Exhibit (8)(kk)(i)
PARTICIPATION AGREEMENT
by and among
DFA INVESTMENT DIMENSIONS GROUP INC.,
DIMENSIONAL FUND ADVISORS LP,
DFA SECURITIES LLC
and
JEFFERSON NATIONAL LIFE INSURANCE COMPANY
THIS AGREEMENT, made and entered into this ____ day of August 2010, by
and among JEFFERSON NATIONAL LIFE INSURANCE COMPANY ("Company"), on its own
behalf and on behalf of segregated asset accounts of the Company that may be
established from time to time (individually, an "Account" and collectively, the
"Accounts"); DFA Investment Dimensions Group Inc. ("Fund"); the Fund's
investment adviser, Dimensional Fund Advisors LP ("Adviser"); and DFA Securities
LLC ("DFAS") (individually, a "Party" and collectively, the "Parties").
The Company, the Fund, the Adviser and DFAS, intending to be legally
bound, hereby agree as follows:
1. Sales of Shares/Procedures
1.1 Shares of the respective portfolios ("Portfolios") of the Fund
listed on Schedule 1.1 hereto, as amended from time to time by the
Parties, shall be sold by the Fund through its agent DFAS, and
purchased by the Company for the appropriate subaccount of each
Account, at the net asset value next computed after receipt by the
Fund or its designee of each order of the Accounts, in accordance
with the provisions of this Agreement, the then current
prospectus(es) of the Portfolios, and the variable annuity
contracts that use the Portfolios as an underlying investment
medium ("Contracts").
1.1(a) Transmission of Instructions For each Portfolio and for
each Account maintained by the Company with such Portfolio,
the Company shall transmit to National Securities Clearing
Corporation ("NSCC") (which shall forward the information
to the transfer agent of the Fund), no more than two
aggregate purchase orders as follows:
(i) a purchase order for the Accounts expressed in
dollars (sent via NSCC's DCC&S System); and
(ii) a purchase order for the Accounts expressed in
shares (sent via NSCC's DCC&S System);
and no more than two aggregate redemption orders as
follows:
(i) a redemption order for the Accounts expressed in
dollars (sent via NSCC's DCC&S System); and
(ii) a redemption order for the Accounts expressed in
shares (sent via NSCC's DCC&S System);
each of which reflects the aggregated effect of all purchases and
all redemptions of shares of the Portfolios in such categories,
based upon instructions from each Account (collectively,
"Instructions") received prior to the Close of Trading on a given
Business Day ("Trade Date"). "Close of Trading" shall mean 4:00
p.m. Eastern Time on a Business Day or such other time as the net
asset value of a Portfolio is calculated, as disclosed in the then
current prospectus(es) of the
Portfolios. "Business Day" shall mean, unless otherwise noted in
this Agreement, any day on which the New York Stock Exchange (the
"NYSE") is open for trading and on which a Portfolio calculates
its net asset value pursuant to the rules of the Securities and
Exchange Commission ("SEC"). "Business Day," for the purposes of
this Section 1.1(a), shall also include any day on which the
NSCC's DCC&S System is open to transmit and settle orders, even if
the NYSE is closed for trading on such day.
On any given Business Day, the Company shall accept Instructions
in proper form from an Account up to the Close of Trading, but in
no event shall the Company accept Instructions that have been
received by the Company after the Close of Trading on such
Business Day. Instructions received in proper form by the Company
after the Close of Trading on any Business Day shall be treated as
if accepted on the next following Business Day. Each transmission
of Instructions by the Company will constitute a representation
that all purchase and redemption orders from the Accounts were
received by the Company prior to 4:00 p.m. Eastern Time or the
close of the NYSE, whichever is earlier, on the Business Day on
which the purchase or redemption orders are transmitted, in
accordance with Rule 22c-1 under the Investment Company Act of
1940, as amended (the "1940 Act").
1.1(b) Transmission Deadlines for the Accounts The transmission
of orders for the Accounts will be accepted by the Fund
only if provided through NSCC's DCC&S System in the file
delivered to the Fund or its transfer agent prior to 6:30
a.m. Eastern Time (currently NSCC Cycle 8) on the next
Business Day following the Trade Date. Any information
delivered to the Fund after such 6:30 a.m. Eastern Time
file is received will be rejected by the Fund or its
transfer agent, subject to the Fund's sole discretion to
accept any trade.
In the event that NSCC systems are not functioning on a
given Business Day, the Company may transmit Instructions
to the Fund, its transfer agent or as otherwise directed by
the Fund or the Adviser via facsimile by 6:30 a.m. Eastern
Time on the next Business Day following the Trade Date;
provided however, the Company will notify the Fund and the
Adviser prior to transmitting Instructions via facsimile.
However, this paragraph will not be applicable to
Instructions which have already been entered via NSCC but
not received by the Fund or its transfer agent. The Company
must notify the Fund of the existence of any such
Instructions, and the Fund and its transfer agent will use
commercially reasonable efforts to process those
Instructions in a mutually satisfactory manner.
The Company will receive pricing and dividend rate and
capital gain distribution rate information and payments
through the NSCC System.
1.1(c) Settlement Aggregated purchase and net redemption
transactions shall be settled in accordance with NSCC rules
and procedures. "Business Day,"
for the purposes of this Section 1.1(c), shall also include
any day on which the NSCC's DCC&S System is open to
transmit and settle orders, even if the NYSE is closed for
trading on such day.
In the event that NSCC systems are not functioning on a
given Business Day (1) for net purchase Instructions, the
Company shall wire payment, or arrange for payment to be
wired by the Company's designated bank, in immediately
available funds, to the Portfolio's custodial account at
the Fund's custodian; and (2) for net redemption
Instructions, the Fund or its transfer agent shall wire
payment, or arrange for payment to be wired, in immediately
available funds, to an account designated by the Company in
writing. Wires from the Company must be received no later
than the close of the Federal Reserve Wire Transfer System
on the next day on which the Federal Reserve Wire Transfer
System is open.
In the event that the total redemption order for any one
Business Day shall exceed dollar limits set for a Portfolio
by the Fund, such Portfolio shall have the option of (i)
settling the redemption on the second Business Day
following trade date through the NSCC's money settlement
process, (ii) settling the redemption outside of Fund/SERV,
if necessary as determined in the discretion of the Fund,
at any time within seven (7) days after receipt of the
redemption order, in accordance with provisions of the 1940
Act, or (iii) in any other manner provided for in the
Portfolio's then current prospectus(es) and statement of
additional information.
Nothing herein shall prevent the Fund, on behalf of a
Portfolio, from delaying or suspending the right of
purchase or redemption in accordance with the provisions of
the 1940 Act and the rules thereunder. The Fund will not
bear any responsibility whatsoever for the proper
disbursement or crediting of redemption proceeds; the
Company alone will be responsible for such action.
1.1(d) Errors The Company shall be solely responsible for the
accuracy of any Instruction transmitted to the Fund or its
transfer agent via NSCC systems or otherwise, and the
transmission of such Instruction shall constitute the
Company's representation to the Fund that the Instruction
is accurate, complete and duly authorized by the Accounts
that are purchasing or redeeming shares of the Portfolio.
The Company shall assume responsibility for any loss to the
Fund, the Portfolios or their transfer agent caused by a
cancellation or correction made subsequent to the date as
of which an Instruction has been placed, and the Company
will immediately pay such loss to the Adviser, the Fund or
such Portfolio(s) upon notification.
