PARTICIPATION AGREEMENT
Among
THE UNIVERSAL INSTITUTIONAL FUNDS, INC.,
XXXXXX XXXXXXX & CO. INCORPORATED
XXXXXX XXXXXXX INVESTMENT MANAGEMENT INC.,
and
THE UNION CENTRAL LIFE INSURANCE COMPANY
Dated as of
May 1, 2003
THIS AGREEMENT is made and entered into as of the 1st day of
May, 2003 by and among The Union Central Life Insurance Company
(the "Company"), an Ohio corporation, on its own behalf and on
behalf of each separate account of the Company set forth on
Schedule A hereto as may be amended from time to time (each such
account referred to as an "Account"), THE UNIVERSAL INSTITUTIONAL
FUNDS, INC. (the "Fund"), a Maryland corporation, XXXXXX XXXXXXX
& CO. INCORPORATED (the "Underwriter"), a Delaware corporation,
and XXXXXX XXXXXXX INVESTMENT MANAGEMENT INC. (the "Adviser"), a
Delaware corporation.
WHEREAS, the Fund engages in business as an open-end
management investment company and is available to act as (i) the
investment vehicle for separate accounts established by insurance
companies for individual and group life insurance policies and
annuity contracts with variable accumulation and/or pay-out
provisions (hereinafter referred to individually and/or
collectively as "Variable Insurance Products") and (ii) the
investment vehicle for certain qualified pension and retirement
plans ("Qualified Plans"); and
WHEREAS, insurance companies desiring to utilize the Fund as
an investment vehicle under their Variable Insurance Products
enter into
participation agreements with the Fund, the
Underwriter and the Adviser (the "Participating Insurance
Companies"); and
WHEREAS, shares of the Fund are divided into several series
of shares, each representing the interest in a particular managed
portfolio of securities and other assets, any one or more of
which may be made available under this Agreement; and
WHEREAS, the Fund intends to offer shares of the series set
forth on Schedule B hereto (each such series referred to as a
"Portfolio"), as such Schedule may be amended from time to time
by mutual agreement of the parties hereto, to the Account(s) of
the Company (all references herein to "shares" of a Portfolio
shall mean the class or classes of shares specifically identified
on Schedule B); and
WHEREAS, the Fund has obtained an order from the Securities
and Exchange Commission ("SEC"), dated September 19, 1996 (File
No. 812-10118), granting Participating Insurance Companies and
Variable Insurance Product separate accounts exemptions from the
provisions of Sections 9(a), 13(a), 15(a), and 15(b) of the
Investment Company Act of 1940, as amended (the "1940 Act"), and
Rules 6e-2(b)(15) and 6e-3(T)(b)(15) thereunder, to the extent
necessary to permit shares of the Fund to be sold to and held by
Variable Insurance Product separate accounts of both affiliated
and unaffiliated life insurance companies and Qualified Plans
(the "Shared Funding Exemptive Order"); and
WHEREAS, the Fund is registered as an open-end management
investment company under the 1940 Act and its shares are
registered under the Securities Act of 1933, as amended (the
"1933 Act"); and
WHEREAS, the Adviser is duly registered as an investment
adviser under the Investment Advisers Act of 1940, as amended,
and any applicable state securities laws; and
WHEREAS, the Adviser manages the Portfolios of the Fund; and
WHEREAS, the Underwriter is registered as a broker/dealer
under the Securities Exchange Act of 1934, as amended (the "1934
Act"), is a member in good standing of the National Association
of Securities Dealers, Inc. (the "NASD") and serves as principal
underwriter of the shares of the Fund; and
WHEREAS, the Company has registered or will register under
the 1933 Act the Variable Insurance Products identified on
Schedule A hereto (the "Contracts"), as such Schedule may be
amended from time to time by mutual written agreement of the
parties hereto; and
WHEREAS, each Account is a duly organized, validly existing
segregated asset account, established by resolution or under
authority of the Board of Directors of the Company, on the date
shown for such Account on Schedule A hereto, to set aside and
invest assets attributable to the Contracts; and
WHEREAS, the Company has registered or will register each
Account as a unit investment trust under the 1940 Act; and
WHEREAS, to the extent permitted by applicable insurance
laws and regulations, the Company intends to purchase shares of
the Portfolios, on behalf of each Account or sub-Account thereof
(together, as applicable, an "Account"), to fund the Contracts
and the Underwriter is authorized to sell such shares to each
such Account at net asset value.
NOW, THEREFORE, in consideration of their mutual promises,
the Company, the Fund, the Underwriter and the Adviser agree as
follows:
ARTICLE I. Purchase and Redemption of Fund Shares
1.1. The Fund and the Underwriter agree to make
available for purchase by the Company shares of the Portfolios
and shall execute orders placed for each Account on a daily basis
at the net asset value next computed after receipt by the Fund or
its designee of such order. For purposes of this Section 1.1,
the Company shall be the designee of the Fund and the Underwriter
for receipt of such orders from each Account and receipt by such
designee shall constitute receipt by the Fund; provided that the
Fund receives notice of such order by 10:00 a.m. Eastern time on
the next following Business Day. "Business Day" shall mean any
day on which the
New York Stock Exchange, Inc. is open for
trading and on which the Fund calculates its net asset value
pursuant to SEC rules.
1.2. The Fund, so long as this Agreement is in effect,
agrees to make shares of the Portfolios available for purchase at
the applicable net asset value per share by the Company and its
Accounts on those days on which the Fund calculates its net asset
value pursuant to SEC rules and the Fund shall use reasonable
efforts to calculate such net asset value on each day that the
New York Stock Exchange, Inc. is open for trading.
Notwithstanding the foregoing, the Board of Directors of the Fund
(the "Board") may refuse to permit the Fund 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 Board acting in good faith and in light of its
fiduciary duties under federal and any applicable state laws,
necessary in the best interests of the shareholders of such
Portfolio.
1.3. The Fund and the Underwriter agree that shares of the
Fund will be sold only to Participating Insurance Companies and
their separate accounts and to certain Qualified Plans. No
shares of a Portfolio will be sold to the general public.
