FUND PARTICIPATION AGREEMENT
This Agreement is entered into as of the___ day of ____ , 1998, among Business
Men's Assurance Company of America ("Insurance Company"), a life insurance
company organized under the laws of the State of Missouri, LAZARD ASSET
MANAGEMENT ("▇▇▇"), a division of Lazard Freres & Co. LLC, a New York limited
liability company, and LAZARD RETIREMENT SERIES, INC. (the "Fund"), a
corporation organized under the laws of the State of Maryland, with respect to
the Fund's portfolios set forth on Schedule 1 hereto, as such Schedule may be
revised from time to time (each, a "Portfolio").
ARTICLE I.
DEFINITIONS
1.1. "Act" shall mean the Investment Company Act of 1940, as amended.
1.2. "Board" shall mean the Board of Directors of the Fund having the
responsibility for management and control of the Fund.
1.3. "Business Day" shall mean any day for which the Fund calculates net asset
value per share as described in the Fund's Prospectus.
1.4. "Commission" shall mean the Securities and Exchange Commission.
1.5. "Contract" shall mean a variable annuity contract and/or variable life
contract that uses the Fund as an underlying investment medium. Individuals who
participate under a group Contract are "Participants."
1.6. "Contractholder" shall mean any entity that is a party to a Contract with a
Participating Company.
1.7. "Disinterested Board Members" shall mean those members of the Board that
are not deemed to be "interested persons" of the Fund, as defined by the Act.
1.8. "Participating Companies" shall mean any insurance company (including
Insurance Company), which offers variable annuity and/or variable life insurance
contracts to the public and which has entered into an agreement with the Fund
for the purpose of making Fund shares available to serve as the underlying
investment medium for the aforesaid Contracts.
1.9. "Prospectus" shall mean the Fund's current prospectus and statement of
additional information, as most recently filed with the Commission, with respect
to the Portfolios.
1.10. "Separate Account" shall mean BMA Variable Life Account A and BMA Variable
Annuity Account A separate accounts established by Insurance Company in
accordance with the laws of the State of Missouri.
1.11. "Software Program" shall mean the software program used by the Fund for
providing Fund and account balance information including net asset value per
share.
1.12. "Insurance Company's General Account(s)" shall mean the general account(s)
of Insurance Company and its affiliates which invest in the Fund.
ARTICLE II.
REPRESENTATIONS
2.1. Insurance Company represents and warrants that (a) it is an insurance
company duly organized and in good standing under applicable law; (b) it has
legally and validly established the Separate Account pursuant to the Missouri
Insurance Code for the purpose of offering to the public certain individual
variable annuity contracts; (c) it has registered the Separate Account as a unit
investment trust under the Act to serve as the segregated investment account for
the Contracts; and (d) each Separate Account is eligible to invest in shares of
the Fund without such investment disqualifying the Fund as an investment medium
for insurance company separate accounts supporting variable annuity contracts or
variable life insurance contracts.
2.2. Insurance Company represents and warrants that (a) the Contracts will be
described in a registration statement filed under the Securities Act of 1933, as
amended ("1933 Act"); (b) the Contracts will be issued and sold in compliance in
all material respects with all applicable federal and state laws; and (c) the
sale of the Contracts shall comply in all material respects with state insurance
law requirements. Insurance Company agrees to inform the Fund promptly of any
investment restrictions imposed by state insurance law and applicable to the
Fund.
2.3. Insurance Company represents and warrants that the Contracts currently are
and at the time of issuance will be treated as life insurance, endowment or
annuity contracts under applicable provisions of the Internal Revenue Code of
1986, as amended (the "Code"), that it will maintain such treatment and that it
will notify the Fund immediately upon having a reasonable basis for believing
that the Contracts have ceased to be so treated or that they might not be so
treated in the future.
2.4. Fund represents that the Fund is registered with the Commission under the
Act as an open-end, management investment company and possesses, and shall
maintain, all legal and regulatory licenses, approvals, consents and/or
exemptions required for the Fund to operate and offer its shares as an
underlying investment medium for Participating Companies.
2.5. Fund represents that each Portfolio is currently qualified as a Regulated
Investment Company under Subchapter M of the Code, and that it will maintain
such qualification (under Subchapter M or any successor or similar provision)
and that it will notify Insurance Company immediately upon having a reasonable
basis for believing that any Portfolio invested in by the Separate Account has
ceased to so qualify or that it might not so qualify in the future.
2.6. Fund represents and warrants that each Portfolio will comply with the
diversification requirements set forth in Section 817(h) of the Code, and the
rules and regulations thereunder, including without limitation Treasury
Regulation 1.817-5, and will notify Insurance Company immediately upon having a
reasonable basis for believing any Portfolio has ceased to comply or might not
so comply and will immediately take all reasonable steps to diversify adequately
the Portfolio to achieve compliance.
2.7. ▇▇▇ represents and warrants that it is and will remain duly registered and
licensed to the extent required in all material respects as an investment
adviser under all applicable federal and state securities laws and shall perform
its obligations hereunder in compliance in all material respects with any
applicable state and federal laws.
2.8. Insurance Company agrees that the Fund shall be permitted (subject to the
other terms of this Agreement) to make the Portfolios' shares available to other
Participating Companies and contractholders and to qualified pension and
retirement plans.
2.9. Fund represents and warrants that any of its directors, officers,
employees, investment advisers, and other individuals/entities who deal with the
money and/or securities of the Fund 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 that required by Rule 17g-1 under the Act. The
aforesaid Bond shall include coverage for larceny and embezzlement and shall be
issued by a reputable bonding company.