Each Party shall notify the other Parties of any errors or
omissions in any information and interruptions in or delay
or unavailability of, the means of transmittal of any such
information as promptly as possible. The
Company agrees to maintain reasonable errors and omissions
insurance coverage commensurate with the Company's
responsibilities under this Agreement.
In the event of an error in the computation of a
Portfolio's net asset value per share, the Fund will follow
its then current policy adopted for the sale and
distribution of shares of the Portfolio regarding
appropriate error correction standards. Any gain to the
Company or an Account attributable to the incorrect
calculation or reporting of a Portfolio's daily net asset
value shall be immediately returned to the Portfolio. The
Company agrees to make commercially reasonable efforts to
recover from the Account(s) any material losses incurred by
the Adviser, the Fund or the Portfolios as a result of the
foregoing.
The Company shall maintain a record of the total number of
shares of the Portfolios which are so purchased, based on
information provided by the Fund or its designee to the
Company, and shall reconcile with the Fund on a periodic
basis the number of shares of each Portfolio attributable
to each Account. If an order to purchase shares of a
Portfolio must be canceled due to nonpayment, the Company
will be responsible for any loss incurred by the Fund or
the Portfolio arising out of such cancellation. To recover
any such loss, the Fund and the Portfolios reserve the
right to redeem shares of the affected Portfolio(s) held in
the name of the Company or a corresponding subaccount of
the applicable Account.
1.2 The Fund will redeem the shares of the Portfolios when requested
on behalf of the Company or the corresponding subaccount of the
applicable Account at the net asset value next computed after
receipt by the Fund or its designee of each request for
redemption, in accordance with the provisions of this Agreement,
the then current prospectus(es) of the Portfolios, the statement
of additional information of the Fund and the Contracts; provided,
however, if any conflicts exist among any such documents, then the
terms of the Fund's current prospectus(es) describing the
Portfolios and the statement of additional information describing
the Portfolios shall control.
The Company shall apply any net redemption proceeds received by it
in accordance with the applicable Contracts. The Company shall not
process or effect any redemptions with respect to shares of any
Portfolio after receipt by the Company of notification of
suspension of the determination of the net asset value of such
Portfolio. The Board of Directors of the Fund ("Directors") may
refuse to sell shares of any Portfolio to any person, including
the Company with respect to the Accounts, or suspend or terminate
the offering of shares of such Portfolio, if such action is
required by law or by regulatory authorities having jurisdiction,
or is deemed by the Directors, in their sole discretion, acting in
good faith and in light of the Directors' duties under federal and
any applicable state laws, necessary in the best interests of
shareholders of the Portfolio.
1.3 The Company agrees to purchase and redeem the shares of each
Portfolio in accordance with the provisions of this Agreement and
the then current prospectus(es) of the Portfolios. Except as
necessary to implement transactions initiated by Contract holders,
or as otherwise may be required by applicable U.S. federal laws or
regulations with respect to maintaining the Contracts' status
under the Internal Revenue Code of 1986, as amended from time to
time and any successor provisions thereto (the "Code"), the
Company shall not redeem shares of the Portfolios attributable to
the Contracts.
1.4 Issuance and transfer of shares of the Portfolios will be by
book-entry only. Stock certificates will not be issued to the
Company or to the applicable Accounts. Shares purchased from the
Fund will be recorded in appropriate book-entry titles for the
Accounts by the Fund or its designee.
1.5 The Fund shall furnish prompt notice, followed by written
confirmation to the Company, of any income, dividends or capital
gain distributions payable on the Portfolios' shares. The Company
hereby elects to receive all such dividends and distributions as
are payable on shares of a Portfolio in additional shares of that
Portfolio. The Fund shall notify the Company or its delegates of
the number of shares of the Portfolios so issued as payment of
such dividends and distributions.
The Company shall maintain a record of the number of shares of the
Portfolios held by the Accounts on behalf of each Contract holder,
and the Company shall maintain appropriate records of Contract
holder information.
The Company shall investigate all inquiries from Contract holders
relating to their interests in the Accounts and the Portfolios,
and shall respond to all communications from Contract holders and
other persons having an interest in the Contracts relating to the
Company's duties hereunder, in such form of correspondence as the
Company, the Fund and the Adviser may mutually agree.
Upon notice from the Fund, identifying one or more Accounts that
may be engaging (or suspected of engaging) in market timing
activities with respect to the Portfolios, the Company will assist
the Fund and the Adviser by providing such information as the
Company may determine to be reasonable and consistent with
applicable law to assist the Fund and the Adviser in their
determination of whether market timing activities have occurred,
and the Company will fully cooperate with the Fund and the Adviser
in limiting or preventing any market timing activities in the
Portfolios by the Accounts.
2. Proxy Solicitations and Voting
2.1 The Fund agrees that the terms on which shares of the Portfolios
are offered to the Accounts will not be materially altered without
at least sixty (60) days' prior written notice to the Company
during any period when the Accounts own shares of the Portfolios.
2.2 If and to the extent required by applicable law or by the terms of
the Contracts, the Company shall:
(i) solicit voting instructions from the Contract holders;
(ii) vote the shares of the Portfolios held by the Accounts in
accordance with instructions received from the Contract
holders; and
(iii) vote the shares of the Portfolios held by the Accounts for
which no timely instructions have been received from the
Contract holders in the same proportion as shares of such
Portfolio for which instructions have been received,
if and to the extent that (i) the SEC continues to interpret the
1940 Act to require pass-through voting privileges for variable
contract holders, and (ii) such interpretation is deemed
applicable to the Contracts. The Company reserves the right to
vote Portfolio shares held in any segregated asset account in its
own right, to the extent permitted by applicable law. The Company
will calculate voting privileges in a manner consistent with other
separate accounts investing in the Portfolios and in accordance
with applicable law. The Company agrees to hold the Fund, the
Portfolios, the Adviser and DFAS harmless from and against any
liability that may arise as a result of the Company's voting
Portfolio shares held in any segregated account in its own right.
2.3 The Fund, on behalf of the Portfolios, will comply with all
provisions of the 1940 Act requiring voting by shareholders, and
in particular, the Fund, at its option, will either provide for
annual or special meetings or comply with Section 16(c) of the
1940 Act, as well as with Sections 16(a) and, if and when
applicable, 16(b) of the 1940 Act and the rules thereunder.
Further, the Fund will act in accordance with the SEC's
interpretation of the requirements of Section 16(a) of the 1940
Act with respect to periodic elections of directors and with
whatever rules the SEC may promulgate with respect thereto.
3. Representations and Warranties
3.1 The Company represents and warrants that it is an insurance
company within the meaning of Section 816(a) of the Code, duly
organized and in good standing under applicable law, and that it
has legally and validly established each Account prior to any
issuance or sale thereof as a segregated asset account under
applicable state insurance law, and that it has and will maintain
the capacity to issue all Contracts that may be sold; and that it
is properly licensed, qualified and in good standing to sell the
Contracts in all jurisdictions where the Company does business.
The Company represents and warrants that the Contracts will be
issued and sold in compliance, in all material respects, with all
applicable federal and state laws, and that the sale of the
Contracts shall comply in all material respects with state
insurance suitability requirements.
3.2 The Company represents and warrants that the Contracts are or will
be registered under the Securities Act of 1933, as amended (the
"1933 Act").
