PARTICIPATION AGREEMENT BY AND AMONG NATIONWIDE LIFE INSURANCE COMPANY NATIONWIDE LIFE AND ANNUITY INSURANCE COMPANY ON BEHALF OF THEMSELVES AND THEIR SEPARATE ACCOUNTS AND SALOMON BROTHERS ASSET MANAGEMENT INC AND SALOMON BROTHERS VARIABLE SERIES...
BY
AND
AMONG
NATIONWIDE
LIFE INSURANCE COMPANY
NATIONWIDE
LIFE AND ANNUITY INSURANCE COMPANY
ON
BEHALF
OF THEMSELVES AND
THEIR
SEPARATE ACCOUNTS
AND
SALOMON
BROTHERS ASSET MANAGEMENT INC
AND
SALOMON
BROTHERS VARIABLE SERIES FUNDS INC
THIS
AGREEMENT, made and entered into as of September , 1999 ("Agreement"), by
and among
Salomon Brothers Variable Series Funds Inc, a Maryland corporation (the "Fund"),
Salomon Brothers Asset Management Inc, a Delaware Corporation (the "Adviser")
and Nationwide Life Insurance Company and Nationwide Life and Annuity Insurance
Company, Ohio He insurance companies (collectively referred to herein as
"NATIONWIDE"),
on behalf of themselves and each of their segregated asset accounts listed
in
Schedule A hereto, as the parties hereto may amend from time to time (each,
an
"Account," and
collectively, the "Accounts").
W1TNESSETH
THAT:
WHEREAS,
the Fund is registered with the Securities and Exchange Commission ("SEC")
as an
open-end management investment company under the Investment Company Act of
1940,
as amended (the "1940 Act");
WHEREAS,
the Fund is available to the extent set forth herein to act as the investment
vehicle for separate accounts established for variable life insurance policies
and variable annuity contracts to be offered by insurance companies which
have
entered into participation agreements with the Fund and ("Participating
Insurance Companies");
WHEREAS,
the Fund currently consists of seven separate investment portfolios which
issue
shares ("Shares") registered under the Securities Act of 1933, as amended
(the
"1933 Act");
WHEREAS,
the Fund will make Shares of each investment portfolio listed on
Schedule A hereto (each, a "Portfolio" and collectively, the "Portfolios")
as
the Parties hereto may amend from time to time available for purchase by
the
Accounts;
WHEREAS,
the Fund has received an order (the "Order") from the SEC to permit
Participating Insurance Companies and variable annuity and variable He insurance
separate accounts exemptions from the provisions of sections 9(a), 13(a),
15(a),
and 15(b) of the 1940 Act and Rules 6e-2(b)(15) and 6e-3(T){bXl5) thereunder,
to
the extent necessary to permit shares of the Fund to be sold to and held
by
variable annuity and variable life insurance separate accounts of both
affiliated and unaffiliated He insurance companies;
WHEREAS,
NATIONWIDE will be the issuer of certain variable annuity contracts and variable
life insurance policies (collectively, the "Contracts") as set forth on Schedule
A hereto, as the Parties hereto may amend from time to time, which Contracts,
if
required by applicable law, will be registered under the 1933
Act;
WHEREAS,
NATIONWIDE wi11, to the extent set forth herein, fund the variable life
insurance policies and variable annuity contracts through the Accounts, each
of
which may be divided into two or more subaccounts ("Subaccounts"; reference
herein to an "Account" includes reference to each Subaccount thereof to the
extent the context requires);
WHEREAS,
NATIONWIDE will serve as the depositor of the Accounts, each of
which
is registered as a unit investment trust under the 1940 Act (or exempt
therefrom), and the security interests deemed to be issued by the Accounts
under
the Contracts will be registered as securities under the 1933 Act (or exempt
therefrom);
WHEREAS,
to the extent permitted by applicable insurance laws and regulations,
NATIONWIDE intends to purchase Shares in one or more of the Portfolios on
behalf
of the Accounts to fund the Contracts; and
NOW,
THEREFORE, in consideration of the mutual benefits and promises
contained herein, the Parties hereto agree as follows:
Section
1. Available Portfolios 1.1Available Portfolios
The
Fund
will make Shares of each Portfolio listed on Schedule A available to NATIONWIDE
for purchase and redemption at net asset value next computed after the Fund's
receipt of a purchase or redemption order and with no sales charges, in
accordance with the Fund's then current prospectus and subject to the terms
and
conditions of this Agreement. The Board of Directors of the Fund may refuse
to
sell Shares of any Portfolio to any person, or suspend or terminate the offering
of Shares of any Portfolio if such action is required by law or by regulatory
authorities having jurisdiction or if, in the sole discretion of the Directors
acting in good faith and in light of their fiduciary duties under federal
and
any applicable state laws, such action is deemed in the best interests of
the
shareholders of such Portfolio.
1.2 Addition.
Deletion or Modification of Portfolios.
The
Parties hereto may agree, from time to time, to add other Portfolios to provide
additional funding alternatives for the Contracts, or to delete or modify
existing Portfolios, by amending Schedule A hereto. Upon such amendment to
Schedule A, any applicable reference to a Portfolio, the Fund, or its Shares
herein shall include a reference to all Portfolios set forth on Schedule
A
as then amended. Schedule A, as amended from time to time, is incorporated
herein by reference and is a part hereof
1.3
No Sales to the General Publie.
The
Fund
represents that shares of the Portfolios will be sold only to Participating
Insurance Companies, their separate accounts and qualified pension and
retirement plans ("Plans") and that no Shares of any Portfolio have been
or will
be sold to the general public.
Section
2. Processing Transactions
2.1 Placing Orders.
(a) The
Fund
or its designated agent will use its best effort to provide NATIONWIDE with
the
net asset value per Share for each Portfolio by 6:30 p.m. Eastern Time on
each
Business Day, As used herein, "Business Day" shall mean any day on which
(i) the
New York Stock Exchange is open for regular trading, and (ii) the Fund
calculates the Portfolios' net asset
value.
(b) NATIONWIDE
will use the data provided by the Fund each Business Day pursuant to paragraph
(a) immediately above to calculate Account unit values and to process
transactions that receive that same Business Day's Account unit values.
NATIONWIDE will perform such Account processing the same Business Day, and
will
place corresponding orders to purchase or redeem Shares with the Fund by
9:00
a.m. Eastern Time the following Business Day.
(c) With
respect to payment of the purchase price by NATIONWIDE and of redemption
proceeds by the Fund, NATIONWIDE and the Fund shall net purchase and redemption
orders with respect to each Portfolio and shall transmit one net payment
per
Portfolio in accordance with Section 2.2, below.
(d) If
the
Fund provides materially incorrect Share net asset value information (as
determined under SEC guidelines), NATIONWIDE 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 or reporting of net
asset
value per Share, dividend or capital gain information shall be reported promptly
upon discovery to NATIONWIDE.
