FUND PARTICIPATION AGREEMENT
This Agreement is entered into as of the 30th day of September, 2002, between GE
Capital Life Assurance Company of New York ("Insurance Company"), a life
insurance company organized under the laws of the State of New York, and X.X.
Xxxxxx Series Trust II ("Fund"), a business trust organized under the laws of
Delaware, with respect to the Fund's portfolio or portfolios set forth on
Schedule 1 hereto, as such Schedule may be revised from time to time (the
"Series": if there are more than one Series to which this Agreement applies, the
provisions herein shall apply severally to each such Series).
ARTICLE I
1. DEFINITIONS
1.1. "Act" shall mean the Investment Company Act of 1940, as amended.
1.2. "Board" shall mean the Board of Trustees of the Fund having the
responsibility for management and control of the Fund.
1.3. "Business Day" shall mean any day for which the Fund calculates net asset
value per share as described in the Fund's Prospectus.
1.4. "Commission" shall mean the Securities and Exchange Commission.
1.5. "Contract" shall mean a variable annuity or variable life insurance
contract that uses the Fund as an underlying investment medium. Individuals
who participate under a group Contract are "Participants".
1.6. "Contractholder" shall mean any entity that is a party to a Contract with a
Participating Company.
1.7. "Disinterested Board Members" shall mean those members of the Board that
are not deemed to be "interested persons" of the Fund, as defined by the
Act.
1.8. "Participating Companies" shall mean any insurance company (including
Insurance Company), which offers variable annuity and/or variable life
insurance contracts to the public and which has entered into an agreement
with the Fund for the purpose of making Fund shares available to serve as
the underlying investment medium for the aforesaid Contracts.
1.9. "Plans" shall mean qualified pension and retirement benefit plans.
1.10. "Prospectus" shall mean the Fund's current prospectus and statement of
additional information, as most recently filed with the Commission, with
respect to the Series.
1.11. "Separate Account" shall mean those segregated asset accounts listed in
Schedule II; each a separate account established by Insurance Company in
accordance with the laws of the State of New York.
1.12. "Software Program" shall mean the software program used by the Fund for
providing Fund and account balance information including net asset value
per share.
1.13. "Insurance Company's General Account(s)" shall mean the general account(s)
of Insurance Company and its affiliates which invest in the Fund.
ARTICLE II
2. REPRESENTATIONS
2.1 Insurance Company represents and warrants that (a) it is an insurance
company duly organized and in good standing under applicable law; (b) it
has legally and validly established the Separate Account pursuant to the
laws of the State of New York for the purpose of offering to the public
certain individual variable annuity contracts; (c) it has registered each
Separate Account as a unit investment trust under the Act to serve as the
segregated investment account for the Contracts, unless otherwise exempt
therefrom; (d) each Separate Account is eligible to invest in shares of the
Fund without such investment disqualifying the Fund as an investment medium
for insurance company separate accounts supporting variable annuity
contracts or variable life insurance contracts; and (e) each Separate
Account shall comply with all applicable legal requirements.
2.2 Insurance Company represents and warrants that (a) the Contracts will be
described in a registration statement filed under the Securities Act of
1933, as amended ("1933 Act"), unless otherwise exempt therefrom (b) the
Contracts will be issued and sold in compliance in all material respects
with all applicable federal and state laws: and (c) the sale of the
Contracts shall comply in all material respects with state insurance law
requirements. Insurance Company agrees to inform the Fund promptly of any
investment restrictions imposed by state insurance law and applicable to
the Fund.
2.3 Insurance Company represents and warrants that the income, gains and
losses, whether or not realized, from assets allocated to the Separate
Account are, in accordance with the applicable Contracts, to be credited to
or charged against such Separate Account without regard to other income,
gains or losses from assets allocated to any other accounts of Insurance
Company. Insurance Company represents and warrants that the assets of the
Separate Account are and will be kept separate from Insurance Company's
General Account and any other separate accounts Insurance Company may have,
and will not be charged with liabilities from any business that Insurance
Company may conduct or the liabilities of any companies affiliated with
Insurance Company.
2.4 Fund represents that the Fund is registered with the Commission under the
Act as an open-end management investment company and possesses, and shall
maintain, all legal and regulatory licenses, approvals, consents and/or
exemptions required for the Fund to operate and offer its shares as an
underlying investment medium for Participating Companies. The Fund has
established five portfolios and may in the future establish other
portfolios.