1.4. The Fund and the Underwriter agree to redeem for
cash, on the Company's request, any full or fractional shares of
the Portfolios held by the Company, executing such requests on a
daily basis at the net asset value next computed after receipt by
the Fund or its designee of the request for redemption. Subject
to and in accordance with applicable laws and regulations,
however, the Fund reserves the right to redeem shares of the
Portfolios for assets other than cash. For purposes of this
Section 1.4, the Company shall be the designee of the Fund and
the Underwriter for receipt of requests for redemption from each
Account and receipt by such designee shall constitute receipt by
the Fund; provided that the Fund receives notice of such request
for redemption by 10:00 a.m. Eastern time on the next following
Business Day.
1.5. The Company agrees that purchases and redemptions of
Portfolio shares offered by the then current prospectus of the
Fund shall be made in accordance with the provisions of such
prospectus. The Company will give the Fund, the Underwriter and
the Adviser forty-five (45) days written notice of its intention
to make available in the future any other investment company as a
funding vehicle under the Contracts that has investment
objectives and policies similar to the Portfolios.
1.6. The Company shall pay for Portfolio shares on the
next Business Day after an order to purchase Fund shares is made
in accordance with the provisions of Section 1.1 hereof. Payment
shall be in federal funds transmitted by wire and the Company
agrees to use its best efforts to transmit such funds by no later
than 2:00 p.m. Eastern time on the day of transmission. For
purposes of Sections 2.10 and 2.11, upon receipt by the Fund of
the federal funds so wired, such funds shall cease to be the
responsibility of the Company and shall become the responsibility
of the Fund.
1.7. Issuance and transfer of the Fund's shares will be by
book entry only. Share certificates will not be issued to the
Company or any Account. Shares ordered from the Fund will be
recorded in an appropriate title for each Account or the
appropriate sub-account of each Account.
1.8. The Fund shall use its best efforts to furnish same-
day notice (by wire or telephone, followed by written
confirmation) to the Company of any income dividends or capital
gain distributions payable on Portfolio 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 Company reserves the
right to revoke this election and to receive all such income
dividends and capital gain distributions in cash. The Fund shall
notify the Company of the number of shares so issued as payment
of such dividends and distributions.
1.9. The Fund shall make the net asset value per share for
each Portfolio available to the Company on each Business Day as
soon as reasonably practical after the net asset value per share
is calculated (normally by 6:30 p.m. Eastern time) and shall use
its best efforts to make such net asset value per share available
by 7:00 p.m. Eastern time.
1.10. The Company shall not redeem Fund shares
attributable to the Contracts (as distinct from Fund shares
attributable to the Company's assets held in the Account) except
(i) as necessary to implement Contract owner initiated or
approved transactions, or (ii) as required by state and/or
federal laws or regulations or judicial or other legal precedent
of general application (hereinafter referred to as a "Legally
Required Redemption") or (iii) as permitted by an order of the
SEC pursuant to Section 26(c) of the 1940 Act. Upon request, the
Company will promptly furnish to the Fund the opinion of counsel
for the Company (which counsel shall be reasonably satisfactory
to the Fund) to the effect that any redemption pursuant to clause
(ii) above is a Legally Required Redemption. Furthermore, except
in cases where permitted under the terms of the Contracts, the
Company shall not prevent Contract owners from allocating
payments to a Portfolio that was otherwise available under the
Contracts without first giving the Fund ninety (60) days prior
written notice of its intention to do so.
ARTICLE II. Representations and Warranties
2.1. The Company represents and warrants that: (i) it is
an insurance company duly organized and in good standing under
applicable law; (ii) it has legally and validly established each
Account prior to any issuance or sale thereof as a segregated
asset account under applicable laws and regulations; and (iii) it
has registered or, prior to any issuance or sale of the
Contracts, will register and will thereafter maintain the
registration of each Account as a unit investment trust in
accordance with the provisions of the 1940 Act to serve as a
segregated investment account for the Contracts. The Company
further represents and warrants that: (i) the Contracts are or
will be registered and shall remain registered under the 1933
Act; (ii) the Contracts will be issued and sold in compliance in
all material respects with all applicable federal and state laws;
and (iii) the sale of the Contracts shall comply in all material
respects with state insurance suitability requirements. The
Company shall amend the registration statement for the Accounts
and the Contracts under the 1940 Act and the 1933 Act,
respectively, from time to time as required in order to effect
the continuous offering of the Contracts.
2.2. The Fund and the Underwriter represent and warrant
that Fund shares sold pursuant to this Agreement shall be
registered under the 1933 Act, duly authorized for issuance and
sold in compliance with the laws of the State of Maryland and all
applicable federal and state securities laws and that the Fund is
and shall remain registered under the 0000 Xxx. The Fund shall
amend the registration statement for its shares 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 Fund shall
register and qualify the shares for sale in accordance with the
laws of the various states only if and to the extent deemed
advisable by the Fund.
2.3. The 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
use its reasonable efforts to maintain such qualification (under
Subchapter M or any successor or similar provision) and that it
will notify the Company immediately upon having a reasonable
basis for believing that it has ceased to so qualify.
2.4. The Company represents and warrants that each Account
is and will continue to be a "segregated asset account" under
applicable provisions of the Code and applicable Treasury
Regulations promulgated thereunder and that each Contract is and
will continue to be treated as a "variable contract" under
applicable provisions of the Code and applicable Treasury
Regulations promulgated thereunder. The Company further
represents and warrants that it will make every effort to
maintain such treatment and that it will notify the Fund
immediately upon having a reasonable basis for believing that any
Account or Contract has ceased to be so treated or that any
Account or Contract might not be so treated in the future.
2.5. The Fund represents that to the extent that it
decides to finance distribution expenses pursuant to Rule 12b-1
under the 1940 Act, the Fund undertakes to have the Board, a
majority of whom are not interested persons of the Fund,
formulate and approve any plan under Rule 12b-1 to finance
distribution expenses.
2.6. The Fund makes no representation as to whether any
aspect of its operations (including, but not limited to, fees and
expenses and investment policies) complies with the insurance
laws or regulations of the various states.
2.7. The Fund represents that it is lawfully organized and
validly existing under the laws of the State of Maryland and that
it does and will comply in all material respects with the 1940
Act.
2.8. The Adviser represents and warrants that it is and
shall remain duly registered in all material respects under all
applicable federal and state securities laws and that it will
perform its obligations for the Fund in compliance in all
material respects with the laws of its state of domicile and any
applicable state and federal securities laws.