2.10. Insurance Company represents and warrants that all of its employees and
agents who deal with the money and/or securities of the Fund are and shall
continue to be at all times covered by a blanket fidelity bond or similar
coverage in an amount not less than the coverage required to be maintained by
the Fund. The aforesaid Bond shall include coverage for larceny and embezzlement
and shall be issued by a reputable bonding company.
ARTICLE III.
FUND SHARES
3.1. The Contracts funded through the Separate Account will provide for the
investment of certain amounts in the Portfolios' shares.
3.2. Fund agrees to make the shares of its Portfolios available for purchase at
the then applicable net asset value per share by Insurance Company and the
Separate Account on each Business Day pursuant to rules of the Commission.
Notwithstanding the foregoing, the Fund may refuse to sell the shares of any
Portfolio to any person, or suspend or terminate the offering of the shares of
any Portfolio if such action is required by law or by regulatory authorities
having jurisdiction or is, in the sole discretion of the Board, acting in good
faith and in light of its fiduciary duties under federal and any applicable
state laws, necessary and in the best interests of the shareholders of such
Portfolio.
3.3. Fund agrees that shares of the Portfolios will be sold only to
Participating Companies, their separate accounts, the general accounts of those
Participating Companies and their affiliates and to qualified pension and
retirement plans in accordance with Section 817(h) (4) and the Code and Treasury
Regulations 1.817-5. No shares of any Portfolio will be sold to the general
public.
3.4. Fund shall make the net asset value per share of the Portfolios available
to Insurance Company on a daily basis as soon as reasonably practicable after
the net asset value per share is calculated but shall use its best efforts to
make such net asset value available by 6:30 p.m. Eastern time. If the Fund
provides Insurance Company with materially incorrect net asset value per share
information through no fault of Insurance Company, Insurance Company, on behalf
of the Separate Account, shall be entitled to an adjustment to the number of
shares purchased or redeemed to reflect the correct net asset value per share.
Any material error in the calculation of net asset value per share, dividend or
capital gain information shall be reported promptly upon discovery to Insurance
Company.
3.5. At the end of each Business Day, Insurance Company will use the information
described in Section 3.4 to calculate the Separate Account unit values for the
day. Using this unit value, Insurance Company will process the day's Separate
Account transactions received by it by the close of trading on the floor of the
New York Stock Exchange (currently 4:00 p.m. Eastern time) to determine the net
dollar amount of Portfolio shares which will be purchased or redeemed at that
day's closing net asset value per share for such Portfolio. The net purchase or
redemption orders will be transmitted to the Fund by Insurance Company by 9:00
a.m. Eastern time on the Business Day next following Insurance Company's receipt
of that information. Subject to Sections 3.6 and 3.8, all purchase and
redemption orders for Insurance Company's General Accounts shall be effected at
the net asset value per share of the relevant Portfolio next calculated after
receipt of the order by the Fund or its Transfer Agent.
3.6. Fund appoints Insurance Company as its agent for the limited purpose of
accepting orders, for the purchase and redemption of shares of each Portfolio
for the' Separate Account. Fund will execute orders for any Portfolio at the
applicable net asset value per share determined as of the close of trading on
the day of receipt of such orders by Insurance Company acting as agent
("effective trade date"), provided that the Fund receives notice of such orders
by 9:00 a.m. Eastern time on the next following Business Day and, if such orders
request the purchase of Portfolio shares, the conditions specified in Section
3.8, as applicable, are satisfied. A redemption or purchase request for any
Portfolio that does not satisfy the conditions specified above and in Section
3.8, as applicable, will be effected at the net asset value computed for such
Portfolio on the Business Day immediately preceding the next following Business
Day upon which such conditions have been satisfied.
3.7. Insurance Company will make its best efforts to notify Fund in advance of
any unusually large purchase or redemption orders.
3.8. If Insurance Company's order requests the purchase of Portfolio shares,
Insurance Company will pay for such purchases by wiring Federal Funds to Fund or
its designated custodial account on the day the order is transmitted. Insurance
Company shall make all reasonable efforts to transmit to the Fund payment in
Federal Funds by 12:00 noon Eastern time on the Business Day the Fund receives
the notice of the order pursuant to Section 3.5. Fund will execute such orders
at the applicable net asset value per share determined as of the close of
trading on the effective trade date if Fund receives payment in Federal Funds by
12:00 midnight Eastern time on the Business Day the Fund receives the notice of
the order pursuant to Section 3.5. If payment in Federal Funds for any purchase
is not received or is received by the Fund after 12:00 noon Eastern time on such
Business Day, Insurance Company shall promptly upon the Fund's request,
reimburse the Fund for any charges, costs, fees, interest or other expenses
incurred by the Fund in connection with any advances to, or borrowings or
overdrafts by, the Fund, or any similar expenses incurred by the Fund, as a
result of portfolio transactions effected by the Fund based upon such purchase
request.
3.9. If Insurance Company's order requests a net redemption resulting in a
payment of redemption proceeds to Insurance Company, the Fund shall use its best
efforts to wire the redemption proceeds to Insurance Company, except as provided
below, within three Business Days or, upon notice to Insurance Company, such
longer period as permitted by the Act or the rules, orders or regulations
thereunder. If Insurance Company's order requests the redemption of Portfolio
shares valued at or greater than $1 million, the Fund will wire such amount to
Insurance Company within seven days of the order. If Insurance Company's order
requests the application of redemption proceeds from the redemption of Portfolio
shares to the purchase of shares of another Portfolio, the Fund shall so apply
such proceeds the same Business Day that Insurance Company transmits such order
to the Fund.
3.10. Fund has the obligation to ensure that Portfolio shares are registered
with the Commission at all times.
