Exhibit (h)(5)(M)
FUND PARTICIPATION AGREEMENT
THIS AGREEMENT is entered into as of this 2nd day of September, 2003, as
amended and restated on May 17, 2004, among ING USA ANNUITY AND LIFE INSURANCE
COMPANY, a life insurance company organized under the laws of the State of
Delaware and RELIASTAR LIFE INSURANCE COMPANY OF NEW YORK, a life insurance
company organized under the laws of the State of New York (individually and
together, the "Insurance Company"), each on behalf of itself and certain of its
separate accounts (each, an "Account"), as listed in Appendix B to this
Agreement, as such Appendix may be amended from time to time by mutual agreement
in writing; ING INVESTORS TRUST (the "Trust"), an open-end management investment
company that is a business trust organized under the laws of the Commonwealth of
Massachusetts; ING INVESTMENTS, LLC ("ING"), a limited liability company
organized under the laws of the State of Delaware; Directed Services, Inc.
("DSI"), a broker-dealer and registered investment adviser organized under the
laws of the state of Delaware, which serves as the Trust's distributor; AMERICAN
FUNDS INSURANCE SERIES ("Series"), an open-end management investment company
organized under the laws of the Commonwealth of Massachusetts; and CAPITAL
RESEARCH AND MANAGEMENT COMPANY ("CRMC"), a corporation organized under the laws
of the State of Delaware.
WITNESSETH:
WHEREAS, Insurance Company has issued or proposes to issue to the public,
now and in the future, certain multi-manager variable annuity contracts (the
"Contracts") as set forth in Appendix A to this Agreement, as such Appendix may
be amended from time to time by mutual agreement in writing;
WHEREAS, Insurance Company has established one or more Accounts, as set
forth in Appendix B, under applicable state insurance law, for purposes of
funding the Contracts and has or will register each Account with the United
States Securities and Exchange Commission (the "Commission") as a unit
investment trust under the Securities Act of 1933 (the "1933 Act") and the
Investment Company Act of 1940 (the "1940 Act") (unless the Account is exempt
from such registration);
WHEREAS, the Contracts, which are or will be registered by Insurance
Company with the Commission for offer and sale (unless the Contract is exempt
from such registration), will be in compliance with all applicable laws prior to
being offered for sale;
WHEREAS, the Series has received a "Mixed and Shared Funding Order" from
the Commission granting relief from certain provisions of the 1940 Act and the
rules thereunder to the extent necessary to permit shares of the Series to be
sold to variable annuity and life insurance separate accounts of unaffiliated
insurance companies;
WHEREAS, the Series is divided into various funds (the "Master Funds"), and
each Master Fund has its own assets and liabilities and invests in securities in
accordance with its investment objectives and policies, as described in the
registration statement for the Master Funds;
WHEREAS, the Trust is divided into various series (the "Portfolios"), and
each Portfolio has its own assets and liabilities and invests in securities in
accordance with its investment objectives and policies, as described in the
registration statement for the Portfolios;
WHEREAS, certain Portfolios propose to hold as their only investment shares
of a corresponding Master Fund as set forth in Appendix C, as such Appendix may
be amended from time to time by mutual agreement in writing;
WHEREAS, certain Master Funds (through the Portfolios) will serve as the
underlying investments for the Contracts as set forth in Appendix A to this
Agreement, as such Appendix may be amended from time to time by mutual agreement
in writing;
WHEREAS, CRMC is the investment adviser for the Master Funds; and
WHEREAS, ING is the investment adviser for the Portfolios.
NOW, THEREFORE, in consideration of the foregoing and of mutual covenants
and conditions set forth herein and for other good and valuable consideration,
Insurance Company, the Trust, ING, DSI, the Series and CRMC hereby agree as
follows:
1. The Series and CRMC each represents and warrants to Insurance Company,
the Trust, ING and DSI that: (a) a registration statement under the 1933 Act and
under the 1940 Act with respect to the Series, in the form previously delivered
to Insurance Company and the Trust, and all forms, reports, proxy statements and
other documents required to be filed with the Commission under the 1933 Act, the
Securities Exchange Act of 1934 ("1934 Act") and the 1940 Act (collectively, the
"SEC Filings") have been filed with the Commission and copies of any and all
amendments thereto will be forwarded to Insurance Company and the Trust at the
time that they are filed with the Commission; (b) the Series is, and shall be at
all times while this Agreement is in force, lawfully organized and validly
existing under the laws of the Commonwealth of Massachusetts; (c) the Series is
and shall remain registered as an open-end management investment company under
the 1940 Act; (d) the SEC Filings (including the registration statement) conform
or, when they become effective, will conform in all material respects to the
requirements of the 1933 Act, the 1940 Act and the 1934 Act, and the rules and
regulations of the Commission thereunder, and will not contain any untrue
statement of a material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein not misleading;
provided, however, that this representation and warranty shall not apply to any
statements or omissions made in reliance upon and in conformity with information
furnished in writing to the Series by Insurance Company, ING, DSI or the Trust
expressly for use therein; and (e) the Series and CRMC will comply in all
material respects with all applicable laws and regulations, including, without
limitation, the 1933 Act and the 1940 Act and the rules and regulations
thereunder. The Series shall register and qualify the shares of the
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Master Funds listed on Appendix C for sale in accordance with the securities
laws of the various states only if and to the extent deemed necessary by the
Series.
