1
FUND PARTICIPATION AGREEMENT
This Agreement is entered into as of the 1st day of June, 2001, among New York
Life Insurance and Annuity Corporation , a life insurance company organized
under the laws of the State of Delaware ("Insurance Company"); DREYFUS
INVESTMENT PORTFOLIOS (the "Fund"), The Dreyfus Corporation, a New York
Corporation (the "Advisor") and Dreyfus Service Corporation, a New York
Corporation (the "Distributor"), each a party.
ARTICLE I
DEFINITIONS
1.1 "Act" shall mean the Investment Company Act of 1940, as amended.
1.2 "Board" shall mean the Board of Directors or Trustees, as the case may
be, of a Fund, which has the responsibility for management and control
of the Fund.
1.3 "Business Day" shall mean any day on which the New York Stock Exchange
is open for trading and on which the Fund calculates its net asset
value per share pursuant to the Rules of the Commission.
1.4 "Commission" shall mean the Securities and Exchange Commission.
1.5 "Contract" shall mean a variable annuity or life insurance contract
issued by Insurance Company that uses any Participating Fund (as
defined below) as an underlying investment medium. Individuals who
participate under a group Contract are "Participants." The Contracts
are listed in Schedule A to this Agreement, as such Schedule may be
amended from time to time by mutual written consent of each party.
1.6 "Contractholder" shall mean any person that is a party to a Contract
with a Participating Company (as defined below).
1.7 "Disinterested Board Members" shall mean those members of the Board of
a Fund 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. The Dreyfus Corporation is the
registered investment advisor of the Funds and Dreyfus Service
Corporation is the distributor of the Funds.
1.9 "Participating Companies" shall mean any insurance company (including
Insurance Company) that offers variable annuity and/or variable life
insurance contracts to the public and that has entered into an
agreement with one or more of the Funds.
1.10 "Participating Fund" shall mean each Fund, including, as applicable,
any series thereof, specified in Schedule A, as such Schedule may be
amended from time to time by agreement of
2
the parties hereto, the shares of which are available to serve as the
underlying investment medium for the aforesaid Contracts.
1.11 "Prospectus" shall mean the current prospectus and statement of
additional information of a Fund (or, as the case may be, with respect
to a Contract) and any amendments or supplements thereto, all, as most
recently filed with the Commission.
1.12 "Separate Account" shall mean the separate account or accounts
established by Insurance Company in accordance with applicable state
law, delineated on Schedule A, as such Schedule may be amended from
time to time by agreement of the parties hereto by mutual written
consent of each party.
1.13 "Software Program" shall mean the software program used by a 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
a Fund is not available, such information may be provided by
telephone. The Lion System shall be provided to Insurance Company at
no charge.
1.14 "Insurance Company's General Account(s)" shall mean the general
account(s) of Insurance Company and its affiliates.
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 applicable insurance law and regulation for the purpose of offering
to the public certain individual and group variable annuity and life
insurance contracts; (c) it has registered the Separate Account as a
unit investment trust under the Act (unless exempt therefrom) to serve
as the segregated investment account for the Contracts; and (d) the
Separate Account is eligible to invest in shares of each Participating
Fund without such investment disqualifying any Participating Fund as
an investment medium for insurance company separate accounts
supporting variable annuity contracts or variable life insurance
contracts.
2.2 Insurance Company represents and warrants that (a) the interests under
the Contracts will be registered under the Securities Act of 1933, as
amended ("1933 Act") to the extent required thereby; (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 notify each
Participating Fund promptly of any investment restrictions imposed by
state insurance law and applicable to the Participating Fund.
2
3
2.3 Insurance Company represents and warrants that the income, gains and
losses, whether or not realized, from assets allocated to the Separate
Account are, in accordance with the applicable Contracts, to be
credited to or charged against such Separate Account without regard to
other income, gains or losses from assets allocated to any other
accounts of Insurance Company. Insurance Company represents and
warrants that the assets of the Separate Account are and will be kept
separate from Insurance Company's General Account and any other
separate accounts Insurance Company may have, and will not be charged
with liabilities from any business that Insurance Company may conduct
or the liabilities of any companies affiliated with Insurance Company.
2.4 Each Participating Fund represents that it is lawfully organized and
validly existing under the laws of the state of Massachusetts and that
it is registered with the Commission under the Act as an open-end,
management investment company and possesses, and shall comply with the
Act and shall maintain, all legal and regulatory licenses, approvals,
consents and/or exemptions required for the Participating Fund to
operate and offer its shares as an underlying investment medium for
Participating Companies.
2.5 Each series of a Participating Fund together with the Adviser
represents and warrants that such Participating Fund is and at all
times since its inception has been qualified as a regulated investment
company under Subchapter M of the Internal Revenue Code of 1986, as
amended (the "Code"), and will at all times invest money from the
Contracts in such a manner and take such other actions as necessary to
qualify as a regulated investment company under Subchapter M or any
successor or similar provision) and that the Participating Fund and
the Adviser will make every effort to maintain such qualification and
will notify Insurance Company immediately upon having a reasonable
basis for believing that the Participating Fund has ceased to so
qualify or that it might not so qualify in the future.
2.6 Each Participating Fund, together with their Distributor, represents
and warrants that such Participating Fund shares sold pursuant to this
Agreement shall be registered under the 1933 Act to the extent
required thereby, duly authorized for issuance and sold in compliance
with this Agreement and, in all material respects, all applicable
federal and state laws and that the Participating Fund is and shall
remain registered under the Act. Each Participating Fund shall amend
the registration statement for its shares under the 1933 Act and the
Act from time to time as required in order to effect the continuous
offering of its shares.
2.8 Insurance Company represents and agrees that the Contracts are
currently, and at the time of issuance will be, treated as life
insurance policies, endowments or annuity contracts, under applicable
provisions of the Code, and that it will make every effort to maintain
such treatment and that it will notify each Participating 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. (For purposes of this Agreement, notice to
the Adviser or the Distributor shall be deemed to be notice to
Dreyfus.) Insurance Company agrees that any prospectus offering a
Contract that in all cases will be 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).
3
4
2.9 Insurance Company agrees that each Participating Fund shall be
permitted (subject to the other terms of this Agreement) to make its
shares available to other Participating Companies and Contractholders.
2.10 Each Participating Fund together with the Adviser, represents and
warrants that (i) such Participating Fund will at all times invest
money from the Contracts in such a manner as to ensure that the
Contracts will be treated as variable contracts under the Code and the
regulations issued thereunder (or any successor provisions); and (ii)
the Participating Fund has since its inception complied and will
continue to comply with Section 817(h) of the Code and Treasury
Regulation 1.817-5, and any Treasury interpretations thereof, relating
to the diversification requirements for variable annuity, endowment,
or life insurance contracts, and any amendments or other modifications
or successor provisions to such Section or Regulation. In the event of
a breach of this Section 2.10 by a Participating Fund, it will take
all steps necessary to: (a) notify Insurance Company of such breach,
and (b) adequately diversify the Designated Portfolios so as to
achieve compliance within the 30-day grace period afforded by
Regulation 1.817-5.
2.11 Each Participating Fund together with the Distributor, represents and
warrants that no other Participating Insurance Company has or will
purchase shares of any series of such Participating Fund for any
purpose or under any circumstances that would preclude Insurance
Company from "looking through" to the investments of each series of
the Participating Fund in which it invests, pursuant to the
"look-through" rules found in Treasury Regulation 1.817-5.