3.11. Fund will confirm each purchase or redemption order made by Insurance
Company. Transfer of Portfolio shares will be by book entry only. No share
certificates will be issued to Insurance Company. Insurance Company will record
shares ordered from Fund in an appropriate title for the corresponding account.
3.12. Fund shall credit Insurance Company with the appropriate number of shares.
3.13. On each ex-dividend date of the Fund or, if not a Business Day, on the
first Business Day thereafter, Fund shall communicate to Insurance Company the
amount of dividend and capital gain, if any, per share of each Portfolio. All
dividends and capital gains of any Portfolio shall be automatically reinvested
in additional shares of the relevant Portfolio at the applicable net asset value
per share of such Portfolio on the payable date. Fund shall, on the day after
the payable date or, if not a Business Day, on the first Business Day
thereafter, notify Insurance Company of the number of shares so issued.
ARTICLE IV.
STATEMENTS AND REPORTS
4.1. Fund shall provide monthly statements of account as of the end of each
month for all of Insurance Company's accounts by the fifteenth (15th) Business
Day of the following month.
4.2. At least annually, the Fund or its designee shall provide Insurance
Company, free of charge, with as many copies of the Fund's current Prospectuses
as Insurance Company may reasonably request for distribution to existing
Contractholders and Participants. Fund or its designee shall provide Insurance
Company, at Insurance Company's expense, with as many copies of the Fund's
current Prospectuses as Insurance Company may reasonably request for
distribution to prospective purchasers of Contracts. If requested by Insurance
Company in lieu thereof, the Fund or its designee shall provide such
documentation (including a "camera ready" copy of the Prospectuses as set in
type or, at the request of Insurance Company, as a diskette in the form sent to
the financial printer) and other assistance as is reasonably necessary in order
for the parties hereto once a year (or more frequently if the Prospectuses are
supplemented or amended) to have the prospectus for the Contracts, prospectuses
for other funds offered under the contract, and the Prospectuses printed
together in one document.
The expenses of such printing will be apportioned between Insurance Company and
Fund in proportion to the number of pages of the Contract and Fund prospectus,
taking account of other relevant factors affecting the expense of printing, such
as covers, columns, graphs and charts; Fund to bear the cost of printing the
Fund prospectus portion of such document for distribution only to owners of
existing Contracts funded by the Fund shares and Insurance Company to bear the
expense of printing the portion of such documents relating to the Separate
Account however, Insurance Company shall bear all printing expenses of such
combined documents.
4.3. Fund shall distribute to Insurance Company copies of the Fund's proxy
materials, notices, periodic reports and other printed materials (which the Fund
customarily provides to its shareholders) in quantities as Insurance Company may
reasonably request for distribution to each Contractholder and Participant.
4.4. Fund will provide to Insurance Company at least one complete copy of all
registration statements, Prospectuses, reports, proxy statements, sales
literature and other promotional materials, applications for exemptions,
requests for no-action letters, and all amendments to any of the above, that
relate to the Fund or its shares, contemporaneously with the filing of such
document with the Commission or other regulatory authorities.
4.5. Insurance Company will provide to the Fund at least one copy of all
registration statements, Prospectuses, reports, proxy statements, sales
literature and other promotional materials, applications for exemptions,
requests for no-action letters, and all amendments to any of the above, that
relate to the Contracts or the Separate Account, contemporaneously with the
filing of such document with the Commission.
ARTICLE V.
EXPENSES
5.1. The charge to the Fund for all expenses and costs of the Portfolios,
including but not limited to management , fees, administrative expenses and
legal and regulatory costs, will be made in the determination of the relevant
Portfolio's daily net asset value per share.
5.2. Except as provided in this Article V and, in particular in the next
sentence, Insurance Company shall not be required to pay directly any expenses
of the Fund or expenses relating to the distribution of its shares. Insurance
Company shall pay the following expenses or costs:
a. Such amount of the production expenses of any Fund materials, including the
cost of printing the Fund's Prospectus, or marketing materials for prospective
Insurance Company Contractholders and Participants as ▇▇▇ and Insurance Company
shall agree from time to time.
b. Distribution expenses of any Fund materials or marketing materials for
prospective Insurance Company Contractholders and
Participants.
c. Distribution expenses of Fund materials or marketing materials for Insurance
Company Contractholders and Participants.
Except as provided herein and as may be reflected in each Portfolio's net asset
value per share, all other Fund expenses shall not be borne by Insurance
Company.
ARTICLE VI.
EXEMPTIVE RELIEF
6.1. Insurance Company has reviewed a copy of the Order of Exemption of the
Commission under Section 6(c) of the Act (the "Order") and, in particular, has
reviewed the conditions to the relief set forth in the related Notice. As set
forth in the Notice, Insurance Company agrees to i report any potential or
existing conflicts promptly to the I Board, and in particular whenever contract
voting instructions are disregarded, and recognizes that it will be responsible
for assisting the Board in carrying out its responsibilities under such
application. Insurance Company agrees to carry out such responsibilities with a
view to the interests of existing Contractholders.
6.2. If a majority of the Board, or a majority of Disinterested Board Members,
determines that a material irreconcilable conflict exists with regard to
Contractholder investments in the Fund, the Board shall give prompt notice to
all Participating Companies. If the Board determines that Insurance Company is
responsible for causing or creating said conflict, Insurance Company shall at
its sole cost and expense, and to the extent reasonably practicable (as
determined by a majority of the Disinterested Board Members), take such action
as is necessary to remedy or eliminate the irreconcilable material conflict.
Such necessary action may include, but shall not be limited to:
a. Withdrawing the assets allocable to the Separate Account from the Portfolios
and reinvesting such assets in a different investment medium, or submitting the
question of whether such segregation should be implemented to a vote or all
affected Contractholders; and/or
b. Establishing a new registered management investment company.