2.9. The Underwriter represents and warrants that it is
and shall remain duly registered in all material respects under
all applicable federal and state securities laws and that it will
perform its obligations for the Fund in compliance in all
material respects with the laws of its state of domicile and any
applicable state and federal securities laws.
2.10. The Fund represents and warrants that all of its
directors, officers, employees, and other individuals/entities
dealing 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 the minimum coverage as currently required by Rule
17g-1 of the 1940 Act or related provisions as may be promulgated
from time to time. The aforesaid blanket fidelity bond shall
include coverage for larceny and embezzlement and shall be issued
by a reputable bonding company.
2.11. The Company represents and warrants that all of its
directors, officers, employees, investment advisers, and other
individuals/entities dealing with the money and/or securities of
the Account(s) are and shall continue to be at all times covered
by a blanket fidelity bond or similar coverage for the benefit of
the Company and/or the Account(s) that is reasonable and
customary in light of the Company's obligations under this
Agreement. The aforesaid includes coverage for larceny and
embezzlement and shall be issued by a reputable bonding company
in an amount not less than $5 million. The Company agrees to
make all reasonable efforts to see that this bond or another bond
containing these provisions is always in effect, and agrees to
notify the Fund, the Underwriter and the Adviser in the event
that such coverage no longer applies.
ARTICLE III. Prospectuses, Reports to Shareholders and
Proxy Statements; Voting
3.1. The Fund or its designee shall provide the Company
with as many printed copies of the Fund's current prospectus and
statement of additional information as the Company may reasonably
request. If requested by the Company, in lieu of providing
printed copies the Fund shall provide camera-ready film or
computer diskettes containing the Fund's prospectus and statement
of additional information, and such other assistance as is
reasonably necessary in order for the Company once each year (or
more frequently if the prospectus and/or statement of additional
information for the Fund is amended during the year) to have the
prospectus for the Contracts and the Fund's prospectus printed
together in one document, and to have the statement of additional
information for the Fund and the statement of additional
information for the Contracts printed together in one document.
Alternatively, the Company may print the Fund's prospectus and/or
its statement of additional information in combination with other
fund companies' prospectuses and statements of additional
information.
3.2. Except as provided in this Section 3.2, all expenses
of preparing, setting in type, printing and distributing Fund
prospectuses and statements of additional information shall be
the expense of the Company. For prospectuses and statements of
additional information provided by the Company to its Contract
owners who currently own shares of one or more Portfolios
("Existing Contract Owners"), in order to update disclosure as
required by the 1933 Act and/or the 1940 Act, the cost of
printing shall be borne by the Fund. If the Company chooses to
receive camera-ready film or computer diskettes in lieu of
receiving printed copies of the Fund's prospectus, the Fund shall
bear the cost of typesetting to provide the Fund's prospectus to
the Company in the format in which the Fund is accustomed to
formatting prospectuses, and the Company shall bear the expense
of adjusting or changing the format to conform with any of its
prospectuses. In such event, the Fund will reimburse the Company
in an amount equal to the product of "x" and "y", where "x" is
the number of such prospectuses distributed to Existing Contract
Owners and "y" is the Fund's per unit cost of printing the Fund's
prospectus. The same procedures shall be followed with respect
to the Fund's statement of additional information. The Company
agrees to provide the Fund or its designee with such information
as may be reasonably requested by the Fund to assure that the
Fund's expenses do not include the costs of printing, typesetting
or distributing any prospectuses or statements of additional
information other than the costs of printing those prospectuses
or statements of additional information actually distributed to
Existing Contract Owners.
3.3. The statement of additional information of the Fund
shall be obtainable from the Fund, the Underwriter, the Company
or such other person as the Fund may designate.
3.4. The Fund, at its expense, shall provide the Company
with copies of its proxy statements, reports to shareholders, and
other communications (except for prospectuses and statements of
additional information, which are covered in Section 3.1) to
shareholders in such quantity and in Adobe Portable Document
Format as the Company shall reasonably require for distributing
to Existing Contract Owners. The Fund shall not pay any costs of
distributing such proxy materials, reports to shareholders and
other communications to prospective Contract owners.
3.5. If and to the extent required by law, the Company
shall distribute all proxy materials furnished by the Fund to
Contract owners to whom voting privileges are required to be
extended and shall:
(i) solicit voting instructions from Contract owners;
(ii) vote the Portfolio shares in accordance with
instructions received from Contract owners; and
(iii) vote Portfolio shares for which no instructions have
been received in the same proportion as Portfolio
shares for which instructions have been received;
so long as and to the extent that the SEC continues to interpret
the 1940 Act to require pass-through voting privileges for
variable contract owners. The Company reserves the right to vote
Portfolio shares held in any segregated asset account in its own
right, to the extent permitted by law. If the Company is
required to solicit voting instructions, the Fund and the Company
shall follow the procedures, and shall have the corresponding
responsibilities, for the handling of proxies and voting
instruction solicitations, as set forth in Schedule C attached
hereto and incorporated herein by reference. Participating
Insurance Companies shall be responsible for ensuring that each
of their separate accounts participating in the Fund (and for
which the soliciting of voting instructions is required)
calculates voting privileges in a manner consistent with the
standards set forth on Schedule C, which standards will also be
provided to the other Participating Insurance Companies.
3.6. The Fund will comply with all provisions of the 1940
Act requiring voting by shareholders, and in particular the Fund
will either provide for annual meetings (except insofar as the
SEC may interpret Section 16 of the 1940 Act not to require such
meetings) or comply with Section 16(c) of the 1940 Act (although
the Fund is not one of the trusts described in Section 16(c) of
the 0000 Xxx) as well as with Section 16(a) of the 1940 Act and,
if and when applicable, Section 16(b) of the 1940 Act. Further,
the Fund will act in accordance with the SEC's interpretation of
the requirements of Section 16(a) of the 1940 Act with respect to
periodic elections of directors and with whatever rules the SEC
may promulgate with respect thereto.
ARTICLE IV. Sales Material and Information
4.1. The Company shall furnish, or shall cause to be
furnished, to the Fund or its designee, each piece of sales
literature or other promotional material in which the Fund, the
Underwriter or the Adviser is named, at least ten (10) Business
Days prior to its use. No such material shall be used without
the prior approval of the Fund or its designee. The Fund shall
use its reasonable best efforts to review any such material as
soon as practicable after receipt and no later than ten (10)
Business Days after receipt of such material.