2.2Payments
(a) NATIONWIDE
shall pay for Shares of each Portfolio on the same day that it notifies the
Fund
of a purchase request for such Shares. Payment for Shares shall be made in
federal funds transmitted to the Fund by wire to be received by the Fund
by 1:00
P.M. Eastern Time on the day the Fund is notified of the purchase request
for
Shares. If payment in federal funds for any purchase is not received, or
is
received by the Fund after 1:00 p.m. Eastern Time on such Business Day,
NATIONWIDE shall promptly, upon the Fund's request in writing, 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 non-payment
or late payment.
(b) The
Fund
wi11 wire payment in federal funds for net redemptions to an account designated
by NATIONWIDE by 1:00 p.m. Eastern Time on the business day succeeding the
day
the order is placed, to the extent practicable, but in any event within five
(5)
calendar days after the date the order is placed in order to enable NATIONWIDE
to pay redemption proceeds within the time specified in Section 22(e) of
the
▇▇▇▇ ▇▇▇. The Fund shall not bear any responsibility whatsoever for the proper
disbursement or crediting of redemption proceeds by NATIONWIDE.
2.3
Applicable Price
(a) Share
purchase payments and redemption orders that result from purchase payments,
premium payments, surrenders and other transactions under Contracts
(collectively, "Contract transactions") and that NATIONWIDE receives prior
to
the dose of regular trading on the New York Stock Exchange on a Business
Day
will be executed at the net asset values of the appropriate Portfolios next
computed after receipt by the Fund or its designated agent of the orders.
For
purposes of this Section 2.3(a), NATIONWIDE shall be the designated agent
of the
Fund for receipt of orders relating to Contract transactions on each Business
Day and receipt by such designated agent shall constitute receipt by the
Fund;
provided that the Fund receives notice of such orders by 10:00 a.m.
Eastern Time on the following Business Day.
(b) All
other
Share purchases and redemptions by NATIONWIDE will be effected at the net
asset
values of the appropriate Portfolios next computed after receipt by the Fund
or
its designated agent of the order therefor, and such orders will be
irrevocable.
2.4
Dividends and Distributions
The
Fund
will furnish notice by wire or telephone (followed by written confirmation)
on
or prior to the payment date to NATIONWIDE of any income dividends or capital
gain distributions payable on the Shares of any Portfolio. NATIONWIDE hereby
elects to reinvest all dividends and capital gains distributions in additional
Shares of the corresponding Portfolio at the ex-dividend date net asset values
until NATIONWIDE otherwise notifies the Fund in writing, it being agreed
by the
Parties that the ex-dividend date and the payment date with respect to any
dividend or distribution will be the same Business Day. NATIONWIDE reserves
the
right to revoke this election and to receive all such income dividends and
capital gain distributions in cash. Any such revocation will take effect
with
respect to the next income dividend or capital gain distribution following
receipt by the Fund of such notification from NATIONWIDE.
2.5
Book Entry
Issuance
and transfer of Portfolio Shares will be by book entry only. Stock certificates
will not be issued to NATIONWIDE. Shares ordered from the Fund will be recorded
in an appropriate title for NATIONWIDE, on behalf of its Accounts.
Section
3. Costs and Expenses 3.1 General
Except
as
otherwise specifically provided herein, each parry will bear all expenses
incident to its performance under this Agreement.
3.2
Registration
(a)
The
Fund will bear the cost of its registering as a management investment company
under the 1940 Act and registering its Shares under the 1933 Act, and keeping
such registrations current and effective; including, without limitation,
the
preparation of and filing with the SEC of Forms N-SAR and Rule 24f-2 Notices
with respect to the Fund and its Shares and payment of all applicable
registration or filing fees with respect to any of the foregoing.
(b) NATIONWIDE will bear the cost of registering, to the extent required,
each
Account as a unit investment trust under the 1940 Act and registering units
of
interest under the Contracts under the 1933 Act and keeping such registrations
current and effective; including, without limitation, the preparation and
filing
with the SEC of Forms N-SAR and Rule 24f-2 Notices with respect to each Account
and its units of interest and payment of all applicable registration or filing
fees with respect to any of the foregoing.
3.3
Fund Expense
The
Fund
will bear, or arrange for others to bear, the costs of preparing and filing
with
the SEC the Fund's prospectus, statement of additional information and any
amendments or supplements thereto (collectively, the "Fund Prospectus") and
setting the Fund Prospectus for printing. In addition, the Fund will bear
the
costs of printing and distributing the Fund's Prospectus, the Fund's periodic
reports to shareholders, the Fund proxy material and other shareholder
communications to existing Contract owners on whose behalf the Accounts hold
Shares to the extent required by law or as deemed appropriate by the
Fund.
3.4
Nationwide Expenses
NATIONWIDE
will bear the costs of preparing, filing with the SEC and printing each
Account's prospectus, statement of additional information and any amendments
or
supplements thereto (collectively, the "Account Prospectus"), any periodic
reports to Contract owners, annuitants, insureds or participants (as
appropriate) under the Contracts (collectively, "Participants"), voting
instruction solicitation material and other Participant communications to
the
extent required by law or as deemed appropriate by NATIONWIDE. In addition,
NATIONWIDE will bear the costs of printing in quantity and distributing the
Fund
Prospectus to be delivered to prospective Participants.
3.5
Parties To Cooperate
Each
parry agrees to cooperate with the other, in arranging to print, mail and/or
deliver, in a timely manner, combined or coordinated prospectuses or other
materials of the Fund and the Accounts.
Section
4. Legal Compliance 4.1 Tax Laws
(a) The
Fund
represents and warrants that it will elect to be qualified as a regulated
investment company ("RIC") under Subchapter M of the Internal Revenue Code
of
1986, as amended (the "Code"), and represents that it will qualify and maintain
its qualification as a RIC and to comply with the diversification requirements
set forth in Section 817(h) of the Code and the regulations thereunder. The
Fund
will notify NATIONWIDE immediately upon having a reasonable
basis for believing that it has ceased to so qualify or so comply, or that
it
might not so qualify or so comply in the future.
(b) NATIONWIDE
represents and warrants that the Contracts currently are and will be treated
as
annuity contracts or life insurance contracts under applicable provisions
of the
Code
(c) and
that
it will maintain such treatment; NATIONWIDE will notify the Fund immediately
upon having a reasonable basis for believing that any of the Contracts have
ceased to be so treated or that they might not be so treated in the
future.
(c)
NATIONWIDE represents and warrants that each Account is a "segregated asset
account" and that interests in each Account are offered exclusively through
the
purchase of or transfer into a "variable contract," within the meaning of
such
terms under Section 817 of the Code and the regulations thereunder. NATIONWIDE
will continue to meet such definitional requirements, and it will notify
the
Fund immediately upon having a reasonable basis for believing that such
requirements have ceased to be met or that they might not be met in the
future.
4.2
Insurance and Certain Other Laws
(a) NATIONWIDE
represents and warrants that (i) it is an insurance company duly organized,
validly existing and in good standing under all applicable laws and has full
corporate power, authority and legal right to execute, deliver and perform
its
duties and comply with its obligations under this Agreement, (ii) it has
legally
and validly established and maintains each Account as a segregated asset
account
under all applicable laws and regulations, and (iii) the Contracts comply
in all
material respects with all applicable federal and state laws and
regulations.