3.3 The Company represents and warrants that it has or will have
registered each Account as a unit investment trust, in accordance
with the provisions of the 1940 Act or each such Account is, and
will continue to be, exempt from registration under section 3(c)
of the 1940 Act, to serve as a segregated investment account for
the Contracts.
3.4 The Company represents that the Contracts are currently treated as
variable annuity contracts under the Code, and that the Company
will maintain such treatment and that the Company will notify the
Adviser and the Fund promptly upon having a reasonable basis for
believing that the Contracts have ceased to be so treated or that
the Contracts might not be so treated in the future.
3.5 This Agreement has been duly authorized, executed and delivered by
the Company, and is a valid and legally binding contract
enforceable in accordance with its terms. No consent, approval,
authorization or order of any court or governmental authority is
required for the consummation by the Company of the transactions
contemplated by this Agreement. The execution and delivery of this
Agreement did not, and the consummation of the transactions
contemplated by this Agreement will not, violate the Company's
organizational documents or Bylaws, or any resolution, agreement
or arrangement to which the Company is a party or by which the
Company is bound.
3.6 The Company and the Accounts are duly authorized to acquire shares
of the Portfolios as contemplated by the terms of this Agreement.
The Company will cooperate with the Fund in providing information
as provided in Schedule 3.6 hereto and will assist the Fund in
preventing possible market timing and other trading activities in
violation of the Fund's policies and procedures, including without
limitation restricting or prohibiting further purchases or
exchanges of Fund shares as provided in Schedule 3.6 hereto.
3.7 There are no material legal, administrative or other proceedings
pending or, to the Company's knowledge, threatened against the
Company or its property or assets that could result in liability
on its part. The Company knows of no facts that might form the
basis for the institution of such proceedings. Neither the Company
nor the Accounts are parties to or subject to the provisions of
any order, decree or judgment of any court or governmental body
that materially and adversely affects its or their business or its
or their ability to consummate the transactions herein
contemplated.
3.8 Except as noted below, the disclosure contained in the applicable
offering documents for the Accounts does not contain any untrue
statements of a material fact or omit to state any material fact
required to be stated therein or necessary to make the statements
therein not misleading, and such disclosure meets all legal
requirements of applicable federal and state laws and regulations.
The Company
represents and warrants that all current and future offering
documents with respect to the Accounts and other materials that
mention the Company, the Fund, the Portfolios, DFAS or the Adviser
shall meet the requirements described in the first sentence of
this subparagraph; provided, however, that the Company shall not
be responsible for any disclosure that is provided to it in the
Fund's current prospectus(es) describing the Portfolios or the
Fund's registration statement as filed with the SEC.
3.9 The Fund represents and warrants that it is lawfully established
and validly existing under the laws of the State of Maryland. The
Fund represents that its operations are and shall at all times
remain in material compliance with the laws of the State of
Maryland to the extent required to perform this Agreement.
3.10 The Fund represents and warrants that the shares of the Portfolios
sold pursuant to this Agreement are registered under the 1933 Act,
and duly authorized for issuance; that the Fund shall amend its
registration statement for the Portfolios under the 1933 Act and
the 1940 Act, from time to time, as required in order to effect
the continuous offering of the shares of the Portfolios; that the
Fund will sell such shares in compliance with all applicable
federal and state laws; and that the Fund is and will remain
registered under, and complies and will comply in all material
respects with, the 1940 Act. The Fund shall register and qualify
the shares of the Portfolios for sale in accordance with the laws
of the various states only if, and to the extent, deemed advisable
by the Fund or DFAS.
3.11 The Fund represents and warrants that the Portfolios will take
reasonable steps to satisfy (or as to Portfolios that have not yet
commenced business, will invest the money received from the sale
of Portfolio shares so as to satisfy) the diversification
requirements of Section 817(h) of the Code and the Treasury
Regulations promulgated thereunder, and that the Fund will take
all reasonable steps to ensure that the Portfolios continue to
satisfy such requirements. The Fund agrees to notify the Company
upon having a reasonable basis for believing that any Portfolio
has ceased to satisfy such diversification requirements. Upon the
written request of the Company, the Fund shall provide Company a
certification of its compliance with Section 817(h) of the Code
and Treasury Regulation 1.817-5 within twenty (20) days of the end
of each calendar quarter.
3.12 The Fund represents and warrants that the Portfolios qualify (or
as to Portfolios that have not yet commenced business, will
qualify) as regulated investment companies under Subchapter M of
the Code, and that the Fund will take all reasonable steps to
maintain such qualification, subject to the reservation of the
right of the Directors of the Fund to not maintain the
qualification of a Portfolio as a regulated investment company if
the Directors determine this course of action to be beneficial to
shareholders. The Fund agrees to notify the Company upon having a
reasonable basis for believing that any Portfolio has ceased to so
qualify or upon the Directors taking any such action.
3.13 DFAS represents and warrants that it is and will remain a member
in good standing of the Financial Industry Regulatory Authority,
Inc. ("FINRA"), and is and will be duly registered as a
broker-dealer with the SEC under the Securities Exchange Act of
1934, as amended (the "1934 Act"). DFAS represents that its
operations are, and shall at all times remain, in material
compliance with the laws of the State of Delaware to the extent
required to perform this Agreement. DFAS further represents and
warrants that it will sell and distribute the shares of the
Portfolios in accordance with any applicable state laws and
federal securities laws, including without limitation, the 1933
Act, the 1934 Act, and the ▇▇▇▇ ▇▇▇.
3.14 The Parties represent and warrant to each other that all of their
directors, officers, employees, investment advisers, and other
individuals/entities dealing with the money and/or securities of
the Portfolios are and shall continue to be at all times covered
by a blanket fidelity bond or similar coverage for the benefit of
the Fund in an amount not less than the amount required by the
applicable rules of FINRA and the federal securities laws,
including the 1940 Act, as applicable. The aforesaid bond shall
include coverage for larceny and embezzlement and shall be issued
by a reputable bonding company. The Parties agree to make all
reasonable efforts to assure that such bond or another bond
containing these provisions is continuously in effect, and each
agrees to notify promptly the other Parties in the event that such
coverage no longer applies.
3.15 The Parties agree not to knowingly facilitate a Contract holder's
participation in the Fund's investment process in contravention of
the following, which the Parties, as of the date hereof, to their
knowledge, represent and warrant to be true: (1) there is not, and
there will not be, any arrangement, plan, contract or agreement
between the Adviser (or a subadviser) and a Contract holder
regarding the availability of the Fund as an Account under the
Contract, or the specific assets to be held by the Fund or a fund
that the Fund may invest its assets; (2) other than a Contract
holder's ability to allocate Contract premiums and transfer
amounts in the Company's Account to and from the Company's Account
corresponding to the Fund, all investment decisions concerning the
Fund will be made by the Adviser, any subadviser(s) and the
Company's Board of Directors in their sole and absolute
discretion; (3) the percentage of the Fund's assets invested in a
particular fund will not be fixed in advance of any Contract
holder's investment and will be subject to change by the Adviser
or a subadviser at any time without notice; (4) a Contract holder
cannot, and will not be able to, direct the Fund's investment in
any particular asset or recommend a particular investment or
investment strategy; (5) there is not, and will not be, any
agreement or plan between the Adviser or a subadviser and a
Contract holder regarding a particular investment of the Fund; (6)
a Contract holder cannot, and will not be able to, communicate
directly or indirectly with the Adviser or a subadviser concerning
the selection, quality or rate of return on any specific
investment or group of investments held by the Fund; (7) a
Contract holder does not have, and will not have, any current
knowledge of the Fund's specific assets other than as may be
required to be presented in periodic reports to the Fund's
shareholders;
(8) a Contract holder does not have, and will not have, any legal,
equitable, direct or indirect ownership interest in any of the
assets of the Fund; and (9) a Contract holder only has, and only
will have, a contractual claim against the insurance company
offering the Contract to receive cash from the insurance company
under the terms of his or her Contract.