4.2. The Company shall not give any information or make
any representations or statements on behalf of the Fund or
concerning the Fund in connection with the sale of the Contracts
other than the information or representations contained in the
registration statement or prospectus for the Fund shares, as such
registration statement or prospectus may be amended or
supplemented from time to time, or in reports or proxy statements
for the Fund which are in the public domain or approved by the
Fund for distribution to Fund shareholders, or in sales
literature or other promotional material approved by the Fund or
its designee, except with the permission of the Fund.
4.3. The Fund or its designee shall furnish, or shall
cause to be furnished, to the Company or its designee, each piece
of sales literature or other promotional material in which the
Company and/or its Account(s) or Contract(s) are named at least
ten (10) Business Days prior to its use. No such material shall
be used if the Company or its designee reasonably objects to such
use within ten (10) Business Days after receipt of such material.
4.4. Neither the Fund, the Underwriter nor the Adviser
shall give any information or make any representations on behalf
of the Company or concerning the Company, each Account, or the
Contracts, other than the information or representations
contained in a registration statement or prospectus for the
Contracts, as such registration statement or prospectus may be
amended or supplemented from time to time, or in reports or proxy
statements for each Account which are in the public domain or
approved by the Company for distribution to Contract owners, or
in sales literature or other promotional material approved by the
Company or its designee, except with the permission of the
Company.
4.5. The Fund will provide to the Company at least one
complete copy of all registration statements, prospectuses,
statements of additional information, reports, proxy statements,
sales literature and other promotional materials, applications
for exemptions, requests for no-action letters, and all
amendments to any of the above, that relate to the Fund or its
shares and are relevant to the Company or the Contracts.
4.6. The Company will provide to the Fund at least one
complete copy of all registration statements, prospectuses,
statements of additional information, reports, solicitations for
voting instructions, sales literature and other promotional
materials, applications for exemptions, requests for no action
letters, and all amendments to any of the above, that relate to
investment in the Fund or the Portfolios under the Contracts.
4.7. For purposes of this Article IV, the phrase "sales
literature or other promotional material" includes, but is not
limited to, any of the following that refer to the Fund or any
affiliate of the Fund: advertisements (such as material
published, or designed for use in, a newspaper, magazine, or
other periodical, radio, television, telephone or tape recording,
videotape display, signs or billboards, motion pictures, or other
public media), sales literature (i.e., any written communication
distributed or made generally available to customers or the
public, including brochures, circulars, research reports, market
letters, form letters, seminar texts, reprints or excerpts of any
other advertisement, sales literature, or published article),
educational or training materials or other communications
distributed or made generally available to some or all agents or
employees, and registration statements, prospectuses, statements
of additional information, shareholder reports, and proxy
materials.
ARTICLE V. Fees and Expenses
5.1. The Fund shall pay no fee or other compensation to
the Company under this Agreement, except that if the Fund or any
Portfolio adopts and implements a service plan and/or a plan
pursuant to Rule 12b-1, then the Underwriter may make payments to
the Company or to the underwriter for the Contracts pursuant to
such plans if and in amounts agreed to by the Underwriter in
writing.
5.2. All expenses incident to performance by the Fund
under this Agreement shall be paid by the Fund. The Fund shall
see to it that all its shares are registered and authorized for
issuance in accordance with applicable federal law and, if and to
the extent deemed advisable by the Fund, in accordance with
applicable state laws prior to their sale. Except as otherwise
set forth in Section 3.2 of this Agreement, the Fund shall bear
the expenses for the cost of registration and qualification of
the Fund's shares, preparation and filing of the Fund's
prospectus and registration statement, proxy materials and
reports, setting the prospectus in type, setting in type and
printing the proxy materials and reports to shareholders, the
preparation of all statements and notices required by any federal
or state law, and all taxes on the issuance or transfer of the
Fund's shares.
5.3. The Company shall bear the expenses of distributing
the Fund's prospectus, statement of additional information, proxy
materials and reports to owners of Contracts issued by the
Company.
ARTICLE VI. Diversification
6.1. The Fund will use its best efforts to at all times
comply with Section 817(h) of the Code and Treasury Regulation
1.817-5, relating to the diversification requirements for
annuity, endowment, or life insurance contracts and any
amendments or other modifications to such Section or Regulations.
In the event the Fund ceases to so qualify, it will take
reasonable steps to (a) notify the Company of such event and (b)
adequately diversify the Fund so as to achieve compliance within
the grace period afforded by Regulation 1.817-5.
ARTICLE VII. Potential Conflicts
7.1. The Board will monitor the Fund for the existence of
any material irreconcilable conflict between the interests of the
contract owners of all separate accounts investing in the Fund.
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 contract owners; or (f) a
decision by a Participating Insurance Company to disregard the
voting instructions of contract owners. The Fund shall promptly
inform the Company if the Board determines that an irreconcilable
material conflict exists and the implications thereof.
7.2. The Company will report any potential or existing
conflicts of which it is aware to the Board. The Company will
assist the Board in carrying out its responsibilities under the
Shared Funding Exemptive Order by providing the Board with all
information reasonably necessary for the Board to consider any
issues raised. This includes, but is not limited to, an
obligation by the Company to inform the Board whenever Contract
owner voting instructions are disregarded. The Company agrees
that these responsibilities will be carried out with a view only
to the interests of Contract owners.
7.3. If it is determined by a majority of the Board, or a
majority of its disinterested members, that a material
irreconcilable conflict exists, the Company and other
Participating Insurance Companies shall, at their expense and to
the extent reasonably practicable (as determined by a majority of
the disinterested directors), take whatever steps are necessary
to remedy or eliminate the irreconcilable material conflict, up
to and including: (1) withdrawing the assets allocable to some or
all of the separate accounts from the Fund or any Portfolio and
reinvesting such assets in a different investment medium,
including (but not limited to) another portfolio of the Fund, or
submitting the question whether 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 policy 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 (2) establishing a new registered management
investment company or managed separate account. No charge or
penalty will be imposed as a result of such withdrawal. The
Company agrees that it bears the responsibility to take remedial
action in the event of a Board determination of an irreconcilable
material conflict and the cost of such remedial action with
respect to the Accounts' investment in the Fund, and that these
responsibilities will be carried out with a view only to the
interests of Contract owners.
