AMERICAN FUNDS
FUND PARTICIPATION AGREEMENT
THIS AGREEMENT is entered into as of this 16th day of March, 1999 among HARTFORD
LIFE INSURANCE COMPANY ("HL), HARTFORD LIFE AND ANNUITY INSURANCE COMPANY
("HL&A") (collectively, HL and HL&A may hereinafter be referred to as
"Hartford"), both life insurance companies organized under the laws of the State
of Connecticut, AMERICAN VARIABLE INSURANCE SERIES ("Series"), an open-end
management investment company organized under the laws of the Commonwealth of
Massachusetts, and CAPITAL RESEARCH AND MANAGEMENT COMPANY ("CRMC"), a
corporation organized under the laws of the State of Delaware, and having a
business address of ▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇.
WITNESSETH:
WHEREAS, Hartford proposes to issue to the public, now and in the future,
certain multi-manager variable annuity contracts ("Contracts");
WHEREAS, Hartford has established one (1) or more separate accounts ("Account")
for the purposes of issuing the Contracts and has or will register the Account
with the United States Securities Exchange Commission ("the SEC") as an unit
investment trust under the Investment Company Act of 1940 ("▇▇▇ ▇▇▇▇ ▇▇▇") and
pursuant to the Connecticut Insurance Code;
WHEREAS, the Series has received a "Mixed and Shared Funding Order" from the SEC
granting relief from the certain provisions of the 1940 Act and the rules
thereunder to the extent necessary to permit shares of the Series to be sold to
variable annuity and life insurance separate accounts of unaffiliated insurance
companies;
WHEREAS, the Series is divided into various funds ("Funds"), each Fund being
subject to certain fundamental investment policies which may not be changed
without a majority vote of the shareholders of such Fund;
WHEREAS, certain Funds will serve as the underlying investment medium for the
Contracts; and
WHEREAS, CRMC is the investment adviser for the Series
NOW THEREFORE, in consideration of the foregoing and of mutual covenants and
conditions set forth herein and for other good and valuable consideration,
Hartford, the Account, the Series and CRMC hereby agree as follows:
1. The Series and CRMC each represents and warrants to Hartford that: (i) a
registration statement under the Securities Act of 1933 ("1933 Act") and under
the 1940 Act with respect to the Series has been filed with the SEC in the form
previously delivered to Hartford, and copies of any and all amendments thereto
will be forwarded to Hartford at the time that they
FINAL FUND PARTICIPATION AGREEMENT
are filed with the SEC; (ii) the Series is, and shall be at all times while this
Agreement is in force, lawfully organized, validly existing, and properly
qualified as an open-end management investment company in accordance with the
laws of the Commonwealth of Massachusetts; and (iii) the Series registration
statement and any further amendments or supplements thereto will, when they
become effective, conform in all material respects to the requirements of the
1933 Act and the 1940 Act, and the rules and regulations of the SEC thereunder,
and will not contain an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the statement
therein not misleading; provided, however, that this representation and warranty
shall not apply to any statements or omissions made in reliance upon and in
conformity with information furnished in writing to the Series by Hartford
expressly for use therein.
2. The Series will furnish to Hartford such information with respect to the
Series in such form and signed by such of its officers as Hartford may
reasonably request, and will warrant that the statements therein contained when
so signed will be true and correct. The Series will advise Hartford immediately
of: (a) any request by the SEC (i) for amendment of the registration statement
relating to the Series or (ii) for additional information; (b) the issuance by
the SEC of any stop order suspending the effectiveness of the registration
statement of the Series or the initiation of any proceeding for that purpose;
(c) the institution of any proceeding, investigation or hearing involving the
offer or sale of the Contracts or the Series of which it becomes aware; or (d)
the happening of any material event, if known, which makes untrue any statement
made in the registration statement of the Series or which requires the making of
a change therein in order to make any statement made therein not misleading.
3. The Series will use best efforts to register for sale under the 1933 Act
and, if required, under state securities laws, such additional shares of the
Series as may reasonably be necessary for use as the funding vehicle for the
Contracts.