4. Sales Material and Information
4.1 The Company shall promptly provide the Fund with copies of any
Contract holder complaints respecting the Contracts that relate to
the Fund or to the Portfolios.
4.2 Except with the written consent of the Adviser, the Fund or DFAS,
as appropriate, the Company shall not make any material
representations concerning the Adviser, DFAS, the Fund or the
Portfolios, other than the information or representations
contained in: (a) a registration statement or prospectus for the
Fund, as amended or supplemented from time to time; (b) published
reports or statements of the Fund which are in the public domain
or are approved by the Fund; or (c) sales literature or other
promotional material of the Fund.
Notwithstanding the foregoing, this provision shall not be
interpreted to prevent the Company from providing information
about the Adviser, DFAS, the Fund or this Agreement to their
Directors, regulators, accountants, legal counsel or otherwise in
the ordinary course of their business.
4.3 Except with the written consent of the Company, the Adviser, DFAS,
or the Fund shall not make any material representations concerning
the Company, other than the information or representations
contained in:
(a) a registration statement or offering memoranda for the
Contracts, as amended or supplemented from time to time;
(b) published reports or statements of the Contracts or the
Accounts which are in the public domain or are approved by
the Company; or
(c) sales literature or other promotional material of the
Company.
Notwithstanding the foregoing, this provision shall not be
interpreted to prevent the Adviser, DFAS and the Fund from
providing information about the Company or this Agreement to their
Directors, regulators, accountants, legal counsel or otherwise in
the ordinary course of their business.
4.4 No Party shall use any other Party's names, logos, trademarks or
service marks, whether registered or unregistered, without the
prior written consent of such Party.
4.5 The Fund will provide to the Company at least one complete copy of
all registration statements, prospectuses, statements of
additional information, 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 Portfolios or their shares,
in final form as filed with the SEC. If requested by the Company,
the Fund shall provide such documentation (including a final copy
of the amended prospectus(es) of the Portfolios as set in type
(including an 8 1/2" x 11" size camera-ready stat) at the Fund's
expense) and other assistance as is reasonably necessary in order
for the Company once each year to have, at the Company's expense,
the current prospectus(es) for the Portfolios printed together in
with the document describing the Contracts.
4.6 The Company will provide to the Fund at least one complete copy of
all offering materials describing the Fund, the Portfolios and the
Contracts, including application and investment election forms,
sample illustrations, reports, solicitations for voting
instructions, sales literature and any other promotional
materials, applications for exemptions, requests for no-action
letters, and all amendments to any of the above, that relate to
the Fund, the Portfolios, the Contracts and each Account. In the
event any such documents are required to be filed with any
regulatory authority or body, the Company shall provide such
materials in final form as filed with such regulatory authority or
body. The Company represents and warrants that the Contracts,
registration statements, offering memoranda and any other filing
in connection therewith with respect to the Accounts will not
materially deviate from the form of such documents provided to the
Fund.
4.7 For purposes of this Section 4, the phrase "sales literature or
other promotional material" shall be construed in accordance with
all applicable securities laws and regulations.
4.8 To the extent required by applicable law, including the
administrative requirements of regulatory authorities, or as
mutually agreed between the Company and DFAS, the Company reserves
the right to modify any of the Contracts in any respect
whatsoever. The Company reserves the right, in its sole
discretion, to suspend the sale of any Contract, in whole or in
part, or to accept or reject any application for the sale of a
Contract. The Company agrees to notify the other Parties promptly
upon the occurrence of any event that the Company believes might
necessitate a material modification or suspension.
5. Fees and Expenses
5.1 The Fund shall bear the cost of registration and qualification of
the shares of the Portfolios; preparation and filing of the
Portfolios' prospectus(es) and the Fund's registration statement,
proxy materials and reports relating to the Portfolios,
including postage; preparation of all other statements and notices
relating to the Portfolios required by any federal or state law;
payment of all applicable fees, including, without limitation, all
fees due under Rule 24f-2 of the 1940 Act relating to the
Portfolios; and all taxes on the issuance or transfer of the
Portfolios' shares.
5.2 The Company shall assure that the Contracts are registered under
the 1933 Act, and that each Account is registered as a unit
investment trust in accordance with the 1940 Act. The Company
shall bear the expenses for the costs of preparation and filing of
the Company's prospectus and registration statement with respect
to the Contracts; preparation of all other statements and notices
relating to each Account or Contracts required by any federal or
state law; all expenses for the solicitation and sale of the
Contracts, including all costs of printing and distributing all
copies of advertisements, prospectuses, statements of additional
information, proxy materials and reports to Contract holders and
prospective purchasers of the Contracts, as required by applicable
state and federal law; payment of all applicable fees and taxes
relating to the Contracts; all costs of drafting, filing and
obtaining approvals of the Contracts in the various states under
applicable insurance laws; and all other costs associated with
ongoing compliance with all such laws and its obligations
hereunder.
6. Indemnification
6.1 Indemnification by the Company
6.1(a) The Company agrees to indemnify, defend and hold harmless
the Fund, the Portfolios, DFAS and the Adviser, and each of
their directors and officers (as applicable), and each
person, if any, who controls any of them within the meaning
of Section 15 of the 1933 Act (collectively, the
"Indemnified Parties" for purposes of this Section 6.1)
against any and all losses, claims, damages, liabilities
(including amounts paid in settlement with the written
consent of the Company) or litigation (including reasonable
legal and other expenses) (except in all cases, excluding
consequential or special damages), to which the Indemnified
Parties may become subject under any statute, regulation,
at common law or otherwise, and:
(i) arise out of or are based upon any untrue statements
or alleged untrue statements of any material fact
contained in the registration statement, offering
memoranda or sales literature for the Contracts (or
any amendment or supplement to any of the
foregoing), or arise out of or are based upon the
omission or the alleged omission to state therein a
material fact required to be stated therein or
necessary to make the statements therein not
misleading, provided that this Section 6.1(a) shall
not apply as to any Indemnified Party if such
statement or omission or such alleged statement or
omission was made in reliance upon and in conformity
with
information furnished to the Company by or on behalf
of the Fund for use in the registration statement or
offering memoranda for the Contracts (or any
amendment or supplement) or otherwise for use in
connection with the sale of the Contracts or the
shares of the Portfolios;
(ii) arise out of, or as a result of, statements or
representations or wrongful conduct of the Company
or persons under its control, with respect to the
sale or distribution of the Contracts or the shares
of the Portfolios;
(iii) arise out of any untrue statement or alleged untrue
statement of a material fact contained in a
registration statement, prospectus, or sales
literature covering the Fund and the Portfolios or
any amendment thereof or supplement thereto, or the
omission or alleged omission to state therein a
material fact required to be stated therein, or
necessary to make the statements therein not
misleading, if such a statement or omission was made
in reliance upon information furnished to the Fund
by or on behalf of the Company;
(iv) arise out of, or as a result of, any failure by the
Company or persons under its control to provide the
services and furnish the materials contemplated
under the terms of this Agreement; or
(v) arise out of, or result from, any material breach of
any representation and/or warranty made by the
Company or persons under its control in this
Agreement or arise out of or result from any other
material breach of this Agreement by the Company or
persons under its control;
as limited by and in accordance with the provisions of
Sections 6.1(b) and 6.1(c) hereof.