(b) The
Fund
represents and warrants that it is a corporation duly organized, validly
existing, and in good standing under the laws of the State of Maryland and
has
full corporate power, authority, and legal right to execute, deliver, and
perform its duties and comply with its obligations under this Agreement.
Notwithstanding the foregoing, the Fund, makes no representations as to whether
any aspect of its operations (including, but not limited to, fees and expenses
and investment policies) otherwise complies with the insurance Iaws or
regulations of any state.
(c) The
Adviser represents that it is and warrants that it shall remain duly registered
as an investment adviser under all applicable federal and state securities
laws
and agrees that it shall perform its obligations to the Fund in accordance
in
all material respects with such laws.
(d) NATIONWIDE
acknowledges and agrees that it is the responsibility of NATIONWIDE and other
Participating Insurance Companies to determine investment restrictions under
state insurance law applicable to any Portfolio, and that the Fund shall
bear no
responsibility to NATIONWIDE, for any such determination or the correctness
of
such determination. NATIONWIDE has determined that the investment restrictions
set forth in the current Fund Prospectus are sufficient to comply with all
investment restrictions under state insurance laws that are currently applicable
to the Portfolios as a result of the Accounts' investment therein. NATIONWIDE
shall inform the Fund of any additional investment restrictions imposed by
state
insurance law after the date of this agreement that may become applicable
to the
Fund or any Portfolio from time to time as a result of the Accounts' investment
therein. Upon receipt of any such information from NATIONWIDE or any other
Participating Insurance Company, the Fund shall determine whether it is in
the
best interests of shareholders to comply with any such restrictions. If the
Fund
determines that it is not in the best interests of shareholders to comply
with a
restriction determined to be applicable by the NATIONWIDE, the Fund shall
so
inform NATIONWIDE, and the Fund and NATIONWIDE shall discuss alternative
accommodations in the circumstances.
4.3
Securities Laws,
(a) NATIONWIDE
represents and warrants that (i) interests in each Account pursuant to the
Contracts will be registered under the 1933 Act to the extent required by
the
1933 Act, (ii) the Contracts will be duly authorized for issuance and sold
in
compliance with all applicable federal and state laws, including, without
limitation, the 1933 Act, the 1934 Act, the 1940 Act and applicable state
law,
(iii) each Account is and will remain registered under the 1940 Act, to the
extent required by the 1940 Act or any other relevant provision, (iv) each
Account does and will comply in all material respects with the requirements
of
the 1940 Act and the rules thereunder, to the extent required, (v) each
Account's 1933 Act registration statement relating to the Contracts, together
with any amendments thereto, will at all times comply in all material respects
with the requirements of the 1933 Act and the rules thereunder, (vi) NATIONWIDE
will amend the registration statement for its Contracts under the 1933 Act
and
for its Accounts under the 1940 Act from time to time as required in order
to
effect the continuous offering of its Contracts unless otherwise exempt,
or as
may otherwise be required by applicable law, (vii) each Account Prospectus
will
at all
times comply in all material respects with the requirements of the
1933
Act and the rules thereunder, (viii) all of its directors, officers, employees,
investment advisers, and other individuals/entities having access to the
funds
and/or securities of any Portfolio are and continue to be at all times covered
by a blanket fidelity bond or similar coverage covering such risks and in
such
amount as is customary for companies engaged in similar businesses in similar
industries. The aforesaid bond includes coverage for larceny and embezzlement
and is issued by a reputable bonding company.
(b) The
Fund
represents and warrants that (i) Shares sold pursuant to this Agreement will
be
registered under the 1933 Act to the extent required by the 1933 Act and
will be
duly authorized for issuance and sold in compliance with Maryland law, (ii)
the
Fund is and will remain registered under the 1940 Act to the extent required
by
the 1940 Act, (iii) the Fund will amend the registration statement under
the
1933 Act and the 1940 Act from time to time as required in order to effect
the
continuous offering of its Shares, (iv) the Fund does and will comply in
all
material respects with the requirements of the 1940 Act and the rules
thereunder, (v) the Fund's 1933 Act registration statement, together with
any
amendments thereto, will at all times comply in all material respects with
the
requirements of the 1933 Act and rules thereunder, (vi) the Fund's Prospectus
will at all times comply in all material respects with the requirements of
the
1933 Act and the rules thereunder and (vii) all of its directors, officers,
employees, investment advisers, and other individuals/entities having access
to
the funds and/or securities of any Portfolio are and 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 minimal coverage as required currently
by
Rule 17g-(1) of the 1940 Act or related provisions as may be promulgated
from
time to time. The aforesaid bond includes coverage for larceny and embezzlement
and is issued by a reputable bonding company.
(c) The
Fund
will at its expense register and qualify its Shares for sale in accordance
with
the laws of any state or other jurisdiction if and to the extent reasonably
deemed advisable by the Fund.
4.4 Notice
of Certain Proceedings and Other Circumstances.
(a)
The
Fund will immediately notify NATIONWIDE of (i) the issuance by any court
or
regulatory body of any stop order, cease and desist order, or other similar
order with respect to
the
Fund's registration statement under the 1933 Act or the Fund Prospectus,
(ii)
any request by the SEC for any amendment to such registration statement or
the
Fund Prospectus that may affect the offering of Shares of any Portfolio,
(iii)
the initiation of any proceedings for that purpose or for any other purpose
relating to the registration or offering of Shares of any Portfolio, or (iv)
any
other action or circumstances that may prevent the lawful offer or sale of
Shares of any Portfolio in any state or jurisdiction, including, without
limitation, any circumstances in which such Shares are not registered and
are
not, in all material respects, issued and sold in accordance with applicable
state and federal law. The Fund will make every reasonable effort to prevent
the
issuance of any such stop order, cease and desist order or similar order
and, if
any such order is issued, to obtain the lifting thereof at the earliest possible
time.
(b)
NATIONWIDE will immediately notify the Fund of (i) the issuance by any court
or
regulatory body of any stop order, cease and desist order, or other similar
order with respect to each Account's registration statement under the 1933
Act
relating to the Contracts or each Account Prospectus, (ii) any request by
the
SEC for any amendment to such registration statement or Account Prospectus
that
may affect the offering of Shares of any Portfolio, (ii) the initiation of
any
proceedings for that purpose or for any other purpose relating to the
registration or offering of each Account's interests pursuant to the Contracts,
or (iv) any other action or circumstances that may prevent the lawful offer
or
We of said interests in any state or jurisdiction, including, without
limitation, any circumstances in which said interests are not registered
and are
not, in all material respects, issued and sold in accordance with applicable
state and federal law. NATIONWIDE will make every reasonable effort to prevent
the issuance of any such stop order, cease and desist order or similar order
and, if any such order is issued, to obtain the lifting thereof at the earliest
possible time.
4.5
Documents Provided by NATIONWIDE; Information About the
Fund.