2.12 Each Participating Fund, together with the Adviser, represents and
warrants that all its directors, trustees, officers, employees, , and
other individuals/entities who deal with the money and/or securities
of the Participating Fund are and shall continue to be at all times
covered by a blanket fidelity bond or similar coverage for the benefit
of the Participating 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. The Participating Fund and the Adviser each shall
make all reasonable efforts to see that this bond or another bond
containing these same provisions is always in effect, and each agrees
to notify the Insurance Company in the event such coverage no longer
applies.
2.13 Insurance Company represents and warrants that all of its employees
and agents who deal with the money and/or securities of each
Participating 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 that required to be maintained by entities subject to the
requirements of Rule 17g-1 of the Act . The aforesaid Bond shall
include coverage for larceny and embezzlement and shall be issued by a
reputable bonding company. The Insurance Company shall make all
reasonable efforts to see that this bond or another bond containing
these same provisions is always in effect, and each agrees to notify
the Participating Fund and the Adviser in the event such coverage no
longer applies.
4
5
2.14 The Adviser and the Distributor each represents and warrants that (i)
it is lawfully organized and validly existing under the laws of its
state of organization; (ii) in the case of the Adviser, it is
registered as an investment adviser under the Investment Advisers Act
of 1940 and, in the case of the Distributor, it is registered as a
broker-dealer under the Securities Exchange Act of 1934 and a member
of the National Association of Securities Dealers, Inc.; and (iii) it
is and will remain duly registered and licensed in all material
respects under all applicable federal and state laws and shall perform
its obligations hereunder in compliance in all material respects with
all applicable federal and state laws.
2.15 Insurance Company agrees that Dreyfus shall be deemed a third party
beneficiary under this Agreement and may enforce any and all rights
conferred on a Participating Fund, Adviser or Distributor by virtue of
this Agreement.
2.16 Insurance Company represents and warrants that the Insurance Company's
General Account will not for any reason, or any period of time, own
shares of any Participating Fund or series thereof.
2.16 Each party to this Agreement represents and warrants that (i) it has
full power and authority to enter into and perform its obligations
under this Agreement; (ii) it has duly taken all necessary steps to
authorize the person signing this Agreement on its behalf to do so and
to authorize the performance of its obligations under this Agreement;
and (iii) assuming the accuracy of and compliance with this
representation and warranty by all other parties, this Agreement will
be valid, binding on, and enforceable against such party in accordance
with its terms, subject only to such limitations as apply generally to
the rights of creditors, such as, but not limited to, bankruptcy laws,
laws governing the insolvency of insurance companies and other
entities, and principles of equity.
ARTICLE III
FUND SHARES
3.1 The Company intends to purchase shares of the series of the
Participating Fund on behalf of the Separate Account to fund the
Contracts.
3.2 Each Participating Fund agrees to make its shares available for
purchase indefinitely at the then applicable net asset value per share
by Insurance Company on behalf of the Separate Account on each
Business Day pursuant to rules of the Commission. Notwithstanding the
foregoing, the Board of Trustees of the Participating Fund may suspend
or terminate the offering of shares to any person, or suspend or
terminate the offering of its shares, if such action is required by
law or by regulatory authorities having jurisdiction or is, in the
sole discretion of its Board, acting in good faith and in light of its
fiduciary duties under federal and any applicable state laws to
Participating Fund shareholders including Insurance Company and the
Separate Account, necessary and in the best interests of the
Participating Fund's shareholders.
5
6
3.3 Each Participating Fund agrees that shares of the Participating Fund
will be sold only to (a) Participating Companies and their separate
accounts and to persons or plans (collectively, Qualified Persons")
that represent and warrant to the Participating Fund that they qualify
to purchase shares of the Participating Fund under Section 817 (h) of
the Code, and the regulations thereunder without impairing the ability
of the Separate Account to consider the portfolio investments of the
Participating Fund as constituting investments of the Separate Account
for the purpose of satisfying the diversification requirements of
Section 817(h). Except as otherwise set forth in this Section 3.3, no
shares of any Participating Fund will be sold to the general public.
The Participating Fund shall not sell Participating Fund shares to any
insurance company or separate account unless an agreement
substantially complying with Articles V, VI, VII and Sections 2.1,
2.3, 2.8, 3.6 and 9.1 of this Agreement is in effect to govern such
sales, to the extent required. Insurance Company hereby represents and
warrants that it and the Account are Qualified Persons.
3.4 Each Participating Fund shall redeem for cash, at the Insurance
Company's request, any full or fractional shares held by the Insurance
Company on behalf of the Separate Account, such redemptions to be
effected on a daily basis at net asset value in accordance with
Section 3.8 of this Agreement. Notwithstanding the foregoing, the
Participating Fund may delay redemption of Participating Fund shares
to the extent permitted by the Act, and any rules, regulations or
orders thereunder.
3.5 Each Participating Fund shall make the nest asset value per share
available to the Insurance Company on a daily basis as soon as
reasonably practicable after the net asset value per share is
calculated in a manner required or permitted by applicable law, but
shall use its best efforts to provide closing net asset value,
dividend and capital gain information on a per-share basis to
Insurance Company by 6:00 p.m. Eastern time on each Business Day. In
the event the Participating Fund is unable to meet the 6:00 pm time
stated herein, the Participating Fund shall, on the next business day,
provide additional time under Sections 3.7 and 3.8 below for the
Insurance Company to place orders for the purchase and redemption of
shares equal to the time it takes the Fund to make the net asset
values available to the Insurance Company. If the Insurance Company
places its purchase or redemption order within the time afforded by
any such extension, the Insurance Company on behalf of the Separate
Account, shall be entitled to the share net asset value computed as of
the close of the prior Business Day (the "effective trade date," as
that term is used in Section 3.8 below) regardless of whether the
Participating Fund is able to process those orders within its regular
daily processing cycle for such prior Business Day. Any material
errors in the calculation of net asset value, dividend and capital
gain information shall be reported to Insurance Company immediately
upon discovery.
3.6 (a) The Adviser shall reimburse a Participating Fund (and/or the
Insurance Company as necessary or appropriate to make the Insurance
Company, its Separate Accounts, and/or contractholders or
participants, as the case may be, whole) for any net loss resulting
from the Participating Fund's or its agents' material miscalculation
and/or materially incorrect reporting of a net asset value. Should a
material miscalculation or materially incorrect report by the
Participating Fund or its agents result in a net gain to
contractholders or participants, the Insurance Company will consult
with the Participating Fund or its designee as to what, if any,
reasonable efforts shall be made to recover the net gain for the
appropriate series of the Participating Fund. Should a material
miscalculation or materially incorrect report by the Participating
Fund or its agents result in a net gain to the Insurance Company or a
Separate
6
7
Account (taking into account any monies paid to contractholders or
participants owners), the Participating Fund, on behalf of the
appropriate series of the Participating Fund, shall be entitled to
debit an appropriate number of full or fractional shares from the
account of the Insurance Company or the Separate Account (as
appropriate) equal to the amount of such net gain.
(b) Each Participating Fund, the Adviser, and the Insurance Company
each agrees to use its best efforts to negotiate an appropriate
standard of materiality to be applied to any miscalculation or
incorrect reporting of a Participating Fund's net asset value. The
Participating Fund, the Adviser, and the Insurance Company each agree
to promptly notify the others upon discovery of a potentially material
miscalculation or incorrect report. In the event the Participating
Fund, the Adviser, and the Insurance Company cannot agree on a
negotiated standard of materiality, then the following standard of
materiality shall apply:
(i) If the amount of the error is less than $.01 per share, it
is considered immaterial and no adjustments need be made.