6.1(b) The Company shall not be liable under this indemnification
provision with respect to any losses, claims, damages,
liabilities or litigation to which an Indemnified Party
would otherwise be subject by reason of such Indemnified
Party's willful misfeasance, bad faith, or gross negligence
in the performance of such Indemnified Party's duties or by
reason of such Indemnified Party's reckless disregard of
obligations or duties under this Agreement or to the Fund,
whichever is applicable, or to the extent of such
Indemnified Party's gross negligence.
6.1(c) The Company shall not be liable under this indemnification
provision with respect to any claim made against an
Indemnified Party unless such Indemnified Party shall have
notified the Company in writing within a reasonable time
after the summons or other first legal process giving
information of the nature of the claim shall have been
served upon such Indemnified Party (or after such
Indemnified Party shall have received notice of such
service on any designated agent), but failure to notify the
Company of any such claim shall not relieve the Company
from any liability which it may have to the Indemnified
Party otherwise than on account of this indemnification
provision. In case any such action is brought against the
Indemnified Parties, the Company shall be entitled to
participate, at its own expense, in the defense of such
action, provided that it gives written notice of such
intention to the Indemnified Parties. The Company also
shall be entitled to assume and to control the defense
thereof. After notice from the Company to such Party of the
Company's election to assume the defense thereof, the
Indemnified Party shall bear the fees and expenses of any
additional counsel retained by it, and the Company will not
be liable to such Party under this Agreement for any legal
or other expenses subsequently incurred by such Party
independently in connection with the defense thereof other
than reasonable costs of investigation.
6.1(d) The Indemnified Parties will promptly notify the Company of
the commencement of any litigation or proceedings against
them in connection with the issuance or sale of the shares
of the Portfolios or the Contracts or the operation of the
Portfolios.
6.2 Indemnification by DFAS
6.2(a) DFAS agrees to indemnify, defend and hold harmless the
Company and each of its directors and officers and each
person, if any, who controls the Company within the meaning
of Section 15 of the 1933 Act (collectively, the
"Indemnified Parties" for purposes of this Section 6.2)
against any and all losses, claims, damages, liabilities
(including amounts paid in settlement with the written
consent of the Fund or DFAS) or litigation (including
reasonable legal and other expenses) (except in all cases,
excluding consequential or special damages) to which the
Indemnified Parties may become subject under any statute,
regulation, at common law or otherwise, and:
(i) arise out of or are based upon any untrue statement
or alleged untrue statement of any material fact
contained in the registration statement or current
prospectus(es) or sales literature of the Fund and
the Portfolios (or any amendment or supplement to
any of the foregoing), or arise out of or are based
upon the omission or the alleged omission to state
therein a material fact required to be stated
therein or necessary to make the statements therein
not misleading, provided that this Section 6.2(a)
shall not apply as to any Indemnified Party if such
statement or omission or such alleged statement or
omission was made in reliance upon and in conformity
with information furnished to the Fund by or on
behalf
of the Company for use in the registration statement
or prospectus(es) for the Portfolios or in sales
literature (or any amendment or supplement) or
otherwise for use in connection with the sale of the
shares of the Portfolios;
(ii) arise out of, or as a result of, statements or
representations or wrongful conduct of DFAS or the
Fund or persons under their control, with respect to
the sale or distribution of the shares of the
Portfolios (it is understood that the persons who
are involved in the sale or distribution of the
Contracts are not under the control of DFAS, the
Adviser or the Fund);
(iii) arise out of any untrue statement or alleged untrue
statement of a material fact contained in a
registration statement, offering memoranda or sales
literature covering the Contracts, or any amendment
thereof or supplement thereto, or the omission or
alleged omission to state therein a material fact
required to be stated therein, or necessary to make
the statements therein not misleading, if such
statement or omission was made in reliance upon
information furnished to the Company by or on behalf
of the Fund;
(iv) arise out of, or as a result of, any failure by
DFAS, the Fund or persons under their control to
provide the services and furnish the materials
contemplated under the terms of this Agreement; or
(v) arise out of or result from any material breach of
any representation and/or warranty made by DFAS, the
Fund or persons under their control in this
Agreement or arise out of or result from any other
material breach of this Agreement by DFAS, the Fund
or persons under their control;
as limited by and in accordance with the provisions of
Sections 6.2(b) and 6.2(c) hereof.
6.2(b) DFAS shall not be liable under this indemnification
provision with respect to any losses, claims, damages,
liabilities or litigation to which an Indemnified Party
would otherwise be subject by reason of such Indemnified
Party's willful misfeasance, bad faith, or gross negligence
in the performance of such Indemnified Party's duties or by
reason of such Indemnified Party's reckless disregard of
obligations and duties under this Agreement or to the
Company or the Accounts, whichever is applicable, or to the
extent of such Indemnified Party's gross negligence.
6.2(c) DFAS shall not be liable under this indemnification
provision with respect to any claim made against an
Indemnified Party unless such Indemnified Party shall have
notified DFAS in writing within a reasonable time after
the summons or other first legal process giving information
of the nature of the claim shall have been served upon such
Indemnified Party (or after such Indemnified Party shall
have received notice of such service on any designated
agent), but failure to notify DFAS of any such claim shall
not relieve DFAS from any liability which it may have to
the Indemnified Party otherwise than on account of this
indemnification provision. In case any such action is
brought against the Indemnified Parties, DFAS will be
entitled to participate, at its own expense, in the defense
thereof, provided that it gives written notice of such
intention to the Indemnified Parties. DFAS also shall be
entitled to assume and to control the defense thereof.
After notice from DFAS to such Party of DFAS's election to
assume the defense thereof, the Indemnified Party shall
bear the fees and expenses of any additional counsel
retained by it, and DFAS will not be liable to such party
under this Agreement for any legal or other expenses
subsequently incurred by such Party independently in
connection with the defense thereof other than reasonable
costs of investigation.
6.2(d) The Indemnified Parties will promptly notify DFAS of the
commencement of any litigation or proceedings against them
in connection with the issuance or sale of the Contracts or
the operation of the Accounts.