(a) NATIONWIDE
will provide to the Fund or its designated agent at least one (1) complete
copy
of all SEC registration statements, Account Prospectuses, reports, any
preliminary and final voting instruction solicitation material, applications
for
exemptions, requests for now action letters, and all amendments to any of
the
above, that relate to the Fund which serves as an investment option in each
Account or the Contracts, contemporaneously with the filing of such document
with the SEC or other regulatory authorities.
(b) NATIONWIDE
will provide to the Fund or its designated agent at least one (1) complete
copy
of each piece of sales literature or other promotional material in which
any
Portfolio, the Fund or any of its affiliates is named, at least ten (10)
Business Days prior to its use or such shorter period as the Parties hereto
may,
from time to time, agree upon. No such material shall be used if the Fund
or its
designated agent objects to such use within ten (10) Business Days after
receipt
of such material or such shorter period as the Parties hereto may, from time
to
time, agree upon.
(c) Neither
NATIONWIDE nor any of its affiliates, will give any information
or make
any representations or statements on behalf of or concerning any Portfolio,
the
Fund or its affiliates in connection with the sale of the Contracts other
than
(i) the information or representations contained in the then current
registration statement, including the Fund Prospectus contained therein,
relating to Shares, as such registration statement and the Fund Prospectus
may
be amended from time to time; (ii) in reports or proxy materials for the
Fund;
(iii) in published reports for the Fund that are in the public domain and
approved by the Fund for distribution by
NATIONWIDE;
or (iv) in sales literature or other promotional material approved by the
Fund
for use by NATIONWIDE, except with the express written permission of the
Fund.
(d) NATIONWIDE
shall adopt and implement procedures reasonably designed to ensure that
information concerning the Fund and its affiliates that is intended for use
only
by brokers or agents selling the Contracts (i.e., information that is not
intended for distribution to Participants) ("broker only materials") is so
used,
and neither the Fund nor any of its affiliates shall be liable for any losses,
damages or expenses relating to the improper use of such broker only
materials.
(e) For
the
purposes of this Section 4.5, the phrase "sales literature or other promotional
material" includes, but is not limited to, 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 (e.g., on-line networks
such
as the Internet or other electronic messages)), sales literature (i.e., any
written communication distributed or made generally available to customers
or
the public, including brochures, circulars, research reports, market letters,
form letters, seminar texts, 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 the NASD rules,
the
1933 Act or the ▇▇▇▇ ▇▇▇.
4.6
Documents Provided by Fund; Information About
NATIONWIDE.
(a) The
Fund
will provide to NATIONWIDE at least one (1) complete copy of all SEC
registration statements, Fund Prospectuses, reports, any preliminary and
final
proxy material, applications for exemptions, requests for no-action letters,
and
all amendments to any of the above, that relate to the Fund or the Shares
of a
Portfolio, contemporaneously with the filing of such document with the SEC
or
other regulatory authorities.
(b) The
Fund
will provide to NATIONWIDE copies of all Fund prospectuses, and printed copies
of all statements of additional information, proxy materials, periodic reports
to shareholders and other materials required by law to be sent to Participants
who have allocated any Contract value to a Portfolio. The Fund will provide
such
copies to NATIONWIDE in a timely manner so as to enable NATIONWIDE to print and
distribute such materials within the time required by law to be furnished
to
Participants.
(c) The
Fund
will provide to NATIONWIDE or its designated agent at least one (1) complete
copy of each piece of sales literature or other promotional material in which
NATIONWIDE, or any of its respective affiliates is named, or that refers
to the
Contracts, at least ten (10) Business Days prior to its use or such shorter
period as the Parties hereto may, from time to time, agree upon. No such
material shall be used if NATIONWIDE or its designated agent reasonably objects
to such use within ten (10) Business Days after receipt of such material
or such
shorter period as the Parties hereto may, from time to time, agree
upon.
(d) Neither
the Fund nor any of its affiliates will give any information or make any
representations or statements on behalf of or concerning NATIONWIDE, each
Account, or the Contracts other than (i) the information or representations
contained in the registration statement, including each Account Prospectus
contained therein, relating to the Contracts, as such registration statement
and
Account Prospectus may be amended from time to time: (ii) in published reports
for the Account or the Contracts that are in the public domain and approved
by
NATIONWIDE for distribution; or (iii) in sales literature or other promotional
material approved by NATIONWIDE or its affiliates, except with the express
written permission of NATIONWIDE.
(e) The
Fund
shall cause its principal underwriter to adopt and implement procedures
reasonably designed to ensure that information concerning NATIONWIDE, and
its
respective affiliates that is intended for use only by brokers or agents
selling
the Contracts (i.e., information that is not intended for distribution to
Participants) ("broker only materials") is so used, and neither NATIONWIDE,
nor
any of its respective affiliates shall be liable for any losses, damages
or
expenses relating to the improper use of such broker only
materials.
(f) For
purposes of this Section 4.6, the phrase "sales literature or other promotional
material" includes, but is not limited to, 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 (i.e., any written
communication distributed or made generally available to customers or the
public, including brochures, circulars, research reports, market letters,
form
letters, seminar texts, 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 the NASD rules, the 1933
Act
or the 1940 Act.
Section
5. Mixed and Shared Funding
NATIONWIDE
acknowledges that the Fund has received an order from the SEC granting relief
from various provisions of the 1940 Act and the rules thereunder to the extent
necessary to permit Fund shares to be sold to and held by variable annuity
and
variable life insurance separate accounts of both affiliated and unaffiliated
Participating Insurance Companies, as well as by Plans. Any conditions or
undertakings that are imposed on NATIONWIDE and the Fund by virtue of such
order
shall be incorporated herein by reference, as of the date such order is granted,
as though set forth herein in full, and the parties to this Agreement shall
comply with such conditions and undertakings to the extent applicable to
each
such party.