4. The Series agrees to make Class 1 and Class 2 shares of all of its Funds
available to the Contract. To the extent Hartford uses Class 2 shares, it will
be entitled to a fee from the Series of .25% per annum of Class 2 assets
attributable to the Contracts to offset Contract marketing expenses for as long
as the Series' Rule 12b-1 plan remains in effect. Fund shares to be made
available to Accounts for the Contracts shall be sold by the Series and
purchased by Hartford for a given Account at the net asset value (without the
imposition of a sales load) next computed after receipt of each order by the
Series or its designee, as established in accordance with the provisions of the
then current prospectus of the Series. For purposes of this Paragraph 4, HL and
HL&A each shall be a designee of the Series for receipt of such orders from each
Account, and receipt by such designee by 4:00 p.m. Eastern time shall constitute
receipt by the Series; provided that the Series receives notice of such order by
9:30 a.m. Eastern time on the following Business Day. "Business Day" shall mean
any day on which the New York Stock Exchange ("NYSE") is open for trading and on
which the Series calculates its net asset value pursuant to the rules of the
SEC. The Series will make its shares available indefinitely for purchase at the
applicable net asset value per share by each Company and its Accounts on those
days on which the Series calculates its net asset value pursuant to the rules of
the SEC, and the Series shall use its best efforts to calculate such net asset
value on each day on which the NYSE
FINAL FUND PARTICIPATION AGREEMENT
2
is open for trading. The Series shall make the net asset value per share for
each of the Funds available to HL and/or HL&A on a daily basis as soon as
reasonably practical after the Series calculates its net asset value per share,
and the Series shall use its best efforts to make such net asset value per share
available by 6:30 p.m. Eastern time. The Series, and its investment adviser,
CRMC, are responsible for maintaining net asset values for the Funds in
accordance with the requirements of the 1940 Act and its current prospectus.
Shares of particular Funds shall be ordered in such quantities and at such times
as determined by Hartford to be necessary to meet the requirements of the
Contracts. Orders or payments for shares purchased will be sent promptly to the
Series and will be made in federal funds transmitted by wire.
The Series reserves the right to temporarily suspend sales if the Board of
Trustees of the Series deems it appropriate and in the best interests of the
Series or in response to the order of an appropriate regulatory authority.
5. The Contracts funded through the Account will provide for the allocation of
net amounts among certain subaccounts for investment in such shares of the Funds
as may be offered from time to time in the Contracts. The selection of the
particular subaccount is to be made by the Contract owner and such selection may
be changed in accordance with the terms of the Contracts.
6. Transfer of the Series' shares will be by book entry only. No stock
certificates will be issued to the Account. Shares ordered from a particular
Fund will be recorded by the Series as instructed by HL or HL&A in an
appropriate title for the corresponding Account or subaccount.
7. The Series shall furnish notice promptly to Hartford of any dividend or
distribution payable on any shares underlying subaccounts. HL and HL&A hereby
elect to receive all such dividends and distributions as are payable on shares
of a Fund recorded in the title for the corresponding subaccount in additional
shares of that Fund. The Series shall notify Hartford of the number of shares so
issued. HL and HL&A each reserve the right to revoke this election and to
receive all such income dividends and capital gain distributions in cash.
8. The Series shall redeem its shares in accordance with the terms of its then
current prospectus. For purposes of this Paragraph 8, HL and HL&A each shall be
a designee of the Series for receipt of requests for redemption from each
Account, and receipt by such designee by 4:00 p.m. Eastern time shall constitute
receipt by the Series; provided that the Series receives notice of such request
for redemption by 9:30 a.m. Eastern time on the following Business Day. HL and
HL&A each shall purchase and redeem the shares of Funds offered by the then
current prospectus of the Series in accordance with the provisions of such
prospectus.