6.3 Indemnification by the Adviser
6.3(a) The Adviser agrees to indemnify and hold harmless the
Company and each of its directors and officers and each
person, if any, who controls the Company within the meaning
of Section 15 of the 1933 Act (collectively, the
"Indemnified Parties" for purposes of this Section 6.3)
against any and all losses, claims, damages, liabilities
(including amounts paid in settlement with the written
consent of the Fund or the Adviser) or litigation
(including reasonable legal and other expenses) (except in
all cases, excluding consequential or special damages) to
which the Indemnified Parties may become subject under any
statute, regulation, at common law or otherwise, and:
(i) arise out of or based upon any untrue statement or
alleged untrue statement of any material fact
contained in the registration statement or current
prospectus(es) or sales literature of the Fund and
the Portfolios (or any amendment or supplement to
any of the foregoing), or arise out of or are based
upon the omission or the alleged omission to state
therein a material fact required to be stated
therein or necessary to make the statements therein
not misleading, provided that this Section 6.3(a)
shall not apply as to any Indemnified Party if such
statement or omission or such alleged statement or
omission was made in reliance upon and in conformity
with information furnished to the Fund or the
Adviser by or on behalf of the Company for use in
the registration statement or prospectus(es) for the
Portfolios or in sales literature
(or any amendment or supplement) or otherwise for
use in connection with the sale of the shares of the
Portfolios;
(ii) arise out of, or as a result of, statement or
representations or wrongful conduct of DFAS, the
Fund or the Adviser or persons under their control,
with respect to the sale or distribution of the
shares of the Portfolios (it is understood that the
persons who are involved in the sale or distribution
of the Contracts are not under the control of DFAS,
the Adviser or the Fund);
(iii) arise out of any untrue statement or alleged untrue
statement of a material fact contained in a
registration statement, offering memoranda or sales
literature covering the Contracts, or any amendment
thereof or supplement thereto, or the omission or
alleged omission to state therein a material fact
required to be stated therein, or necessary to make
the statements therein not misleading, if such
statement or omission was made in reliance upon
information furnished to the Company by or on behalf
of the Fund or the Adviser;
(iv) arise out of, or as a result of, any failure by
DFAS, the Adviser, the Fund or persons under their
control to provide the services and furnish the
materials contemplated under the terms of this
Agreement; or
(v) arise out of or result from any material breach of
any representation and/or warranty made by DFAS, the
Fund, the Adviser or persons under their control in
this Agreement or arise out of or result from any
other material breach of this Agreement by DFAS, the
Adviser, the Fund or persons under their control;
as limited by and in accordance with the provisions of
Sections 6.3(b) and 6.3(c) hereof.
6.3(b) The Adviser shall not be liable under this indemnification
provision with respect to any losses, claims, damages,
liabilities or litigation to which an Indemnified Party
would otherwise be subject by reason of such Indemnified
Party's willful misfeasance, bad faith, or gross negligence
in the performance of such Indemnified Party's duties or by
reason of such Indemnified Party's reckless disregard of
obligations and duties under this Agreement or to the
Company or the Accounts, whichever is applicable, or to the
extent of such Indemnified Party's gross negligence.
6.3(c) The Adviser shall not be liable under this indemnification
provision with respect to any claim made against an
Indemnified Party unless such Indemnified Party shall have
notified the Fund or the Adviser in writing within a
reasonable time after the summons or other first legal
process
giving information of the nature of the claim shall have
been served upon such Indemnified Party (or after such
Indemnified Party shall have received notice of such
service on any designated agent), but failure to notify the
Fund or the Adviser of any such claim shall not relieve the
Adviser from any liability which it may have to the
Indemnified Party otherwise than on account of this
indemnification provision. In case any such action is
brought against the Indemnified Parties, the Adviser will
be entitled to participate, at its own expense, in the
defense thereof, provided that it gives written notice of
such intention to the Indemnified Parties. The Adviser also
shall be entitled to assume and to control the defense
thereof. After notice from the Adviser to such Party of the
Adviser's election to assume the defense thereof, the
Indemnified Party shall bear the fees and expenses of any
additional counsel retained by it, and the Adviser will not
be liable to such Party under this Agreement for any legal
or other expenses subsequently incurred by such Party
independently in connection with the defense thereof, other
than reasonable costs of investigation.
6.3(d) The Indemnified Parties will promptly notify the Fund or
the Adviser of the commencement of any litigation or
proceedings against them in connection with the issuance or
sale of the Contracts or the operation of the Accounts.
7. Potential Conflicts
7.1 The Directors will monitor the Fund for the existence of any
material irreconcilable conflict between the interests of the
contract owners of all separate accounts investing in the
Portfolios. An irreconcilable material conflict may arise for a
variety of reasons, including: (a) an action by any state
insurance regulatory authority; (b) a change in applicable
insurance (including federal, state or other jurisdiction), tax,
or securities laws or regulations, or a public ruling, private
letter ruling, no-action or interpretive 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 Portfolio are being
managed; (e) a difference in voting instructions given by variable
annuity contract and variable life insurance contract owners; or
(f) a decision by an insurer to disregard the voting instructions
of contract owners. The Directors shall promptly inform the
Company if they determine that an irreconcilable material conflict
exists and the implications thereof.
7.2 The Company will report any potential or existing conflicts of
which it is aware to the Directors and, on an annual basis, shall
provide the Fund with written notification that the Company is not
aware of any conflict, if such is the case. The Company will
assist the Directors in carrying out their responsibilities under
any applicable provisions of the federal securities laws and/or
any exemptive orders granted by the SEC, including the order
obtained by the Fund from the SEC, dated March 12, 2002 (File No.
812-12760) ("Exemptive Order"), by providing
the Directors with all information reasonably necessary for the
Directors to consider any issues raised. This includes, but is not
limited to, an obligation by the Company to inform the Directors
whenever Contract holder voting instructions are disregarded.
The Company acknowledges that: (i) the Company's disregard of
voting instructions may conflict with the majority of Contract
holders' voting instructions; and (ii) the Company's action could
preclude a majority vote approving a proposed change or could
represent a minority view. If the Company's judgment represents a
minority position or would preclude a majority vote, then the
Company may be required, at the Fund's election, to withdraw the
Accounts' investment in the Portfolios. Other than possible
decline in the value of an Account due to fluctuations in the net
asset value of the Portfolios, no charge or penalty will be
imposed as a result of such withdrawal.
7.3 If it is determined by a majority of the Directors, or a majority
of its disinterested Directors, that a material irreconcilable
conflict exists, the Company shall, at its expense and to the
extent reasonably practicable (as determined by a majority of
disinterested Directors), take whatever steps are necessary to
remedy or eliminate the irreconcilable material conflict, up to
and including: (1) withdrawing the assets allocable to some or all
of the Accounts from any Portfolio and reinvesting such assets in
a different investment medium, including (but not limited to)
another Portfolio of the Fund, or submitting the question whether
such segregation should be implemented to a vote of all affected
Contract holders and, as appropriate, segregating the assets of
any appropriate group that votes in favor of such segregation, or
offering to the affected Contract holders the option of making
such a change; and (2) establishing a new registered management
investment company or managed separate account.
7.4 If a material irreconcilable conflict arises because a particular
state insurance regulator's decision applicable to the Company
conflicts with the majority of other insurance regulators, then
the Company will withdraw the affected Account's investment in the
Portfolio(s) and terminate this Agreement with respect to such
Account within six (6) months after the Directors inform the
Company in writing that the Directors have determined that such
decision has created an irreconcilable material 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 Directors. Until the end of the foregoing six (6)
month period, DFAS and the Fund shall continue to accept and
implement orders by the Company for the purchase (and redemption)
of shares of the Portfolios.
7.5 For purposes of Sections 7.3 through 7.5 of this Agreement, a
majority of the disinterested Directors shall determine whether
any proposed action adequately remedies any irreconcilable
material conflict. The Company shall not be required by Section
7.3 to establish a new funding medium for the Contracts if an
offer to do so has been declined by vote of a majority of Contract
holders materially
adversely affected by the irreconcilable material conflict. In the
event that the Directors determine that any proposed action does
not adequately remedy any irreconcilable material conflict, then
the Company will withdraw an Account's investment in the
Portfolios and terminate this Agreement within six (6) months
after the Directors inform 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.
