EXHIBIT 99-B.8.53
FUND PARTICIPATION AGREEMENT
BETWEEN
FRANKLIN XXXXXXXXX
AND
ING INSURANCE COMPANY OF AMERICA
ING Insurance Company of America ("IICA"), ____________________ (the
"Fund") and ___________________ (the "Distributor") hereby agree to an
arrangement whereby the Fund shall be made available to serve as underlying
investment media for Variable Annuity Contracts ("Contracts") to be issued by
IICA.
1. ESTABLISHMENT OF ACCOUNTS; AVAILABILITY OF FUND.
IICA represents that it has established Variable Annuity Accounts B, C, D
and F and may establish such other accounts as may be set forth in Schedule
A attached hereto and as may be amended from time to time with the mutual
consent of the parties hereto (the "Accounts"), each of which is a separate
account under Connecticut Insurance law, and has registered or will
register each of the Accounts (except for such Accounts for which no such
registration is required) as a unit investment trust under the Investment
Company Act of 1940 (the "1940 Act"), to serve as an investment vehicle for
the Contracts. Each Contract provides for the allocation of net amounts
received by IICA to an Account for investment in the shares of one of more
specified open-end management investment companies available through that
Account as underlying investment media. Selection of a particular
investment management company and changes therein from time to time are
made by the participant or Contract owner, as applicable under a particular
Contract.
2. PRICING INFORMATION; ORDERS; SETTLEMENT.
(a) The Fund will make Fund shares available to be purchased by IICA, and
will accept redemption orders from IICA, on behalf of each Account at
the net asset value applicable to each order on those days on which
the Fund calculates its net asset value (a "Business Day"). Fund
shares shall be purchased and redeemed in such quantity and at such
time determined by IICA to be necessary to meet the requirements of
those Contracts for which the Fund(s) serve as underlying investment
media, provided, however, that the Board of Trustees of the Fund
(hereinafter the "Trustees") may upon reasonable notice to IICA,
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 the best interests of the shareholders of any Portfolio and in
compliance with their fiduciary obligations under federal and/or any
applicable state laws, necessary in the best interests of the
shareholders of any Portfolio.
1
(b) The Fund will provide to IICA closing net asset value, dividend and
capital gain information at the close of trading each day that the New
York Stock Exchange (the "Exchange") is open (each such day a
"Business Day"), and in no event later than 6:30 p.m. Eastern Standard
time on such Business Day. IICA will send via facsimile or electronic
transmission to the Fund or its specified agent orders to purchase
and/or redeem Fund shares by 9 a.m. Eastern Standard Time the
following business day. Payment for net purchases will be wired by
IICA to an account designated by the Fund to coincide with the order
for shares of the Fund.
(c) The Fund hereby appoints IICA as its agent for the limited purpose of
accepting purchase and redemption orders for Fund shares relating to
the Contracts from Contract owners or participants. Orders from
Contract owners or participants received from any distributor of the
Contracts (including affiliates of IICA) by IICA, acting as agent for
the Fund, prior to the close of the Exchange on any given business day
will be executed by the Fund at the net asset value determined as of
the close of the Exchange on such Business Day, provided that the Fund
receives written (or facsimile) notice of such order by 9 a.m. Eastern
Standard Time on the next following Business Day. Any orders received
by IICA acting as agent on such day but after the close of the
Exchange will be executed by the Fund at the net asset value
determined as of the close of the Exchange on the next business day
following the day of receipt of such order, provided that the Fund
receives written (or facsimile) notice of such order by 9 a.m. Eastern
Standard Time within two days following the day of receipt of such
order.
(d) Payments for net redemptions of shares of the Fund will be wired by
the Fund to an account designated by IICA by 4:00 p.m. Eastern
Standard Time on the same Business Day IICA places an order to redeem
Fund Shares. Payments for net purchases of the Fund will be wired by
IICA to an account designated by the Fund by 4:00 p.m. Eastern
Standard Time on the same Business Day IICA places an order to
purchase Fund shares. Payments shall be in federal funds transmitted
by wire.