2. The Trust, ING and DSI each represents and warrants to Insurance
Company, the Series and CRMC that the shares of the Portfolios listed on
Appendix C are or will be registered under the 1933 Act and that the shares will
be issued, sold and distributed in compliance in all material respects with all
applicable federal securities laws. The Trust further represents and warrants
that: (a) the Trust is, and shall be at all times while this Agreement is in
force, lawfully organized and validly existing under the laws of the
Commonwealth of Massachusetts; (b) the Trust is and shall remain registered as
an open-end management investment company under the 1940 Act; (c) the SEC
Filings (including the registration statement) of the Trust conform or, when
they become effective, will conform in all material respects to the requirements
of the 1933 Act, the 1934 Act and the 1940 Act, and the rules and regulations of
the Commission thereunder, and will not contain any untrue statement of a
material fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading; provided, however, that
this representation and warranty shall not apply to any statements or omissions
made in reliance upon and in conformity with information furnished in writing to
the Series by Insurance Company, CRMC or the Series expressly for use therein;
and (e) the Trust, ING and DSI will comply in all material respects with all
applicable laws and regulations, including, without limitation, the 1933 Act and
the 1940 Act and the rules and regulations thereunder. The Trust shall register
and qualify the shares of the Portfolios listed on Appendix C for sale in
accordance with the securities laws of the various states only if and to the
extent deemed necessary by the Trust.
2a. Insurance Company represents and warrants to the Trust, Series and
CRMC that the Contracts are currently and at the time of issuance will be
treated as annuity contracts under applicable provisions of the Internal Revenue
Code of 1986, as amended, and the regulations thereunder (the "Code"), that it
will maintain such treatment and that it will notify the Trust, Series and CRMC
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.
3. The Series will furnish to Insurance Company and the Trust such
information with respect to the Series in such form and signed by such of its
officers as Insurance Company and/or the Trust may reasonably request, and will
warrant that the statements therein contained when so signed will be true and
correct. The Series will advise Insurance Company and the Trust immediately of:
(a) any non-routine request by the Commission (i) for amendment of the
registration statement relating to the Series, or (ii) for additional
information; (b) the issuance by the Commission of any stop order suspending the
effectiveness of the registration statement of the Series or the initiation of
any proceeding for that purpose; (c) the institution of any proceeding,
investigation or hearing involving the offer or sale of the Contracts or the
Series of which it or CRMC becomes aware; or (d) the happening of any material
event, if known, which makes untrue any statement made in the registration
statement of the Series or which requires the making of a change therein in
order to make any statement made therein not misleading.
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4. The Series will make Class 2 shares of the Master Funds listed on
Appendix C available to the Portfolios and will register for sale under the 1933
Act and, if required, under state securities laws, such additional shares of the
Master Funds as may be reasonably necessary for investment by the Portfolios
under this Agreement and maintain a continuous offering of the shares of the
Master Funds. DSI, as the Trust's distributor, will be entitled to a Rule 12b-1
service fee paid by the Series and to be accrued daily and paid monthly at an
annual rate of 0.25% of the average daily net assets of the Class 2 shares of
each Master Fund attributable to the Contracts. DSI may use the fee in
connection with offering shares of the Portfolios to Insurance Company or for
other purposes or services deemed appropriate by DSI, including services for
Contract owners with investments in subaccounts corresponding to the Portfolios
investing in Class 2 shares of each Master Fund (each, a "Subaccount") for as
long as the Series' Class 2 Plan of Distribution pursuant to Rule 12b-1 under
the 1940 Act (the "12b-1 plan") remains in effect and the Portfolios remain
invested in shares of the Master Funds. Master Fund shares to be made available
to the Portfolios shall be sold by the Series and purchased by the Trust for a
given Portfolio at the net asset value of the respective Master Fund (without
the imposition of a sales load) next computed after receipt of each order by the
Series or its designee, as established in accordance with the provisions of the
then current Prospectus of the Series. For purposes of this Paragraph 4,
Insurance Company shall be a designee of each Master Fund and each Portfolio for
receipt of such orders attributable to the Contracts, and receipt by such
designee as of 4:00 p.m. Eastern time (or other such time the Boards of Trustees
of the Trust and the Series shall so designate) shall constitute receipt by the
Trust and the Series; provided that the Portfolio and the Master Fund each
receives actual notice of such order by 9:30 a.m. Eastern time on the following
Business Day ("Next Business Day"). "Business Day" shall mean any day on which
the New York Stock Exchange ("NYSE") is open for trading and on which the Series
or Portfolio, as applicable, calculates its net asset value pursuant to the
rules of the Commission. The Series will make shares of the Master Funds
available indefinitely for purchase at the applicable net asset value per share
by the Trust and its Portfolios on those days on which the Series calculates its
net asset value pursuant to the rules of the Commission, and the Series shall
use its best efforts to calculate such net asset value on each day on which the
NYSE is open for trading. The Series shall make the net asset value per share
for each Master Fund available to the Trust on a daily basis as soon as
reasonably practicable after the Series calculates its net asset value per
share, and the Series shall use its best efforts to make such net asset value
per share available by 6:30 p.m. Eastern time. CRMC and the Series shall report
to the Trust and Insurance Company any material error in the calculation of the
net asset values, dividends or capital gain information as soon as practicable
upon discovery. In the event of any material error in the calculation or
communication of net asset value, dividends or capital gain information or delay
in the communication by CRMC, the Series will act in accordance with its then
current policies and procedures relating to error correction, which policies and
procedures shall be provided to Insurance Company and the Trust and shall be in
accordance with the 1933 Act and 1940 Act (and any applicable regulations
thereunder) and SEC policies regarding pricing errors, including in regards to
when the party responsible for the error must compensate a Fund or its
shareholders for any losses. The Series and CRMC are responsible for maintaining
net asset values for each Master Fund in accordance with the requirements of the
1940 Act and the Series' then current Prospectus. Shares of particular Master
Funds shall be ordered in such quantities and at such times as determined by the
Trust to be necessary to meet the requirements
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of the Portfolios. Payments for shares purchased will be made in federal funds
transmitted by wire on the Next Business Day, and Insurance Company and the
Trust shall each use commercially reasonable efforts to wire (or cause to be
wired) funds to the other, for the purpose of settling net purchase orders or
orders of redemption, by 3:00 p.m. Eastern time on the Next Business Day.