6.3. If a material irreconcilable conflict arises as a result of a decision by
Insurance Company to disregard Contractholder voting instructions and said
decision represents a minority position or would preclude a majority vote by all
Contractholders having an interest in the Fund, Insurance Company may be
required, at the Board's election, to withdraw the Separate Account's investment
in the Fund.
6.4. For the purpose of this Article, a majority of the Disinterested Board
Members shall determine whether or not any proposed action adequately remedies
any irreconcilable material conflict, but in no event will the Fund be required
to bear the expense of establishing a new funding medium for any Contract.
Insurance Company shall not be required by this Article to establish a new
funding medium for any Contract if an offer to do so has been declined by vote
of a majority of the Contractholders materially adversely affected by the
irreconcilable material conflict.
6.5. No action by Insurance Company taken or omitted, and no action by the
Separate Account or the Fund taken or omitted as a result of any act or failure
to act by Insurance Company pursuant to this Article VI shall relieve Insurance
Company of its obligations under, or otherwise affect the operation of, Article
V.
ARTICLE VII.
VOTING OF FUND SHARES
7.1. Insurance Company will provide pass-through voting privileges to all
Contractholders or Participants as long as the Commission continues to interpret
the Act as requiring pass-through voting privileges for Contractholders or
Participants. Accordingly, Insurance Company, where applicable, will vote shares
of a Portfolio held in its Separate Account in a manner consistent with voting
instructions timely received from its Contractholders or Participants. Insurance
Company will be responsible for assuring that the Separate Account calculates
voting privileges in a manner consistent with other Participating Companies.
Insurance Company will vote shares for which it has not received timely voting
instructions, as well as shares it owns, in the same proportion as it votes
those shares for which it has received voting instructions.
7.2. If and to the extent Rule 6e-2 and Rule 6e-3(T) under the Act are amended,
or if Rule 6e-3 is adopted, to provide exemptive relief from any provision of
the Act or the rules thereunder with respect to mixed and shared funding on
terms and conditions materially different from any exemptions granted in the
Order, then the Fund, and/or the Participating Companies, as appropriate, shall
take such steps as may be necessary to comply with Rule 6e-2 and Rule 6e-3(T),
as amended, and Rule 6e-3, as adopted, to the extent such Rules are applicable.
ARTICLE VIII.
MARKETING AND REPRESENTATIONS
8.1. The Fund or its underwriter shall periodically furnish Insurance Company
with the following documents, in quantities as Insurance Company may reasonably
request:
a. Current Prospectus and any supplements thereto; b. other marketing materials.
Expenses for the production of such documents shall be borne by Insurance
Company in accordance with Section 4.2 and 5.2 of this Agreement.
8.2. Insurance Company shall designate certain persons or entities which shall
have the requisite licenses to solicit applications for the sale of Contracts.
No representation is made as to the number or amount of Contracts that are to be
sold by Insurance Company. Insurance Company shall comply with all applicable
federal and state laws in connection therewith.
8.3. Insurance Company shall furnish, or shall cause to be furnished, to the
Fund, each piece of sales literature or other promotional material in which the
Fund, its investment adviser or the administrator is named, at least fifteen
Business Days prior to its use. No such material shall be used unless the Fund
approves such material. Such approval (if given) and shall be presumed given if
not received within ten Business Days after receipt of such material. The Fund
shall use all reasonable efforts to respond within ten days of receipt.
8.4. Insurance Company shall not give any information or make any
representations or statements on behalf of the Fund or concerning the Fund or
any Portfolio in connection with the sale of the Contracts other than the
information or representations contained in the registration statement or
Prospectus, as may be amended or supplemented from time to time, or in reports
or proxy statements for the Fund, or in sales literature or other promotional
material approved by the Fund.
8.5. Fund shall furnish, or shall cause to be furnished, to Insurance Company,
each piece of the Fund's sales literature or other promotional material in which
Insurance Company or the Separate Account is named, at least fifteen Business
Days prior to its use. No such material shall be used unless Insurance Company
approves such material. Such approval (if given) shall be presumed given if not
received within ten Business Days after receipt of such material. Insurance
Company shall use all reasonable efforts to respond within ten days of receipt.
8.6. Fund shall not, in connection with the sale of Portfolio shares, give any
information or make any representations on behalf of Insurance Company or
concerning Insurance Company, the Separate Account, or the Contracts other than
the information or representations contained in a registration statement or
prospectus for the Contracts, as may be amended or supplemented from time to
time, or in published reports for the Separate Account which are in the public
domain or approved by Insurance Company for distribution to Contractholders or
Participants, or in sales literature or other promotional material approved by
Insurance Company.
8.7. For purposes of this Agreement, the phrase "sales literature or other
promotional material" or words of similar import include, without limitation,
advertisements (such as material published, or designed for use, in a newspaper,
magazine or other periodical, radio, television, telephone or tape recording,
videotape display, signs or billboards, motion pictures or other public media),
sales literature (such as any written communication distributed or made
generally available to customers or the public, including brochures, circulars,
research reports, market letters, form letters, seminar texts, or reprints or
excerpts of any other advertisement, sales literature, or published article),
educational or training materials or other communications distributed or made
generally available to some or all agents or employees, registration statements,
prospectuses, statements of additional information, shareholder reports and
proxy materials, and any other material constituting sales literature or
advertising under National Association of Securities Dealers, Inc. rules, the
Act or the 1933 Act.
ARTICLE IX.