(e) In lieu of applicable provisions set forth in paragraphs 2(a) through
2(d) above, the parties may agree to provide pricing information,
execute orders and wire payments for purchases and redemptions through
National Securities Clearing Corporation's Fund/SERV system in which
case such activities will be governed by the provisions set forth in
Exhibit I to this Agreement.
(f) Each party has the right to rely on information or confirmations
provided by the other party (or by any affiliate of the other party),
and shall not be liable in the event that an error is a result of any
misinformation supplied by the other party
(g) The Fund and Distributor shall indemnify and hold IICA harmless, from
the effective date of this Agreement, against any amount IICA is
required to pay to Contract owners or participants due to: (i) an
incorrect calculation of a Fund's daily net asset value, dividend
rate, or capital gains distribution rate or (ii) incorrect or late
reporting of the daily net asset value, dividend rate, or capital gain
distribution rate of a Fund, upon written notification by IICA, with
supporting data, to Distributor. In addition, the Fund or the
Distributor shall be liable to IICA for systems and out of pocket
costs
2
incurred by IICA in making a Contract owner's or a participant's
account whole, if such costs or expenses are a result of the Fund's or
the Distributor's failure to provide timely or correct net asset
values, dividend and capital gains or financial information. If a
mistake is caused in supplying such information or confirmations,
which results in a reconciliation with incorrect information, the
amount required to make a Contract owner's or a participant's account
whole shall be borne by the party providing the incorrect information,
regardless of when the error is corrected.
(h) IICA agrees to purchase and redeem the shares of the Funds named in
Schedule B offered by the then current prospectus and statement of
additional information of the Fund in accordance with the provisions
of such prospectus and statement of additional information.
3. FEES.
In consideration of services provided by IICA under this Agreement, the
Fund or Distributor shall pay fees to IICA as set forth in Schedule C.
4. EXPENSES.
(a) Except as otherwise provided in this Agreement, all expenses incident
to the performance by the Fund under this Agreement shall be paid by
the Fund, including the cost of registration of Fund shares with the
Securities and Exchange Commission (the "SEC") and in states where
required. The Fund and Distributor shall pay no fee or other
compensation to IICA under this Agreement, and IICA shall pay no fee
or other compensation to the Fund or Distributor, except as provided
herein and in Schedule C attached hereto and made a part of this
Agreement as may be amended from time to time with the mutual consent
of the parties hereto. All expenses incident to performance by each
party of its respective duties under this Agreement shall be paid by
that party, unless otherwise specified in this Agreement.
(b) The Fund or the Distributor shall provide to IICA, at the location
designated by IICA, periodic fund reports to shareholders and other
materials that are required by law to be sent to Contract owners or
participants. In addition, the Fund or the Distributor shall provide
IICA with a sufficient quantity of its prospectuses, statements of
additional information and any supplements to any of these materials,
to be used in connection with the offerings and transactions
contemplated by this Agreement
(c) The Fund or Distributor shall make available for reimbursement certain
out-of-pocket expenses IICA incurs in connection with providing
shareholder services to Contract Owners and participants. These
expenses include actual postage paid by IICA in mailing updated
prospectuses, supplements and financial reports to Contract owners or
participants, and all costs incurred by IICA associated with proxies
for the Funds, including proxy preparation, group authorization
letters, programming for tabulation and necessary materials (including
postage).
5. REPRESENTATION.
3
IICA agrees that it and its agents shall not, without the written consent
of the Fund or the Distributor, make representations concerning the Fund or
its shares except those contained in the then current prospectuses and in
current printed sales literature approved by or deemed approved by the Fund
or the Distributor.
6. TERMINATION.
This agreement shall terminate as to the sale and issuance of new
Contracts:
(a) at the option of either IICA, the Distributor or the Fund, upon sixty
days advance written notice to the other parties;
(b) at the option of IICA, upon one week advance written notice to the
Distributor and the Fund, if Fund shares are not available for any
reason to meet the requirement of Contracts as determined by IICA.