7.4. 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 Fund's election, to withdraw the affected Account's
investment in the Fund and terminate this Agreement with respect
to such Account (at the Company's expense); 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 members of the
Board. No charge or penalty will be imposed as a result of such
withdrawal. The Company agrees that it bears the responsibility
to take remedial action in the event of a Board determination of
an irreconcilable material conflict and the cost of such remedial
action, and that these responsibilities will be carried out with
a view only to the interests of Contract owners.
7.5. For purposes of Sections 7.3 and 7.4 of this
Agreement, a majority of the disinterested members of the Board
shall determine whether any proposed action adequately remedies
any irreconcilable material conflict, but in no event will the
Fund be required to establish a new funding medium for the
Contracts. The Company shall not be required by Section 7.3 or
7.4 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.
7.6. 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 Shared Funding Exemptive Order) on terms and conditions
materially different from those contained in the Shared Funding
Exemptive Order, then (a) the Fund 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; and (b) Sections 3.4, 3.5, 7.1, 7.2, 7.3 and 7.4 of
this Agreement shall continue in effect only to the extent that
terms and conditions substantially identical to such Sections are
contained in such Rule(s) as so amended or adopted.
7.7. Each of the Company and the Adviser shall at least
annually submit to the Board such reports, materials or data as
the Board may reasonably request so that the Board may fully
carry out the obligations imposed upon it by the provisions
hereof and in the Shared Funding Exemptive Order. Such reports,
materials and data shall be submitted more frequently if deemed
appropriate by the Board.
ARTICLE VIII. Indemnification
8.1. Indemnification by the Company
8.1(a). The Company agrees to indemnify and hold
harmless the Fund, the Underwriter, the Adviser and each member
of the Board and each officer and employee of the Fund, and each
director, officer and employee of the Underwriter and the
Adviser, and each person, if any, who controls the Fund, the
Underwriter or the Adviser within the meaning of Section 15 of
the 1933 Act (collectively, the "Indemnified Parties" and
individually, an "Indemnified Party," for purposes of this
Section 8.1) against any and all losses, claims, damages,
liabilities (including amounts paid in settlement with the
written consent of the Company) or litigation (including
reasonable legal and other expenses), to which the Indemnified
Parties may become subject under any statute or 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 Fund's
shares or the Contracts and:
(i) arise out of or are based upon any untrue statements
or alleged untrue statements 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 statements
therein not misleading, provided that this agreement
to indemnify shall not apply as to any Indemnified
Party if such statement or omission or such alleged
statement or omission was made in reliance upon and
in conformity with information furnished to the
Company (or made upon approval) by or on behalf of
the Fund 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 Fund 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
Fund not supplied by the Company, or persons under
its control and other than statements or representa-
tions authorized by the Fund, the Underwriter or
the Adviser) or unlawful conduct of the Company
or persons under its control, with respect to the
sale or distribution of the Contracts or Fund
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 Fund 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 a
statement or omission was made in reliance upon and
in conformity with information furnished to the Fund
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.
Each of paragraphs (i) through (v) above is limited by and in
accordance with the provisions of Sections 8.1(b) and 8.1(c)
below.
8.1(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
an Indemnified Party as such may arise from such Indemnified
Party's willful misfeasance, bad faith, or gross negligence in
the performance of such Indemnified Party's duties or by reason
of such Indemnified Party's reckless disregard of obligations or
duties under this Agreement.
8.1(c). The Company shall not be liable under this
indemnification provision with respect to any claim made against
an Indemnified Party unless such 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
Indemnified Party (or after such 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
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 Indemnified Parties, the
Company shall be entitled to participate, at its own expense, in
the defense of such action. The Company also shall 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 Indemnified Party shall bear the fees and expenses of 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.
8.1(d). The Fund, the Underwriter or the Adviser, as
applicable, will promptly notify the Company of the commencement
of any litigation or proceedings against an Indemnified Party in
connection with this Agreement, the issuance or sale of the Fund
shares or the Contracts, or the operation of the Fund.
8.2. Indemnification by the Underwriter
8.2(a). The Underwriter agrees to indemnify and hold
harmless the Company and each of its directors, officers and
employees, and each person, if any, who controls the Company
within the meaning of Section 15 of the 1933 Act (collectively,
the "Indemnified Parties" and individually, an "Indemnified
Party," for purposes of this Section 8.2) against any and all
losses, claims, damages, liabilities (including amounts paid in
settlement with the written consent of the Underwriter) or
litigation (including reasonable legal and other expenses) to
which the Indemnified Parties may become subject under any
statute or 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 shares of a Portfolio 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 Fund (or any amendment or
supplement to any of the foregoing), or arise out of
or are based upon the omission or the alleged omission
to state therein a material fact required to be stated
therein or necessary to make the statements therein not
misleading, provided that this agreement to indemnify
shall not apply as to any Indemnified Party if such
statement or omission or such alleged statement or
omission was made in reliance upon and in conformity
with information furnished to the Fund, the Under-
writer or the Adviser (or made upon approval) by or
on behalf of the Company for use in the registration
statement or prospectus for the Fund 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 Fund or the
Underwriter or persons under their respective
control and other than statements or representa-
tions authorized by the Company) or unlawful
conduct of the Fund or the Underwriter or persons
under their respective 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 Fund
or the Underwriter; or
(iv) arise as a result of any failure by the Underwriter
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
Underwriter in this Agreement or arise out of or
result from any other material breach of this
Agreement by the Underwriter.
Each of paragraphs (i) through (v) above is limited by and in
accordance with the provisions of Sections 8.2(b) and 8.2(c)
below.
8.2(b). The Underwriter shall not be liable under this
indemnification provision with respect to any losses, claims,
damages, liabilities or litigation incurred or assessed against
an Indemnified Party as such may arise from such Indemnified
Party's willful misfeasance, bad faith, or gross negligence in
the performance of such Indemnified Party's duties or by reason
of such Indemnified Party's reckless disregard of obligations and
duties under this Agreement.