INDEMN"IFICATION
9.1. Insurance Company agrees to indemnify and hold harmless the Fund, ▇▇▇, any
sub-investment adviser of a Portfolio, and their affiliates, and each of their
directors, trustees, general members, officers, employees, agents and each
person, if any, who controls or is associated with any of the foregoing entities
or persons within the meaning of the 1933 Act (collectively, the "Indemnified
Parties" for purposes of this Section), against any and all losses, claims,
damages or liabilities joint or several (including any investigative, legal and
other expenses reasonably incurred in connection with, and any amounts paid in
settlement of, any action, suit or proceeding or any claim asserted) for which
the Indemnified Parties may become subject, under the 1933 Act or otherwise,
insofar as such losses, claims, damages or liabilities (or actions in respect to
thereof) (i) arise out of or are based upon any untrue statement or alleged
untrue statement of any material fact contained in information furnished by
Insurance Company for use in the registration statement or Prospectus or sales
literature or advertisements of the Fund or with respect to the Separate Account
or Contracts, 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; (ii) arise out of or as
a result of conduct, statements or representations (other than statements or
representations contained in the Prospectus and sales literature or
advertisements of the Fund) of Insurance Company or its agents, with respect to
the sale and distribution of Contracts for which Portfolio shares are an
underlying investment; (iii) arise out of the wrongful conduct of Insurance
Company or persons under its control with respect to the sale or distribution of
the Contracts .or Portfolio shares; (iv) arise out of Insurance Company's
incorrect calculation and/or untimely reporting of net purchase or redemption
orders; or (v) arise out of any breach by Insurance Company of a material term
of this Agreement or as a result of any failure by Insurance Company to provide
the services and furnish the materials or to make any payments provided for in
this Agreement. Insurance Company will reimburse any Indemnified Party in
connection with investigating or defending any such loss, claim, damage,
liability or action; provided, however, that with respect to clauses (i) and
(ii) above Insurance Company will not be liable in any such case to the extent
that any such loss, claim, damage or liability arises out of or is based upon
any untrue statement or omission or alleged omission made in such registration
statement, prospectus, sales literature, or advertisement in conformity with
written information furnished to Insurance Company by the Fund specifically for
use therein. This indemnity agreement will be in addition to any liability which
Insurance Company may otherwise have.
9.2. ▇▇▇ and the Fund each agrees to indemnify and hold harmless Insurance
Company and each of its directors, officers, employees, agents and each person,
if any, who controls Insurance Company within the meaning of the 1933 Act
against any losses, claims, damages or liabilities to which Insurance Company or
any such director, officer, employee, agent or controlling person may become
subject, under the 1933 Act or otherwise, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) (1) arise out of or are
based upon any untrue statement or alleged untrue statement of any material fact
contained in the registration statement or Prospectus or sales literature or
advertisements of the Fund; (2) arise out of or are based upon the omission to
state in the registration statement or Prospectus or sales literature or
advertisements of the Fund any material fact required to be stated therein or
necessary to make the statements therein not misleading; or (3) arise out of or
are based upon any untrue statement or alleged untrue statement of any material
fact contained in the registration statement or Prospectus or sales literature
or advertisements with respect to the Separate Account or the Contracts and such
statements were based on information provided in writing to Insurance Company by
the Fund specifically for use therein; (4) arise as a result of (i) failure by
the Fund to provide substantially the services and furnish the materials under
the terms of this Agreement; or (ii) a failure by a Portfolio(s) invested in by
the Separate Account to comply with the diversification requirements of Section
817(h) of the Code; or (iii) a failure by a Portfolio(s) invested in by the
Separate Account to qualify as a "regulated investment company" under Subchapter
M of the Code; or (5) arise out of or result from any material breach of this
Agreement by the Fund or ▇▇▇; and ▇▇▇ or the Fund will reimburse any legal or
other expenses reasonably incurred by Insurance Company or any such director,
officer, employee, agent or controlling person in connection with investigating
or defending any such loss, claim, damage, liability or action; provided,
however, that ▇▇▇ or the Fund will not be liable in any such case to the extent
that any such loss, claim, damage or liability arises out of or is based upon an
untrue statement or omission or alleged omission made in such Registration
Statement, Prospectus, sales literature or advertisements in conformity with
written information furnished to the Fund by Insurance Company specifically for
use therein or is otherwise based upon the negligence or misconduct of the
Insurance Company. This indemnity agreement will be in addition to any liability
which the Fund may otherwise have.
9.3. The Fund shall indemnify and hold Insurance Company harmless against any
and all liability, loss, damages, costs or expenses which Insurance Company may
incur, suffer or be required to pay due to the Fund's (1) incorrect calculation
of the daily net asset value, dividend rate or capital gain distribution rate of
a Portfolio; (2) incorrect reporting of the daily net asset value, dividend rate
or capital gain distribution rate; and (3) untimely reporting of the net asset
value, dividend rate or capital gain distribution rate; provided that the Fund
shall have no obligation to indemnify and hold harmless Insurance Company if the
incorrect calculation or incorrect or untimely reporting was the result of
incorrect information furnished by Insurance Company or information furnished
untimely by Insurance Company or otherwise as a result of or relating to a
breach of this Agreement by Insurance Company. In no event will the Fund be
liable for any consequential, incidental, special or indirect damages resulting
to Insurance Company hereunder.