Section
6. Termination
6.1
Events of Termination
Subject
to Section 6.4 below, this Agreement will terminate as to a
Portfolio:
(a) at the option of any party, with or without cause, upon one (1)
year advance written notice to the other parties; or
(b) at the option of Nationwide if shares of a Portfolio are not
reasonably available to meet the requirements of the Contracts as determined
by
NATIONWIDE provided, however, that such a termination shall apply only
to the Portfolio(s) not available. Prompt written notice of the election
to
terminate for such cause shall be furnished by NATION IDE to the
Fund;
(c) at
the
option of the Fund upon institution of formal proceeding against NATIONWIDE
or
its affiliates by the NASD, the SEC, any state insurance regulator or any
other
regulatory body regarding NATIONWIDE's obligations under this Agreement or
related to the sale of the Contracts, the operation of each Account, or the
purchase of Shares, each case, the Fund reasonably determines that such
proceedings, or the facts on which such proceedings would be based, have
a
material likelihood of imposing material adverse consequences on the Portfolio
with respect to which the Agreement is to be terminated; or
(d) at
the
option of NATIONWIDE upon institution of formal proceedings against the Fund,
its principal underwriter, or its investment adviser by the NASD, the SEC,
or
any state insurance regulator or any other regulatory body regarding the
Fund's
obligations under this Agreement or related to the operation or management
of
the applicable Portfolio or the purchase of the applicable Portfolios, if,
m
each case, NATIONWIDE reasonably determines that such proceedings, or the
facts
on which such proceedings would be based, have a material likelihood of imposing
material adverse consequences on NATIONWIDE, or the Subaccount corresponding
to
the Portfolio with respect to which the Agreement is to be terminated;
or
(e) at
the
option of any parry in the event that (i) a Portfolio's Shares are not
registered and, in all material respects, issued and sold in accordance with
any
applicable federal or state law, or (ii) such law precludes the use of such
Shares as an underlying investment medium of the Contracts issued or to be
issued by NATIONWIDE; or
(f) at
the
option of NATIONWIDE if the applicable Portfolio ceases to qualify as a RIC
under Subchapter M of the Code or under successor or similar provisions or
fails
to comply with the diversification requirements of Section 817(h) of the
Code or
such requirements under successor or similar provisions or if NATIONV~IDE
reasonably believes the applicable Portfolio may so cease to qualify or comply
and, in each case, the Fund upon written request fails to provide reasonable
assurance that it will take action to cure or correct such failure;
or
(g) at
the
option of the Fund if the Contracts issued by NATIONWIDE cease to qualify
as
annuity contracts or life insurance contracts under the Code or if Fund
reasonably believes the applicable Contracts may so cease to qualify, or
if
interests in an Account under the Contracts are not registered, where required,
and, in all material respects, are not issued or sold in accordance with
any
applicable federal or state law and, in each case, NATIONWIDE upon written
request fails to provide reasonable assurance that it will take action to
cure
or correct such failure; or
(h) at
the
option of the Fund by written notice to NATIONWIDE,
if the Fund shall determine in its sole judgment exercised in good
faith,
that NATIONWIDE and/or its affiliated companies 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;
or
(i) at
the
option of NATIONWIDE by written notice to the Fund, if NATIONWIDE shall
determine in its sole judgment exercised in good faith, that the Fund and/or
its
affiliated companies 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; or
(j) at
the
option of NATIONWIDE by written notice to the Fund, if NATIONWIDE shall
determine in its sole judgment exercised in good faith, that the Adviser
and/or
its affiliated companies 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; or
(k) at
the
option of either party upon a determination by a majority of the Fund's Board
of
Directors, or a majority of the Fund's
disinterested directors, that an irreconcilable material conflict exists
among
the interests of: (1) all contract owners of variable insurance products
of all
separate accounts; or (2) the interests of the Participating Insurance Companies
investing in the Fund; or
(1) at the option of any party upon another party's material breach of any
provision of this Agreement; or
(m) with
respect to any Account, upon requisite vote of the Contract owners having
an
interest in that Account (or any subaccount) or upon the receipt of a
substitution order by the SEC to substitute the shares of another investment
company for the corresponding Fund shares in accordance with the terms of
the
Contracts for which those Fund shares had been selected to serve as the
underlying investment media. NATIONWIDE will give at least 30 days' prior
written notice to the Fund of the date of any proposed vote to replace the
Fund's shares; or
(n) at
the
option of the Fund if it suspends or terminates the offering of Shares of
the
applicable Portfolio to all Participating Insurance Companies or only designated
Participating Insurance Companies, if such action is required by law or by
regulatory authorities having jurisdiction or if, in the sole discretion
of the
Fund acting in good faith, suspension or termination is necessary in the
best
interests of the shareholders of the applicable Portfolio (it being understood
that "shareholders" for this purpose shall mean Participants), such notice
effective immediately upon receipt of written notice, it being understood
that a
lack Participating Insurance Companies interest in the applicable Portfolio
may
be grounds for a suspension or termination as to such Portfolio.
6.2
Notice Requirement for Termination
No
termination of this Agreement will be effective unless and until the party
terminating this Agreement gives prior written notice to the other party
to this
Agreement of its intent to terminate, and such notice shall set forth the
basis
for such termination. Furthermore:
(a)
in
the event that any termination is based upon the provisions of Section 6.1(a)
hereof, such prior written notice shall be given at least one (1) year in
advance of the effective date of termination unless a shorter time is agreed
to
by the Parties hereto;
(b)
in
the event that any termination
is based upon the provisions of Section 6.1(b), 6.1(c), 6.1(d),
6.1(e), 6.1(f), 6.1(g), 6.1(h), 6.1(i), 6.16), 6.1(k), 6.1(1), 6.1(m), or
6.1(n)
hereof, such prior written notice shall be given at least 30 days in advance
of
the effective date of termination unless a shorter time is agreed to by the
Parties hereto.
6.3
Fund To Remain Available
Notwithstanding
any termination of this Agreement, the Fund will, at the option of NATIONWIDE,
continue to make available additional shares of a Portfolio 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 Portfolios
of
the Fund (as in effect on such date), redeem investments in Portfolios of
the
Fund and/or invest in Portfolios of the Fund upon the making of additional
purchase payments under the Existing Contracts. Notwithstanding any termination
of this Agreement, NATIONWIDE agrees to distribute to holders of Existing
Contracts all materials required by law to be distributed to such holders
(including, without limitation, prospectuses, statements of additional
information, proxy materials and periodic reports). The parties agree that
this
Section 6.3 will not apply to any terminations under the conditions of the
Order
and the effect of such terminations will be governed by the Order.
6.4
Survival of Warranties and Indemnifications
All
warranties and indemnifications will survive the termination of this
Agreement.
Section
7. Parties To Cooperate Respecting
Termination
Subject
to the provisions of Section 6.3 hereof, the Parties hereto agree to cooperate
and give reasonable assistance to one another in taking all necessary and
appropriate steps for the purpose of ensuring that an Account owns no Shares
of
the applicable Portfolio after the Final Termination Date with respect thereto,
or, in the case of a termination pursuant to Section 6.1(a), the termination
date specified in the notice of termination. Such steps may include combining
the affected Account with another Account, substituting other mutual fund
shares
for those of the affected Portfolio, or otherwise terminating participation
by
the Contracts in such Portfolio.
Section
8. Assignment
This
Agreement may not be assigned by any party, except with the prior written
consent of all the Parties.