(ii) If the amount of the error is $.01 per share or more, then
the following shall apply:
(1) If the amount of the difference in the erroneous net
asset value as reported and the correct net asset value
is less than .5% of the correct net asset value, the
Adviser shall reimburse the affected series of the
Participating Fund to the extent of any loss resulting
from the error (taking into account any gains resulting
from the error). No other adjustments shall be made.
(2) If the amount of the difference in the erroneous net
asset value as reported and the correct net asset value
is .5% of the correct net asset value or greater, then
Adviser will determine the impact of the error to the
affected series of the Participating Fund and shall
reimburse such portfolio (and/or Insurance Company, as
appropriate, such as in the event that the error was not
discovered until after the Insurance Company processed
transactions using the erroneous net asset value) to the
extent of any loss resulting from the error (taking into
account any gains resulting from the error). To the
extent that an overstatement of net asset value per
share is detected quickly and the Insurance Company has
not mailed redemption checks to contractholders or
participants, the Insurance Company, the Participating
Fund and the Adviser shall examine the extent of the
error to determine the feasibility of reprocessing such
redemption transaction (for purposes of reimbursing the
Participating Fund to the extent of any such
overpayment).
3.7 At the end of each Business Day, Insurance Company will use the
information described in Sections 3.2 and 3.5 to calculate the unit
values of the Separate Account for the day. Using this unit value,
Insurance Company will process the day's Separate Account transactions
received by it by the close of regular trading on the floor of the New
York Stock Exchange (currently
7
8
4:00 p.m. Eastern time) to determine the net dollar amount of each
Participating Fund's shares that will be purchased or redeemed at that
day's closing net asset value per share. The net purchase or
redemption orders will be transmitted to each Participating 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 3.8 and 3.9, all purchase and redemption orders for Insurance
Company's General Accounts shall be effected at the net asset value
per share of each Participating Fund next calculated after receipt of
the order by the Participating Fund or its Transfer Agent.
3.8 Each Participating Fund appoints Insurance Company as its agent for
the limited purpose of accepting orders for the purchase and
redemption of Participating Fund shares on behalf of the Separate
Account (but not with respect to any shares that may be held in the
Insurance Company's General Account). Each Participating Fund will
execute orders 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 Participating 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 Participating Fund shares, the
conditions specified in Section 3.9, as applicable, are satisfied. A
redemption or purchase request that does not satisfy the conditions
specified above and in Section 3.9, as applicable, will be effected at
the net asset value per share computed on the Business Day immediately
preceding the next following Business Day upon which such conditions
have been satisfied in accordance with the requirements of this
Section and Section 3.9. Insurance Company represents and warrants
that all orders submitted by the Insurance Company for execution on
the effective trade date shall be solely for the purpose of, and in an
amount reasonably necessary to adjust its ownership of, a
Participating Fund's shares to properly support the portion of its
Contract liabilities and obligations that are attributable to that
Participating Fund and that such adjustments will be made solely to
reflect one or more of the following: (a) bona fide specific or
standing orders or instructions received from Contractholders or
Participants prior to the close of trading on the New York Stock
Exchange on the effective trade date (the "effective time"), (b) the
deduction of charges as of said effective time under the terms of the
Contracts from amounts allocated to that Participating Fund, (c)
payment of annuity benefits or death benefits based on that
Participating Fund's net asset value as of said effective time.
3.9 In the event of net purchases of a Participating Fund's shares,
Insurance Company will pay for such purchases by wiring Federal Funds
to the Participating Fund or its designated custodial account on the
day the order is transmitted. Insurance Company shall make all
reasonable efforts to transmit to the applicable Participating Fund
payment in Federal Funds by 12:00pm Eastern time on the Business Day
the Participating Fund receives the notice of the order pursuant to
Sections 3.7 and 3.8. Each applicable Participating 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 the
Participating Fund receives payment in Federal Funds by 12:00 midnight
Eastern time on the Business Day the Participating Fund receives the
notice of the order pursuant to Section 3.x. If payment if Federal
Funds for any purchase is not received or is received by a
Participating Fund after 12:00 noon Eastern time on such Business Day,
8
9
Insurance Company shall promptly, upon each applicable Participating
Fund's request, reimburse the respective Participating Fund for any
costs or interest incurred by the Participating Fund in connection
with any advances to, or borrowings or overdrafts by, the
Participating Fund as a result of portfolio transactions effected by
the Participating Fund based upon such purchase request. If Insurance
Company's order requests the redemption of any Participating Fund's
shares valued at or greater than $1 million dollars, the Participating
Fund will wire such amount to Insurance Company within seven days of
the order.
3.10 In the event of net redemptions, the Participating Fund shall pay the
Insurance Company for shares of each series of the Participating Fund
redeemed by 2:00 p.m. Eastern time on the next Business Day after it
receives the redemption request from the Insurance Company pursuant to
Sections 3.7 and 3.8 above. Payment of redemption proceeds shall be
made in federal funds transmitted by wire to an account designated by
the Insurance Company. The Fund reserves the right to delay payment of
redemption proceeds to the extent permitted under Section 22(e) of the
Act and any rules thereunder, and in accordance with the procedures
and policies of the Participating Fund as described in the then
current prospectus.
3.11 Each Participating Fund has the obligation to ensure that its shares
are registered with applicable federal agencies at all times.
3.12 Each Participating Fund will confirm each purchase or redemption order
made by Insurance Company. Issuance and transfer of Participating Fund
shares will be by book entry only. No share certificates will be
issued to Insurance Company. Insurance Company will record shares
ordered from a Participating Fund in an appropriate ledger for the
corresponding account.
3.13 Each Participating Fund shall credit Insurance Company with the
appropriate number of shares.
3.14 On each ex-dividend date of a Participating Fund or, if not a Business
Day, on the first Business Day thereafter, each Participating Fund
shall communicate by wire or telephone followed by written
confirmation to Insurance Company the amount of dividend and capital
gain, if any, per share. The Insurance Company hereby elects to
receive all such dividends and distributions as are payable on any
shares in the form of additional shares. The Insurance Company
reserves the right, on its behalf and on behalf of the Separate
Account, to revoke this election at any time and to receive all
dividends and capital gains distributions in cash.. Each Participating
Fund shall, on the day after the ex-dividend 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 Each Participating 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.
9
10
Each Participating Fund shall distribute to Insurance Company printed
copies of the Participating Fund's Prospectuses, proxy materials,
notices, periodic reports and other printed materials (which the
Participating Fund customarily provides to its shareholders) in
quantities as Insurance Company may reasonably request for
distribution to each Contractholder and Participant. Insurance Company
may elect to print the Participating Fund's prospectus and/or its
statement of additional information in combination with other fund
companies' prospectuses and statements of additional information,
which are also offered in Insurance Company's insurance product at
their own cost. If requested by Insurance Company, the Participating
Fund shall provide such documents (including a "camera-ready" copy of
such documents as set in type, a diskette in the form sent to the
financial printer, or an electronic copy of the documents in a format
suitable for posting on the Company's website, all as Insurance
Company may reasonably request) and such other assistance as is
reasonably necessary in order for Insurance Company to have
prospectuses, Statements of Additional Information, supplements, proxy
statements, and annual / semi-annual reports for the Contracts and the
Funds printed together in a single document or posted on Insurance
Company's website.
4.2 Each Participating 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 Participating Fund
or its shares, contemporaneously with the filing of such document with
the Commission or other regulatory authorities.
4.3 Insurance Company will provide to each Participating 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.
4.4 Insurance Company will provide Participating Funds on a semi-annual
basis, or more frequently as reasonably requested by the Participating
Funds, with a current tabulation of the number of existing
Contractholders of Insurance Company whose Contract values are
invested in the Participating Funds. This tabulation will be sent to
Participating Funds in the form of a letter signed by a duly
authorized officer of the Insurance Company attesting to the accuracy
of the information contained in the letter.