Reasonable advance notice of election to terminate shall be furnished
by INF Life;
(c) at the option of either IICA, the Distributor or the Fund, immediately
upon institution of formal proceedings against the broker-dealer or
broker-dealers marketing the Contracts, the Account, IICA, the Fund or
the Distributor by the National Association of Securities Dealers,
Inc. (the "NASD"), the SEC or any other regulatory body;
(d) upon the determination of the Accounts to substitute for the Fund's
shares the shares of another investment company in accordance with the
terms of the applicable Contracts. IICA will give 60 days written
notice to the Fund and the Distributor of any decision to replace the
Fund's' shares;
(e) upon assignment of this Agreement, unless made with the written
consent of all other parties hereto;
(f) if Fund shares are not registered, issued or sold in conformance with
Federal law or such law precludes the use of Fund shares as an
underlying investment medium for Contracts issued or to be issued by
IICA. Prompt notice shall be given by the appropriate party should
such situation occur.
7. CONTINUATION OF AGREEMENT.
Termination as the result of any cause listed in Section 6 shall not affect
the Fund's obligation to furnish its shares to Contracts then in force for
which its shares serve or may serve as the underlying medium unless such
further sale of Fund shares is prohibited by law or the SEC or other
regulatory body.
8. ADVERTISING MATERIALS; FILED DOCUMENTS.
(a) Advertising and sales literature with respect to the Fund prepared by
IICA or its agents for use in marketing its Contracts (except any
material that simply lists the Funds' names) will be submitted to the
Fund or its designee for review before such material is used with any
Contract owner or participant. The Fund or its designee
4
shall advise the submitting party in writing within three (3) Business
Days of receipt of such materials of its approval or disapproval of
such materials.
(b) The Fund will provide additional copies of its financials as soon as
available to IICA and at least one complete copy of all registration
statements, prospectuses, statements of additional information, annual
and semi-annual reports, proxy statements and all amendments or
supplements to any of the above that relate to the Fund promptly after
the filing of such document with the SEC or other regulatory
authorities. At the Distributor's request, IICA will provide to the
Distributor at least one complete copy of all registration statements,
prospectuses, statements of additional information, annual and
semi-annual reports, proxy statements, and all amendments or
supplements to any of the above that relate to the Account promptly
after the filing of such document with the SEC or other regulatory
authority.
(c) The Fund or the Distributor will provide via Excel spreadsheet
diskette format or in electronic transmission to IICA at least
quarterly portfolio information necessary to update Fund profiles with
seven business days following the end of each quarter.
9. PROXY VOTING.
(a) IICA shall provide pass-through voting privileges on Fund shares held
by registered separate accounts to all Contract owners and
participants to the extent the SEC continues to interpret the 1940 Act
as requiring such privileges. IICA shall provide pass-through voting
privileges on Fund shares held by unregistered separate accounts to
all Contract owners.
(b) IICA will distribute to Contract owners and participants, as
appropriate, all proxy material furnished by the Fund and will vote
Fund shares in accordance with instructions received from such
Contract owners and participants. If and to the extent required by
law, IICA, with respect to each group Contract and in each Account,
shall vote Fund shares for which no instructions have been received in
the same proportion as shares for which such instructions have been
received. IICA and its agents shall not oppose or interfere with the
solicitation of proxies for Fund shares held for such Contract owners
and participants.