Section
9. Notices
Notices
and communications required or permitted by Section 9 hereof will be given
by
means mutually acceptable to the Parties concerned. Each other notice or
communication required or permitted by this Agreement will be given to the
following persons at the following addresses and facsimile numbers, or such
other persons, addresses or facsimile numbers as the party receiving such
notices or communications may subsequently direct in writing:
Nationwide
Life Insurance Company
Nationwide
Life and Annuity Insurance Company ▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇,
▇▇▇▇ ▇▇▇▇▇
Att:
Vice
President - Life Company Operations
with
a
copy to:
Compliance
Manager - Securities Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
Salomon
Brothers Variable Series Funds Inc. ▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇
▇▇▇▇,
▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Facsimile:
(▇▇▇) ▇▇▇-▇▇▇▇
Attn.:
Corporate Secretary
Section
10. Voting Procedures
Subject
to the cost allocation procedures set forth in Section 3 hereof, NATIONWIDE
will
distribute all proxy material furnished by the Fund to Participants to whom
pass-through voting privileges are required to be extended and will solicit
voting instructions from Participants. NATIONWIDE will vote Shares in accordance
with timely instructions received from Participants. NATIONWIDE will vote
Shares
that are (a) not attributable to Participants to whom pass-through voting
privileges are extended, or (b) attributable to Participants, but for which
no
timely instructions have been received, in the same proportion as Shares
for
which said instructions have been received from Participants, so long as
and to
the extent that the SEC continues to interpret the 1940 Act to require pass
through voting privileges for Participants. Neither NATIONWIDE nor any of
its
affiliates will in any way recommend action in connection with or oppose
or
interfere with the solicitation of proxies for the Shares held for such
Participants. NATIONWIDE reserves the right to vote shares held in any Account
in its own right, to the extent permitted by law. NATIONWIDE shall be
responsible for assuring that each of its Accounts holding Shares calculates
voting privileges in the manner required by the Order obtained by the Fund.
The
Fund will notify NATIONWIDE of any amendments to the Order it has
obtained.
Section
11. Indemnification 11.1 Of the Fund by
NATIONWIDE
(a)
Except to the extent provided in Sections 11.1(b) and 11.1(c), below, NATIONWIDE
agrees to indemnify and hold harmless the Fund, its affiliates, and each
person,
if any, who controls the Fund or its affiliates within the meaning of Section
15
of the 1933 Act and each of their respective directors and officers
(collectively, the "Indemnified Parties" for purposes of this Section 11.1)
against any and all losses, claims, damages, costs, expenses, liabilities
(including amounts paid in settlement with the written consent of NATIONWIDE)or
actions in respect thereof (including, to the extent reasonable, legal and
other
expenses), to which the Indemnified Parties may become subject under any
statute, regulation, at common law or otherwise insofar as such losses, claims,
damages, costs, expenses, liabilities or actions:
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(i)arise
out of or are based upon any untrue statement or alleged untrue
statement
of any material fact contained in any Account's 1933 Act registration
statement, any Account Prospectus, the Contracts, or sales literature
or
advertising 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 agreement to indemnify 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
written information furnished to NATIONWIDE by or on behalf of
the Fund
for use in any Account's
1933 Act
registration statement, any Account Prospectus, the Contracts,
or sales
literature or advertising (or any amendment or supplement to any
of the
foregoing); or
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(ii)arise
out of or as a result of any other statements or representations
(other
than statements or representations contained in the Fund's 1933
Act
registration statement, the Fund Prospectus, sales literature or
advertising of the Fund, or any amendment or supplement to any
of the
foregoing, not supplied for use therein by or on behalf of NATIONWIDE,
or
its affiliates and on which such persons have reasonably relied)
or the
negligent, illegal or fraudulent conduct of NATIONWIDE, or its
respective
affiliates or persons under their control (including, without limitation,
their employees and "Associated Persons," as that term is defined
in
paragraph (ee) of Article I of the NASD's By-Laws) or subject to
its
authorization, including without limitation, broker-dealers or
agents
authorized to sell the Contracts, in connection with the We, marketing
or
distribution of the Contracts or Shares;
or
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(iii)arise
out of or are based upon any untrue statement or alleged untrue
statement
of any material fact contained in the Fund's 1933 Act registration
statement, the Fund Prospectus, sales literature or advertising
of the
Fund, or any amendment or supplement to any of the foregoing, 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 and
in conformity with information furnished to the Fund or its affiliates
by
or on behalf of NATIONWIDE or its affiliates for use in the Fund's
1933
Act registration statement, the Fund Prospectus, sales literature
or
advertising of the Fund, or any amendment or supplement to any
of the
foregoing; or
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(iv)arise
as a result of any failure by NATIONWIDE or persons under its control
(or
subject to its authorization) to perform the obligations, provide
the
services and furnish the materials required under the terms of
this
Agreement, or any material breach of any representation and/or
warranty
made by NATIONWIDE in this Agreement or arise out of or result
from any
other material breach of this Agreement by NATIONWIDE or persons
under its
control (or subject to its authorization);
or
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(v)arise
as a result of failure to transmit a request for purchase or redemption
of
Shares or payment therefor within the time period specified herein
and
otherwise in accordance with the procedures set forth in this Agreement;
or
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(vi)arise
as a result of any unauthorized use of the trade names of the Fund
to the
extent such use is not required by applicable law or
regulation.
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(b) This
indemnification is in addition to any liability that NATIONWIDE may otherwise
have. NATIONWIDE shall not be liable under this Section 11.1 with respect
to any
losses, claims, damages, costs, expenses, liabilities or actions to which
an
Indemnified Party would otherwise be subject by reason of willful misfeasance,
bad faith, or Boss negligence in the performance by that Indemnified Parry
of
its duties or by reason of that Indemnified Party's reckless disregard of
obligations or duties (i) under this Agreement, or (ii) to the
Fund.
(c) NATIONWIDE
shall not be liable under this Section 11.1 with respect to any action against
an Indemnified Party unless the Fund shall have notified NATIONWIDE in writing
promptly after the summons or other first legal process giving information
of
the nature of the action shall have been served upon such Indemnified Party
(or
after such Indemnified Parry shall have received notice of such service on
any
designated agent), but NATIONWIDE shall be relieved of liability under this
Section 11.1 only to the extent the indemnifying parry is damaged
solely by
reason of such party's failure to so notify and failure to notify NATIONWIDE
of
any such action shall not relieve NATIONWIDE from any liability which they
may
have to the Indemnified Party against whom such action is brought otherwise
than
on account of this Section 11.1. Except as otherwise provided herein,
in case any such action is brought against an Indemnified Party, NATIONWIDE
shall be entitled to participate, at its own expense, in the defense of such
action and also shall be entitled to assume the defense thereof (which shall
include, without limitation, the conduct of any ruling request and closing
agreement or settlement with the Internal Revenue Service ("IRS") and/or
SEC),
with counsel approved by the Indemnified Party named in the action, which
approval shall not be unreasonably withheld. After notice from NATIONWIDE
to
such Indemnified Party of NATIONWIDE's election to assume the defense thereof,
the Indemnified Party will cooperate fully with NATIONWIDE and shall bear
the
fees and expenses of any additional counsel retained by it, and NATIONWIDE
will
not be liable to such Indemnified Parry under this Agreement for any legal
or other expenses subsequently incurred by such Indemnified Parry
independently in connection with the defense thereof, other than reasonable
costs of investigation.