ARTICLE V
EXPENSES
5.1 All expenses and costs of each Participating Fund, including but not
limited to management fees, administrative expenses and legal and
regulatory costs, will be included in the determination of the
Participating Fund's daily net asset value per share.
5.2 Expenses associated with the preparation, filing and distribution of
registration statements, prospectuses, supplements, annual and
semi-annual reports, proxy statements and voting
10
11
instructions and specified sales material and other material listed in
Schedule B shall be paid for in accordance with the cost allocations
set forth in Schedule B.
5.3 A Participating Fund's principal underwriter may pay Insurance
Company, or the broker-dealer acting as principal underwriter for the
Insurance Company's Contracts, for distribution and other services
related to the Shares of the Participating Fund pursuant to any
distribution plan adopted by the Participating Fund in accordance with
Rule 12b-1 under the Act, subject to the terms and conditions of an
agreement between the Participating Fund's principal underwriter for
the Insurance Company's Contracts, as applicable, related to such
plan.
5.4 Except as otherwise expressly provided in this Agreement, each party
agrees to bear all expenses incident to performance by the party under
this Agreement.
ARTICLE VI
EXEMPTIVE RELIEF
6.1 Insurance Company has reviewed a copy of (i) the amended order dated
December 31, 1997 of the Securities and Exchange Commission under
Section 6(c) of the Act with respect to Dreyfus Variable Investment
Fund and Dreyfus Life and Annuity Index Fund, Inc.; and (ii) the order
dated February 5, 1998 of the Securities and Exchange Commission under
Section 6(c) of the Act with respect to The Dreyfus Socially
Responsible Growth Fund, Inc. and Dreyfus Investment Portfolios, and,
in particular, has reviewed the conditions to the relief set forth in
each related notice of application published by the Commission. As set
forth therein, if Dreyfus Variable Investment Fund, Dreyfus Life and
Annuity Index Fund, Inc., The Dreyfus Socially Responsible Growth
Fund, Inc. or Dreyfus Investment Portfolios is a Participating Fund,
Insurance Company agrees, as applicable, to report any potential or
existing conflicts promptly to the respective Board of Dreyfus
Investment Portfolios, and, in particular, whenever contract voting
instructions are disregarded, and recognizes that it will be
responsible for assisting each applicable 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 variable life and annuity contract owners and participants.
6.2 Each Participating Fund's Board will monitor the Participating Fund
for the existence of any material irreconcilable conflict between the
interests of the variable life and annuity contract owners and
participants of all separate accounts investing in the Fund and all
other persons investing in the Participating Fund. A material
irreconcilable conflict may arise for a variety of reasons, including:
(a) an action by any state insurance regulatory authority; (b) a
change in applicable federal or state insurance, tax, or securities
laws or regulations, or a public ruling, private letter ruling,
no-action or interpretative letter, or any similar action by
insurance, tax, or securities regulatory authorities; (c) an
administrative or judicial decision in any relevant proceeding; (d)
the manner in which the investments of any Participating Fund are
being managed; (e) a difference in voting instructions given by
variable annuity contract and variable life insurance contract owners;
(f) a decision by an insurer to disregard the voting instructions
11
12
of contract owners; or (g) if applicable, a decision by a qualified
pension or retirement plan to disregard the voting instructions of its
participants. The Participant Fund shall promptly inform Insurance
Company if its Board determines that a material irreconcilable
conflict exists and the implications thereof.
6.3 If a majority of the Board, or a majority of Disinterested Board
Members, determines that a material irreconcilable conflict exists
with regard to contract owner or participant investments in a
Participating Fund, the Board shall give prompt notice to all
Participating Companies and any other Participating Fund. 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 material irreconcilable conflict.
Such necessary action may include, but shall not be limited to:
a. Withdrawing the assets allocable to the Separate Account
from the Participating Fund and reinvesting such assets
in another Participating Fund (if applicable) or a
different investment medium, or submitting the question
of whether such segregation should be implemented to a
vote of all affected Contract owners and participants
and, as appropriate, segregating the assets of any
appropriate group (e.g., annuity contract owners, life
insurance contract owners, or variable contract owners
of one or more Participating Insurance Companies) that
votes in favor of such segregation, or offering to the
effected contract owners the option of making such a
change;; and/or
b. Establishing a new registered management investment
company or managed separate account.
6.4 If a material irreconcilable conflict arises as a result of a decision
by Insurance Company to disregard Contractholder or Participant voting
instructions and said decision represents a minority position or would
preclude a majority vote by all Contract owners and participants
having an interest in a Participating Fund, Insurance Company may be
required, at the Board's election, to withdraw the investments of the
Separate Account in that Participating Fund and terminate this
Agreement with respect to the Account (at the Company's expense),
provided however that such withdrawal and termination shall be limited
to the extent required by the foregoing material irreconcilable
conflict as determined by a majority of the disinterested members of
the Board. Any such withdrawal and termination must take place within
six (6) months after the Participating Fund gives written notice that
this provision is being implemented, and until the end of that six (6)
month period the Participating Fund shall continue to accept and
implement orders by the Company for the purchase (and redemption) of
shares of the Participating Fund. No charge or penalty will be imposed
as a result of such withdrawal. The responsibility to take such
remedial action shall be carried out with a view only to the interest
of the Contractholders and Participants.
6.5 If a material irreconcilable conflict arises because a particular
state insurance regulator's decision applicable to the Insurance
Company conflicts with the majority of other state regulators, then
the Insurance Company will withdraw the affected Separate Account's
12
13
investment in the Participating Fund and terminate this Agreement with
respect to such Fund (at the Company's expense) within six (6) months
after the Board informs the Insurance Company in writing that it has
determined that such decision has created a material irreconcilable
conflict; provided, however, that such withdrawal and termination
shall be limited to the extent required by the foregoing material
irreconcilable conflict as determined by a majority of the
disinterested members of the Board. Until the end of the foregoing six
(6) month period, the Participating Fund shall continue to accept and
implement orders by the Insurance Company for the purchase (and
redemption) of shares of the Fund. The responsibility to take such
action shall be carried out with a view only to the interest of the
Contractholders and Participants.
6.6 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
any Participating 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 contract owners or participants materially adversely affected
by the irreconcilable material conflict In the event that the Board
determines that any proposed action does not adequately remedy any
material irreconcilable conflict, then the Company will withdraw the
Account's investment in the Fund and terminate this Agreement within
six (6) months after the Board informs the Company in writing of the
foregoing determination; provided, however, that such withdrawal and
termination shall be limited to the extent required by any such
material irreconcilable conflict as determined by a majority of the
disinterested members of the Board.
6.7 If and to the extent any Mixed and Shared Funding Order or any
amendment thereto contains terms and conditions different from Article
VI of this Agreement, then the Fund and/or the Participating Insurance
Companies, as appropriate, shall take such steps as may be necessary
to comply with the Mixed and Shared Funding Exemptive Order, and this
Article VI shall be deemed to incorporate such new terms and
conditions, and any term or condition of this Article VI that is
inconsistent therewith shall be deemed to be succeeded thereby. If and
to the extent that Rule 6e-2 and Rule 6e-3(T) are amended, or Rule
6e-3 under the Act is adopted, to provide exemptive relief from any
provision of the Act or the rules promulgated thereunder with respect
to mixed or shared funding (as defined in the Mixed and Shared Funding
Exemptive Order) on terms and conditions materially different from
those contained in the Mixed and Shared Funding Exemptive Order, then
(a) the Fund and/or the Participating Insurance Companies as
appropriate, shall take such steps as may be necessary to comply with
Rules 6e-2 and 6e-3(T), as amended, and Rule 6e-3, as adopted, to the
extent such rules are applicable; and (b) this Article VI shall be
deemed to incorporate such new terms and conditions, and any term or
condition of this Article VI that is inconsistent therewith, shall be
deemed to be succeded thereby.
