INVESTMENT ACCOUNTING AGREEMENT
THIS AGREEMENT is made effective as of the ________ day of ______________,
1998, by and between INVESTORS FIDUCIARY TRUST COMPANY, a trust company
established under the laws of the state of Missouri, having its principal place
of business at 000 Xxxxxxxxxxxx, Xxxxxx Xxxx, Xxxxxxxx 00000 ("IFTC"), and
Separate Account Ten, a separate account of Integrity Life Insurance Company a
corporation organized under the laws of the State of Ohio, having its statutory
home office at 000 Xxxx Xxxxxx Xxxxxx, Xxxxxxxxxx, Xxxxxxxx, 00000 ("Insurance
Company"), on its own behalf and on behalf of each Separate Account listed on
Schedule A hereto, as it may be amended from time to time, incorporated herein
by reference (each a "Separate Account").
WITNESSETH:
WHEREAS, Insurance Company desires to appoint IFTC as its agent to perform
certain investment accounting and recordkeeping functions for investment
portfolio assets of the Separate Account; and
WHEREAS, IFTC is willing to accept such appointment on the terms and
conditions hereinafter set forth.
NOW THEREFORE, for and in consideration of the mutual promises contained
herein, the parties hereto, intending to be legally bound, mutually covenant and
agree as follows:
1. APPOINTMENT OF AGENT. Insurance Company hereby constitutes and appoints
IFTC as its agent to perform certain investment accounting and
recordkeeping functions for each Separate Account relating to portfolio
transactions required under Rule 31a of the Investment Company Act of 1940
(the "1940 Act") and to value the Assets.
2. REPRESENTATIONS AND WARRANTIES.
A. Insurance Company hereby represents, warrants and acknowledges to
IFTC:
1. That it is a corporation duly organized and existing and in good
standing under the laws of its state of organization, and that
each Separate Account is registered under the 1940 Act; and
2. That it has the requisite power and authority under applicable
law, its articles of incorporation and its bylaws to enter into
this Agreement; it has taken all requisite action necessary to
appoint IFTC as investment accounting and recordkeeping agent for
the Separate Account; this Agreement has been duly executed and
delivered by Insurance Company; and this Agreement constitutes a
legal, valid and binding obligation of Insurance Company,
enforceable in accordance with its terms.
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B. IFTC hereby represents, warrants and acknowledges to Insurance Company:
1. That it is a trust company duly organized and existing and in good
standing under the laws of the State of Missouri; and
2. That it has the requisite power and authority under applicable law,
its charter and its bylaws to enter into and perform this Agreement;
this Agreement has been duly executed and delivered by IFTC; and this
Agreement constitutes a legal, valid and binding obligation of IFTC,
enforceable in accordance with its terms.
3. DUTIES AND RESPONSIBILITIES OF THE PARTIES.
A. DELIVERY OF ACCOUNTS AND RECORDS. Insurance Company will turn over or
cause to be turned over to IFTC all accounts and records needed by
IFTC to perform its duties and responsibilities hereunder fully and
properly. IFTC may rely conclusively on the completeness and
correctness of such accounts and records.
B. ACCOUNTS AND RECORDS. IFTC will prepare and maintain, under the
direction of and as interpreted by Insurance Company, Insurance
Company's accountants and/or other advisors, such accounts and
records: (a) needed to perform the accounting and recordkeeping
functions under Rule 31a of the 1940 Act; (b) required as a basis for
calculation of the valuation of the Assets; and (c) as otherwise
agreed upon by the parties. Insurance Company will advise IFTC in
writing of all applicable record retention requirements. IFTC will
preserve such accounts and records in the manner and for the periods
agreed upon by the parties. Insurance Company will furnish, in writing
or its electronic or digital equivalent, accurate and timely
information needed by IFTC to complete such accounts and records when
such information is not readily available from generally accepted
securities industry services or publications.