4a. The Series and CRMC agree that total return and yield performance
information of the Series derived from its registration statement provided by
the Series or CRMC may be used by the Trust, DSI or Insurance Company in
connection with the sale of shares of the Portfolios and the Contracts without
prior approval of the Series or CRMC, and the Trust, DSI and Insurance Company
will be responsible for using such information in conformity with the
information provided.
4b. The Series shall provide the Trust and Insurance Company with at least
one hundred twenty (120) days' advance notice, or such lesser time as may be
agreed to by the parties, of any change in the Series' investment objective, and
at least sixty (60) days' advance notice, or such lesser time as may be agreed
to by the parties, of any material change in the Series' principal investment
strategy described in its Prospectus, or any change in the Series' fiscal year
or time for calculating net asset value for purposes of Rule 22c-1.
4c. The Series reserves the right to temporarily suspend or terminate
sales of the Series' shares to the Trust and the Portfolios if such action is
required by law, or if the Board of Trustees of the Series deems it necessary,
appropriate and in the best interests of the Series and its shareholders or in
response to the order of an appropriate regulatory authority.
4d. As of the Effective Date of this Agreement, the Series is unable to
provide pricing information, order execution and wire payment for purchases and
redemptions of Master Fund shares through the National Securities Clearing
Corporation ("NSCC") and its subsidiary systems described in Appendix D to this
Agreement. The Series agrees to provide pricing information, order execution and
wire payment for purchases and redemptions of Master Fund Shares through the
NSCC and its subsidiary systems pursuant to Appendix D to this Agreement, as
such Appendix may be amended from time to time by mutual agreement in writing,
as soon as it becomes feasible for the Series to do so.
5. The Trust will make shares of the Portfolios listed on Appendix C
available to Insurance Company and will register for sale under the 1933 Act
and, if required, under state securities laws, such additional shares of the
Portfolios as may reasonably be necessary for use as the funding vehicle for the
Contracts and to maintain a continuous offering of the shares of the Portfolios.
5a. The Trust reserves the right to temporarily suspend or terminate sales
of the Portfolios' shares to Insurance Company, or purchases of the Series'
shares by the Trust and the Portfolios, if any such action is required by law,
or if the Board of Trustees of the Trust deems it necessary, appropriate and in
the best interest of the Trust and its shareholders (including Contract owners)
or in response to the order of an appropriate regulatory authority.
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6. The Contracts funded through each Account will provide for the
allocation of net amounts among certain Subaccounts for investment in such
shares of the Portfolios as may be offered from time to time in the Contracts.
The selection of the particular Subaccount is to be made by the Contract owner
and such selection may be changed in accordance with the terms of the Contracts.
Insurance Company reserves the right to refuse, to impose limitations on, or to
limit any transaction request if the request would tend to disrupt Contract
administration or is not in the best interest of the Contract owners or an
Account or Subaccount.
7. Transfer of the Series' and the Trust's shares will be by book entry
only. No stock certificates will be issued to the Accounts or Portfolios. Shares
ordered from a particular Master Fund will be recorded by CRMC or the Series'
transfer agent as instructed by the Trust in an appropriate title for the
corresponding Portfolio. Shares ordered from a particular Portfolio will be
recorded by DSI or the Trust's transfer agent as instructed by Insurance Company
in an appropriate title for the corresponding Account or Subaccount.
8. The Series shall furnish notice promptly to the Trust of any dividend
or distribution payable on any shares of the Master Funds held by the
Portfolios. The Trust hereby elects to receive all such dividends and
distributions as are payable on shares of a Master Fund recorded in the title
for the corresponding Portfolio in additional shares of that Master Fund. The
Series shall notify the Trust of the number of shares so issued. The Trust
reserves the right to revoke this election and to receive all such income
dividends and capital gain distributions in cash.
8a. The Trust shall furnish notice promptly to Insurance Company of any
dividend or distribution payable on any shares underlying the Portfolios.
Insurance Company hereby elects to receive all such dividends and distributions
as are payable on shares of a Portfolio recorded in the title for the
corresponding Subaccount in additional shares of that Portfolio. The Trust shall
notify Insurance Company of the number of shares so issued. Insurance Company
reserves the right to revoke this election and to receive all such income
dividends and capital gain distributions in cash.