11.2
Of NATIONWIDE by the Fund
(a)
Except to the extent provided in Sections 11.2(b), 11.2(c) and 11.2(d), below,
the Fund agrees to indemnify and hold harmless NATIONWIDE, its affiliates,
and
each person, if any, who controls NA"T"IONWIDE or its affiliates within the
meaning of Section 15 of the 1933 Act and each of their respective directors
and
officers (collectively, the "Indemnified Parties" for purposes of this Section
11.2) against any and all losses, claims, damages, costs, expenses, liabilities
(including amounts paid in settlement with the written consent of the Fund)
or
actions in respect thereof (including, to the extent reasonable, legal and
other
expenses), to which the Indemnified Parties may become subject under any
statute, regulation, at common law, or otherwise; insofar as such losses,
claims, damages, costs, expenses, liabilities or actions:
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(i)arise
out of or are based upon any untrue statement or alleged untrue
statement
of any material fact contained in the Fund's 1933 Act registration
statement, Prospectus or sales literature or advertising of the
Fund (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 agreement to indemnify shall not apply to any Indemnified
Party if
such statement or omission or such alleged statement or omission
was made
in reliance upon and in conformity with written information furnished
to
the Fund or its affiliates by or on behalf of NATIONWIDE
or its affiliates for use in the Fund's 1933 Act registration
statement, the Fund Prospectus, or in sales literature or advertising
or
otherwise for use in connection with the We of Contracts or Shares
(or any
amendment or supplement to any of the foregoing);
or
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(ii)arise
out of or as a result of any other statements or representations
(other
than statements or representations contained in any Account's 1933
Act
registration statement, any Account Prospectus, sales literature
or
advertising for the Contracts, or any amendment or supplement to
any of
the foregoing, not supplied for use therein by or on behalf of
the Fund or
its affiliates and on which such persons have reasonably relied)
or the
negligent, illegal or fraudulent conduct of the Fund or its affiliates
or
persons under its control (including, without limitation, their
employees
and "Associated Persons" as that Term is defined in Section (ee)
of
Article 1 of the NASD By-Laws), in connection with the We, marketing
or
distribution of Fund Shares; or
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(iii)arise
out of or are based upon any untrue statement or alleged untrue
statement
of any
material fact contained in any Account's 1933 Act registration
statement, any Account Prospectus, sales literature or advertising
covering the Contracts, or any amendment or supplement to any of
the
foregoing, 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 and in conformity with written information furnished to NATIONWIDE,
or its affiliates by or on behalf of the Fund for use in any Account's
1933 Act registration statement, any Account Prospectus, sales
literature
or advertising covering the Contracts, or any amendment or supplement
to
any of the foregoing; or
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(iv)arise
as a result of any failure by the Fund or persons under its control
(or
subject to its authorization) to perform the obligations, provide
the
services and furnish the materials required of it under the terms
of this
Agreement, including, without limitation, any failure of the Fund
or its
designated agent to inform NATIONWIDE of the correct net asset
values per
share for each Portfolio on a timely basis sufficient to ensure
the timely
execution of all purchase and redemption orders at the correct
net asset
value per share, or any material breach of any representation and/or
warranty made by the Fund in this Agreement or arise out of or
result from
any other material breach of this Agreement by the Fund or persons
under
its control (or subject to its authorization);
or
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(v)arise
as a result of any unauthorized use of the trade names of NATIONWIDE
to
the extent such use is not required by applicable law or
regulation.
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(b) Thus
indemnification is in addition to any liability that the Fund may otherwise
have. The Fund shall not be liable under this Section 11.2 with respect to
any
losses, claims, damages, costs, expenses, liabilities or actions to which
an
Indemnified Party would otherwise be subject by reason of willful misfeasance,
bad faith, or gross negligence in the performance by that Indemnified Party
of
its duties or by reason of such Indemnified Party's reckless disregard of
its
obligations and duties (i) under this Agreement, or (ii) to NATIONWIDE, each
Account or Participants.
(c) The
Fund
shall not be liable under this Section 11.2 with respect to any action against
an Indemnified Party unless the Indemnified Party shall have notified the
Fund
in writing promptly after the summons or other first legal process giving
information of the nature of the action shall have been served upon such
Indemnified Party (or after such Indemnified Parry shall have received notice
of
such service on any designated agent), but the Fund shall be relieved of
liability under this Section 11.2 only to the extent the indemnifying party
is
damaged solely by reason of such party's failure
to so
notify and failure to notify the Fund of any such action shall not relieve
the
Fund from any liability which it may have to the Indemnified Party against
whom
such action is brought otherwise than on account of this Section 11.2. Except
as
otherwise provided herein, in case any such action is brought against an
Indemnified Parry, the Fund will be entitled to participate, at its own expense,
in the defense of such action and also shall be entitled to assume the defense
thereof (which shall include, without limitation, the conduct of any ruling
request and closing agreement or other settlement proceeding with the IRS
and/or
SEC), with counsel approved by the Indemnified Party named in the action,
which
approval shall not be unreasonably withheld. After notice from the Fund to
such
Indemnified Party of the Fund's election to assume the defense thereof, the
Indemnified Party will cooperate fully with the Fund and shall bear the fees
and
expenses of any additional counsel retained by it, and the Fund will not
be
liable to such Indemnified Party under this Agreement for any legal or other
expenses subsequently incurred by such Indemnified Party independently in
connection with the defense thereof, other than reasonable costs of
investigation.
11.3
Of NATIONWIDE by the Adviser
(a)
Except to the extent provided in Sections 11.3(b), 11.3(c) and 1.3(d), below,
the Adviser agrees to indemnify and hold harmless NATIONWIDE, its affiliates,
and each person, if any, who controls NATIONWIDE or its affiliates within
the
meaning of Section 15 of the 1933 Act and each of their respective directors
and
officers (collectively, the "Indemnified Parties" for purposes of this Section
11.2) against any and all losses, claims, damages, costs, expenses, liabilities
(including amounts paid in settlement with the written consent of the Fund)
or
actions in respect thereof (including, to the extent reasonable, legal and
other
expenses), to which the Indemnified Parties may become subject under any
statute, regulation, at common law, or otherwise; insofar as such losses,
claims, damages, costs, expenses, liabilities or actions:
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(i)arise
out of or are based upon any untrue statement or alleged untrue
statement
of any material fact contained in the Fund's 1933 Act registration
statement, Prospectus or sales literature or advertising of the
Fund (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 agreement
to indemnify shall not apply to any Indemnified Party if such statement
or
omission or such alleged statement or omission was made in reliance
upon
and in conformity with written information furnished to the Adviser,
the
Fund or their affiliates by or on behalf of NATIONWIDE or its affiliates
for use in the Fund's 1933 Act registration statement, the Fund
Prospectus, or in sales literature or advertising or otherwise
for use in
connection with the We of Contracts or Shares (or any amendment
or
supplement to any of the foregoing);
or
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(ii)arise
out of or as a result of any other statements or representations
(other
than statements or representations contained in any Account's 1933
Act
registration statement, any Account Prospectus, sales literature
or
advertising for the Contracts, or any amendment or supplement to
any of
the foregoing, not supplied for use therein by or on behalf of
the
Adviser, the Fund or their affiliates and on which such persons
have
reasonably relied) or the negligent, illegal or fraudulent conduct
of the
Adviser, the Fund or their affiliates or persons under their control
(including, without limitation, their employees and "Associated
Persons"
as that Term is defined in Section (ee) of Article 1 of the NASD
By-Laws),
in connection with the sale, marketing or distribution of Fund
Shares;
or
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(iii)arise
out of or are based upon any untrue statement or alleged untrue
statement
of any material fact contained in any Account's 1933 Act registration
statement, any Account
Prospectus, sales literature or advertising covering
the
Contracts, or any amendment or supplement to any of the foregoing,
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 and in
conformity with written information furnished to NATIONWIDE, or
its
affiliates by or on behalf of the Adviser or the Fund for use in
any Account's
1933 Act registration statement, any Account Prospectus, sales
literature
or advertising covering the Contracts, or any amendment or supplement
to
any of the foregoing; or
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(iv)arise
as a result of any failure by the Adviser or the Fund or persons
under
their control (or subject to their authorization) to perform the
obligations, provide the services and furnish the materials required
of it
under the terms of this Agreement, including, without limitation,
any
failure of the Fund or its designated agent to inform NATIONWIDE
of the
correct net asset values per share for each Portfolio on a timely
basis
sufficient to ensure the timely execution of all purchase and redemption
orders at the correct net asset value per share, or any material
breach of
any representation and/or warranty made by the Adviser or the Fund
in this
Agreement or arise out of or result from any other material breach
of this
Agreement by the Adviser or persons under its control (or subject
to its
authorization); or
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(v)arise
as a result of any unauthorized use of the trade names of NATIONWIDE
to
the extent such use is not required by applicable law or
regulation.