ARTICLE VII
13
14
VOTING OF PARTICIPATING FUND SHARES
7.1 Each Participating Fund shall, in accordance with Section 4.1 of this
Agreement, provide Insurance Company with copies, at no cost to
Insurance Company, of the Participating Fund's proxy material, reports
to shareholders and other communications to shareholders in such
quantity as Insurance Company shall reasonably require for
distributing to Contractholders or Participants.
If and to the extent required by law or any applicable order
referenced to in Section 6.1 above, Insurance Company shall:
(a) solicit voting instructions from Contractholders or
Participants on a timely basis and in accordance with
applicable law;
(b) vote the Participating Fund shares attributable to
Contractholders or Participants in accordance with
instructions received from them, or if no instructions
have been received, in the same proportion as
Participating Fund shares in the same Separate Account
for which instructions have been received; and
(c) vote Participating Fund shares in the Insurance Company
General Account in the same proportion as voting
instructions are received for such shares in all of
Insurance Company's Separate Accounts.
7.2 The Fund will comply with all provisions of the Act requiring voting
by shareholders, and in particular, the Fund will either provide for
annual meetings or comply with Section 16(c) of the Act (although the
Fund is not one of the trusts described in Section 16(c) of that Act)
as well as with Section 16(a) and if and when applicable Section
16(b). Further, the Fund will act in accordance with the Commission's
interpretation of the requirements of Section 16(a) with respect to
periodic elections of trustees and with whatever rules the Commission
may promulgate with respect thereto.
ARTICLE VIII
MARKETING AND REPRESENTATIONS
8.1 Each Participating Fund or their Distributor shall periodically
furnish Insurance Company with the following documents, in quantities
as Insurance Company may reasonably request:
(a) Current Prospectus and any supplements thereto; and
(b) Other marketing materials.
14
15
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 that
shall have the requisite licenses to solicit applications for the sale
of Contracts. No representation is made as to the number or amount of
Contracts that are to be sold by Insurance Company. Insurance Company
shall comply with all applicable federal and state laws in connection
with the marketing of the Contracts.
8.3 Insurance Company shall furnish, or shall cause to be furnished, to
each applicable Participating Fund or its designee, each piece of
sales literature or other promotional material in which the
Participating Fund or the Adviser or Distributor is named, at least
fifteen Business Days prior to its use. No such material shall be used
unless the Participating Fund or its designee 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. Each applicable Participating Fund or its designee, as the
case may be, shall use all reasonable efforts to respond within ten
days of receipt. The Participating Fund or its designee reserves the
right to reasonably object to the continued use of any such sales
literature or other promotional material in which the Participating
Fund or the Adviser is named and no such material shall be used if the
Participating Fund or its designee so objects.
8.4 Insurance Company shall not give any information or make any
representations or statements on behalf of a Participating Fund or
concerning a Participating Fund in connection with the sale of the
Contracts other than the information or representations contained in
the registration statement or Prospectus of, or in reports or proxy
statements for, the applicable Participating Fund, or in sales
literature or other promotional material approved under Section 8.3 of
this Agreement.
8.5 Each Participating Fund, the Adviser, the Distributor or their
respective designees shall furnish, or shall cause to be furnished, to
Insurance Company, each piece of the Participating Fund's sales
literature or other promotional material in which Insurance Company,
the Separate Account or any Contract is named, at least fifteen
Business Days prior to its use. No such material shall be used unless
Insurance Company approves such material. A 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. The Insurance Company reserves the right to reasonably object
to the continued use of any such sales literature or other promotional
material in which the Insurance Company is named and no such material
shall be used if the Insurance Company or its designee so objects.
8.6 Each Participating Fund, the Adviser, and the Distributor shall not,
in connection with the sale of Participating Fund 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, or in
published reports for the Separate Account that are in the public
domain or approved by Insurance Company for distribution to
Contractholders or Participants, or in
15
16
sales literature or other promotional material approved under Section
8.5 of this Agreement. The fund and the Adviser and Distributor shall
comply with all applicable federal and state laws in connection with
any efforts they make, directly or indirectly, to promote sales of the
Fund's shares.
8.7 For purposes of this Agreement, the phrase "sales literature or other
promotional material" includes, 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.
8.8 The Participating Fund will provide the Insurance Company with as much
notice as is reasonably practicable of any proxy solicitation, and of
any material change in the Fund's registration statement, particularly
any change that could result in a change to the registration statement
or Prospectus for any Separate Account or Contract. The Participating
Fund will work with the Company so as to enable the Insurance Company
to solicit proxies from Contract owners, or to make changes to its
Prospectus or registration statement, in an orderly manner. The
Participating Fund will make reasonable efforts to attempt to have
changes affecting Contract Prospectuses become effective
simultaneously with the annual updates for such prospectuses.
ARTICLE IX
INDEMNIFICATION
9.1 Insurance Company agrees to indemnify and hold harmless each
Participating Fund, the Adviser, the Distributor and their respective
affiliates, and each of their directors, trustees, officers,
employees, agents and each person, if any, who controls any of the
foregoing entities or persons within the meaning of Section 15 of the
1933 Act (collectively, the "Indemnified Parties" for purposes of
Section 9.1 of this Agreement), against any and all losses, claims,
damages or liabilities investigations or litigation (including any
amounts reasonably paid by the Participating Fund, the Adviser or the
Distributor as necessary to make Contractholders and Participants
whole, and reasonable, legal and other expenses reasonably incurred in
connection with any amounts paid in settlement of, any action, suit,
proceeding or asserted claim) to which the Indemnified Parties may
become subject, under the 1933 Act or otherwise (collectively, a
"Loss"), insofar as such Loss is related to the sale or acquisition of
the Contracts, the purchase or redemption of Participating Fund shares
in connection with the Contracts, or the actions or operations of the
Insurance Company or the Separate Account in connection with the
performance of this Agreement, and:
16
17
(i) arises out of or is based upon any untrue statement or
alleged untrue statement of any material fact contained
in the registration statement, Prospectus, sales
literature or other promotional material with respect to
the Contracts or the Separate Account;
(ii) arises out of or is based upon any omission or alleged
omission to state therein a material fact required to be
stated therein or necessary to make the statements
therein not misleading;
(iii) arises out of or is based upon any untrue statement or
alleged untrue statement of any material fact contained
in information furnished in writing by Insurance Company
for use in the registration statement, Prospectus or
sales literature or other promotional material of the
Participating Fund or arises out of or is based upon the
omission or the alleged omission to state in such
information a material fact required to be stated
therein or necessary to make the statements therein, in
the context in which they are published in such
documents, not misleading;
(iv) arises out of or as a result of wrongful conduct,
statements or representations (other than statements or
representations referred to in clauses (i), (ii) or
(iii) of this Section 9.1) of Insurance Company or its
agents, with respect to the sale and distribution of
Contracts for which the respective Participating Fund's
shares are an underlying investment;
(v) arises out of or results from any material breach by
Insurance Company of a representation or warranty made
by the Insurance Company in this Agreement;
(vi) 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 the respective
Participating Fund's Shares;
(vii) arise out of Insurance Company's incorrect calculation
and/or untimely reporting of net purchase or redemption
orders; or
(viii) arises out of or results from any other material breach
of this Agreement, by Insurance Company.