7.6 If and to the extent that Rule 6e-2 and Rule 6e-3(T) are amended,
or Rule 6e-3 is adopted, to provide exemptive relief from any
provision of the 1940 Act or the rules promulgated thereunder with
respect to mixed or shared funding (as defined in any Exemptive
Order) on terms and conditions materially different from those
contained in any Exemptive Order, then (a) the Fund and/or the
Company, 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)
Sections 7.1, 7.2, 7.3 and 7.4 of this Agreement shall continue in
effect only to the extent that terms and conditions substantially
identical to such Sections are contained in such Rule(s) as so
amended or adopted by the SEC.
8. Term and Termination
8.1 This Agreement may be terminated by any Party with or without
cause on sixty (60) days' advance written notice.
8.2 Notwithstanding any other provision of this Agreement, DFAS, the
Adviser or the Fund may terminate this Agreement for cause on not
less than thirty (30) days' prior written notice to the Company,
unless the Company has cured such cause within thirty (30) days of
receiving such notice, for any material breach by the Company of
any representation, warranty, covenant or obligation hereunder.
8.3 Notwithstanding any other provision of this Agreement, the Company
may terminate this Agreement for cause on not less than thirty
(30) days' prior written notice to DFAS, the Adviser and the Fund,
unless DFAS, the Adviser or the Fund, as appropriate, has cured
such cause within thirty (30) days of receiving such notice, for
any material breach by DFAS, the Adviser or the Fund of any
representation, warranty, covenant or obligation hereunder.
8.4 Notwithstanding any other provision of this Agreement, the Company
may terminate this Agreement by written notice to the Fund and
DFAS with respect to any Portfolio based upon the Company's
determination that shares of such Portfolio are not reasonably
available to meet the requirements of the Contracts.
8.5 Notwithstanding any other provision of this Agreement, the Company
may terminate this Agreement by written notice to the Fund, the
Adviser and DFAS with respect to any Portfolio in the event such
Portfolio's 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 the underlying
investment media of the Contracts issued or to be issued by the
Company.
8.6 Notwithstanding any other provision of this Agreement, the Company
may terminate this Agreement by written notice to the Fund, the
Adviser and DFAS with respect to any Portfolio in the event that
such Portfolio ceases to qualify as a "regulated investment
company" under Subchapter M of the Code, or if the Company
reasonably believes that any such Portfolio may fail to so
qualify.
8.7 Notwithstanding any other provision of this Agreement, the Company
may terminate this Agreement by written notice to the Fund, the
Adviser and DFAS with respect to any Portfolio in the event that
such Portfolio fails to satisfy the diversification requirements
of Section 817 of the Code and the Treasury regulations
promulgated thereunder.
8.8 Notwithstanding any other provision of this Agreement, the Fund,
the Adviser or DFAS may terminate this Agreement by written notice
to the Company, if any one or all shall determine, in their sole
judgment, exercised in good faith, that the Company has suffered a
material adverse change in its business, operations, financial
condition or prospects since the date of this Agreement or is the
subject of material adverse publicity.
8.9 Notwithstanding any other provision of this Agreement, the Company
may terminate this Agreement by written notice to the Fund, the
Adviser and DFAS, if the Company shall determine, in its sole
judgment, exercised in good faith, that any of the Fund, the
Portfolios, the Adviser or DFAS has suffered a material adverse
change in its business, operations, financial condition or
prospects since the date of this Agreement or is the subject of
material adverse publicity.
8.10 Notwithstanding any other provision of this Agreement, any Party
may terminate this Agreement for cause on not less than thirty
(30) days' prior written notice to all other Parties, unless any
of the other Parties has cured such cause within thirty (30) days
of receiving such notice, for any one of the following reasons:
(a) change in control of any Party or such Party's ultimate
controlling person; however, a change in the name of the
Party will not constitute a change in control;
(b) a material change in, or other material revision to, the
Contracts or the prospectus(es) of the Portfolios, which
material change or revision is not acceptable to any of the
other Parties; or
(c) any action taken by federal, state or other regulatory
authorities of competent jurisdiction which, in the
reasonable judgment of any of the Parties, either (i)
materially and adversely alters the terms, advantages
and/or benefits of the Contracts to current or prospective
purchasers; or (ii) materially or adversely alters the
terms or conditions of such Party's participation in the
subject matter of this Agreement.
8.11 Notwithstanding the termination of this Agreement, each
Party shall continue for so long as any Contracts remain
outstanding to perform such of its duties hereunder as are
necessary to ensure the continued tax status thereof and
the payment of benefits thereunder, with respect to a
Portfolio and the corresponding subaccount of each Account.
9. Notices
Any notice shall be deemed sufficiently given when sent by
registered or certified mail, reputable overnight mail, or via facsimile, to the
other Parties at the address of such Parties set forth below or at such other
address as such Parties may from time to time specify in writing to the other
Parties.
If to the Fund:
▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
Vice President and Secretary
DFA Investment Dimensions Group Inc.
▇▇▇▇ ▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
If to the Adviser:
▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
Vice President and Secretary
Dimensional Fund Advisors LP
▇▇▇▇ ▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
If to DFAS:
▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
Vice President and Secretary
DFA Securities LLC
▇▇▇▇ ▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
If to the Company:
▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq. General Counsel & Secretary
Jefferson National Life Insurance Company
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
10. Miscellaneous
10.1 The captions in this Agreement are included for convenience of
reference only and in no way affect the construction or effect of
any provisions hereof.
10.2 If any portion 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.
10.3 This Agreement may be executed simultaneously in two or more
counterparts, each of which taken together shall constitute one
and the same instrument.
10.4 Each Party shall cooperate with each other Party and all
appropriate governmental authorities (including, without
limitation, the SEC, FINRA, and any applicable insurance,
securities or other regulator of competent jurisdiction), and
shall permit such authorities reasonable access to its books and
records as required by applicable law in connection with any
investigation or inquiry relating to this Agreement.
10.5 Each Party hereto grants to the other Parties the right to audit
its records relating to the terms and conditions of this Agreement
upon reasonable notice during reasonable business hours in order
to confirm compliance with this Agreement.
10.6 The rights, remedies and obligations contained in this Agreement
are cumulative and are in addition to any and all rights, remedies
and obligations, at law or in equity, which the Parties hereto are
entitled to under state and federal laws.
10.7 Subject to the requirements of legal process and regulatory
authority, the Fund, the Adviser and DFAS shall treat as
confidential the names and addresses of the owners of the
Contracts and all information reasonably identified as
confidential in writing by the Company hereto and, except as
permitted by this Agreement, shall not disclose, disseminate or
utilize such names and addresses and other confidential
information without the express written consent of the Company
until such time as it may come into the public domain.
10.8 This Agreement or any of the rights and obligations hereunder may
not be assigned by any Party without the prior written consent of
all Parties hereto.
10.9 In any dispute arising hereunder, each Party waives its right to
demand a trial by jury and hereby consents to a bench trial of all
such disputes.
10.10 The terms of this Agreement shall be construed and the provisions
hereof interpreted under and in accordance with the laws of the
State of New York, without regard to the conflicts of law
principles thereof; provided, however, that all performances
rendered hereunder shall be subject to compliance with all
applicable state and federal laws and regulations.
To the extent they are applicable, this Agreement shall be subject
to the provisions of the 1933 Act, the 1934 Act, and the 1940 Act,
and the rules and regulations and interpretations thereunder,
including such exemptions from those statutes, rules and
regulations as the SEC may grant, and any applicable FINRA
regulations or interpretations, and the terms hereof shall be
interpreted and construed in accordance therewith.