9. The Series shall pay all expenses incidental to its performance under this
Agreement. The Series shall see to it that all of its shares are registered and
authorized for issue in accordance with applicable federal and state laws prior
to their purchase for the Account. The Series shall bear the expenses for the
cost of registration of its shares, preparation of prospectuses to be sent to
existing Contract owners, proxy materials and reports, the printing and
distribution
FINAL FUND PARTICIPATION AGREEMENT
3
of such items to each Contract owner who has allocated net amounts to any
Subaccount, the preparation of all statements and notices required from it by
any federal or state law, and taxes on the issue or transfer of the Series'
shares subject to this Agreement. The Series will provide Hartford, at least
once a year, with enough copies of its Statement of Additional Information to be
able to distribute one (1) to each Contract owner or prospective Contract owner
who requests such Statement of Additional Information.
10. Hartford shall bear the expenses for the cost of preparation and delivery
of Series prospectuses to be sent to prospective Contract owners. The Series
shall provide, at its expense, such documentation (in camera ready or other
mutually agreeable form) and other assistance as is reasonably necessary in
order for Hartford once each year (or more frequently if the prospectus for the
Series is amended) to have the prospectus or prospectuses for the Contracts and
the Series prospectus printed together in one (1) or more documents (such
printing to be done at Hartford's expense).
11. Hartford represents and warrants to the Series that any information
furnished in writing by Hartford to the Series for use in the registration
statement of the Series will not result in the registration statement's failing
to conform in all respects to the requirements of the 1933 Act and the 1940 Act
and the rules and regulations thereunder or containing any untrue statement of a
material fact or omission to state a material fact required to be stated therein
or necessary to make the statements therein not misleading.
12. Hartford and its affiliates shall make no representations concerning the
Series' shares except those contained in the then current prospectus of the
Series, in such printed information subsequently issued on behalf of the Series
or other funds managed by CRMC as supplemental to the appropriate fund
prospectus or in materials approved by AFD, as provided in the Business
Agreement in effect among Hartford, AFD, and CRMC dated March 4, 1999 ("Business
Agreement").
13. Shares of the Series may be offered to separate accounts of various
insurance companies in addition to Hartford. No shares of the Series shall be
sold to the general public in contravention of Section 817 of the Internal
Revenue Code of 1986 as amended and the regulations thereunder ("Section 817").
14. The parties to this Agreement recognize that due to differences in tax
treatment or other considerations, the interests of various Contract owners
participating in one or more Funds might, at some time, be in conflict. Each
party shall report to the other party any potential or existing conflict of
which it becomes aware. The Board of Trustees of the Series shall promptly
notify Hartford of the existence of irreconcilable material conflict and its
implications. If such a conflict exists, Hartford will, at its own expense, take
whatever action it deems necessary to remedy such conflict; in any case,
Contract owners will not be required to bear such expenses.
5. The Series agrees to comply with the diversification requirements of Section
817.
FINAL FUND PARTICIPATION AGREEMENT
4
16. Hartford agrees to indemnify and hold the Series harmless against, any and
all losses, claims, damages, liabilities or litigation (including legal and
other expenses) which the Series may be subject under any statute, at common law
or otherwise, insofar as such losses, claims, damages, liabilities or expenses
(or actions in respect thereof) or settlements arising as a result of Hartford's
(a) making untrue statements of material facts or omitting material facts in the
registration statement, prospectus or sales literature; (b) making untrue
statements of material facts that the Series includes in their materials,
provided the Series relies on information supplied by Hartford; (c) unlawful
conduct by Hartford with respect to the sale of the Contracts or Fund shares;
and (d) breaching this Agreement or a representation or warranty.
17. The Series and CRMC each agrees to indemnify and hold Hartford harmless
against, any and all losses, claims, damages, liabilities or litigation
(including legal and other expenses) which Hartford may be subject under any
statute, at common law or otherwise, insofar as such losses, claims, damages,
liabilities or expenses (or actions in respect thereof) or settlements arising
as a result of the Series', or CRMC's (a) making untrue statements of material
facts or omitting material facts in the registration statement, prospectus or
sales literature; (b) making untrue statements of material facts that the Series
includes in their materials, provided Hartford relies on information supplied by
the Series; (c) unlawful conduct by the Series with respect to the sale of the
Contracts or Fund shares; and (d) breaching this Agreement or a representation
or warranty.