Insurance Company will reimburse any Indemnified Party in connection
with investigating or defending any such Loss; provided, however, that
notwithstanding anything else in this Section 9.1, Insurance Company
will not be liable under this Section 9.1 to the extent that any Loss
arises out of or is based upon any untrue statement or omission or
alleged untrue statement or omission made in conformity with written
information furnished to Insurance Company by the Participating Fund,
the Adviser, Dreyfus or the Distributor for use in one or more of the
documents referred to in clause (i) of this Section 9.1 or approved
under Section 8.3 of this Agreement..
9.2 Each Participating Fund severally agrees to indemnify and hold
harmless Insurance Company and each of its directors, officers,
employees, agents and each person, if any, who controls Insurance
Company within the meaning of Section 15 of the 1933 Act
(collectively, the Indemnified Parties for purposes of Section 9.2 of
this Agreement) against any losses, claims, damages, liabilities,
investigations or litigations (including any amounts reasonably paid
by Insurance Company as necessary to make Contractholders and
Participants whole, and reasonable legal and other expenses reasonably
incurred in connection with, and any amounts
17
18
paid in settlement of, any action, suit, proceeding or asserted claim
to which the Indemnified Parties become subject, under the 1933 Act or
otherwise (collectively a "Loss"), insofar as such Loss is related to
the sale or acquisition of the Contracts, the purchase or redemption
of Participating Fund shares in connection with the Contracts, or the
actions or operations of the Participating Fund in connection with the
performance of this Agreement, and:
(i) arises out of or is based upon any untrue statement or
alleged untrue statement of any material fact contained in
the registration statement, Prospectus, sales literature
or other promotional material of the Participating Fund;
(ii) arises out of or is based upon the omission or alleged
omission to state in the registration statement,
Prospectus, sales literature or other promotional material
of the Participating Fund any material fact required to be
stated therein or necessary to make the statements therein
not misleading;
(iii) arises out of or is based upon any untrue statement or
alleged untrue statement of any material fact contained in
information furnished in writing by the Participating Fund
for use in the registration statement, Prospectus, sales
literature orother promotional material with respect to
the Separate Account or the Contracts or arises out of or
is based upon the omission or the alleged omission to
state in such information a material fact required to be
stated therein or necessary to make the statements
therein, in the context in which they are published in
such documents, not misleading;
(iv) arises out of or results from any material breach by the
Participating Fund of a representation or warranty made
by the Participating Fund in this Agreement; or
(v) arises out of or results from any other material breach
of this Agreement by the Participating Fund.
The Participating Fund will reimburse any legal or other expenses
reasonably incurred by any Indemnified Party in connection with
investigating or defending any such Loss; provided, however, that,
notwithstanding anything else in this Section 9.2, the Participating
Fund will not be liable under this Section 9.2 to the extent that any
such Loss arises out of or is based upon any untrue statement or
omission or alleged untrue statement or omission made in conformity
with written information furnished to the Participating Fund, the
Adviser, Dreyfus or the Distributor by Insurance Company for use in
one or more of the documents referred to in clause (i) of this Section
9.2.
9.3 The Adviser agrees to indemnify and hold harmless the Insurance
Company and each of its directors, officers, employees, agents, and
each person, if any, who controls the Insurance Company within the
meaning of Section 15 of the 1933 Act (collectively, the "Indemnified
Parties" for purposes of this Section 9.3) against any losses, claims,
damages, liabilities, investigations, or litigations (including any
amounts reasonably paid by Insurance Company as necessary to make
Contractholders and Participants whole, and reasonable legal and other
expenses reasonably incurred in connection with, and any amounts paid
in settlement of, any action, suit, proceeding or asserted claim) to
which the Indemnified Parties become subject, under the 1933 Act or
otherwise (collectively a "Loss"), insofar as such Loss is related to
the sale or acquisition of the Contracts, the purchase or redemption
of Participating Fund shares in
18
19
connection with the Contracts, or the actions or operations of a
Participating Fund in connection with the performance of this
Agreement, and:
(i) arises out of or is based upon any untrue statement or
alleged untrue statement of any material fact contained
in the registration statement, Prospectus, sales
literature or advertisement of a Participating fund;
(ii) arises out of or is based upon the omission or alleged
omission to state in the registration statement,
Prospectus, sales literature or advertisements of the
Participating Fund any material fact required to be
stated therein or necessary to make the statements
therein not misleading;
(iii) arises out of or is based upon any untrue statement or
alleged untrue statement of any material fact contained
in information furnished in writing by the Adviser
(whether on behalf of the Participating Fund or
otherwise) for use in the registration statement,
Prospectus, sales literature or advertisements with
respect to the Separate Account or the Contracts or
arises out of or is based upon the omission or the
alleged omission to state in such information a material
fact required to be stated therein or necessary to make
the statements made therein, in the context in which
they are published in such documents, not misleading;
(iv) arises out of or results from any material breach by the
Adviser of a representation or warranty made by the
Adviser in this Agreement; or
(v) arises out of or results from any other material breach
of this Agreement by the Adviser.
The Adviser will reimburse any legal or other expenses reasonably
incurred by any Indemnified Party in connection with investigating or
defending any such Loss; provided, however, that, notwithstanding
anything else in this Section 9.3, the Adviser will not be liable
under this Section 9.3 to the extent that any such Loss arises out of
or is based upon any untrue statement or omission or alleged untrue
statement or omission made in conformity with written information
furnished to a Participating Fund, the Adviser, the Distributor or
Dreyfus by the Insurance Company for use in one or more of the
documents referred to in clause (i) of this Section 9.3.
9.4 The Distributor agrees to indemnify and hold harmless the Insurance
Company and each of its directors, officers, employees, agents, and
each person, if any, who controls the Insurance Company within the
meaning of Section 15 of the 1933 Act (collectively, the "Indemnified
Parties" for purposes of this Section 9.4) against any losses, claims,
damages, liabilities, investigations, or litigations (including any
amounts reasonably paid by Insurance Company as necessary to make
Contractholders and Participants whole, and reasonable legal and other
expenses reasonably incurred in connection with, and any amounts paid
in settlement of, any action, suit, proceeding or asserted claim) to
which the Indemnified Parties become subject, under the 1933 Act or
otherwise (collectively a "Loss"), insofar as such Loss is related to
the sale or acquisition of the Contracts, the purchase or redemption
of Participating Fund shares in connection with the Contracts, or the
actions or operations of a Participating Fund in connection with the
performance of this Agreement, and:
19
20
(i) arises out of or is based upon any untrue statement or
alleged untrue statement of any material fact contained
in information furnished in writing by the Distributor
(whether on behalf of the Participating Fund or
otherwise) for use in the registration statement,
Prospectus, sales literature or advertisements with
respect to the Separate Account or the Contracts or
arises out of or is based upon the omission or the
alleged omission to state in such information a material
fact required to be stated therein or necessary to make
the statements made therein, in the context in which
they are published in such documents, not misleading;
(ii) arises out of or results from any material breach by the
Distributor of a representation or warranty made by the
Distributor in this Agreement; or
(iii) arises out of or results from any other material breach
of this Agreement by the Distributor.
The Distributor will reimburse any legal or other expenses reasonably
incurred by any Indemnified Party in connection with investigating or
defending any such Loss; provided, however, that, notwithstanding
anything else in this Section 9.4, the Distributor will not be liable
under this Section 9.4 to the extent that any such Loss arises out of
or is based upon any untrue statement or omission or alleged untrue
statement or omission made in conformity with written information
furnished to a Participating Fund, the Adviser, the Distributor or
Dreyfus by the Insurance Company for use in one or more of the
documents referred to in clause (i) of this Section 9.4.