8.2(c). The Underwriter shall not be liable under this
indemnification provision with respect to any claim made against
an Indemnified Party unless such Indemnified Party shall have
notified the Underwriter in writing within a reasonable time
after the summons or other first legal process giving information
of the nature of the claim shall have been served upon such
Indemnified Party (or after such Indemnified Party shall have
received notice of such service on any designated agent), but
failure to notify the Underwriter of any such claim shall not
relieve the Underwriter from any liability which it may have to
the 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 Indemnified Parties,
the Underwriter will be entitled to participate, at its own
expense, in the defense thereof. The Underwriter also shall be
entitled to assume the defense thereof, with counsel satisfactory
to the party named in the action. After notice from the
Underwriter to such party of the Underwriter's election to assume
the defense thereof, the Indemnified Party shall bear the fees
and expenses of any additional counsel retained by it, and the
Underwriter 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.
8.2(d). The Company will promptly notify the Underwriter
of the commencement of any litigation or proceedings against an
Indemnified Party in connection with this Agreement, the issuance
or sale of the Contracts or the operation of the Account(s).
8.3. Indemnification by the Adviser
8.3(a). The Adviser agrees to indemnify and hold harmless
the Company and each of its directors, officers and employees,
and each person, if any, who controls the Company within the
meaning of Section 15 of the 1933 Act (collectively, the
"Indemnified Parties" and individually, an "Indemnified Party,"
for purposes of this Section 8.3) against any and all losses,
claims, damages, liabilities (including amounts paid in
settlement with the written consent of the Adviser) or litigation
(including reasonable legal and other expenses) to which the
Indemnified Parties may become subject under any statute or
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
shares of a Portfolio 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 Fund (or any amendment or
supplement to any of the foregoing), or arise out of
or are based upon the omission or the alleged omission
to state therein a material fact required to be stated
therein or necessary to make the statements therein not
misleading, provided that this agreement to indemnify
shall not apply as to any Indemnified Party if such
statement or omission or such alleged statement or
omission was made in reliance upon and in conformity
with information furnished to the Fund, the Underwriter
or the Adviser (or made upon approval) by or on behalf
of the Company for use in the registration statement
or prospectus for the Fund 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 Fund or the Adviser
or persons under their respective control and other
than statements or representations authorized by the
Company) or unlawful conduct of the Fund or the
Adviser or persons under their respective 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
Fund or the Adviser; or
(iv) arise as a result of any failure by the Adviser 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 Adviser
in this Agreement or arise out of or result from any
other material breach of this Agreement by the Adviser.
Each of paragraphs (i) through (v) above is limited by and in
accordance with the provisions of Sections 8.3(b) and 8.3(c)
below.
8.3(b). The Adviser shall not be liable under this
indemnification provision with respect to any losses, claims,
damages, liabilities or litigation incurred or assessed against
an Indemnified Party as such may arise from such Indemnified
Party's willful misfeasance, bad faith, or gross negligence in
the performance of such Indemnified Party's duties or by reason
of such Indemnified Party's reckless disregard of obligations and
duties under this Agreement.
8.3(c). The Adviser shall not be liable under this
indemnification provision with respect to any claim made against
an Indemnified Party unless such Indemnified Party shall have
notified the Adviser in writing within a reasonable time after
the summons or other first legal process giving information of
the nature of the claim shall have been served upon such
Indemnified Party (or after such Indemnified Party shall have
received notice of such service on any designated agent), but
failure to notify the Adviser of any such claim shall not relieve
the Adviser from any liability which it may have to the
Indemnified Party against whom such action is brought otherwise
than on account of this indemnification provision. In case any
such action is brought against the Indemnified Parties, the
Adviser will be entitled to participate, at its own expense, in
the defense thereof. The Adviser also shall be entitled to
assume the defense thereof, with counsel satisfactory to the
party named in the action. After notice from the Adviser to such
party of the Adviser's election to assume the defense thereof,
the Indemnified Party shall bear the fees and expenses of any
additional counsel retained by it, and the Adviser 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.
8.3(d). The Company will promptly notify the Adviser of
the commencement of any litigation or proceedings against an
Indemnified Party in connection with this Agreement, the issuance
or sale of the Contracts or the operation of the Account(s).
ARTICLE IX. Applicable Law
9.1. This Agreement shall be construed and the provisions
hereof interpreted under and in accordance with the laws of the
State of
New York.
9.2. This Agreement shall be subject to the provisions of
the 1933, 1934 and 1940 Acts, and the rules and regulations and
rulings thereunder, including such exemptions from those
statutes, rules and regulations as the SEC may grant (including,
but not limited to, the Shared Funding Exemptive Order) and the
terms hereof shall be interpreted and construed in accordance
therewith.
ARTICLE X. Termination
10.1. This Agreement shall continue in full force and
effect until the first to occur of:
(a) termination by any party for any reason by sixty (60) days
advance written notice delivered to the other parties; or
(b) termination by the Company by written notice to the Fund, the
Underwriter and the Adviser with respect to any Portfolio based
upon the Company's determination that shares of such Portfolio
are not reasonably available to meet the requirements of the
Contracts; provided, however, that said termination shall become
effective ten (10) days after receipt of notice unless the Fund
makes available a sufficient number of shares of the Portfolio to
reasonably meet the requirements of the Contracts within said ten
(10) day period; or
(c) termination by the Company by written notice to the Fund, the
Underwriter and the Adviser with respect to any Portfolio in the
event that any of the Portfolio's shares are not registered,
issued or sold in accordance with applicable state and/or federal
law or such law precludes the use of such shares as the
underlying investment media of the Contracts issued or to be
issued by the Company; or
(d) termination by the Company by written notice to the Fund, the
Underwriter and the Adviser with respect to any Portfolio in the
event that such Portfolio ceases to qualify as a Regulated
Investment Company under Subchapter M of the Code or under any
successor or similar provision; or
(e) termination by the Company by written notice to the Fund, the
Underwriter and the Adviser with respect to any Portfolio in the
event that such Portfolio fails to meet the diversification
requirements specified in Article VI hereof; or
(f) termination by the Fund, the Underwriter or the Adviser by
written notice to the Company if the Fund, the Underwriter or the
Adviser, as applicable, shall determine, in its sole judgment
exercised in good faith, that the Company and/or its affiliated
companies has suffered a material adverse change in its business,
operations, financial condition or prospects since the date of
this Agreement or is the subject of material adverse publicity;
or
(g) termination by the Company by written notice to the Fund, the
Underwriter and the Adviser, if the Company shall determine, in
its sole judgment exercised in good faith, that the Fund, the
Underwriter or the Adviser has suffered a material adverse change
in its business, operations, financial condition or prospects
since the date of this Agreement or is the subject of material
adverse publicity; or
(h) termination by the Fund, the Underwriter or the Adviser by
written notice to the Company, if the Company gives the Fund, the
Underwriter and the Adviser the written notice specified in
Section 1.5 hereof and at the time such notice was given there
was no notice of termination outstanding under any other
provision of this Agreement; provided, however, any termination
under this Section 10.1(h) shall be effective forty-five (45)
days after the notice specified in Section 1.5 was given; or
(i) termination by any party to this Agreement upon another
party's material breach of any provision of this Agreement.