C. ACCOUNTS AND RECORDS PROPERTY OF INSURANCE COMPANY. IFTC acknowledges
that all of the accounts and records maintained by IFTC pursuant
hereto are the property of Insurance Company and will be made
available to Insurance Company for inspection or reproduction within a
reasonable period of time, upon demand. IFTC will assist Insurance
Company's independent auditors, or upon the prior written approval of
Insurance Company, or upon demand, any regulatory body, in any
requested review of Insurance Company's accounts and records,
provided, that Insurance Company will reimburse IFTC for all expenses
and employee time invested in any such review outside of routine and
normal periodic reviews. Upon receipt from Insurance Company of the
necessary information or instructions, IFTC will supply information
from the books and records it maintains for the Separate Account that
Insurance Company may reasonably request for tax returns,
questionnaires, periodic reports to regulators and such other reports
and information requests as Insurance Company and IFTC may agree upon
from time to time.
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D. ADOPTION OF PROCEDURES. IFTC and Insurance Company may from time to
time adopt such procedures as they agree upon, and IFTC may
conclusively assume that no procedure approved or directed by
Insurance Company, Insurance Company's accountants or other advisors
conflicts with or violates any requirements of any Separate Account's
prospectus the articles of incorporation, bylaws, any applicable law,
rule or regulation, or any order, decree or agreement by which
Insurance Company may be bound. Insurance Company will be responsible
for notifying IFTC of any statutes, regulations, rules, requirements
or policies or any changes thereto which may impact IFTC's
responsibilities or procedures under this Agreement.
E. VALUATION OF ASSETS. IFTC will value the Assets in accordance with
Insurance Company's Instructions (as defined below) utilizing the
pricing sources designated by the Insurance Company ("Pricing
Sources").
4. INSTRUCTIONS.
A. The term "Instructions," as used herein, means written (including
telecopied, telexed, or electronically transmitted) or oral
instructions which IFTC reasonably believes were given by a designated
representative of Insurance Company. Insurance Company will deliver
to IFTC, prior to delivery of any Assets to IFTC and thereafter from
time to time as changes therein are necessary, written Instructions
naming one or more designated representatives to give Instructions in
the name and on behalf of Insurance Company, which Instructions may be
received and accepted by IFTC as conclusive evidence of the authority
of any designated representative to act for Insurance Company and may
be considered to be in full force and effect until receipt by IFTC of
notice to the contrary. Unless such written Instructions delegating
authority to any person to give Instructions specifically limit such
authority to specific matters or require that the approval of anyone
else will first have been obtained, IFTC will be under no obligation
to inquire into the right of such person, acting alone, to give any
Instructions whatsoever. If Insurance Company fails to provide IFTC
any such Instructions naming designated representatives, any
Instructions received by IFTC from a person reasonably believed to be
an appropriate representative of Insurance Company will constitute
valid and proper Instructions hereunder. The term "designated
representative" may include Insurance Company's employees and agents,
including investment managers and their employees.
B. No later than the next business day immediately following each oral
Instruction, Insurance Company will send IFTC written confirmation of
such oral Instruction. At IFTC's sole discretion, IFTC may record on
tape, or otherwise, any oral Instruction whether given in person or
via telephone, each such recording identifying the date and the time
of the beginning and ending of such oral Instruction.
C. Insurance Company will provide upon IFTC's request a certificate
signed by an officer or designated representative of Insurance
Company, as conclusive proof of any fact or matter required to be
ascertained from Insurance Company hereunder. Insurance
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Company will also provide IFTC Instructions with respect to any matter
concerning this Agreement requested by IFTC. If IFTC reasonably
believes that it could not prudently act according to the
Instructions, or the instruction or advice of Insurance Company's
accountants or counsel, it may in its discretion, with notice to
Insurance Company, not act according to such Instructions.