2.5 Fund represents that it is currently qualified as a Regulated Investment
Company under Subchapter M of the Internal Revenue Code of 1986, as amended
(the "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 Insurance Company immediately upon having a
reasonable basis for believing that it has ceased to so qualify or that it
might not so qualify in the future.
2.6 Insurance Company represents and agrees that the Contracts are currently,
and at the time of issuance will be, treated as life insurance policies or
annuity contracts, whichever is appropriate, under applicable provisions of
the Code, and that it will make every effort to maintain such treatment and
that it will notify the Fund and its investment adviser 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. Insurance
Company agrees that any prospectus offering a Contract that is a "modified
endowment contract," as that term is defined in Section 7702A of the Code,
will identify such Contract as a modified endowment contract (or policy).
2.7 The Fund agrees that the Fund shall sell Fund shares to only Participating
Companies and their separate accounts and to persons or plans ("Qualified
Persons") that qualify to purchase shares of the Fund under Section 817(h)
of the Code and the regulations thereunder without impairing the ability of
the Separate Account to consider the investments of the Series of the Fund
as constituting investments of the Separate Account for the purpose of
satisfying the diversification requirements of Section 817(h). The
Insurance Company hereby represents and warrants that it and the Separate
Account are Qualified Persons.
2.8 The Fund will invest the assets of each Series in a manner as to ensure
that the Contracts will be treated as annuity or life insurance contracts,
whichever is appropriate under the Code and the regulations issued
thereunder (or any successor provisions). Without limiting the scope of the
foregoing, the Fund will, with respect to each Series, comply with Section
817(h) of the Code and Treasury Regulation 1.817-5 and any endowment, or
life insurance contracts and any amendments or other modifications or
successor provisions to such Sections or Regulations. In the event of a
breach of this provision by the Fund, it will take all reasonable steps (a)
to notify the Insurance Company of such breach and to (b) adequately
diversify the affected Series so as to achieve compliance within the grace
period afforded by Treasury Regulation 1.817-5.
2.9 Insurance Company agrees that the Fund shall be permitted (subject to the
other terms of this Agreement) to make Series shares available to other
Participating Companies and contractholders and to Plans.
2.10 Fund represents and warrants that any of its trustees, officers, employees,
investment advisers, and other individuals/entities who deal with the money
and/or securities of the Fund are and shall continue to be at all times
covered by a blanket fidelity bond or similar coverage for the benefit of
the Fund in an amount not less than that required by Rule 17g-1 under the
Act. The aforesaid Bond shall include coverage for larceny and embezzlement
and shall be issued by a reputable bonding company.
2.11 Insurance Company represents and warrants that all of its employees and
agents who deal with the money and/or securities of the Fund are and shall
continue to be at all times covered by a blanket fidelity bond or similar
coverage in an amount not less than the coverage required to be maintained
by the Fund. The aforesaid Bond shall include coverage for larceny and
embezzlement and shall be issued by a reputable bonding company.
2.12 Insurance Company agrees that the Fund's investment adviser shall be deemed
a third party beneficiary under this Agreement and may enforce any and all
rights conferred by virtue of this Agreement.
ARTICLE III
3. FUND SHARES
3.1 The Contracts funded through the Separate Account will provide for the
investment of certain amounts in the Series Shares.
3.2 Fund agrees to make the shares of its Series available for purchase at the
then applicable net asset value per share by Insurance Company and the
Separate Account on each Business Day pursuant to rules of the Commission.
Notwithstanding the foregoing, the Fund may refuse to sell the shares of
any Series to any person, or suspend or terminate the offering of the
shares of any Series if such action is required by law or by regulatory
authorities having jurisdiction or is, in the sole discretion of the Board,
acting in good faith and in light of its fiduciary duties under federal and
any applicable state laws, necessary and in the best interests of the
shareholders of such Series.
3.3 Fund agrees that shares of the Fund will be sold only to Participating
Companies and their separate accounts and to the general accounts of those
Participating Companies and their affiliates and to Plans. No shares of any
Series will be sold to the general public.