9.4. Promptly after receipt by an indemnified party under this Article of notice
of the commencement of any action, such indemnified party will, if a claim in
respect thereof is to be made against the indemnifying party under this Article,
notify the indemnifying party of the commencement thereof. The omission to so
notify the indemnifying party will not relieve the indemnifying party from any
liability under this Article IX, except to the extent that the omission results
in a failure of actual notice to the indemnifying party and such indemnifying
party is damaged solely as a result of the failure to give such notice. In case
any such action is brought against any indemnified party, and it notified the
indemnifying party of the commencement thereof, the indemnifying party will be
entitled to participate therein and, to the extent that it may wish, assume the
defense thereof, with counsel satisfactory to such indemnified party, and to the
extent that the indemnifying party has given notice to such effect to the
indemnified party and is performing its obligations under this Article, the
indemnifying party shall not be liable for any legal or other expenses
subsequently incurred by such indemnified party in connection with the defense
thereof, other" than reasonable costs of investigation. Notwithstanding the
foregoing, in any such proceeding, any indemnified party shall have the right to
retain its own counsel, but the fees and expenses of such counsel shall be at
the expense of such indemnified party unless {i} the indemnifying party and the
indemnified party shall have mutually agreed to the retention of such counselor
{ii} the named parties to any such proceeding {including any impleaded parties}
include both the indemnifying party and the indemnified party and representation
of both parties by the same counsel would be inappropriate due to actual or
potential differing interests between them. The indemnifying party shall not be
liable for any settlement of any proceeding effected without its written
consent."
A successor by law of the parties to this Agreement shall be entitled to the
benefits of the indemnification contained in this Article IX.
ARTICLE X.
COMMENCEMENT AND TERMINATION
10.1. This Agreement shall be effective as of the date hereof and shall continue
in force until terminated in accordance with the provisions herein.
10.2. This Agreement shall terminate without penalty as to one or more
Portfolios at the option of the terminating party:
a. At the option of Insurance Company or the Fund at any time from the date
hereof upon 180 days' written notice, unless a shorter time is agreed to by the
parties;
b. At the option of Insurance Company, if shares of any Portfolio are not
reasonably available to meet the requirements of the Contracts as determined by
Insurance Company. Prompt notice of election to terminate shall be furnished by
Insurance Company, said termination to be effective ten days after receipt of
notice unless the Fund makes available a sufficient number of shares to meet the
requirements of the Contracts within said ten-day period;
c. At the option of Insurance Company, upon the institution of formal
proceedings against the Fund or ▇▇▇ by the Commission, the National Association
of Securities Dealers, Inc. or any other regulatory body, the expected or
anticipated ruling, judgment or outcome of which would, in Insurance Company's
reasonable judgment, materially impair the Fund's ability to meet and perform
the Fund's obligations and duties hereunder. Prompt notice of election to
terminate shall be furnished by Insurance Company with said termination to be
effective upon receipt of notice;
d. At the option of the Fund, upon the institution of formal proceedings against
Insurance Company by the Commission, the National Association of Securities
Dealers, Inc. or any other regulatory body, the expected or anticipated ruling,
judgment or outcome of which would, in the Fund's reasonable judgment,
materially impair Insurance Company's ability to meet and perform Insurance
Company's obligations and duties hereunder. Prompt notice of election to
terminate shall be furnished by the Fund with said termination to be effective
upon receipt of notice;
e. At the option of the Fund, if the Fund shall determine, in its sole judgment
reasonably exercised in good faith, that Insurance Company has suffered a
material adverse change in its business or financial condition or is the subject
of material adverse publicity and such material adverse change or material
adverse publicity is likely to have a material adverse impact upon the business
and operation of the Fund or ▇▇▇, the Fund shall notify Insurance Company in
writing of such determination and its intent to terminate this Agreement, and
after considering the actions taken by Insurance Company and any other changes
in circumstances since the giving of such notice, such determination of the Fund
shall continue to apply on the sixtieth (60th) day following the giving of such
notice, which sixtieth day shall be the effective date of termination;
At the option of the Insurance Company, if the Insurance Company shall
determine, in its sole judgment reasonably exercised in good faith, that Fund
has suffered a material adverse change in its business or financial condition or
is the subject of .material adverse publicity and such material adverse .:
change or material adverse publicity is likely to have a material adverse impact
upon the business and operation of the Insurance Company, the Insurance Company
shall notify the Fund and ▇▇▇ in writing of such determination and its intent to
terminate this Agreement, and after considering the actions taken by the Fund
and ▇▇▇ and any other changes in circumstances since the giving of such notice,
such determination of the Insurance Company shall continue to apply on the
sixtieth (60th) day following the giving of such notice, which sixtieth day
shall be the effective date of termination;
f. Upon termination of the Investment Management Agreement between the Fund and
▇▇▇ or its successors unless Insurance Company specifically approves the
selection of a new Fund investment adviser. The Fund shall promptly furnish
notice of such termination to Insurance Company;
g. In the event Portfolio shares are not registered, issued or sold in
accordance with applicable federal law, or such law precludes the use of such
shares as the underlying investment medium of Contracts issued or to be issued
by Insurance Company. Termination shall be effective immediately upon such
occurrence without notice;
h. At the option of the Fund upon a determination by the Board in good faith
that it is no longer advisable and in the best interests of shareholders for the
Fund to continue to operate pursuant to this Agreement. Termination pursuant to
this Subsection (h) shall be effective upon notice by" the Fund to Insurance
Company of such termination;
i. At the option of the Fund if the Contracts cease to qualify as annuity
contracts or life insurance policies, as applicable, under the Code, or if the
Fund reasonably believes that the Contracts may fail to so qualify, with
termination effective upon written notice to the Insurance Company;
j. At the option of Insurance Company or the Fund, upon a party's breach of any
material provision of this Agreement, which breach has not been cured to the
satisfaction of the non-breaching party within 10 days after written notice of
such breach is delivered to the breaching party;
k. At the option of the Fund, if the Contracts are not registered, issued or
sold in accordance with applicable federal and/or state law; or
1. Upon assignment of this Agreement, unless made with the written consent of
the non-assigning party.
Any such termination pursuant to this Article X shall not affect the operation
of Article V of this Agreement. Any termination of this Agreement shall not
affect the operation of Article IX of this Agreement.