10.2. Notwithstanding any termination of this Agreement
with respect to a Portfolio, the Fund and the Underwriter shall
at the option of the Company continue to make available
additional shares of the 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"), unless such further sale of Portfolio shares is
proscribed by law, regulation or applicable regulatory authority,
or unless the Board determines that liquidation of the Portfolio
following termination of this Agreement is in the best interests
of the Portfolio. Specifically, subject to the foregoing, the
owners of the Existing Contracts shall be permitted to direct
reallocation of investments in the Portfolio, redemption of
investments in the Portfolio and/or investment in the Portfolio
upon the making of additional purchase payments under the
Existing Contracts. The parties agree that this Section 10.2
shall not apply to any terminations under Article VII and the
effect of such Article VII terminations shall be governed by
Article VII of this Agreement.
ARTICLE XI. 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 Fund:
The Universal Institutional Funds, Inc.
c/x Xxxxxx Xxxxxxx Investment Management Inc.
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: President
If to the Underwriter:
Xxxxxx Xxxxxxx & Co. Incorporated
c/x Xxxxxx Xxxxxxx Investment Management Inc.
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: General Counsel
If to the Adviser:
Xxxxxx Xxxxxxx Investment Management Inc.
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: General Counsel
If to the Company:
The Union Central Life Insurance Company
0000 Xxxxxxxx Xxxx
Xxxxxxxxxx, XX 00000
Attention: Xxxxxx de Xxxxx
ARTICLE XII. Miscellaneous
12.1. All persons dealing with the Fund must look solely
to the property of the Fund for the enforcement of any claims
against the Fund, as neither the Board, officers, agents or
shareholders of the Fund assume any personal liability for
obligations entered into on behalf of the Fund.
12.2. Subject to the requirements of legal process and
regulatory authority, each party hereto shall treat as
confidential any "non-public personal information" about any
"consumer" of another party (as such terms are defined in SEC
Regulation S-P) and any other information reasonably identified
as confidential in writing by another party ("Confidential
Information"). Each party agrees not to disclose, disseminate or
utilize another party's Confidential Information except: (i) as
permitted by this Agreement, (ii) upon the written consent of the
other party, (iii) where the Confidential Information comes into
the public domain through no fault of the party receiving the
information, or (iv) as otherwise required or permitted under
applicable law.
12.3. The captions in this Agreement are included for
convenience of reference only and in no way define or delineate
any of the provisions hereof or otherwise affect their
construction or effect.
12.4. This Agreement may be executed simultaneously in two
or more counterparts, each of which taken together shall
constitute one and the same instrument.
12.5. If any provision of this Agreement shall be held or
made invalid by a court decision, statute, rule or otherwise, the
remainder of the Agreement shall not be affected thereby.
12.6. Each party hereto shall cooperate with each other
party and all appropriate governmental authorities (including
without limitation the SEC, the National Association of
Securities Dealers 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.
Notwithstanding the generality of the foregoing, each party
hereto further agrees to furnish state insurance authorities with
any information or reports in connection with services provided
under this Agreement which such authorities may request in order
to ascertain whether the insurance operations of the Company are
being conducted in a manner consistent with applicable law and
regulations.
12.7. 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.
12.8. This Agreement or any of the rights and obligations
hereunder may not be assigned by any party without the prior
written consent of all parties hereto; provided, however, that
the Adviser may assign this Agreement or any rights or
obligations hereunder to any affiliate of or company under common
control with the Adviser, if such assignee is duly licensed and
registered to perform the obligations of the Adviser under this
Agreement.
12.9. If requested by the Fund, the Underwriter or the
Adviser, the Company shall furnish, or shall cause to be
furnished, to the requesting party or its designee copies of the
following documents:
(a) the Company's annual statement (prepared under statutory
accounting principles) and annual report (prepared under
generally accepted accounting principles ("GAAP"), if any), as
soon as practical and in any event within ninety (90) days after
the end of each fiscal year;
(b) the Company's quarterly statements (prepared under statutory
accounting principles and GAAP, if any), as soon as practical and
in any event within forty-five (45) days after the end of each
quarterly period;
(c) any financial statement, proxy statement, notice or report of
the Company sent to stockholders and/or policyholders, as soon as
practical after the delivery thereof to stockholders;
(d) any registration statement (without exhibits) and financial
reports of the Company filed with the SEC or any state insurance
regulator, as soon as practical after the filing thereof; and
(e) any other report submitted to the Company by independent
accountants in connection with any annual, interim or special
audit made by them of the books of the Company, as soon as
practical after the receipt thereof.
12.10. Unless otherwise specifically provided in this
Agreement, no provision of this Agreement may be amended or
modified in any manner except by a written agreement executed by
all parties.
IN WITNESS WHEREOF, each of the parties hereto has caused
this Agreement to be executed in its name and on its behalf by
its duly authorized representative and its seal to be hereunder
affixed hereto as of the date specified above.
THE UNION CENTRAL LIFE INSURANCE COMPANY
By: /s/ Xxxxxxx X. Xxxxxxxx
Name: Xxxxxxx X. Xxxxxxxx
Title:Vice President
THE UNIVERSAL INSTITUTIONAL FUNDS, INC.
By: ______________________________
Name: Xxxxxxxx Xxxxx Yu
Title:
XXXXXX XXXXXXX & CO. INCORPORATED
By: ______________________________
Name:
Title:
XXXXXX XXXXXXX INVESTMENT MANAGEMENT INC.