3.4 Fund shall use its best efforts to provide closing net asset value,
dividend and capital gain information for each Series available on a
per-share and Series basis to Insurance Company by 7:00 p.m. Eastern Time
on each Business Day. Any material errors in the calculation of net asset
value, dividend and capital gain information shall be reported immediately
upon discovery to Insurance Company. Non-material errors will be corrected
in the next Business Day's net asset value per share for the Series in
question.
3.5 At the end of each Business Day, Insurance Company will use the information
described in Sections 3.2 and 3.4 to calculate the Separate Account unit
values for the day. Using this unit value, Insurance Company will process
the day's Separate Account transactions received by it by the close of
trading on the floor of the New York Stock Exchange (currently 4:00 p.m.
Eastern time) to determine the net dollar amount of Series shares which
will be purchased or redeemed at that day's closing net asset value per
share for such Series. The net purchase or redemption orders will be
transmitted to the Fund by Insurance Company by 8:30 a.m. Eastern Time on
the Business Day next following Insurance Company's receipt of that
information. Subject to Sections 3.6 and 3.8, all purchase and redemption
orders for Insurance Company's General Accounts shall be effected at the
net asset value per share of the relevant Series next calculated after
receipt of the order by the Fund or its Transfer Agent.
3.6 Fund appoints Insurance Company as its agent for the limited purpose of
accepting orders for the purchase and redemption of shares of each Series
for the Separate Account. Fund will execute orders for any Series at the
applicable net asset value per share determined as of the close of trading
on the day of receipt of such orders by Insurance Company acting as agent
("effective trade date"), provided that the Fund receives notice of such
orders by 8:30 a.m. Eastern Time on the next following Business Day and, if
such orders request the purchase of Series shares, the conditions specified
in Section 3.8. as applicable, are satisfied. A redemption or purchase
request for any Series that does not satisfy the conditions specified above
and in Section 3.8, as applicable, will be effected at the net asset value
computed for such Series on the Business Day immediately preceding the next
following Business Day upon which such conditions have been satisfied.
3.7 Insurance Company will make its best efforts to notify Fund in advance of
any unusually large purchase or redemption orders.
3.8 If Insurance Company's order requests the purchase of Series shares,
Insurance Company will pay for such purchases by wiring Federal Funds to
Fund or its designated custodial account on the day the order is
transmitted. Insurance Company shall transmit to the Fund payment in
Federal Funds by the close of the Federal Reserve wire system on the
Business Day the Fund receives the notice of the order pursuant to Section
3.5. Fund will execute such orders at the applicable net asset value per
share determined as of the close of trading on the effective trade date if
Fund receives payment in Federal Funds by the close of the Federal Reserve
wire system on the Business Day the Fund receives the notice of the order
pursuant to Section 3.5. If payment in Federal Funds for any purchase is
not received on such Business Day, Insurance Company shall promptly upon
the Fund's request, reimburse the Fund for any charges, costs, fees,
interest or other expenses incurred by the Fund in connection with any
advances to, or borrowings or overdrafts by, the Fund, or any similar
expenses incurred by the Fund, as a result of portfolio transactions
effected by the Fund based upon such purchase request. If Insurance
Company's order requests the redemption of Series shares valued at or
greater than $ 1 million dollars, the Fund may wire such amount to
Insurance Company within seven days of the order.
3.9 Fund has the obligation to ensure that Series shares are registered with
applicable federal agencies at all times.
3.10 Fund will confirm each purchase or redemption order made by Insurance
Company. Transfer of Series shares will be by book entry only. No share
certificates will be issued to Insurance Company. Insurance Company will
record shares ordered from Fund in an appropriate title for the
corresponding account.
3.11 Fund shall credit Insurance Company with the appropriate number of shares.
3.12 On each ex-dividend date of the Fund or, if not a Business Day, on the
first Business Day thereafter. Fund shall communicate to Insurance Company
the amount of dividend and capital gain, if any, per share of each Series.
All dividends and capital gains of any Series shall be automatically
reinvested in additional shares of the relevant Series at the applicable
net asset value per share of such Series on the payable date. Fund shall,
on the day after the payable date or, if not a Business Day, on the first
Business Day thereafter, notify Insurance Company of the number of shares
so issued.