10.3. In the event of any termination of this Agreement, the Fund and ▇▇▇ will,
at the option of the Insurance Company, continue to make available additional
shares of the Fund pursuant to the terms and conditions of this Agreement, for
all Contracts in effect on the effective date of termination of this Agreement
(hereinafter referred to as "Existing Contracts") . Specifically, without
limitation, the owners of the Existing Contracts will be permitted to reallocate
investments in the Designated Portfolios .(as in effect on such date), redeem
investments in the Portfolios and/or invest in the Portfolios upon the making of
additional purchase payments under the existing Contracts. However, the
availability of additional shares hereunder will be subject to the restrictions
and limitations set forth in Article VI, as applicable. The Company agrees (I)
to terminate the availability of shares of the Fund to Contracts other than
Existing Contracts and (ii) to request approval from SEC to replace shares of
the Fund with other investments for Contracts and, if and when granted such
approval, thereafter to so replace shares of the Fund, in each such case as soon
as reasonably practicable.
ARTICLE XI.
AMENDMENT S
11.1. Any changes in the terms of this Agreement shall be made by agreement in
writing by the parties hereto.
ARTICLE XII.
NOTICE
12.1. Each notice required by this Agreement shall be given by certified mail,
return receipt requested, to the appropriate parties at the following addresses:
Insurance Company: Business Men's Assurance Company of America
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ Senior V.P.
Fund: Lazard Retirement Series, Inc.
▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: President
▇▇▇: Lazard Asset Management
▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: Secretary
with copies to: Stroock & Stroock & ▇▇▇▇▇ LLP
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.
Notice shall be deemed to be given on the date of receipt by the addresses as
evidenced by the return receipt.
ARTICLE XIII.
MISCELLANEOUS
13.1. This Agreement has been executed on behalf of the Fund by the undersigned
officer of the Fund in his capacity as an officer of the Fund.
13.2. Each party shall cooperate with each other party and all appropriate
governmental authorities (including without limitation the SEC, the NASD and
state insurance regulators) and shall permit authorities reasonable access to
its books and records in connection with any investigation or inquiry relating
to this Agreement or the transactions contemplated hereby.
13.3 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.
13.4 If the Agreement terminates, the parties agree that Article IX and Section
13.2 and 13.3 shall remain in effect after termination.
ARTICLE XIV.
LAW
14.1. This Agreement shall be construed in accordance with the internal laws of
the State of New York, without 4t giving effect to principles of conflict of
laws.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement to be duly
executed and attested as of the date first above written.
BUSINESS MEN'S ASSURANCE COMPANY OF AMERICA
By:
-----------------------------------------
Attest:
------------------------------------
LAZARD RETIREMENT SERIES, INC.
By:
------------------------------------------
Attest:
------------------------------------
LAZARD ASSET MANAGEMENT,
a division of Lazard Freres & Co., LLC
By:
------------------------------------------
Attest:
------------------------------------
SCHEDULE 1
Name of Portfolio
Lazard Retirement Bantam Value Portfolio
Lazard Retirement Emerging Markets Portfolio
Lazard Retirement Emerging World Funds Portfolio
Lazard Retirement Equity Portfolio
Lazard Retirement Global Equity Portfolio
Lazard Retirement International Equity Portfolio
Lazard Retirement International Fixed-Income Portfolio
Lazard Retirement International Small Cap Portfolio
Lazard Retirement Small Cap Portfolio
Lazard Retirement Strategic Yield Portfolio
DISTRIBUTION AND SERVICING PLAN AGREEMENT
LAZARD RETIREMENT SERIES, INC.
Lazard Freres & Co. LLC
▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Gentlemen:
We wish to enter into this Agreement with you for distribution and
certain other services with respect to the shares of each portfolio named on
Schedule 1 hereto, as such Schedule may be revised from time to time (each, a
"Portfolio"), of Lazard Retirement Series, Inc. (the "Fund") of which you are
the principal underwriter as defined in the Investment Company Act of 1940, as
amended (the" Act"), and the exclusive agent for the continuous distribution of
its shares.
The terms and conditions of this Agreement are as follows:
1. We agree to provide reasonable assistance in connection with the
sale of the Portfolios' shares, which assistance may include distributing sales
literature, marketing and advertising. If ..we are restricted or unable to
provide the services contemplated above, we agree not to perform ., such
services and not to accept fees thereafter. Our acceptance of any fees hereunder
shall constitute our representation (which shall survive any payment of such
fees and any termination of this Agreement and shall be reaffirmed each time we
accept a fee hereunder) that our receipt of such fee is lawful under the laws
which regulate our activities as an insurance company.
2. We agree to provide shareholder and administrative services for our
clients who own shares, whether of record or beneficially, of any Portfolio
("clients"), which services may include, without limitation, answering client
inquiries about the Fund or any Portfolio; assisting clients in changing
dividend options, account designations and addresses; performing sub-accounting;
establishing and maintaining shareholder accounts and records; processing
purchase and redemption transactions; investing client account cash balances
automatically in Portfolio shares or in separate account investment options
funded by Portfolio shares; providing periodic statements showing a client's
account balance and integrating such statements with those of other transactions
and balances in the client's other accounts that we service; arranging for bank
wires; and providing such other information and services as the Fund reasonably
may request, to the extent we are permitted by applicable statute, rule or
regulation. In this regard, you recognize that to the extent we are subject to
the provisions of the ▇▇▇▇▇-▇▇▇▇▇▇▇▇ Act and other laws governing, among other
things, the conduct of activities we may undertake and for which we may be paid,
we intend to perform only those activities as are consistent with our statutory
and regulatory obligations. We shall provide to clients a schedule of any fees
that we may charge directly to them.