IN WITNESS WHEREOF, each of the Parties hereto has caused this Agreement
to be duly executed as of the date first set forth above.
Company:
JEFFERSON NATIONAL LIFE INSURANCE COMPANY
By: ________________________________________
Name: ________________________________________
Title: ________________________________________
Fund:
DFA INVESTMENT DIMENSIONS GROUP INC.
By: ________________________________________
Name: ________________________________________
Title: ________________________________________
Adviser:
DIMENSIONAL FUND ADVISORS LP
By: Dimensional Holdings Inc., general partner
By: ________________________________________
Name: ________________________________________
Title: ________________________________________
DFAS:
DFA SECURITIES LLC
By: ________________________________________
Name: ________________________________________
Title: ________________________________________
Schedule 1.1
VA U.S. Targeted Value Portfolio
VA U.S. Large Value Portfolio
VA International Value Portfolio
VA International Small Portfolio
VA Short-Term Fixed Portfolio
VA Global Bond Portfolio
SCHEDULE 3.6: Rule 22c-2 Provisions
1. Agreement to Provide Information. The Company (hereafter, an
"Intermediary") agrees to provide the Fund, upon written request, the
taxpayer identification number ("TIN"), the Individual/International
Taxpayer Identification Number ("ITIN")(1), or other government-issued
identifier ("GII"), if known, of any or all Contract holders or
shareholder(s) of the account (together, "Shareholder(s)") and the
amount, date, name or other identifier of any investment professional(s)
associated with the Shareholder(s) or account (if known), and transaction
type (purchase, redemption, transfer, or exchange) of every purchase,
redemption, transfer, or exchange of Fund shares ("Shares") held through
an account maintained by the Intermediary during the period covered by
the request.
1.1. Period Covered by Request. Unless otherwise directed by the Fund,
Intermediary agrees to provide the information specified in
Section 1 for each trading day.
1.2. Form and Timing of Response.
1.2.1. Intermediary agrees to provide, promptly upon request of
the Fund or its designee, the requested information
specified in Section 1. If requested by the Fund or its
designee, Intermediary agrees to use its best efforts to
determine promptly whether any specific person about whom
it has received the identification and transaction
information specified in Section 1 is itself a financial
intermediary ("indirect intermediary") and, upon further
request of the Fund or its designee, promptly either (i)
provide (or arrange to have provided) the information set
forth in Section 1 for those shareholders who hold an
account with an indirect intermediary, or (ii) restrict or
prohibit the indirect intermediary from purchasing, in
nominee name on behalf of other persons, securities issued
by the Fund. Intermediary additionally agrees to inform the
Fund whether it plans to perform (i) or (ii).
1.2.2. Responses required by this paragraph must be communicated
in writing and in a format mutually agreed upon by the
parties.
1.2.3. To the extent practicable, the format for any transaction
information provided to the Fund should be consistent with
the NSCC Standardized Data Reporting Format.
1.3. Limitations on Use of Information. The Fund agrees not to use the
information received from the Intermediary for the Fund's use in
external solicitation or marketing to shareholders without the
prior written consent of the Intermediary. The Fund is permitted
to use the information received from the Intermediary for the
Fund's internal purposes, including monitoring compliance with the
Fund's internal policies, procedures and practices. The Fund
agrees to keep any non-public information furnished by the
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(1) According to the IRS' website, the ITIN refers to the Individual Taxpayer
Identification number, which is a nine-digit number that always begins
with the number 9 and has a 7 or 8 in the fourth digit, example
9XX-7X-XXXX.. The IRS issues ITINs to individuals who are required to
have a U.S. taxpayer identification number but who do not have, and are
not eligible to obtain a Social Security Number (SSN) from the Social
Security Administration (SSA). SEC Rule 22c-2 inadvertently refers to the
ITIN as the International Taxpayer Identification Number.
Intermediary confidential consistent with the Fund's then current
privacy policy, except as necessary to comply with federal, state,
or local laws, rules, or other applicable legal requirements.
2. Agreement to Restrict Trading. Intermediary agrees to execute written
instructions from the Fund to restrict or prohibit further purchases or
exchanges of Shares by a Shareholder that has been identified by the Fund
as having engaged in transactions in the Fund's Shares (directly or
indirectly through the Intermediary's account) that violate policies
established by the Fund for the purpose of eliminating or reducing any
dilution of the value of the outstanding Shares issued by the Fund.
2.1. Form of Instructions. Instructions to restrict or prohibit trading
must include the TIN, ITIN, or GII, if known, and the specific
restriction(s) to be executed. If the TIN, ITIN, or GII is not
known, the instructions must include an equivalent identifying
number of the Shareholder(s) or account(s) or other agreed upon
information to which the instruction relates.
2.2. Timing of Response. Intermediary agrees to execute instructions
from the Fund to restrict or prohibit trading as soon as
reasonably practicable, but not later than ten (10) business days
after receipt of the instructions by the Intermediary.
2.3. Confirmation by Intermediary. Intermediary must provide written
confirmation to the Fund that instructions have been executed.
Intermediary agrees to provide confirmation as soon as reasonably
practicable, but not later than ten (10) business days after the
instructions have been executed.
3. Definitions. For purposes of this Schedule C:
3.1. The term "Fund" includes the Fund's principal underwriter and
transfer agent. The term not does include any "excepted funds" as
defined in SEC Rule 22c-2(b) under the 1940 Act.(2)
3.2. The term "Shares" means the interests of Shareholders
corresponding to the redeemable securities of record issued by the
Fund under the 1940 Act that are held by the Intermediary.
3.3. The term "Shareholder" means the beneficial owner of Shares,
whether the Shares are held directly or by the Intermediary in
nominee name; except:
3.3.1. with respect to retirement plan recordkeepers, the term
"Shareholder" means the Plan participant notwithstanding
that the Plan may be deemed to be the beneficial owner of
Shares; and
3.3.2. with respect to insurance companies, the term "Shareholder"
means the holder of interests in a variable annuity or
variable life insurance contract issued by the
Intermediary.
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(2) As defined in SEC Rule 22c-2(b), the term "excepted fund" means any: (1)
money market fund; (2) fund that issues securities that are listed on a
national exchange; and (3) fund that affirmatively permits short-term
trading of its securities, if its prospectus clearly and prominently
discloses that the fund permits short-term trading of its securities and
that such trading may result in additional costs for the fund.
3.4. The term "written" includes electronic writings and facsimile
transmissions.
3.5. The term "Intermediary" shall mean a "financial intermediary" as
defined in SEC Rule 22c-2.(3)
3.6. The term "purchase" does not include the automatic reinvestment of
dividends.
3.7. The term "promptly" as used in Section 1.2 shall mean as soon as
practicable but in no event later than 10 business days from the
Intermediary's receipt of the request for information from the
Fund or its designee.
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(3) "Financial intermediary" is defined in SEC Rule 22c-2(c)(1) as: "(i) any
broker, dealer, bank, or other entity that holds securities of record
issued by the fund, in nominee name; (ii) a unit investment trust or fund
that invests in the fund in reliance on section 12(d)(1)(E) of the Act
(15 U.S.C. 80a-12(d)(1)(E)); and (iii) in the case of a
participant-directed employee benefit plan that owns the securities
issued by the fund, a retirement plan's administrator under section
3(16)(A) of the Employee Retirement Income Security Act of 1974 (29
U.S.C. 1002(16)(A)) or any entity that maintains the plan's participant
records."