By: ______________________________
Name:
Title:
SCHEDULE A
SEPARATE ACCOUNTS AND ASSOCIATED CONTRACTS
Name of Separate Account Form Number and Name of
and Date Established by Contract Funded by Separate Account
Board of Directors
Carillon Account Variable Annuity UC 2617
(February 6, 1984) (sold only in VT and NY until the
other contract forms are approved)
Variable Annuity UC 8134 (VA I)
Variable Annuity UC 8135 (VA II)
Carillon Life Account Variable Universal Life UC 8703
(July 10, 1995)
A-1
SCHEDULE B
PORTFOLIOS OF THE UNIVERSAL INSTITUTIONAL FUNDS, INC.
AVAILABLE UNDER THIS AGREEMENT
Core Plus Fixed Income Portfolio - Class I Shares
U.S. Real Estate Portfolio - Class I Shares
B-1
SCHEDULE C
PROXY VOTING PROCEDURES
The following is a list of procedures and corresponding
responsibilities for the handling of proxies and voting
instructions relating to the Fund. The defined terms herein
shall have the meanings assigned in the
Participation Agreement
except that the term "Company" shall also include the department
or third party assigned by the Company to perform the steps
delineated below.
o The proxy proposals are given to the Company by
the Fund as early as possible before the date set
by the Fund for the shareholder meeting to enable
the Company to consider and prepare for the
solicitation of voting instructions from Contract
owners and to facilitate the establishment of
tabulation procedures. At this time the Fund will
inform the Company of the Record, Mailing and
Meeting dates. This will be done verbally
approximately two months before the shareholder
meeting.
o Promptly after the Record Date, the Company will
perform a "tape run", or other activity, which will
generate the names, addresses and number of units
which are attributed to each Contract owner/policy-
holder (the "Customer") as of the Record Date.
Allowance should be made for account adjustments
made after this date that could affect the status
of the Customers' accounts as of the Record Date.
Note: The number of proxy statements is determined
by the activities described in this Step #2. The
Company will use its best efforts to call in the
number of Customers to the Fund, as soon as possible,
but no later than two weeks after the Record Date.
o The Fund's Annual Report must be sent to each
Customer by the Company either before or together
with the Customers' receipt of voting instruction
solicitation material. The Fund will provide the
last Annual Report to the Company pursuant to the
terms of Section 3.4 of the
Participation Agreement
to which this Schedule relates.
o The text and format for the Voting Instruction Cards
("Cards" or "Card") is provided to the Company by
the Fund. The Company, at its expense, shall produce
and personalize the Voting Instruction Cards. The
Fund or its affiliate must approve the Card before it
is printed. Allow approximately 2-4 Business Days
for printing information on the Cards. Information
commonly found on the Cards includes:
- name (legal name as found on account registration)
- address
- fund or account number
- coding to state number of units
C-1
- individual Card number for use in tracking and
verification of votes (already on Cards as printed
by the Fund).
(This and related steps may occur later in the chronological
process due to possible uncertainties relating to the proposals.)
o During this time, the Fund will develop, produce
and pay for the Notice of Proxy and the Proxy
Statement (one document). Printed and folded
notices and statements will be sent to Company
for insertion into envelopes (envelopes and
return envelopes are provided and paid for by
the Company). Contents of envelope sent to
Customers by the Company will include:
- Voting Instruction Card(s)
- One proxy notice and statement (one document)
- return envelope (postage pre-paid by Company)
addressed to the Company or its tabulation agent
- "urge buckslip" - optional, but recommended
(this is a small, single sheet of paper that
requests Customers to vote as quickly as possible
and that their vote is important; one copy will
be supplied by the Fund.)
- cover letter - optional; supplied by Company and
reviewed and approved in advance by the Fund
o The above contents should be received by the Company
approximately 3-5 Business Days before mail date.
Individual in charge at Company reviews and approves
the contents of the mailing package to ensure
correctness and completeness. Copy of this approval
sent to the Fund.
o Package mailed by the Company.
* The Fund must allow at least a 15-day solicitation
time to the Company as the shareowner. (A 5-week
period is recommended.) Solicitation time is
calculated as calendar days from (but not
including,) the shareholder meeting, counting
backwards.
o Collection and tabulation of Cards begins.
Tabulation usually takes place in another department
or another vendor depending on process used. An
often used procedure is to sort Cards on arrival
by proposal into vote categories of all yes, no,
or mixed replies, and to begin data entry.
Note: Postmarks are not generally needed. A need
for postmark information would be due to an
insurance company's internal procedure and has not
been required by the Fund in the past.
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o Signatures on Card checked against legal name on
account registration that was printed on the Card.
Note: For Example, if the account registration is
under "Xxxx X. Xxxxx, Trustee," then that is the
exact legal name to be printed on the Card and is
the signature needed on the Card.
o If Cards are mutilated, or for any reason are
illegible or are not signed properly, they are sent
back to Customer with an explanatory letter and a
new Card and return envelope. The mutilated or
illegible Card is disregarded and considered to be
not received for purposes of vote tabulation. Any
Cards that have been "kicked out" (e.g. mutilated,
illegible) of the procedure are "hand verified,"
i.e., examined as to why they did not complete the
system. Any questions on those Cards are usually
remedied individually.
o There are various control procedures used to ensure
proper tabulation of votes and accuracy of that
tabulation. The most prevalent is to sort the Cards
as they first arrive into categories depending upon
their vote; an estimate of how the vote is progressing
may then be calculated. If the initial estimates and
the actual vote do not coincide, then an internal
audit of that vote should occur. This may entail a
recount.
o The actual tabulation of votes is done in units which
is then converted to shares. (It is very important
that the Fund receives the tabulations stated in terms
of a percentage and the number of shares.) The Fund
must review and approve tabulation format.
o Final tabulation in shares is verbally given by the
Company to the Fund on the morning of the shareholder
meeting not later than 10:00 a.m. Eastern time. The
Fund may request an earlier deadline if reasonable and
if required to calculate the vote in time for the
shareholder meeting.
o A Certification of Mailing and Authorization to Vote
Shares will be required from the Company as well as
an original copy of the final vote. The Fund will
provide a standard form for each Certification.
o The Company will be required to box and archive the
Cards received from the Customers. In the event that
any vote is challenged or if otherwise necessary for
legal, regulatory, or accounting purposes, the Fund
will be permitted reasonable access to such Cards.
o All approvals and "signing-off" may be done orally,
but must always be followed up in writing.
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