5. LIMITATION OF LIABILITY OF IFTC. IFTC is not responsible or liable for,
and Insurance Company will indemnify and hold IFTC harmless from and
against, any and all costs, expenses, losses, damages, charges, counsel
fees (including, without limitation, disbursements and the allocable cost
of in-house counsel), payments and liabilities which may be asserted
against or incurred by IFTC or for which IFTC may be held to be liable,
arising out of or attributable to:
A. IFTC's action or failure to act pursuant hereto; provided that IFTC
has acted in good faith and with reasonable care; and provided
further, that in no event shall IFTC be liable for consequential,
special, or punitive damages;
B. IFTC's payment of money as requested by Insurance Company, or the
taking of any action which might make it or its nominee liable for
payment of monies or in any other way; provided, however, that nothing
herein obligates IFTC to take any such action or expend its own monies
except in its sole discretion;
C. IFTC's action or failure to act hereunder upon any Instruction,
advice, notice, request, consent, certificate or other instrument or
paper appearing to it to be genuine and to have been properly
executed, including any Instruction, communications, data or other
information received by IFTC by means of the Systems, as hereinafter
defined, or any electronic system of communication;
D. IFTC's action or failure to act in good faith reliance on the advice
or opinion of counsel for Insurance Company or of its own counsel with
respect to questions or matters of law, which advice or opinion may be
obtained by IFTC at the expense of Insurance Company, or on the
Instruction, advice or statements of any officer or employee of
Insurance Company or Insurance Company's accountants or other
authorized individuals, and other persons believed by it in good faith
to be expert in matters upon which they are consulted;
E. Any error, omission, inaccuracy or other deficiency in any accounts
and records or other information provided by or on behalf of the
Insurance Company with respect to the Separate Account to IFTC,
including the accuracy of the prices quoted by the Pricing Sources or
for the information supplied by Insurance Company to value the Assets
(except to the extent such inaccuracy results from IFTC's lack of
reasonable care in performing the agreed-upon tolerance checks as to
the data furnished), or the failure of Insurance Company to provide,
or provide in a timely manner, any accounts, records, or information
needed by IFTC to perform its duties hereunder;
F. Insurance Company's refusal or failure to comply with the terms hereof
(including
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without limitation Insurance Company's failure to pay or reimburse
IFTC under Section 5 hereof), Insurance Company's negligence or
willful misconduct, or the failure of any representation or warranty
of Insurance Company hereunder to be and remain true and correct in
all respects at all times;
G. The use or misuse, whether authorized or unauthorized, of the Systems
or any electronic system of communication used hereunder, by Insurance
Company or by any person who acquires access to the Systems or such
other systems through the terminal device, passwords, access
instructions or other means of access to such Systems or such other
system which are utilized by, assigned to or otherwise made available
to Insurance Company, except to the extent attributable to any
negligence or willful misconduct by IFTC;
H. Loss occasioned by the acts, omissions, defaults or insolvency of any
broker, bank, trust company, securities system or any other person
with whom IFTC may deal; and
I. The failure or delay in performance of its obligations hereunder, or
those of any entity for which it is responsible hereunder, arising out
of or caused, directly or indirectly, by circumstances beyond the
affected entity's reasonable control, including, without limitation:
any interruption, loss or malfunction of any utility, transportation,
computer (hardware or software) or communication service; inability to
obtain labor, material, equipment or transportation, or a delay in
mails; governmental or exchange action, statute, ordinance, rulings,
regulations or direction; war, strike, riot, emergency, civil
disturbance, terrorism, vandalism, explosions, labor disputes,
freezes, floods, fires, tornadoes, acts of God or public enemy,
revolutions, or insurrection.
6. COMPENSATION. In consideration for its services hereunder, Insurance
Company will pay to IFTC the compensation set forth in a separate fee
schedule to be agreed to by Insurance Company and IFTC from time to time,
and, upon demand, reimbursement for IFTC's cash disbursements and
reasonable out-of-pocket costs and expenses, including attorney's fees and
disbursements, incurred by IFTC in connection with the performance of
services hereunder.