ARTICLE IV
4. STATEMENTS AND REPORTS
4.1 Fund shall provide monthly statements of account as of the end of each
month for all of Insurance Company's accounts by the fifteenth (15th)
Business Day of the following month.
4.2 Fund shall distribute to Insurance Company copies of the Fund's
Prospectuses (in printed or electronic format as Insurance Company may
request), proxy materials, notices, periodic reports and other printed
materials (which the Fund customarily provides to its shareholders) in
quantities as Insurance Company may reasonably request for distribution to
each Contractholder and Participant.
4.3 Fund will provide to Insurance Company at least one complete copy of all
registration statements. Prospectuses, 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 Fund or its shares, contemporaneously with the filing of
such document with the Commission or other regulatory authorities.
4.4 Insurance Company will provide to the Fund at least one copy of all
registration statements. Prospectuses, 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 Contracts or the Separate Account, contemporaneously
with the filing of such document with the Commission, or other regulatory
authorities.
ARTICLE V
5. EXPENSES
5.1 The charge to the Fund for all expenses and costs of the Series, including
but not limited to management fees, administrative expenses and legal and
regulatory costs, will be made in the determination of the relevant
Series' daily net asset value per share so as to accumulate to an annual
charge at the rate set forth in the Fund's Prospectus. Excluded from the
expense limitation described herein shall be brokerage commissions and
transaction fees and extraordinary expenses.
5.2 Except as provided in this Article V and, in particular in the next
sentence. Insurance Company shall not be required to pay directly any
expenses of the Fund or expenses relating to the distribution of its
shares. Insurance Company shall pay the following expenses or costs:
a. Such amount of the production expenses of any Fund materials,
including the cost of printing the Fund's Prospectus, or marketing
materials for prospective Insurance Company Contractholders and
Participants as the Fund's investment adviser and Insurance Company
shall agree from time to time.
b. Distribution expenses of any Fund materials or marketing materials for
prospective Insurance Company Contractholders and Participants.
c. Distribution expenses of Fund materials or marketing materials for
Insurance Company Contractholders and Participants.
Except as provided herein, all other Fund expenses shall not be borne by
Insurance Company.
ARTICLE VI
6. EXEMPTIVE RELIEF
6.1 Insurance Company has reviewed a copy of the Notice & Order dated December
24, 1996 of the Commission under Section 6(c) of the Act (File No.
812-10248) and, in particular, has reviewed the conditions to the relief
set forth in the related Notice. As set forth therein. Insurance Company
agrees to report any potential or existing conflicts promptly to the Board,
and in particular whenever contract voting instructions are disregarded,
and recognizes that it will be responsible for assisting the Board in
carrying out its responsibilities under such application. Insurance Company
agrees to carry out such responsibilities with a view to the interests of
existing Contractholders.
6.2 If a majority of the Board, or a majority of Disinterested Board Members,
determines that a material irreconcilable conflict exists with regard to
Contractholder investments in the Fund, the Board shall give prompt notice
to all Participating Companies. If the Board determines that Insurance
Company is responsible for causing or creating said conflict. Insurance
Company shall at its sole cost and expense, and to the extent reasonably
practicable (as determined by a majority of the Disinterested Board
Members), take such action as is necessary to remedy or eliminate the
irreconcilable material conflict. Such necessary action may include, but
shall not be limited to:
a. Withdrawing the assets allocable to the Separate Account from the
Series and reinvesting such assets in a different investment medium,
or submitting the question of whether such segregation should be
implemented to a vote of all affected Contractholders; and/or
b. Establishing a new registered management investment company.
6.3 If a material irreconcilable conflict arises as a result of a decision by
Insurance Company to disregard Contractholder voting instructions and said
decision represents a minority position or would preclude a majority vote
by all Contractholders having an interest in the Fund. Insurance Company
may be required, at the Board's election, to withdraw the Separate
Account's investment in the Fund.
6.4 For the purpose of this Article, a majority of the Disinterested Board
Members shall determine whether or not any proposed action adequately
remedies any irreconcilable material conflict, but in no event will the
Fund be required to bear the expense of establishing a new funding medium
for any Contract. Insurance Company shall not be required by this Article
to establish a new funding medium for any Contract if an offer to do so has
been declined by vote of a majority of the Contractholders materially
adversely affected by the irreconcilable material conflict.