18. Hartford shall be responsible for assuring that the Account calculates
pass-through voting privileges of Contract owners in a manner consistent with
the method of calculating pass-through voting privileges set forth in the
current Contract.
19. The parties understand that there is no intention to create a joint venture
in the subject matter of this Agreement. Accordingly, the right to terminate
this Agreement and to engage in any activity not inconsistent with this
Agreement is absolute. This Agreement will terminate:
(i) By any party at any time upon two (2) years' written notice to the
other parties; provided, however, that such notice may be given only
after June 30, 2004; or
at the option of Hartford or the Series upon ten (10) calendar days'
prior written notice to the other party if a final non-appealable
administrative or judicial decision is entered against the other party
which has a material impact on the Contracts;
at the option of Hartford, upon ten (10) calendar days' prior written
notice, if shares of the Series are not reasonably available;
at the option of Hartford, immediately upon written notice, if the
Series or CRMC fails to meet the requirements for either
diversification under Section 817 or registered investment company
status or if the Board of the
FINAL FUND PARTICIPATION AGREEMENT
5
Series terminates the Class 2 Plan of Distribution pursuant to Rule
12b-1 under the 1940 Act; or
(v) in the event the Series' shares are not registered, issued or sold
in accordance with applicable state and/or federal law or such law
precludes the use of such shares as an underlying investment for the
Contracts issued or to be issued by Hartford; in such event prompt
notice shall be given by Hartford or the Series to the other party.
The effective date for termination pursuant to any notice given under this
Paragraph shall be calculated beginning with the date of receipt of such notice.
20. All notices, consents, waivers, and other communications under this
Agreement must be in writing, and will be deemed to have been duly received (a)
when delivered by hand (with written confirmation of receipt), (b) when sent by
telecopier (with written confirmation of receipt), provided that a copy is
mailed by registered mail, return receipt requested, or (c) the day after it is
sent by a nationally recognized overnight delivery service, in each case to the
appropriate addresses and telecopier numbers set forth below (or to such other
addresses and telecopier numbers as a party may designate by notice to the other
parties):
IF TO HARTFORD:
Hartford Life Insurance Company
Hartford Life and Annuity Insurance Company
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇, Vice President Investment Product Sales
Facsimile No.: ▇▇▇-▇▇▇-▇▇▇▇
WITH A COPY TO:
Hartford Life Insurance Company
Hartford Life and Annuity Insurance Company
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇, Senior Vice President, General Counsel and Secretary
Facsimile No.: ▇▇▇-▇▇▇-▇▇▇▇
IF TO SERIES:
American Variable Insurance Series
▇▇▇ ▇. ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Vice President
Facsimile No.: ▇▇▇-▇▇▇-▇▇▇▇
FINAL FUND PARTICIPATION AGREEMENT
6
WITH A COPY TO:
Capital Research and Management Company
▇▇▇ ▇. ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇, Vice President and Senior Counsel,
Fund Business Management Group
Facsimile No.: ▇▇▇-▇▇▇-▇▇▇▇
IF TO CRMC:
Capital Research and Management Company
▇▇▇ ▇. ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Senior Vice President and Legal Counsel,
Fund Business Management Group, and Secretary
Facsimile No.: ▇▇▇-▇▇▇-▇▇▇▇
WITH A COPY TO:
Capital Research and Management Company
▇▇▇ ▇. ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇, Vice President and Senior Counsel,
Fund Business Management Group
Facsimile No.: ▇▇▇-▇▇▇-▇▇▇▇
21. If this Agreement terminates, any provision of this Agreement necessary to
the orderly windup of business under it will remain in effect as to that
business, after termination.
22. If this Agreement terminates, the Series, at Hartford's option, will
continue to make additional shares of the Series available for all existing
Contracts as of the effective date of termination (under the same terms and
conditions as were in effect prior to termination of this Agreement with respect
to existing Contract owners), unless the Series liquidates or applicable laws
prohibit further sales. Hartford agrees not to redeem shares unless legitimately
required to do so according to a Contract owner's request or under an order from
the SEC.