9. The Series shall effect redemptions of interests in the Master Funds
in accordance with the terms of the Master Funds' then current Prospectus and
the provisions of the 1940 Act and the rules and regulations thereunder. For
purposes of this Paragraph 9, Insurance Company shall be a designee of each
Portfolio and each Master Fund for receipt of requests for redemption from each
Account, and receipt by such designee by 4:00 p.m. Eastern time (or other such
time the Boards of Trustees of the Trust and the Series shall so designate)
shall constitute receipt by the Trust and the Series; provided that the Trust or
Series each receives actual notice of such request for redemption by 9:00 a.m.
Eastern time on the Next Business Day. Insurance Company shall purchase and
redeem the shares of the Portfolios offered by the then current Prospectus of
the Trust in accordance with the provisions of such Prospectus.
9a. All redemption requests, including any redemption requests that the
Trust receives from an Account which necessitate a redemption request to the
Series and a redemption of a
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Portfolio's entire interest from a Master Fund, will be effected in cash at the
next determined net asset value after the redemption request is received,
payable in federal funds. The Series will use its best efforts to settle
redemptions on the business day following the receipt of a redemption request by
the Series and if such next business day settlement is not practicable, then as
soon thereafter as practicable, and will immediately notify the Trust regarding
the anticipated settlement date, which shall in all events be a date permitted
under the 1940 Act. The Trust will settle redemptions immediately upon receipt
of proceeds from the Series.
10. The Series shall pay all expenses incidental to its performance under
this Agreement. The Series shall bear the expenses for the cost of registration
of its shares, preparation of Prospectuses and statements of additional
information to be sent to existing Contract owners (upon request in the case of
the statement of additional information), proxy statements and related materials
and annual and semi-annual shareholder reports, the printing and distribution of
such items to each Contract owner who has allocated net amounts to any
Subaccount, the preparation of all statements and notices required from it by
any federal or state law, and taxes on the issue or transfer of the Series'
shares subject to this Agreement. The Series will provide the Trust and
Insurance Company, at least once a year, with enough copies of its Statement of
Additional Information to be able to distribute one to each Contract owner or
prospective Contract owner who requests such Statement of Additional
Information.
11. Insurance Company shall bear the expenses for the cost of preparation
and delivery of the Portfolios and the Master Funds respective Prospectuses (and
supplements thereto) to be sent to prospective Contract owners. Each of the
Trust and the Series shall provide, at its expense and in a timely manner, such
documentation (in camera-ready or other mutually agreeable form) and other
assistance as is reasonably necessary in order for Insurance Company once each
year (or more frequently if the Prospectus for the Series or the Trust is
amended), and twice each year in the case of the annual and semi-annual
shareholder reports, to have the Prospectus or Prospectuses, and the annual and
semi-annual shareholder reports for the Contracts, the Portfolios and the Master
Funds, printed together in one or more documents (such printing to be done at
Insurance Company's expense with respect to prospective investors).
12. Insurance Company represents and warrants to the Trust and the Series
that any information furnished in writing by Insurance Company to the Trust or
the Series for use in the registration statements of the Trust and the Series,
respectively, will not result in the registration statement's failing to conform
in all respects to the requirements of the 1933 Act and the 1940 Act and the
rules and regulations thereunder or containing any untrue statement of a
material fact or omission to state a material fact required to be stated therein
or necessary to make the statements therein not misleading.
12a. The Trust represents and warrants to the Series that any information
furnished in writing by the Trust to the Series for use in the registration
statement of the Series will not result in the registration statement's failing
to conform in all respects to the requirements of the 1933 Act and the 1940 Act
and the rules and regulations thereunder or containing any untrue statement of a
material fact or omission to state a material fact required to be state therein
or necessary to make the statements therein not misleading.
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12b. The Series represents and warrants to the Trust and Insurance Company
that any information furnished in writing by the Series to the Trust or
Insurance Company for use in the registration statement of the Trust or
Insurance Company will not result in the registration statement's failing to
conform in all respects to the requirements of the 1933 Act and the 1940 Act and
the rules and regulations thereunder or containing any untrue statement of a
material fact or omission to state a material fact required to be stated therein
or necessary to make the statements therein not misleading.
13. Insurance Company, the Trust and their affiliates shall make no
representations concerning the Series' shares except those contained in the then
current Prospectus of the Series, current statement of additional information of
the Series, reports to shareholders, or in such printed information subsequently
issued by the Series or on its behalf by CRMC or American Funds Distributors,
Inc. ("AFD"), including information published on the Series' or CRMC's internet
site, in materials approved by CRMC and AFD or as otherwise provided in the
Business Agreement in effect among Insurance Company, AFD and CRMC dated as of
September 2, 2003.
14. Shares of the Series may be offered to separate accounts of various
insurance companies in addition to Insurance Company and the Trust and otherwise
in accordance with the Mixed and Shared Funding Order. The Series agrees to take
all steps necessary so that the Master Funds meet the requirements of Section
817 relating to diversification for variable annuity, endowment and life
insurance contracts. The Series represents that each Master Fund is currently
qualified as a "regulated investment company" ("RIC") under the Code. The Series
also agrees to maintain each Master Fund's qualification as a RIC, and each will
notify Insurance Company and the Trust immediately upon having a basis for
believing that the Series has ceased to so qualify or that the Series might not
so qualify in the future. The Series will provide the Trust with securities
holdings reports for each Master Fund within ten days after each calendar
quarter.