6.5 No action by Insurance Company taken or omitted, and no action by the
Separate Account or the Fund taken or omitted as a result of any act or
failure to act by Insurance Company pursuant to this Article VI shall
relieve Insurance Company of its obligations under, or otherwise affect the
operation of, Article V.
ARTICLE VII
7. VOTING OF FUND SHARES
7.1 Fund shall provide Insurance Company in a timely fashion, with copies at no
cost to Insurance Company, of the Fund's proxy material, reports to
shareholders and other communications to shareholders in such quantity as
Insurance Company shall reasonably require for distributing to
Contractholders or Participants.
If information is received timely, Insurance Company shall:
(a) solicit voting instructions from Contractholders or Participants on a
timely basis and in accordance with applicable law;
(b) vote the Series shares in accordance with instructions received from
Contractholders or Participants; and
(c) vote Series shares for which no instructions have been received in the
same proportion as Series shares for which instructions have been
received.
Insurance Company agrees at all times to votes its General Account shares
in the same proportion as Series shares for which instructions have been
received from Contractholders or Participants. Insurance Company further
agrees to be responsible for
assuring that voting Series shares for the Separate Account is conducted in
a manner consistent with other Participating Companies. If information is
not received in a timely manner. Insurance Company will abstain from
voting.
ARTICLE VIII
8. MARKETING AND REPRESENTATIONS
8.1 The Fund or its underwriter shall periodically furnish Insurance Company
with the following documents, in quantities as Insurance Company may
reasonably request:
a. Current Prospectus and any supplements thereto in printed or
electronic format as Insurance Company may request.
b. Other marketing materials.
Expenses for the production of such documents shall be borne by Insurance
Company in accordance with Section 5.2 of this Agreement.
8.2 Insurance Company shall designate certain persons or entities which shall
have the requisite licenses to solicit applications for the sale of
Contracts. No representation is made as to the number or amount of
Contracts that are to be sold by Insurance Company. Insurance Company shall
comply with all applicable federal and state laws in connection therewith.
8.3 Insurance Company shall furnish, or shall cause to be furnished, to the
Fund, each piece of sales literature or other promotional material in which
the Fund, its investment adviser or the administrator is named, at least
fifteen Business Days prior to its use. No such material shall be used
unless the Fund approves such material. Such approval (if given) must be in
writing and shall be presumed not given if not received within ten Business
Days after receipt of such material. The Fund shall use all reasonable
efforts to respond within ten days of receipt.
8.4 Insurance Company shall not give any information or make any
representations or statements on behalf of the Fund or concerning the Fund
or any Series in connection with the sale of the Contracts other than the
information or representations contained in the registration statement or
Prospectus, as may be amended or supplemented from time to time, or in
reports or proxy statements for the Fund, or in sales literature or other
promotional material approved by the Fund.
8.5 Fund shall furnish, or shall cause to be furnished, to Insurance Company,
each piece of the Fund's sales literature or other promotional material in
which Insurance Company or the Separate Account is named, at least fifteen
Business Days prior to its use. No such material shall be used unless
Insurance Company approves such material. Such approval (if given) must be
in writing and shall be presumed not given if not received within ten
Business Days after receipt of such material. Insurance Company shall use
all reasonable efforts to respond within ten days of receipt.
8.6 Fund shall not, in connection with the sale of Series shares, give any
information or make any representations on behalf of Insurance Company or
concerning Insurance Company, the Separate Account, or the Contracts other
than the information or representations contained in the then current
registration statement or prospectus for the Contracts, as may be amended
or supplemented from time to time, or in published reports for the Separate
Account which are in the public domain or approved by Insurance Company for
distribution to Contractholders or Participants, or in sales literature or
other promotional material approved by Insurance Company.
8.7 For purposes of this Agreement, the phrase "sales literature or other
promotional material" or words of similar import include, without
limitation, 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 (such as any written
communication distributed or made generally available to customers or the
public, including brochures, circulars, research reports, market letters,
form letters, seminar texts, or 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 National Association of Securities Dealers, Inc. rules,
the Act or the 1933 Act.
