rulings thereunder, including such
exemptions from those statutes, rules and regulations as the SEC may grant.
17
IN WITNESS WHEREOF, the parties have caused their duly authorized officers to
execute this Participation Agreement as of the date and year first above
written.
JANUS ASPEN SERIES
By: /s/ Xxxxxx X. Xxxx
--------------------------------
Name: Xxxxxx X. Xxxx
Title: Assistant Vice President
JANUS DISTRIBUTORS, INC.
By: /s/ Xxxxxx Xxxxxx Xxxxx
--------------------------------
Name: Xxxxxx Xxxxxx Xxxxx
Title: Vice President
HARTFORD LIFE AND ANNUITY INSURANCE
COMPANY
By: /s/ Xxxxx X. Xxx Xxxxx
--------------------------------
Name: Xxxxx X. Xxx Xxxxx
Title: Assistant Vice President
18
Schedule A
Separate Accounts and Associated Contracts
NAME OF SEPARATE ACCOUNT AND CONTRACTS FUNDED
DATE ESTABLISHED BY BOARD OF DIRECTORS BY SEPARATE ACCOUNT
--------------------------------------------------------------------------------
ICMG Registered Variable Life Separate
Account One
(October 9, 1995)
19