15. The Series and the Trust hereby notify Insurance Company that it may
be appropriate to include in the Prospectus pursuant to which a Contract is
offered disclosure regarding the risks of mixed and shared funding.
16. The parties to this Agreement recognize that due to differences in tax
treatment or other considerations, the interests of various Contract owners
participating in one or more Portfolios or Master Funds might, at some time, be
in conflict. Each party shall report to each other party any potential or
existing conflict of which it becomes aware. The Boards of Trustees of the Trust
and the Series shall promptly notify Insurance Company of the existence of
irreconcilable material conflict and its implications. If such a conflict
exists, Insurance Company will, at its own expense, take whatever action deemed
necessary in accordance with the mixed
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and shared funding orders of or applicable to the Series and the Trust,
respectively, to remedy such conflict; in any case, Contract owners will not be
required to bear such expenses.
17. Insurance Company agrees to indemnify and hold the Trust, ING, DSI,
CRMC and the Series and any affiliate, control person, shareholder, director,
trustee, officer or employee of the Trust, ING, DSI or the Series (collectively,
"Indemnified Affiliates") harmless against any and all losses, claims, damages,
liabilities or litigation (including legal and other expenses) to which such
Indemnified Affiliate may be subject under any statute, at common law or
otherwise, insofar as such losses, claims, damages, liabilities or expenses (or
actions in respect thereof) or settlements arise as a result of Insurance
Company's: (a) making untrue statements of material facts or omitting material
facts in a Contract's registration statement, Prospectus, statement of
additional information, private placement memorandum or other disclosure
documents, semi-annual or annual reports to Contract owners and sales literature
for the Contracts; (b) making untrue statements of material facts that an
Indemnified Affiliate includes in its materials, provided that the Indemnified
Affiliate relies on information supplied by Insurance Company; (c) unlawful
conduct, bad faith, willful malfeasance, or gross negligence by Insurance
Company with respect to the sale of the Contracts or Portfolio or Master Fund
shares; or (d) breaching this Agreement or a representation or warranty
contained in this Agreement.
17a. ING and DSI (as between them, in relation to each party's
responsibilities under this Agreement), each on behalf of itself and the Trust,
agrees to indemnify and hold Insurance Company, the Trust, CRMC, the Series and
any affiliate, control person, shareholder, director, trustee, officer or
employee of Insurance Company, the Trust or the Series (collectively,
"Registered Affiliates") harmless against any and all losses, claims, damages,
liabilities or litigation (including legal and other expenses) to which such
Registered Affiliate may be subject under any statute, at common law or
otherwise, insofar as such losses, claims, damages, liabilities or expenses (or
actions in respect thereof) or settlements arise as a result of the Trust's,
ING's or DSI's: (a) making untrue statements of material facts or omitting
material facts in the Trust's registration statement, Prospectuses or statements
of additional information, semi-annual and annual reports to shareholders, and
sales literature; (b) making untrue statements of material facts that a
Registered Affiliate includes in its materials, provided such Registered
Affiliate relies on information supplied by ING or DSI; (c) unlawful conduct,
bad faith, willful malfeasance, or gross negligence by the Trust, ING or DSI
with respect to the sale of the Contracts or Portfolio shares or the operation
of the Trust or a Portfolio; (d) failure of a Portfolio to comply with any of
its investment objectives, policies and restrictions; or (e) breaching this
Agreement or a representation or warranty contained in this Agreement.
17b. The Series and CRMC each agrees to indemnify and hold Insurance
Company, the Trust, ING and DSI and any affiliate, control person, shareholder,
director, trustee, officer or employee of Insurance Company, the Trust, ING or
DSI (collectively, "Insurance Company Affiliates") harmless against any and all
losses, claims, damages, liabilities or litigation (including legal and other
expenses) to which such Insurance Company Affiliate may be subject under any
statute, at common law or otherwise, insofar as such losses, claims, damages,
liabilities or expenses (or actions in respect thereof) or settlements arise as
a result of the Series' or CRMC's: (a) making untrue statements of material
facts or omitting material facts in the Series' registration statement,
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Prospectuses or statements of additional information, semi-annual and annual
reports to shareholders, and sales literature; (b) making untrue statements of
material facts that an Insurance Company Affiliate includes in its materials,
provided such Insurance Company Affiliate relies on information supplied by the
Series or CRMC; (c) unlawful conduct, bad faith, willful malfeasance, or gross
negligence by the Series or CRMC with respect to the sale of the Contracts or
Master Fund shares or the operation of the Series or a Master Fund; (d) failure
of a Master Fund to comply with any of its investment objectives, policies and
restrictions; or (e) breaching this Agreement or a representation or warranty
contained in this Agreement.
18. Insurance Company shall be responsible for assuring that the Account
calculates pass-through voting privileges of Contract owners in a manner
consistent with the method of calculating pass-through voting privileges set
forth in the then current Prospectus or private placement memorandum for the
Contract and the mixed and shared funding orders of or applicable to the Trust
and the Series.
19. Each party hereto shall cooperate with each other party and all
appropriate governmental authorities (including, but not limited to, the
Commission, the NASD 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.