ARTICLE IX
9. INDEMNIFICATION
9.1 Insurance Company agrees to indemnify and hold harmless the Fund, its
investment adviser and their affiliates, and each of their directors,
trustees, officers, employees, agents and each person, if any, who controls
or is associated with any of the foregoing entities or persons within the
meaning of the 1933 Act (collectively, the "Indemnified Parties" for
purposes of Section 9.1), against any and all losses, claims, damages or
liabilities joint or several (including any investigative, legal and other
expenses reasonably incurred in connection with, and any amounts paid in
settlement of, any action, suit or proceeding or any claim asserted) for
which the Indemnified Parties may become subject, under the 1933 Act or
otherwise, insofar as such losses, claims, damages or liabilities (or
actions in respect to thereof) (i) arise out of or are based upon any
untrue statement or alleged untrue statement of any material fact contained
in information furnished by Insurance Company for use in the registration
statement or Prospectus or sales literature or advertisements of the Fund
or with respect to the Separate Account or Contracts, 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; (ii) arise out of or as a result of
conduct, statements or representations (other than statements or
representations contained in the Prospectus and sales literature or
advertisements of the Fund) of Insurance Company or its agents, with
respect to the sale and distribution of Contracts for which Series shares
are an underlying investment; (iii) arise out of the wrongful conduct of
Insurance Company or persons under its control with respect to the sale or
distribution of the Contracts or Series shares; (iv) arise out of Insurance
Company's incorrect calculation and/or untimely reporting of net purchase
or redemption orders; or (v) arise out of any breach by Insurance Company
of a material term of this Agreement or as a result of any failure by
Insurance Company to provide the services and furnish the materials or to
make any payments provided for in this Agreement. Insurance Company will
reimburse any Indemnified Party in connection with investigating or
defending any such loss, claim, damage, liability or action; provided,
however, that with respect to clauses (i) and (ii) above Insurance Company
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 any untrue
statement or omission or alleged omission made in such registration
statement, prospectus, sales literature, or advertisement in conformity
with written information furnished to Insurance Company by the Fund
specifically for use therein or if such information was contained in the
Fund's current registration statement. Prospectus, proxy materials or other
public advertisements; and provided, further, that Insurance Company shall
not be liable for special, consequential or incidental damages. This
indemnity agreement will be in addition to any liability which Insurance
Company may otherwise have.
9.2 The Fund agrees to indemnify and hold harmless Insurance Company and each
of its directors, officers, employees, agents and each person, if any, who
controls Insurance Company within the meaning of the 1933 Act against any
losses, claims, damages or liabilities to which Insurance Company 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) (1) 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 or advertisements of the Fund; (2) arise out of or are
based upon the omission to state in the registration statement or
Prospectus or sales literature or advertisements of the Fund any material
fact required to be stated therein or necessary to make the statements
therein not misleading; or (3) 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 or advertisements
with respect to the Separate Account or the Contracts and such statements
were based on information provided to Insurance Company by the Fund; and
the Fund will reimburse any legal or other expenses reasonably incurred by
Insurance Company 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. Prospectus, sales literature or advertisements in conformity
with written information furnished to the Fund by Insurance Company
specifically for use therein; and provided, further, that the Fund shall
not be liable for special, consequential or incidental damages. This
indemnity agreement will be in addition to any liability which the Fund may
otherwise have.
9.3 The Fund shall indemnify and hold Insurance Company harmless against any
and all liability, loss, damages, costs or expenses which Insurance Company
may incur, suffer or be required to pay due to the Fund's (1) incorrect
calculation of the daily net asset value, dividend rate or capital gain
distribution rate of a Series; (2) incorrect reporting of the daily net
asset value, dividend rate or capital gain distribution rate; and (3)
untimely reporting of the net asset value, dividend rate or capital gain
distribution rate; provided that the Fund shall have no obligation to
indemnify and hold harmless Insurance Company if the incorrect calculation
or incorrect or untimely reporting was the result of incorrect information
furnished by Insurance Company or information furnished untimely by
Insurance Company or otherwise as a result of or relating to a breach of
this Agreement by Insurance Company; and provided, further, that the Fund
shall not be liable for special, consequential or incidental damages.