10. INDEMNIFICATION.
(a) IICA agrees to indemnify and hold harmless the Fund and the
Distributor, and its directors, officers, employees, agents and each
person, if any, who controls the Fund or its Distributor within the
meaning of the Securities Act of 1933 (the "1933 Act") against any
losses, claims, damages or liabilities to which the Fund or any such
director, officer, employee, agent, or controlling person may become
subject, under the 1933 Act or otherwise, insofar as such losses,
claims, damages, or liabilities (or actions in respect thereof) arise
out of or are based upon any untrue statement or alleged untrue
statement of any material fact contained in the Registration
Statement, prospectus or sales literature of IICA 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, or arise out of or as a result
5
of conduct, statements or representations (other than statements or
representations contained in the prospectuses or sales literature of
the Fund) of IICA or its agents, with respect to the sale and
distribution of Contracts for which Fund shares are the underlying
investment. IICA will reimburse any legal or other expenses reasonably
incurred by the Fund or any such director, officer, employee, agent,
investment Distributor, or controlling person in connection with
investigating or defending any such loss, claim, damage, liability or
action; PROVIDED, HOWEVER, that IICA will not be liable in any such
case to the extent that any such loss, claim, damage or liability
arises out of or is based upon (i) an untrue statement or omission or
alleged omission made in such Registration Statement or prospectus in
conformity with written materials furnished to IICA by the Fund
specifically for use therein or (ii) the willful misfeasance, bad
faith, or gross negligence by the Fund or Distributor in the
performance of its duties or the Fund's or Distributor's reckless
disregard of obligations or duties under this Agreement or to IICA,
whichever is applicable. This indemnity agreement will be in addition
to any liability which Company may otherwise have.
(b) The Fund and the Distributor agree to indemnify and hold harmless IICA
and its directors, officers, employees, agents and each person, if
any, who controls IICA within the meaning of the 1933 Act against any
losses, claims, damages or liabilities to which IICA or any such
director, officer, employee, agent or controlling person may become
subject, under the 1933 Act or otherwise, insofar as such losses,
claims, damages or liabilities (or actions in respect thereof) arise
out of or are based upon any untrue statement or alleged untrue
statement of any material fact contained in the Registration
Statement, prospectuses or sales literature of the Fund 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 material fact
required to be stated therein or necessary to make the statements
therein not misleading. The Fund will reimburse any legal or other
expenses reasonably incurred by IICA or any such director, officer,
employee, agent, or controlling person in connection with
investigating or defending any such loss, claim, damage, liability or
action; PROVIDED, HOWEVER, that the Fund will not be liable in any
such case to the extent that any such loss, claim, damage or liability
arises out of or is based upon an untrue statement or omission or
alleged omission made in such Registration Statement or prospectuses
which are in conformity with written materials furnished to the Fund
by IICA specifically for use therein.
(c) Promptly after receipt by an indemnified party hereunder of notice of
the commencement of action, such indemnified party will, if a claim in
respect thereof is to be made against the indemnifying party
hereunder, notify the indemnifying party of the commencement thereof;
but the omission so to notify the indemnifying party will not relieve
it from any liability which it may have to any indemnified party
otherwise than under this Section 10. In case any such action is
brought against any indemnified party, and it notifies the
indemnifying party of the commencement thereof, the indemnifying party
will be entitled to participate therein and, to the extent that it may
wish to, assume the defense thereof, with counsel satisfactory to such
indemnified party, and after notice from the indemnifying party to
such indemnified party of its election to assume the defense thereof,
the indemnifying party will not be liable to such indemnified party
under this Section 10 for any legal or other expenses
6
subsequently incurred by such indemnified party in connection with the
defense thereof other than reasonable costs of investigation.
11. MISCELLANEOUS.
(a) AMENDMENT AND WAIVER. Neither this Agreement, nor any provision
hereof, may be amended, waived, discharged or terminated orally, but
only by an instrument in writing signed by all parties hereto.
(b) NOTICES. All notices and other communications hereunder shall be given
or made in writing and shall be delivered personally, or sent by
telex, telecopier or registered or certified mail, postage prepaid,
return receipt requested, or recognized overnight courier service to
the party or parties to whom they are directed at the following
addresses, or at such other addresses as may be designated by notice
from such party to all other parties.
To IICA:
ING Insurance Company of America
000 Xxxxxxxxxx Xxxxxx
Xxxxxxxx, Xxxxxxxxxxx 00000
Attention: Xxxxx X. Xxxxxxxx, Counsel
To the Fund:
_______________________
_______________________
_______________________
_______________________
Attn: _________________
To the Distributor:
_______________________
_______________________
_______________________
_______________________
Attn: _________________
Any notice, demand or other communication given in a manner prescribed in
this subsection (b) shall be deemed to have been delivered on receipt.