20. The parties understand that there is no intention to create a joint
venture in the subject matter of this Agreement. Accordingly, the right to
terminate this Agreement and to engage in any activity not inconsistent with
this Agreement is absolute. This Agreement will terminate:
(a) by mutual agreement at any time;
(b) by any party at any time upon sixty (60) days' written notice to the
other parties;
(c) at the option of Insurance Company, the Trust, CRMC or the Series upon
ten calendar days' prior written notice to the other parties if a
final non-appealable administrative or judicial decision is entered
against another party which has a material impact on the Contracts;
(d) at the option of Insurance Company or the Trust, immediately upon
written notice, if shares of the Series are not reasonably available
for investment by the Portfolios;
(e) at the option of Insurance Company or the Trust, immediately upon
written notice, if the Series or a Master Fund fails to meet the
requirements for either diversification under Section 817 or RIC
status under the Code, or if the Board of the Series terminates the
12b-1 plan;
(f) at the option of Insurance Company, the Trust, CRMC or the Series in
the event the Series' shares are not registered, issued or sold in
accordance with applicable
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state and/or federal law or such law precludes the use of such shares
as an underlying investment for the Contracts issued or to be issued
by Insurance Company (in such event prompt notice shall be given by
Insurance Company, the Trust, CRMC or the Series to the other
parties);
(g) at Insurance Company's option by written notice to the Series and/or
CRMC if Insurance Company shall determine in its sole judgment
exercised in good faith, that either the Series or CRMC 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) with respect to each Insurance Company, at the option of the Series or
CRMC by written notice to Insurance Company if the Series or CRMC
shall determine in its sole judgment exercised in good faith, that
Insurance Company has suffered a material adverse change in its
business, operations, financial condition or prospects since the date
of this Agreement or is the subject of material adverse publicity.
The effective date for termination pursuant to any notice given under this
Paragraph shall be calculated beginning with the date of receipt of such notice.
21. All notices, consents, waivers, and other communications under this
Agreement must be in writing, and will be deemed to have been duly received: (a)
when delivered by hand (with written confirmation of receipt); (b) when sent by
facsimile (with written confirmation of receipt), provided that a copy is mailed
by registered mail, return receipt requested; or (c) the day after it is sent by
a nationally recognized overnight delivery service, in each case to the
appropriate addresses and facsimile numbers set forth below (or to such other
addresses and facsimile numbers as a party may designate by notice to the other
parties):
IF TO INSURANCE COMPANY:
ING USA Annuity and Life Insurance Company
ReliaStar Life Insurance Company of New York
U.S. Legal Services
0000 Xxxxxxxx Xxxxx
Xxxx Xxxxxxx, XX 00000
Attention: Xxxxx X. Xxxxxx, Counsel
Facsimile No.: 000-000-0000
WITH A COPY TO:
ING Investment Funds
000 Xxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxx Xxxxxxxxx, Head of Outside Funds
11
IF THE TRUST:
ING Investors Trust
0000 Xxxx Xxxxxxxxxx Xxxxx Xxxx
Xxxxxxxxxx, XX 00000-0000
Attn: Xxxxxx X. Naka
Senior Vice President
IF TO ING:
ING Investments, LLC
0000 Xxxx Xxxxxxxxxx Xxxxx Xxxx
Xxxxxxxxxx, XX 00000-0000
Attn: Xxxxxxx X. Xxxxxx
Chief Financial Officer
IF TO DSI:
Directed Services, Inc.
0000 Xxxxxxxx Xxxxx
Xxxx Xxxxxxx, XX 00000
Attn: Xxxxx X. Xxxxxxxx, Vice President
IF TO THE SERIES:
American Funds Insurance Series
000 X. Xxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxxx X. Xxxxxx, Senior Vice President
Facsimile No.: (000) 000-0000
WITH A COPY TO:
Capital Research and Management Company
000 X. Xxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxxx X. Xxxxxxxxxx, Vice President and Senior Counsel,
Fund Business Management Group
Facsimile No.: (000) 000-0000
IF TO CRMC:
Capital Research and Management Company
000 X. Xxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxxxxx, XX 00000
Attention: Xxxxxxx X. Xxxxxx, Senior Vice President and Legal Counsel,
12
Fund Business Management Group, and Secretary
Facsimile No.: (000) 000-0000
WITH A COPY TO:
Capital Research and Management Company
000 X. Xxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxxx X. Xxxxxxxxxx, Vice President and Senior Counsel,
Fund Business Management Group
Facsimile No.: (000) 000-0000
21. If this Agreement terminates, any provision of this Agreement
necessary to the orderly windup of business under it will remain in effect as to
that business, after termination.
22. If this Agreement terminates, the Series and CRMC, at Insurance
Company's option, will continue to make additional shares of the Master Funds
available to the Trust for all existing Contracts as of the effective date of
termination (under the same terms and conditions as were in effect prior to
termination of this Agreement with respect to existing Contract owners), unless
the Series liquidates or applicable laws prohibit further sales. Insurance
Company agrees not to redeem shares of the Trust unless: (a) the Agreement is
terminated pursuant to Paragraph 20(e) or 20(f); (b) legitimately required to do
so according to a Contract owner's request; (c) under an order from the
Commission or pursuant to exemptive relief granted by the Commission or pursuant
to a vote of Contract owners; or (d) as otherwise agreed to or permitted among
the parties.