9.5 Promptly after receipt by an indemnified party under this Article of
notice of the commencement of any investigation, litigation or
proceedings against the indemnified party or its officers or directors
in connection with this Agreement, the issuance or sale of the Fund
shares, the Contracts or the operation of the Separate Account, or
acquisition of Fund shares, , such indemnified party willnotify 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 andassume 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.
20
21
A successor by law of the parties to this Agreement shall be entitled
to the benefits of the indemnification contained in this Article IX.
The provisions of this Article IX shall survive termination of this
Agreement.
21
22
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 provided for by any
of the following:
a. As to any Participating Fund, at the option of any party to
this Agreement, at any time upon 180 days' notice to the other
parties to this Agreement, unless a shorter time is agreed to
by all of the parties.
b. As to any Participating Fund, at the option of Insurance
Company, if shares of that Participating Fund 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 upon receipt of such notice by all
other parties to this Agreement.
c. As to a Participating Fund, at the option of any party to this
Agreement, upon the institution of formal proceedings against
any other party to this Agreement by the Commission, National
Association of Securities Dealers, Inc. or any other regulatory
body, the expected or anticipated ruling, judgment or outcome
of which would, in the terminating party's reasonable judgment,
materially impair that other party's ability to meet and
perform its obligations and duties hereunder. Prompt notice of
election to terminate shall be furnished by the terminating
party to all other parties, with said termination to be
effective upon receipt of notice by all such parties.
d. As to a Participating Fund, at the option of any party to this
Agreement, if that party shall determine, in its sole judgment
reasonably exercised in good faith, that any other party to
this Agreement (or any affiliate of such party) 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 terminating party, such terminating party
shall notify each other party in writing of such determination
and its intent to terminate this Agreement, and, if, after
considering the actions taken by the entity suffering the
adverse change or adverse publicity and any other changes in
circumstances since the giving of such notice, such
determination of the terminating party shall continue to apply
on the sixtieth (60th) day after such notice has been received
by all other parties, such, sixtieth day shall be the effective
date of termination.
e. As to a Participating Fund, upon termination of the Investment
Advisory Agreement between that Participating Fund and Dreyfus
or its successors unless each other party to this Agreement
specifically approves the selection of a new Participating Fund
investment adviser. The terminating party shall give notice of
such termination to all
22
23
other parties, and the termination shall be effective as of a
date specified in the notice, which shall be not more than 180
days after such notice has been received by all such other
parties. Such Participating Fund shall promptly furnish notice
of termination of the Adviser to each other party to this
Agreement.
f. As to a Participating Fund, at the option of any other party to
this Agreement, in the event that (i) Participating Fund ceases
to qualify as a regulated investment company under subchapter M
or any successor provision or fails to comply with the Section
817(h) diversification requirements specified in Sections 2.9
and 2.10 hereof, or if such other party reasonably believes
that the Participating Fund may fail to so qualify or comply;
or (ii) the Participating 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. The terminating party shall deliver notice
to all other parties to this Agreement. The notice shall
specify the effective date of the termination, which shall in
no event be earlier than when all of such notices have been
received.
g. At the option of a Participating Fund upon a determination by
its Board in good faith and in light of its fiduciary duties
under federal and any applicable state laws to Participating
Fund's shareholders, including Insurance Company and the
Separate Account, that such termination is necessary and in the
best interests of shareholders of that Participating Fund.
Termination pursuant to this Subsection (g) shall be effective
upon a date specified in a notice by such Participating Fund to
Insurance Company of such termination. Such date, however,
shall be no earlier than when such notice has been received by
all other parties.
h. At the option of a Participating Fund if the Contracts cease to
qualify as annuity contracts, endowments or life insurance
policies, as applicable, under the Code, or if such
Participating Fund reasonably believes that the Contracts may
fail to so qualify. The terminating party shall deliver notice
to all other parties to this Agreement. The notice shall
specify the effective date of the termination, which shall in
no event be earlier than when all of such notices have been
received.
i. At the option of any party to this Agreement, upon another
party's breach of any material provision of this Agreement. The
terminating party shall deliver notice of such breach to all
other parties to this Agreement. The termination shall be
effective thirty days after the notice has been received by all
such parties, but only if the breaching party shall not have
cured the breach, in all material respects, by the end of that
30-day period.
j. At the option of a Participating Fund, if the Contracts are not
registered, issued or sold in accordance with applicable
federal and/or state law.
k. At the option of the Insurance Company, upon any substitution
of the shares of another investment company or series thereof
for shares of the Fund in accordance with the
23
24
terms of the Contracts, provided that the Insurance Company has
given at least 45 days prior written notice to the Fund and the
Adviser of the date of substitution.
l. Termination by mutual written agreement of the parties to this
Agreement.
10.3 Notwithstanding any termination of this Agreement pursuant to Section
10.2 hereof, each Participating Fund and the Adviser shall, at the
option of the Insurance Company, continue to make available additional
shares of that Participating Fund 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, the owners of the Existing Contracts or Insurance Company,
whichever shall have legal authority to do so, shall be permitted to
reallocate investments in that Participating Fund, redeem investments
in that Participating Fund and/or invest in that Participating Fund
upon the making of additional purchase payments under the Existing
Contracts. If such Participating Fund shares continue to be made
available after such termination, the provisions of this Agreement
shall remain in effect and thereafter either of that Participating
Fund or Insurance Company may terminate the Agreement as to that
Participating Fund, 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
Participating Fund, need not be for more than six months.
10.4 Termination of this Agreement as to any one Participating Fund shall
not be deemed a termination as to any other Participating Fund.
10.5 The parties hereto agree to cooperate and give reasonable assistance
to one another in taking all necessary and appropriate steps for the
purpose of ensuring that a Separate Account owns no shares of a
Participating Fund after the effective date of this Agreement's
termination with respect to such shares or, if such ownership
following termination cannot be avoided, that the duration thereof is
as brief as reasonably practicable. Such steps may include, for
example, combining the affected Separate Account with another Separate
Account, substituting other fund shares for those of the affected
Participating Fund, or otherwise terminating participation by the
Contracts in such Participating Fund.
ARTICLE XI
AMENDMENTS
11.1 Any other changes in the terms of this Agreement, except for the
addition or deletion of any Participating Fund or Contract or Separate
Account as specified in Schedule A, shall be made by agreement in
writing among all parties to this Agreement.
24
25
ARTICLE XII
NOTICE
12.1 Each notice required by this Agreement shall be given by certified
mail, return receipt requested, or next day delivery to the
appropriate parties at the following addresses, or such other address
as a party may from time to time specify in writing to the other
parties:
Insurance Company: New York Life Insurance and Annuity Corporation
00 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxxxx X. Rock, Senior Vice President
Participating Funds: [Name of Fund]
The Dreyfus Corporation
000 Xxxx Xxxxxx, 0xx Xxxxx Xxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: General Counsel
with copies to: Stroock & Stroock & Xxxxx
000 Xxxxxx Xxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Attn: Xxxxx X. Xxxx, Esq.
Xxxxxx X. Xxxxxxx, Esq.
Investment Adviser: The Dreyfus Corporation
000 Xxxx Xxxxxx, 0xx Xxxxx Xxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: General Counsel
Distributor: Dreyfus Service Corporation
000 Xxxx Xxxxxx, 0xx Xxxxx Xxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: General Counsel
25
26
Notice shall be deemed to be given on the date of receipt by the
addressees as evidenced by the mailing receipt.