(c) SUCCESSORS AND ASSIGNS. This agreement shall be binding upon and inure
to the benefit of the parties hereto and their respective permitted
successors and assigns.
7
(d) COUNTERPARTS. This Agreement may be executed in any number of
counterparts, all of which taken together shall constitute one
agreement, and any party hereto may execute this Agreement by signing
any such counterpart.
(e) SEVERABILITY. In case any one or more of the provisions contained in
this Agreement should be invalid, illegal or unenforceable in any
respect, the validity, legality and enforceability of the remaining
provisions contained herein shall not in any way be affected or
impaired thereby.
(f) ENTIRE AGREEMENT. This Agreement constitutes the entire agreement and
understanding between the parties hereto and supersedes all prior
agreement and understandings relating to the subject matter hereof.
(g) GOVERNING LAW. This Agreement shall be governed and interpreted in
accordance with the laws of the State of Connecticut.
(h) NON EXCLUSIVITY. It is understood by the parties that this Agreement
is not an exclusive arrangement in any respect.
(i) CONFIDENTIALITY. The terms of this Agreement and the Schedules thereto
will be held confidential by each party except to the extent that
either party or its counsel may deem it necessary to disclose such
terms.
12. LIMITATION ON LIABILITY OF TRUSTEES, ETC.
This agreement has been executed on behalf of the Fund by the undersigned
officer of the Fund in his or her capacity as an officer of the Fund. The
obligations of this agreement shall be binding upon the assets and property
of the Fund only and shall not be binding on any Trustee, officer or
shareholder of the Fund individually.
IN WITNESS WHEREOF, the undersigned have executed this Agreement by their
duly authorized officers effective as of the ____ day of _________, _____.
ING INSURANCE COMPANY OF AMERICA
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
FUND
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
8
DISTRIBUTOR
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
9
SCHEDULE A
(For any future separate accounts - See Section 1(a)
10
SCHEDULE B
(List of funds available--See Section 1(b))
11
SCHEDULE C
Fees to IICA
1. SERVICING FEES.
Administrative services to Contract owners and participants shall be the
responsibility of IICA and shall not be the responsibility of the Fund or the
Distributor. The Distributor recognizes IICA as the sole shareholder of Fund
shares issued under the Fund Participation Agreement, and that substantial
savings will be derived in administrative expenses, such as significant
reductions in postage expense and shareholder communications, by virtue of
having a sole shareholder for each of the Accounts rather than multiple
shareholders. In consideration of the administrative savings resulting from such
arrangement, Distributor agrees to pay to IICA a servicing fee based on the
annual rate of ____% (_____% quarterly) of the average net assets invested in
the Funds through the Contracts in each calendar quarter. Distributor will make
such payments to IICA within thirty (30) days after the end of each calendar
quarter. Each payment will be accompanied by a statement showing the calculation
of the fee payable to IICA for the quarter and such other supporting data as may
be reasonably requested by IICA.
2. 12b-1 FEES.
In accordance with the Fund's plan pursuant to Rule 12b-1 under the
Investment Company Act of 1940, the Distributor will make payments to IICA at an
annual rate of ____% (______% quarterly) of the average net assets invested in
the Funds through the Contracts in each calendar quarter. Distributor will make
such payments to IICA within thirty (30) days after the end of each calendar
quarter. Each payment will be accompanied by a statement showing the calculation
of the fee payable to IICA for the quarter and such other supporting data as may
be reasonably requested by IICA.
12
EXHIBIT I
Procedures for Pricing and Order/Settlement Through National Securities Clearing
Corporation's Mutual Fund Profile System and Mutual Fund Settlement, Entry and
Registration Verification System
1. As provided in Section 2(e) of the Fund Participation Agreement, the
parties hereby agree to provide pricing information, execute orders and wire
payments for purchases and redemptions of Fund shares through National
Securities Clearing Corporation ("NSCC") and its subsidiary systems as follows:
(a) Distributor or the Funds will furnish to IICA or its affiliate through
NSCC's Mutual Fund Profile System ("MFPS") (1) the most current net asset
value information for each Fund, (2) a schedule of anticipated dividend and
distribution payment dates for each Fund, which is subject to change
without prior notice, ordinary income and capital gain dividend rates on
the Fund's ex-date, and (3) in the case of fixed income funds that declare
daily dividends, the daily accrual or the interest rate factor. All such
information shall be furnished to IICA or its affiliate by 6:30 p.m.