23. The obligations of the Series under this Agreement are not binding
upon any of the Trustees, officers, employees or shareholders (except CRMC if it
is a shareholder) of the Series individually, but bind only the Series' assets.
When seeking satisfaction for any liability of the Series in respect of this
Agreement, Insurance Company, on behalf of itself and the Accounts, agrees not
to seek recourse against said Trustees, officers, employees or shareholders, or
any of them, or any of their personal assets for such satisfaction. Insurance
Company agrees that the obligations of each Master Fund hereunder shall be
several and not joint, in accordance with its proportionate interest hereunder,
and Insurance Company agrees not to proceed against any Master Fund for the
obligations of another Master Fund. Notwithstanding the foregoing, if Insurance
Company seeks satisfaction for any liability of the Series in respect of this
Agreement, Insurance Company (on behalf of itself or any Account) may seek
recourse against CRMC.
23b. The obligations of the Trust under this Agreement are not binding upon
any of the Trustees, officers, employees or shareholders (except Insurance
Company if it is a shareholder), of the Trust individually, but bind only the
Trust's assets. When seeking satisfaction for any liability of the Trust in
respect of this Agreement, Insurance Company, the Series and CRMC agree not to
seek recourse against said Trustees, officers, employees or shareholders, or any
of them, or any of their personal assets for such satisfaction. Insurance
Company, the Series and CRMC also agree that the obligations of each Portfolio
hereunder shall be several and not joint, in accordance with its proportionate
interest hereunder, and the Series and CRMC agree not to
13
proceed against any Portfolio for the obligations of another Portfolio.
24. This Agreement shall be construed in accordance with the laws of the
Commonwealth of Massachusetts.
25. This Agreement and the parties' rights, duties and obligations under
this Agreement are not transferable or assignable by any of them without the
express, prior written consent of the other parties hereto. Any attempt by a
party to transfer or assign this Agreement or any of its rights, duties or
obligations under this Agreement without such consent is void; provided,
however, that a merger of, reinsurance arrangement by, or change of control of a
party shall not be deemed to be an assignment for purposes of this Agreement.
26. The following Paragraphs shall survive any termination of this
Agreement: 4, 17-17(b), 21-26.
27. This Agreement and any amendment to it may be executed in one or more
counterparts. All of those counterparts shall constitute one and the same
agreement.
14
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and attested as of the date first above written.
ING USA ANNUITY AND LIFE INSURANCE
COMPANY (ON BEHALF OF ITSELF
AND EACH ACCOUNT)
Attest: /s/ Xxxxx X. Jaboson
--------------------
Xxxxx X. Xxxxxxxx
\s\Xxxxxx X. Xxxx Vice President
-----------------
RELIASTAR LIFE INSURANCE COMPANY
OF NEW YORK (ON BEHALF OF ITSELF AND EACH
ACCOUNT)
Attest: /s/ Xxxxx X. Jaboson
--------------------
By: Xxxxx X. Xxxxxxxx
\s\Xxxxxx X. Xxxx Its: Vice President
-----------------
AMERICAN FUNDS INSURANCE SERIES
Attest:
/s/ Xxxx X. Xxxxxx
------------------
\s\Xxxxxxx Xxxxxx By: Xxxx X. Xxxxxx
----------------- Its: Secretary
15
CAPITAL RESEARCH AND MANAGEMENT
COMPANY
Attest:
/s/ Xxxxxxx Xxxxxx
------------------
\s\Xxxx X. Xxxxxxxx By: Xxxxxxx X. Xxxxxx
------------------- Its: Vice President and Secretary
ING INVESTORS TRUST
Attest: /s/ Xxxxxxx S. Naka
-------------------
Xxxxxx X. Naka
\s\Xxxxxx Xxxxxxxxxx Senior Vice President
--------------------
ING INVESTMENTS, LLC
Attest: /s/ Xxxxxxx X. Xxxxxx
---------------------
Xxxxxxx X. Xxxxxx
\s\Xxxxxx Xxxxxxxxxx Chief Financial Officer
--------------------
DIRECTED SERVICES, INC.
Attest: /s/ Xxxxx X. Xxxxxxxx
---------------------
Xxxxx X. Xxxxxxxx
Vice President
\s\Xxxxxx X. Xxxx
-----------------
16
APPENDIX A - CONTRACTS
COMPANY CONTRACTS
--------------------------------------------------------------------------------
ING USA Annuity and Life Insurance Company: GoldenSelect Access(R)
GoldenSelect Access One
GoldenSelect DVA Plus(R)
GoldenSelect DVA
GoldenSelect ES II(R)
GoldenSelect Generations,
GoldenSelect Landmark
GoldenSelect Opportunities
GoldenSelect Premium Plus(R)
SmartDesign Advantage
SmartDesign Signature
SmartDesign Variable Annuity
ReliaStar Life Insurance Company of New York GoldenSelect DVA Plus-NY
SmartDesign Variable Annuity - NY
00
XXXXXXXX X - SEPARATE ACCOUNTS
COMPANY SEPARATE ACCOUNT
------------------------------------------------------------------------------------------
ING USA Annuity and Life Insurance Company: - Separate Account B
ReliaStar Life Insurance Company of New York: - ReliaStar Life Insurance Company of
New York Separate Account NY-B
18
APPENDIX C
PORTFOLIOS AND CORRESPONDING MASTER FUNDS
ING INVESTORS TRUST PORTFOLIOS: AMERICAN FUNDS INSURANCE SERIES MASTER FUNDS:
- ING American Funds Growth Portfolio - Growth Fund (Class 2 Shares)
- ING American Funds Growth-Income Portfolio - Growth-Income Fund (Class 2 Shares)
- ING American Funds International Portfolio - International Fund (Class 2 Shares)
19
APPENDIX D
Procedures for Pricing and Order/Settlement Through National Securities Clearing
Corporation's Mutual Fund Profile System and Mutual Fund Settlement, Entry and
Registration Verification System.