9.4 Promptly after receipt by an indemnified party under this Article of notice
of the commencement of any action, such indemnified party will, if a claim
in respect thereof is to be made against the indemnifying party under this
Article, notify the indemnifying
party of the commencement thereof. The omission to so notify the
indemnifying party will not relieve the indemnifying party from any
liability under this Article IX. except to the extent that the omission
results in a failure of actual notice to the indemnifying party and such
indemnifying party is damaged solely as a result of the failure to give
such notice. In case any such action is brought against any indemnified
party, and it notified the indemnifying party of the commencement thereof,
the indemnifying party will be entitled to participate therein and, to the
extent that it may wish, assume the defense thereof, with counsel
reasonably satisfactory to such indemnified party, and to the extent that
the indemnifying party has given notice to such effect to the indemnified
party and is performing its obligations under this Article, the
indemnifying party shall not be liable for any legal or other expenses
subsequently incurred by such indemnified party in connection with the
defense thereof, other than reasonable costs of investigation.
Notwithstanding the foregoing, in any such proceeding, any indemnified
party shall have the right to retain its own counsel, but the fees and
expenses of such counsel shall be at the expense of such indemnified party
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 settlement of any proceeding effected without its
written consent.
A successor by law of the parties to this Agreement shall be entitled to
the benefits of the indemnification contained in this Article IX.
ARTICLE X
10. COMMENCEMENT AND TERMINATION
10.1 This Agreement shall be effective as of the date hereof and shall continue
in force until terminated in accordance with the provisions herein.
10.2 This Agreement shall terminate without penalty as to one or more Series at
the option of the terminating party:
a. At the option of Insurance Company or the Fund at any time from the
date hereof upon 180 days' notice, unless a shorter time is agreed to
by the parties:
b. At the option of Insurance Company, if shares of any Series are not
reasonably available to meet the requirements of the Contracts as
determined by Insurance Company. Prompt notice of election to
terminate shall be furnished by Insurance Company, said termination to
be effective ten days after receipt of notice unless the Fund makes
available a sufficient number of shares to meet the requirements of
the Contracts within said ten-day period;
c. At the option of Insurance Company, upon the institution of formal
proceedings against the Fund by the Commission, National Association
of Securities Dealers or any other regulatory body, the expected or
anticipated ruling, judgment or outcome of which would, in Insurance
Company's reasonable judgment, materially impair the Fund's ability to
meet and perform the Fund's obligations and duties hereunder. Prompt
notice of election to terminate shall be furnished by Insurance
Company with said termination to be effective upon receipt of notice;
d. At the option of the Fund, upon the institution of formal proceedings
against Insurance Company by the Commission, National Association of
Securities Dealers or any other regulatory body, the expected or
anticipated ruling, judgment or outcome of which would, in the Fund's
reasonable judgment, materially impair Insurance Company's ability to
meet and perform Insurance Company's obligations and duties hereunder.
Prompt notice of election to terminate shall be furnished by the Fund
with said termination to be effective upon receipt of notice:
e. At the option of the Fund, if the Fund shall determine, in its sole
judgment reasonably exercised in good faith, that Insurance Company
has suffered a material adverse change in its business or financial
condition or is the subject of material adverse publicity and such
material adverse change or material adverse publicity is likely to
have a material adverse impact upon the business and operation of the
Fund or its investment adviser, the Fund shall notify Insurance
Company in writing of such determination and its intent to terminate
this Agreement, and after considering the actions taken by Insurance
Company and any other changes in circumstances since the giving of
such notice, such determination of the Fund shall continue to apply on
the sixtieth (60th) day following the giving of such notice, which
sixtieth day shall be the effective date of termination;
f. Upon termination of the Investment Advisory Agreement between the Fund
and its investment adviser or its successors unless Insurance Company
specifically approves the selection of a new Fund investment adviser.
The Fund shall promptly furnish notice of such termination to
Insurance Company;
g. In the event the Fund's shares are not registered, issued or sold in
accordance with applicable federal law. or such law precludes the use
of such shares as the underlying investment medium of Contracts issued
or to be issued by Insurance Company. Termination shall be effective
immediately upon such occurrence without notice;
h. At the option of the Fund upon a determination by the Board in good
faith that it is no longer advisable and in the best interests of
shareholders for the Fund to continue to operate pursuant to this
Agreement. Termination pursuant to this Subsection (h) shall be
effective upon notice by the Fund to Insurance Company of such
termination:
i. At the option of the Fund if the Contracts cease to qualify as annuity
contracts or life insurance policies, as applicable. under the Code,
or if the Fund reasonably believes that the Contracts may fail to so
qualify:
j. At the option of either party to this Agreement, upon another party's
breach of any material provision of this Agreement.
k. At the option of the Fund, if the Contracts are not registered, issued
or sold in accordance with applicable federal and/or state law; or
l. Upon assignment of this Agreement, unless made with the written
consent of the non-assigning party.