23. The obligations of the Series under this Agreement are not binding upon any
of the Trustees, officers, employees, or shareholders (except CRMC if it is a
shareholder) of the Series individually, but bind only the Series' assets. When
seeking satisfaction for any liability of the Series in respect of this
Agreement, Hartford and the Account agree not to seek recourse against said
Trustees, officers, employees, or shareholders, or any of them, or any of their
personal assets for such satisfaction. Notwithstanding the foregoing, if
Hartford seeks satisfaction for any liability of the Series in respect of this
Agreement, Hartford and the Account may seek recourse against CRMC.
24. This Agreement shall be construed in accordance with the laws of the State
of New York.
FINAL FUND PARTICIPATION AGREEMENT
7
25. This Agreement and the parties' rights, duties, and obligations under this
Agreement are not transferable or assignable by any of them without the express,
prior written consent of the other party hereto. Any attempt by a party to
transfer or assign this Agreement or any of its rights, duties or obligations
under this Agreement without such consent is void.
26. The following Paragraphs shall survive any termination of this Agreement:
4, 16, 17, 20, 21-26.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed and attested as of the date first above written.
HARTFORD LIFE INSURANCE COMPANY
(ON BEHALF OF THE ACCOUNT AND ITSELF)
By: [ILLEGIBLE]
--------------------------------------
Attest: [ILLEGIBLE] Its: Senior Vice President
HARTFORD LIFE AND ANNUITY INSURANCE
COMPANY
By: [ILLEGIBLE]
--------------------------------------
Attest: [ILLEGIBLE] Its: Senior Vice President
AMERICAN VARIABLE INSURANCE SERIES
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
--------------------------------------
Attest: [ILLEGIBLE] Its: Vice President
CAPITAL RESEARCH AND MANAGEMENT
COMPANY
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
--------------------------------------
Attest: [ILLEGIBLE] Its: Senior Vice President, Fund Business
Management Group, Legal Counsel and
Secretary
FINAL
FUND PARTICIPATION AGREEMENT
8
AMENDMENT #1 TO THE
FUND PARTICIPATION AGREEMENT
The Fund Participation Agreement (the "Agreement"), dated March 16, 1999, by and
among Hartford Life Insurance Company ("HL"), Hartford Life and Annuity
Insurance Company ("HLA") (collectively HL and HLA may hereinafter be referred
to as "Hartford"), American Funds Insurance Series (formerly known as American
Variable Insurance Series) ("Series") and Capital Research Management Company
("CRMC") is hereby amended as follows:
1. The Agreement is amended to include the following:
27. Notwithstanding anything possibly to the contrary in the Agreement or any
Rule 22c-2 Shareholder Information Agreement entered into by the parties, the
Series agrees that the actions of a Contract owner selecting or deselecting a
Company sponsored dynamic or static asset allocation model no more than 12 times
per year (and the resulting transactions in the underlying Funds) shall not
constitute frequent trading as described in the Series prospectus or the Rule
22c-2 Shareholder Information Agreement. Except as provided herein, the Rule
22c-2 Shareholder Information Agreement shall remain in full force and effect.
All other terms and provisions of the Agreement not amended herein shall remain
in full force and effect.
Effective date: May 1, 2008
HARTFORD LIFE INSURANCE COMPANY AMERICAN FUNDS INSURANCE SERIES (FKA
AMERICAN VARIABLE INSURANCE SERIES)
By its authorized officer, By its authorized officer,
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇ By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
-------------------------------- ----------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇ Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Its: Senior Vice President Its: Secretary
Date: 4/29/08 Date:
Approved for Signature
by CRMC Legal Dept. WRB
HARTFORD LIFE AND ANNUITY INSURANCE CAPITAL RESEARCH AND MANAGEMENT COMPANY
COMPANY
By its authorized officer, By its authorized officer,
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇ By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-------------------------------- ----------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇ Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Its: Senior Vice President Its: Vice President and Secretary
Date: 4/29/08 Date: 5/2/2008
Approved for Signature
by CRMC Legal Dept. WRB