3. We shall provide such office space and equipment, telephone
facilities and personnel (which may be all or any part of the space, equipment
and facilities currently used in our business, or all or any personnel employed
by us) as is necessary or beneficial in order to. provide such services
contemplated hereunder.
4. We agree that neither we nor any of our employees or agents are
authorized to make any representation concerning the Portfolios' shares, except
those contained in the Fund's then- current Prospectus and Statement of
Additional Information, copies of which you will supply to, us, or in such
supplemental literature or advertising materials as may be authorized by you in
writing.
5. For all purposes of this Agreement, we will be deemed to be an
independent contractor, and will have no authority to act as agent for you or
the Fund in any matter or in any respect. We and our employees will, upon
request, be available during normal business hours to consult with you or your
designees concerning the performance of our responsibilities under this
Agreement.
6. In consideration of the services and facilities described herein, we
shall be entitled to receive from you, and you agree to pay to us with respect
to each Portfolio, the fees set forth opposite such Portfolio's name on Schedule
1 hereto. We understand that the payment of these fees has been authorized and
will be paid pursuant to a Distribution and Servicing Plan approved by the
Fund's Board and shareholders ("Plan"), and any payments pursuant to this
Agreement shall be paid only so long as this Agreement and the Plan are in
effect.
7. You reserve the right, at your discretion and without notice, to
suspend or withdraw the .sale of any Portfolio's shares.
8. We acknowledge that this Agreement shall become effective, as to a
Portfolio, only when approved by vote of a majority of (i) the Fund's Board and
(ii) the Board members who are not "interested persons" (as defined in the Act)
of the Fund and have no direct or indirect financial interest in this Agreement
(hereinafter "disinterested Directors"), cast in person at a meeting called for
the purpose of voting on such approval.
9. As to each Portfolio, this Agreement shall continue until the last
day of the calendar year following the date of execution, and thereafter shall
continue automatically for successive annual periods ending on the last day of
each calendar year, provided such continuance is approved specifically at least
annually by a vote of a majority of (i) the Fund's Board and (ii) the
disinterested Directors, by vote cast in person at a meeting called for the
purpose of voting on such approval. As to each Portfolio, this Agreement is
terminable without penalty, at any time, by vote of a majority of the
disinterested Directors on not more than 60 days' written notice, by vote of
holders of a majority of a Portfolio's outstanding shares, or, upon 15 days'
notice, by you provided, however, that notwithstanding the Board's failure to
renew this Agreement or termination of this Agreement, it shall continue in
effect until the termination of the Fund Participation Agreement in accordance
with Section 10.3 thereof. Notwithstanding anything contained herein, if the
Plan is terminated by the Fund's Board, or the Plan, or any part thereof, is
found invalid or is ordered terminated by any regulatory or judicial authority,
or we fail to perform the distribution and servicing functions contemplated by
the Fund or by you, this Agreement shall be terminable effective upon our
receipt of notice thereof. This Agreement also shall terminate automatically, as
to the relevant Portfolio, in the event of its assignment (as defined in the
Act).
10. We understand that the Fund's Board will review, at least
quarterly, a written report of the amounts expended pursuant to this Agreement
and the purposes for which such expenditures were made. In connection with such
reviews, we will furnish you or your designees with such information as you or
they may reasonably request and will otherwise cooperate with you and your
designees (including, without limitation, any auditors designated by you), in
connection with the preparation of reports to the Fund's Board concerning this
Agreement and the monies paid or payable by you pursuant hereto, as well as any
other reports or filings that may be required by law.
11. All communications to you shall be sent to you at the address set
forth above. Any notice to us shall be duly given if mailed or telegraphed to us
at the address set forth below.
12. This Agreement shall be construed in accordance with the internal
laws of the State of New York, without giving effect to principles of conflict
of laws.
Very truly yours,
Business Men's Assurance Company
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Date By:
---------------------- -------------------------------------------
Authorized Signature
NOTE: Please return both signed copies of this Agreement to Lazard Freres & Co.
LLC. Upon acceptance one countersigned copy will be returned for your files.
Accepted:
LAZARD FRERES & CO. LLC
Date By:
------------------------------- ----------------------------------------
Authorized Signature
SCHEDULE 1
FEE SCHEDULE
Fee at an
Annual Rate as a
Percentage of Average
Name of Portfolio* Daily Net Asset Value
------------------
of Portfolio Shares
Owned by Clients**
Lazard Retirement. Bantam Value Portfolio .25%
Lazard Retirement Emerging Markets Portfolio .25%
Lazard Retirement Emerging World Funds Portfolio .25%
Lazard Retirement Equity Portfolio .25%
Lazard Retirement Global Equity Portfolio .25%
Lazard Retirement International Equity Portfolio .25%
Lazard Retirement International Fixed-Income Portfolio .25%
Lazard Retirement International Small Cap Portfolio .25%
Lazard Retirement Small Cap Portfolio .25%
Lazard Retirement Strategic Yield Portfolio .25%
Dated:
* If the Fund at any time offers shares of one or more portfolios not
listed on this Schedule 1 (each, a "New Portfolio"), each New Portfolio
shall be deemed to be subject to the Agreement of which this Schedule
is an integral part ("Agreement") and, unless notified to the contrary
by Lazard Freres & Co. LLC, Business Men's Assurance Company of America
may provide distribution and other services with respect to the shares
of the New Portfolio in accordance with the terms of the Agreement and
shall be entitled to receive with respect to such New Portfolio the
fees set forth on this Schedule 1.
** For purposes of determining the fees payable hereunder, the average
daily net asset value of each Portfolio's shares shall be computed in
the manner specified in the Fund's charter documents and then-current
Prospectus and Statement of Additional Information.