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EXHIBIT 8(g)
FUND PARTICIPATION AGREEMENT
This Agreement is entered into as of the 30th day of September, 1993, between
PROVIDENT MUTUAL LIFE INSURANCE COMPANY OF PHILADELPHIA ("Insurance Company"), a
life insurance company organized under the laws of the Commonwealth of
Pennsylvania, and DREYFUS VARIABLE INVESTMENT FUND ("Fund"), an unincorporated
business trust organized under the laws of the Commonwealth of Massachusetts.
ARTICLE I
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 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 "Dreyfus" shall mean The Dreyfus Corporation and its affiliates,
including Dreyfus Service Corporation.
1.9 "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.
1.10 "Prospectus" shall mean the Fund's current prospectus and
statement of additional information, as most recently filed with
the Commission.
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1.11 "Separate Account" shall mean The Provident Mutual Variable
Annuity Separate Account, a separate account established by
Insurance Company in accordance with the laws of the
Commonwealth of Pennsylvania.
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. Such Program may include
the Lion System. In situations where the Lion System or any
other Software Program used by the Fund is not available, such
information may be provided by telephone. The Lion System shall
be provided to Insurance Company at no charge.
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
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 Pennsylvania Insurance Code
for the purpose of offering to the public certain individual
variable annuity contracts; and (c) it has registered the
Separate Account as a unit investment trust under the Act to
serve as the segregated investment account for the Contracts.
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"); (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
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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, diversified management investment
company and possesses, and shall maintain, all legal and
regulatory licenses, approvals, consents and/or exemptions
required for Fund to operate and offer its shares as an
underlying investment medium for Participating Companies. The
Fund has established six series of shares (each, a "Series") and
may in the future establish other series of shares.
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 Dreyfus 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 Fund agrees that the Fund's assets shall be managed and invested
in a manner that complies with the requirements of Section 817(h)
of the Code.
2.8 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.
2.9 Fund represents and warrants that any of its trustees, officers,
employees, investment advisers, and other individuals/entities
who deal with the money and/or
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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.
2.10 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.
2.11 Insurance Company agrees that Dreyfus 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
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. 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 6:00 p.m. Eastern Time on each Business Day. Any material
errors in the calculation of net asset value,
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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 11:00 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 11:00 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 make all
reasonable efforts to transmit to the Fund payment in Federal
Funds by 12:00 noon Eastern Time on
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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 12:00 midnight Eastern Time 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 or is received by the Fund after 12:00 noon Eastern
Time 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 will 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
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.
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4.2 Fund shall distribute to Insurance Company copies of the Fund's
Prospectuses, 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.
ARTICLE V
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 Dreyfus and Insurance
Company shall agree from time to
time.
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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
EXEMPTIVE RELIEF
6.1 Insurance Company has reviewed a copy of the order dated December
23, 1987 of the Securities and Exchange Commission under Section
6(c) of the Act 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 or 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
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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
VOTING OF FUND SHARES
7.1 Fund shall provide Insurance Company 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.
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 Fund shares for the
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Separate Account is conducted in a manner consistent with other
Participating Companies.
7.2 Insurance Company agrees that it shall not, without the prior
written consent of the Fund and Dreyfus, solicit, induce or
encourage Contractholders to (a) change or supplement the Fund's
current investment adviser or (b) change, modify, substitute, add
to or delete the Fund from the current investment media for the
Contracts.
ARTICLE VIII
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;
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 make reasonable efforts to
market the Contracts and 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
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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 a 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.
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ARTICLE IX
INDEMNIFICATION
9.1 Insurance Company agrees to indemnify and hold harmless the Fund,
Dreyfus, any sub-investment adviser of a Series, 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
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specifically for use therein. 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, PML
Securities Company ("PML")(an affiliate of Insurance Company) and each
of their directors, officers, employees, agents and each person, if
any, who controls Insurance Company or PML within the meaning of the
1933 Act against any losses, claims, damages or liabilities to which
Insurance Company, PML 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 or PML by the Fund; and the Fund will reimburse any
legal or other expenses reasonably incurred by Insurance Company, PML
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 or PML
specifically for use therein. 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 and PML harmless
against any and all liability, loss, damages, costs or expenses which
Insurance Company or PML 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
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distribution rate; provided that the Fund shall have no obligation to
indemnify and hold harmless Insurance Company or PML if the incorrect
calculation or incorrect or untimely reporting was the result of
incorrect information furnished by Insurance Company or PML or
information furnished untimely by Insurance Company or PML or otherwise
as a result of or relating to a breach of this Agreement by Insurance
Company.
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
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.
9.5 Insurance Company shall indemnify and hold the Fund, Dreyfus and any
sub-investment adviser of a Series harmless against
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any tax liability incurred by the Fund under Section 851 of the Code
arising from purchases or redemptions by Insurance Company's General
Accounts or the account of its affiliates.
ARTICLE X
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;
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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
Dreyfus, 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 Dreyfus 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;
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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 Dreyfus 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 or Dreyfus
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 and Dreyfus, as promptly as is
practicable under the circumstances, shall notify Insurance Company
whether Dreyfus and 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
AMENDMENTS
11.1 Any other changes in the terms of this Agreement shall be made by
agreement in writing between Insurance Company and Fund.
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ARTICLE XII
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: Provident Mutual Life Insurance Company
of Philadelphia
0000 Xxxxxx Xxxxxx
Xxxxxxxxxxxx, Xxxxxxxxxxxx 00000
Attn:
Fund: Dreyfus Variable Investment Fund
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxxxx X. Xxxxxxx, Secretary
with copies to: Stroock & Stroock & Xxxxx
0 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Attn: Xxxxx X. Xxxx, Esq.
Xxxxxx X. Xxxxxxx, Esq.
Notice shall be deemed to be given on the date of receipt by the
addresses as evidenced by the return receipt.
ARTICLE XIII
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
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.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement to be duly
executed and attested as of the date first above written.
PROVIDENT MUTUAL LIFE INSURANCE
COMPANY OF PHILADELPHIA
By: /s/ Illegible Signature
------------------------------------
Its: Chairman, President & CEO
------------------------------------
Attest: /s/ Illegible Signature
----------------------------
DREYFUS VARIABLE INVESTMENT FUND
By: /s/ Illegible Signature
------------------------------------
Its: Secretary
------------------------------------
Attest: /s/ Illegible Signature
----------------------------
Assistant Secretary
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