1. Subject to the provisions of Paragraph 4 of the Participation
Agreement, the parties hereby agree to provide pricing information, execute
orders and wire payments for purchases and redemptions of Master Fund shares
through National Securities Clearing Corporation ("NSCC") and its subsidiary
systems, when it becomes feasible for the Series to do so, as follows:
(a) The Series will furnish to the Trust or its designated affiliate
through NSCC's Mutual Fund Profile System ("MFPS") (1) the most
current net asset value information for each Master Fund, (2) a
schedule of anticipated dividend and distribution payment dates for
each Master Fund, which is subject to change without prior notice,
ordinary income and capital gain dividend rates on the Master Fund's
ex-date, and (3) in the case of fixed income funds that declare daily
dividends, the daily accrual or the interest rate factor. All such
information shall be furnished to the Trust or its designated
affiliate by 6:30 p.m. Eastern Time on each Business Day or at such
other time as that information becomes available. Changes in pricing
information will be communicated to NSCC and the Trust
(b) Upon receipt of Master Fund purchase, exchange and redemption
instructions for acceptance as of the time at which a Master Fund's
net asset value is calculated as specified in the Series' Prospectus
("Close of Trading") on each Business Day ("Instructions"), and upon
its determination that there are good funds with respect to
Instructions involving the purchase of Master Fund shares, the Trust
or its designated affiliate will calculate the net purchase or
redemption order for each Master Fund. Orders for net purchases or net
redemptions derived from Instructions received by the Trust or its
designated affiliate prior to the Close of Trading on any given
Business Day will be sent to the Defined Contribution Interface of
NSCC's Mutual Fund Settlement, Entry and Registration Verification
System ("Fund/SERV") by 5:00 a.m. Eastern Time on the next Business
Day. Subject to the Trust's or its designated affiliate's compliance
with the foregoing, the Trust or its designated affiliate will be
considered the agent of the Series, and the Business Day on which
Instructions are received by the Trust or its affiliate in proper form
prior to the Close of Trading will be the date as of which shares of
the Master Funds are deemed purchased, exchanged or redeemed pursuant
to such Instructions. Instructions received in proper form by the
Trust or its designated affiliate after the Close of Trading on any
given Business Day will be treated as if received on the next
following Business Day. Dividends and capital gains distributions will
be automatically reinvested at net asset value in accordance with the
Series' then current Prospectuses.
20
(c) The Trust or its designated affiliate will wire payment for net
purchase orders by the Master Fund's NSCC Firm Number, in immediately
available funds, to an NSCC settling bank account designated by the
Trust or its designated affiliate no later than 5:00 p.m. Eastern time
on the same Business Day such purchase orders are communicated to
NSCC. For purchases of shares of daily dividend accrual funds, those
shares will not begin to accrue dividends until the day the payment
for those shares is received.
(d) NSCC will wire payment for net redemption orders by Master Fund, in
immediately available funds, to an NSCC settling bank account
designated by Insurance Company or its designated affiliate, by 5:00
p.m. Eastern Time on the Business Day such redemption orders are
communicated to NSCC, except as provided in the Series' then current
Prospectus and statement of additional information.
(e) If the Series does not send a confirmation of the Trust's or its
designated affiliate's purchase or redemption order to NSCC by the
applicable deadline to be included in that Business Day's payment
cycle, payment for such purchases or redemptions will be made the
following Business Day.
(f) If on any day the Trust or its designated affiliate, or the Series is
unable to meet the NSCC deadline for the transmission of purchase or
redemption orders, it may at its option transmit such orders and make
such payments for purchases and redemptions directly to the Series or
the Trust or its designated affiliate, as applicable, as is otherwise
provided in the Agreement.
(g) These procedures are subject to any additional terms in the Series'
Prospectus and the requirements of applicable law. The Series reserves
the right, at its discretion and without notice, and subject to the
terms and conditions of this Agreement to suspend the sale of shares
or withdraw the sale of shares of any Master Fund.
2. The Trust or its affiliate, the Series and clearing agents (if
applicable) are each required to have entered into membership agreements with
NSCC and met all requirements to participate in the MFPS and Fund/SERV systems
before these procedures may be utilized. Each party will be bound by the terms
of their membership agreement with NSCC and will perform any and all duties,
functions, procedures and responsibilities assigned to it and as otherwise
established by NSCC applicable to the MFPS and Fund/SERV system and the
Networking Matrix Level utilized.
3. Except as modified hereby, all other terms and conditions of the
Agreement shall remain in full force and effect. Unless otherwise indicated
herein, the terms defined in the Agreement shall have the same meaning as in
this Appendix.
21