7. TERM AND TERMINATION. The initial term of this Agreement is for a period
of one (1) year. Thereafter, either Insurance Company or IFTC may
terminate this Agreement by notice in writing, delivered or mailed, postage
prepaid, to the other party and received not less than ninety (90) days
prior to the date upon which such termination will take effect. Upon
termination hereof:
A. Insurance Company will pay IFTC its fees and compensation due
hereunder and its reimbursable disbursements, costs and expenses paid
or incurred to such date and Insurance Company will designate a
successor investment accounting agent (which may be Insurance Company)
by Instruction to IFTC; and
B. IFTC will, upon payment of all sums due to IFTC from Insurance Company
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hereunder, deliver all accounts and records and other properties of
Insurance Company to the successor, or, if none, to Insurance Company,
at IFTC's office.
In the event that accounts, records or other properties remain in the
possession of IFTC after the date of termination hereof for any reason
other than IFTC's failure to deliver the same, IFTC is entitled to
compensation as provided in the then-current fee schedule for its services
during such period, and the provisions hereof relating to the duties and
obligations of IFTC will remain in full force and effect.
8. NOTICES. Notices, requests, instructions and other writings addressed to
Insurance Company at the address set forth above, Attention: _____________,
or at such other address as Insurance Company may have designated to IFTC
in writing, will be deemed to have been properly given to Insurance Company
hereunder. Notices, requests, Instructions and other writings addressed to
IFTC at the address set forth above, Attention: Vice President, Investment
Accounting, or to such other address as it may have designated to Insurance
Company in writing, will be deemed to have been properly given to IFTC
hereunder.
9. THE SYSTEMS; CONFIDENTIALITY.
A. If IFTC provides Insurance Company direct access to the computerized
investment portfolio recordkeeping and accounting systems used by IFTC
("Systems") or if IFTC and Insurance Company agree to utilize any
electronic system of communication, Insurance Company agrees to
implement and enforce appropriate security policies and procedures to
prevent unauthorized or improper access to or use of the Systems or
such other system.
B. Insurance Company will preserve the confidentiality of the Systems and
the tapes, books, reference manuals, instructions, records, programs,
documentation and information of, and other materials relevant to, the
Systems and the business of IFTC ("Confidential Information").
Insurance Company agrees that it will not voluntarily disclose any
such Confidential Information to any other person other than its own
employees who reasonably have a need to know such information pursuant
hereto. Insurance Company will return all such Confidential
Information to IFTC upon termination or expiration hereof.
C. Insurance Company has been informed that the Systems are licensed for
use by IFTC and its affiliates from one or more third parties
("Licensors"), and Insurance Company acknowledges that IFTC and
Licensors have proprietary rights in and to the Systems and all other
IFTC or Licensor programs, code, techniques, know-how, data bases,
supporting documentation, data formats, and procedures, including
without limitation any changes or modifications made at the request or
expense or both of Insurance Company (collectively, the "Protected
Information"). Insurance Company acknowledges that the Protected
Information constitutes confidential material and trade secrets of
IFTC and Licensors. Insurance Company will preserve the
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confidentiality of the Protected Information, and Insurance Company
hereby acknowledges that any unauthorized use, misuse, disclosure or
taking of Protected Information, residing or existing internal or
external to a computer, computer system, or computer network, or the
knowing and unauthorized accessing or causing to be accessed of any
computer, computer system, or computer network, may be subject to
civil liabilities and criminal penalties under applicable law.
Insurance Company will so inform employees and agents who have access
to the Protected Information or to any computer equipment capable of
accessing the same. Licensors are intended to be and are third party
beneficiaries of Insurance Company's obligations and undertakings
contained in this Section.
D. Insurance Company hereby represents and warrants to IFTC that it has
determined to its satisfaction that the Systems are appropriate and
suitable for its use. THE SYSTEMS ARE PROVIDED ON AN AS IS, AS
AVAILABLE BASIS. IFTC EXPRESSLY DISCLAIMS ALL WARRANTIES INCLUDING,
BUT NOT LIMITED TO, THE IMPLIED WARRANTIES OF MERCHANTABILITY AND
FITNESS FOR A PARTICULAR PURPOSE, EXCEPT THOSE WARRANTIES EXPRESSLY
STATED HEREIN.