Any such termination pursuant to Section 10.2a, 10.2d, 10.2e, 10.2f or
10.2k herein shall not affect the operation of Article V of this Agreement.
Any termination of this Agreement shall not affect the operation of Article
IX of this Agreement.
10.3 Notwithstanding any termination of this Agreement pursuant to Section 10.2
hereof, the Fund and its investment adviser may. at the option of the Fund,
continue to make available additional Series shares for so long as the Fund
desires pursuant to the terms and conditions of this Agreement as provided
below, for all Contracts in effect on the effective date of termination of
this Agreement (hereinafter referred to as "Existing Contracts").
Specifically, without limitation, if the Fund so elects to make additional
Series shares available, the owners of the Existing Contracts or Insurance
Company, whichever shall have legal authority to do so, shall be permitted
to reallocate investments in the Series, redeem investments in the Fund
and/or invest in the Fund upon the making of additional purchase payments
under the Existing Contracts. In the event of a termination of this
Agreement pursuant to Section 10.2 hereof, the Fund, as promptly as is
practicable under the circumstances, shall notify Insurance Company whether
the Fund will continue to make Series shares available after such
termination. If Series shares continue to be made available after such
termination, the provisions of this Agreement shall remain in effect and
thereafter either the Fund or Insurance Company may terminate the
Agreement, as so continued pursuant to this Section 10.3, upon prior
written notice to the other party, such notice to be for a period that is
reasonable under the circumstances but, if given by the Fund, need not be
for more than six months.
ARTICLE XI
11. AMENDMENTS
11.1 Any other changes in the terms of this Agreement shall be made by agreement
in writing between Insurance Company and Fund.
ARTICLE XII
12. NOTICE
12.1 Each notice required by this Agreement shall be given by certified mail,
return receipt requested, to the appropriate parties at the following
addresses:
Insurance Company:
GE Capital Life Assurance Company of New York
Administrative Office
0000 Xxxx Xxxxx Xxxxxx
Xxxxxxxx, Xxxxxxxx 00000
Attention: Office of General Counsel
Fund:
X.X. Xxxxxx Series Trust II
c/o JPMorgan Chase Bank
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Legal -- Mutual Funds
Notice shall be deemed to be given on the date of receipt by the addresses
as evidenced by the return receipt.
ARTICLE XIII
13. MISCELLANEOUS
13.1 This Agreement has been executed on behalf of the Fund by the undersigned
officer of the Fund in his capacity as an officer of the Fund. The
obligations of this Agreement shall only be binding upon the assets and
property of the Fund and shall not be binding upon any Trustee, officer or
shareholder of the Fund individually.
ARTICLE XIV
14. LAW
14.1 This Agreement shall be construed in accordance with the internal laws of
the State of New York, without giving effect to principles of conflict of
laws.
14.2 This Agreement shall be subject to the applicable provisions of the 1933
Act. Securities Exchange Act of 1934 and the Act and the rules and
regulations and rulings thereunder, including such exemptions from those
statutes, rules and regulations as the Commission may grant and the terms
hereof shall be interpreted and construed in accordance therewith.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement to be duly
executed and attested as of the date first above written.
GE CAPITAL LIFE ASSURANCE COMPANY OF NEW YORK
By: /s/ Xxxxx X. Genearelli
----------------------------------------
Xxxxx X. Genearelli
Senior Vice President
X. X.XXXXXX SERIES TRUST II
By: /s/ Xxxx X. Xxxxxxxx
----------------------------------------
Xxxx X. Xxxxxxxx
Vice President
SCHEDULE I
Name of Series
Bond Portfolio
International Opportunities Portfolio
Mid Cap Value Portfolio
Small Company Portfolio
U.S. Disciplined Equity Portfolio
SCHEDULE II
Name of Separate Accounts
GE Capital Life Separate Account II