ARTICLE XIII
MISCELLANEOUS
13.1 This Agreement has been executed on behalf of each 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
director, trustee, officer or shareholder of the Fund individually. It
is agreed that the obligations of the Funds are several and not joint,
that no Fund shall be liable for any amount owing by another Fund and
that the Funds have executed one instrument for convenience only.
13.2 This Agreement may be executed simultaneously in two or more
counterparts, each of which taken together shall constitute one and
the same instrument.
13.3 If any provision of this Agreement shall be held or made invalid by a
court decision, statute, rule or otherwise, the remainder of the
Agreement shall not be affected thereby.
13.4 Each Party hereto shall cooperate with each other Party and all
appropriate governmental authorities (including without limitation the
Commission, the National Association of Security Dealers, Inc., 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.
13.5 The rights, remedies and obligations contained in this Agreement are
cumulative and are in addition to any and all rights, remedies,
obligations, at law or in equity, which the parties hereto are
entitled under federal and state laws.
13.6 This Agreement or any of the rights and obligations hereunder may not
be assigned by any Party (and any such assignment shall be null and
void) without the prior consent of all Parties hereto.
13.7 The schedules to this Agreement (each, a "Schedule," collectively, the
"Schedules") form an integral part hereof and are incorporated herein
by reference. The Parties may agree in writing to amend the Schedules
from time to time. References herein to any Schedule are to the
Schedule then in effect, taking into account any amendments thereto.
13.8 Lion Remote System.
26
27
The Insurance Company shall be permitted to use the automated system
made available by Dreyfus for the electronic transmission of account
inquiries and/or instructions with respect to transactions in Shares
to the transfer agent or other person or other entity authorized to
receive such account inquiries and/or transaction instructions (such
automated system, including any computer hardware or other hardware,
software or other equipment of any kind owned or furnished by Dreyfus
for use in conjunction therewith) to fulfill its obligations under
Section 3 of this Agreement to transmit orders for the purchase and
redemption of Shares and to otherwise fulfill its obligations under
this Agreement.
ARTICLE XIV
LAW
14.1 This Agreement shall be construed and provisions hereof interpreted
under and in accordance with the internal laws of the State of New
York, without giving effect to principles of conflict of laws.
ARTICLE XV
FOREIGN TAX CREDITS
15.1 Each Participating Fund agrees to consult in advance with Insurance
Company concerning any decision to elect or not to pass through the
benefit of any foreign tax credits to the Participating Fund's
shareholders pursuant to Section 853 of the Code.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement to be duly
executed and attested as of the date first above written.
NEW YORK LIFE INSURANCE AND
ANNUITY COMPANY
By:
Its:
Attest:
---------------------
DREYFUS INVESTMENT PORTFOLIOS
By:
Its:
Attest:
---------------------
27
28
THE DREYFUS CORPORATION
By:
Its:
Attest:
DREYFUS SERVICE CORPORATION
By:
Its:
Attest:
28
29
SCHEDULE A
SEPARATE ACCOUNTS, CONTRACTS AND PORTFOLIOS SUBJECT TO
THE PARTICIPATION AGREEMENT
Separate Accounts and Associated Contracts
NAME OF SEPARATE ACCOUNT AND DATE NAMES OF CONTRACTS FUNDED BY SEPARATE
ESTABLISHED BY BOARD OF DIRECTORS ACCOUNT AND FORM NUMBERS THEREOF
--------------------------------- -------------------------------------
NYLIAC Variable Universal Life Separate Variable Universal Life #793-90
Account-I Survivorship Variable Universal Life #797-150
June 4, 1993 Variable Universal Life 2000 #799-90
Single Premium Variable Universal Life
#301-95
Pinnacle Variable Universal Life # 300-80 and
#300-82
Pinnacle Survivorship Variable Universal Life
#300-81 and 300-83
NYLIAC Corporate Sponsored Variable Universal Corporate Sponsored Variable
Life Separate Account-I Universal Life #796-40
May 24, 1996 Corporate Executive Series Universal Life
#300-40
NYLIAC Variable Annuity Separate Account-I LifeStages Flexible Premium Variable
October 15, 1992 Annuity (The Original) #993-190
NYLIAC Variable Annuity Separate Account-II LifeStages Flexible Premium Variable
October 15, 1992 Annuity (The Original) #993-190
NYLIAC Variable Annuity Separate Account-III LifeStages Variable Annuity #995-190
November 30, 1994 MainStay Plus Variable Annuity #999-190
(Supersedes #998-190)
New LifeStages Flexible Premium Variable
Annuity #000-190
LifeStages Premium Plus Variable Annuity
#200-195
LifeStages Access Variable Annuity #200-090
MainStay Access Variable Annuity #200-090
MainStay Premium Plus Variable Annuity
#200-190
AmSouth Premium Plus Variable Annuity
#200-190
30
(PAGE 2 OF 2)
PORTFOLIOS OFFERED BY THE FUND TO THE COMPANY
DREYFUS IP TECHNOLOGY INITIAL SHARES
2
31
SCHEDULE B
---------------------------------------------------------------------------------------------------
INSURANCE COMPANY PARTICIPATING FUND ("FUND")
---------------------------------------------------------------------------------------------------
Preparing and filing the Separate Account's Preparing and filing the Fund's registration
("Accounts") registration statement statement
---------------------------------------------------------------------------------------------------
Text composition for Account prospectuses and Text composition for Fund prospectuses and
supplements supplements
---------------------------------------------------------------------------------------------------
Text alterations of Account prospectuses and Text alterations of Fund prospectuses and Fund
Account supplements supplements
---------------------------------------------------------------------------------------------------
Printing Account prospectuses and supplements A camera or web ready Fund prospectus and
and Fund prospectuses and supplements for printing of Fund prospectuses for existing
prospective contractholders and participants Contract Owners that invest in the Fund
("Contract Owners")
---------------------------------------------------------------------------------------------------
Text composition and printing Account Text composition and printing Fund SAIs
statements of additional information ("SAIs")
---------------------------------------------------------------------------------------------------
Mailing and distributing Account SAIs to Mailing and distributing Fund SAIs to Contract
Contract Owners upon request by Owners upon request by Contract Owners
Contract Owners
---------------------------------------------------------------------------------------------------
Mailing and distributing Account prospectuses Text composition and printing of annual and semi-
and Account supplements to Contract Owners of annual reports for the Fund to existing Contract
record as required by federal securities laws Owners that invest in the Funds.
and mailing and distributing account and Fund
prospectuses and supplements to prospective
purchasers
---------------------------------------------------------------------------------------------------
Text composition (Account), printing, mailing, Text composition and printing of proxy statements
and distributing annual and semi-annual and voting instruction solicitation materials to
reports for Account Contract Owners with respect to proxies related
to the Fund.
---------------------------------------------------------------------------------------------------
Mailing and distributing annual and semi-annual
reports for the Fund to existing Contract Owners
that invest in the Funds.
---------------------------------------------------------------------------------------------------
Mailing, distributing, and tabulation of proxy
statements and voting instruction solicitation
materials to Contract Owners with respect to
proxies related to the Fund.
---------------------------------------------------------------------------------------------------
Text composition, printing, mailing,
distributing, and tabulation of proxy
statements and voting instruction solicitation
materials to Contract Owners with respect to
proxies related to the Account
---------------------------------------------------------------------------------------------------
32
(Page 2 of 2)
EXHIBIT B (CONTINUED)
===================================================================================================
Preparation, printing and distributing sales
material and advertising relating to the Funds
contained in Contract advertising and sales
materials and filing such materials with and
obtaining approval from, the Commission, the
National Association of Securities Dealers,
Inc., any state insurance regulatory authority.
and any other appropriate regulatory
authority, to the extent required.
===================================================================================================