10. MULTIPLE SEPARATE ACCOUNTS. If Schedule A lists more than one Separate
Account:
A. Each Separate Account will be regarded for all purposes hereunder as a
separate party apart from each other Separate Account. Unless the
context otherwise requires, with respect to every transaction covered
hereby, every reference herein to Insurance Company is deemed to
relate solely to the particular Separate Account to which such
transaction relates. Under no circumstances will the rights,
obligations or remedies with respect to a particular Separate Account
constitute a right, obligation or remedy applicable to any other
Separate Account. The use of this single document to memorialize the
separate agreement of each Separate Account is understood to be for
clerical convenience only and will not constitute any basis for
joining the Separate Accounts for any reason.
B. Insurance Company may appoint IFTC as its investment accounting and
recordkeeping agent for additional Separate Accounts from time to time
by written notice, provided that IFTC consents to such addition.
Rates or charges for each additional Separate Account will be as
agreed upon by IFTC and Insurance Company in writing.
11. MISCELLANEOUS.
A. This Agreement will be construed according to, and the rights and
liabilities of the parties hereto will be governed by, the laws of the
State of Missouri without reference to the choice of law principles
thereof.
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B. All terms and provisions hereof will be binding upon, inure to the
benefit of and be enforceable by the parties hereto and their
respective successors and permitted assigns.
C. The representations and warranties, the indemnifications extended
hereunder, and the provisions of Section 9 hereof are intended to and
will continue after and survive the expiration, termination or
cancellation hereof.
D. No provisions hereof may be amended or modified in any manner except
by a written agreement properly authorized and executed by each party
hereto.
E. The failure of either party to insist upon the performance of any
terms or conditions hereof or to enforce any rights resulting from any
breach of any of the terms or conditions hereof, including the payment
of damages, will not be construed as a continuing or permanent waiver
of any such terms, conditions, rights or privileges, but the same will
continue and remain in full force and effect as if no such forbearance
or waiver had occurred. No waiver, release or discharge of any
party's rights hereunder will be effective unless contained in a
written instrument signed by the party sought to be charged.
F. The captions herein are included for convenience of reference only,
and in no way define or limit any of the provisions hereof or
otherwise affect their construction or effect.
G. This Agreement may be executed in two or more counterparts, each of
which is deemed an original but all of which together constitute one
and the same instrument.
H. If any provision hereof is determined to be invalid, illegal, in
conflict with any law or otherwise unenforceable, the remaining
provisions hereof will be considered severable and will not be
affected thereby, and every remaining provision hereof will remain in
full force and effect and will remain enforceable to the fullest
extent permitted by applicable law.
I. The benefits of this Agreement may not be assigned by either party nor
may either party delegate all or a portion of its duties hereunder
without the prior written consent of the other party. Notwithstanding
the foregoing, Insurance Company agrees that IFTC may delegate all or
a portion of its duties to an affiliate of IFTC provided that such
delegation shall not reduce the obligations of IFTC under this
Agreement.
J. Neither the execution nor performance hereof will be deemed to create
a partnership or joint venture by and between IFTC and Insurance
Company or any Separate Account.
K. Except as specifically provided herein, this Agreement does not in any
way affect any other agreements entered into among the parties hereto
and any actions taken or
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omitted by either party hereunder will not affect any rights or
obligations of the other party hereunder.
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed
by their respective duly authorized officers.
[SEPARATE ACCOUNT TEN] INVESTORS FIDUCIARY TRUST COMPANY
By: By:
-------------------------------- --------------------------------
Name: Name:
Title: Title:
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SCHEDULE A--LIST OF SEPARATE ACCOUNT DIVISIONS
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