Eastern Time on each business day that the Fund is open for business (each
a "Business Day") or at such other time as that information becomes
available. Changes in pricing information will be communicated to both NSCC
and IICA.
(b) Upon receipt of Fund purchase, exchange and redemption instructions for
acceptance as of the time at which a Fund's net asset value is calculated
as specified in such Fund's prospectus ("Close of Trading") on each
Business Day ("Instructions"), and upon its determination that there are
good funds with respect to Instructions involving the purchase of Shares,
IICA or its affiliate will calculate the net purchase or redemption order
for each Fund. Orders for net purchases or net redemptions derived from
Instructions received by IICA or its affiliate prior to the Close of
Trading on any given Business Day will be sent to the Defined Contribution
Interface of NSCC's Mutual Fund Settlement, Entry and Registration
Verification System ("Fund/SERV") by 5:00 a.m. Eastern Time on the next
Business Day. Subject to IICA's or its affiliate's compliance with the
foregoing, IICA or its affiliate will be considered the agent of the
Distributor and the Funds, and the Business Day on which Instructions are
received by IICA or its affiliate in proper form prior to the Close of
Trading will be the date as of which shares of the Funds are deemed
purchased, exchanged or redeemed pursuant to such Instructions.
Instructions received in proper form by IICA or its affiliate after the
Close of Trading on any given Business Day will be treated as if received
on the next following Business Day. Dividends and capital gains
distributions will be automatically reinvested at net asset value in
accordance with the Fund's then current prospectuses.
(c) IICA or its affiliate will wire payment for net purchase orders by the
Fund's NSCC Firm Number, in immediately available funds, to an NSCC
settling bank account designated by IICA or its affiliate no later than
5:00 p.m. Eastern time on the same Business Day such purchase orders are
communicated to NSCC. For purchases of shares of daily dividend accrual
funds, those shares will not begin to accrue dividends until the day the
payment for those shares is received.
13
(d) NSCC will wire payment for net redemption orders by Fund, in immediately
available funds, to an NSCC settling bank account designated by IICA or its
affiliate, by 5:00 p.m. Eastern Time on the Business Day such redemption
orders are communicated to NSCC, except as provided in a Fund's prospectus
and statement of additional information.
(e) With respect to (c) or (d) above, if Distributor does not send a
confirmation of IICA's or its affiliate's purchase or redemption order to
NSCC by the applicable deadline to be included in that Business Day's
payment cycle, payment for such purchases or redemptions will be made the
following Business Day.
(f) If on any day IICA or its affiliate, or Distributor is unable to meet the
NSCC deadline for the transmission of purchase or redemption orders, it may
at its option transmit such orders and make such payments for purchases and
redemptions directly to Distributor or IICA or its affiliate, as
applicable, as is otherwise provided in the Agreement.
(g) These procedures are subject to any additional terms in each Fund's
prospectus and the requirements of applicable law. The Funds reserve the
right, at their discretion and without notice, to suspend the sale of
shares or withdraw the sale of shares of any Fund.
2. IICA or its affiliate, Distributor and clearing agents (if applicable) are
each required to have entered into membership agreements with NSCC and met all
requirements to participate in the MFPS and Fund/SERV systems before these
procedures may be utilized. Each party will be bound by the terms of their
membership agreement with NSCC and will perform any and all duties, functions,
procedures and responsibilities assigned to it and as otherwise established by
NSCC applicable to the MFPS and Fund/SERV system and the Networking Matrix Level
utilized.
3. Except as modified hereby, all other terms and conditions of the Agreement
shall remain in full force and effect. Unless otherwise indicated herein, the
terms defined in the Agreement shall have the same meaning as in this Exhibit.
14