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(b) This
indemnification is in addition to any liability that the Adviser may otherwise
have. The Adviser shall not be liable under this Section 11.3 with respect
to
any losses, claims, damages, costs, expenses, liabilities or actions to which
an
Indemnified Party would otherwise be subject by reason of willful misfeasance,
bad faith, or gross negligence in the performance by that Indemnified Parry
of
its duties or by reason of such Indemnified Party's reckless disregard of
its
obligations and duties (i) under this Agreement, or (ii) to NATIONWIDE, each
Account or Participants.
(c) The
Adviser shall not be liable under tNs Section 11.3 with respect to any action
against an Indemnified Party unless the Indemnified Party shall have notified
the Adviser in writing promptly after the summons or other first legal process
giving information of the nature of the action 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 the Adviser shall be relieved
of
liability under this Section 11.3 only to the extent the indemnifying party
is
damaged solely by reason of such party's failure to so notify and failure
to
notify the Adviser of any such action shall not relieve the Adviser from
any
liability which it may have to the Indemnified Party against whom such action
is
brought otherwise than on account of this Section 11.3. Except as otherwise
provided herein, in case any such action is brought against an Indemnified
Parry, the Adviser will be entitled to participate, at its own expense, in
the
defense of such action and also shall be entitled to assume the defense thereof
(which shall include, without limitation, the conduct of any ruling request
and
closing agreement or other settlement proceeding with the IRS and/or SEC),
with
counsel approved by the Indemnified Party named in the action, which approval
shall not be unreasonably withheld. After notice from the Adviser to such
Indemnified Party of the Adviser's election to assume the defense thereof,
the
Indemnified Party will cooperate fully with the Fund and shall bear the fees
and
expenses of any additional counsel retained by it, and the Adviser will not
be
liable to such Indemnified Party under this Agreement for any legal or other
expenses subsequently incurred by such Indemnified Party independently in
connection with the defense thereof, other than reasonable costs of
investigation.
11.4 Effect
of Notice
Any
notice given by the indemnifying party to an Indemnified Party referred to
in
Sections 11.1(c), 11,2(c) or 11.3(c) above of participation in or control
of any
action by the indemnifying party will in no event be deemed to be an admission
by the indemnifying party of liability, culpability or responsibility, and
the
indemnifying party will remain free to contest liability with respect to
the
claim among the Parties or otherwise.
11.5 Successors
A
successor by law of any party shall be entitled to the benefits of the
indemnification contained in this Section 11.
11.6 Obligations
of the Fund.
All
persons dealing with the Fund must look solely to the property of the applicable
Portfolio for the enforcement of any claims against the Fund as neither the
Board, Officers, agents or shareholders assume any personal liability for
obligations entered into on behalf of the Fund.
Section
12. Applicable Law
(a) This
Agreement wi11 be construed and the provisions hereof interpreted under and
in
accordance with New York law, without regard for that state's principles
of
conflict of laws.
(b) This
Agreement shall be subject to the provisions of the 1933 Act, 1934 and 1940
acts, and the rules and regulations and rulings thereunder, including such
exemptions from those statutes, rules and regulations as the SEC may grant
(including, but not limited to, any Order of the SEC) and the terms hereof
shall
be interpreted and construed in accordance therewith.
Section
13. Execution in Counterparts
This
Agreement may be executed simultaneously in two or more counterparts, each
of
which taken together with constitute one and the same
instrument.
Section
14. SeverabiIity
If
any
provision of this Agreement is held or made invalid by a court decision,
statute, rule or otherwise, the remainder of this Agreement will not be affected
thereby.
Section
15. Rights Cumulative
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, that the Parties are entitled to under federal and state
laws.
Section
16. Headings
The
headings used in this Agreement are for purposes of reference only and shall
not
limit or define the meaning of the provisions of this Agreement.
Section
17. Confidentiality
Subject
to the requirements of legal process and regulatory authority, each party
hereto
shall treat as confidential the names and addresses of customers of the other
party and all information reasonably identified as confidential in writing
by
any other party hereto and, except as permitted by this Agreement,
shall not, without the express written consent of the affected parry, disclose,
disseminate or utilize such names and addresses and other confidential
information until such time as it may come into the public domain.
Section
18. Trademarks and Fund Names
(a) Salomon
Brothers Asset Management Inc, the adviser to the Fund and its affiliates,
own
all right, title and interest in and to the names, trademarks and service
marks
"Salomon" and "Salomon Brothers" and such other tradenames, trademarks and
service marks as may be identified to NATIONWIDE from time to time (the "Salomon
licensed marks"). Upon termination of this Agreement NATIONWIDE and its
affiliates shall cease to use the Salomon licensed marks, except to the extent
required by law or regulation.
(b) NATIONWIDE
and its affiliates, own all right, title and interest in and to the names,
trademarks and service marks "Nationwide®", Nationwide Life®, Nationwide
Insurance Enterprise®, the N-and eagle logo, "The Best of America®" and such
other tradenames, trademarks and service marks as may be identified
to the
Adviser and/or the Fund from time to time (the "Nationwide" licensed marks).
Upon termination of this Agreement the Fund, the Adviser and their affiliates
shall cease to use the Nationwide licensed marks, except to the extent required
by law or regulation.
Section
19. Parties to Cooperate
Each
parry to this Agreement will cooperate with each other parry and all appropriate
governmental authorities (including, without limitation, the SEC, the NASD
and
state insurance regulators) and will permit each other and such authorities
reasonable access to its books and records (including copies thereof) in
connection with any investigation or inquiry relating to this Agreement or
the
transactions contemplated hereby.
Section
20. Year 2000 Compliance
Adviser
and Nationwide hereby agree and represent that each expects their information
technology systems will be Year 2000 Compliant. The Fund hereby agrees and
represents that it has been advised by the Adviser that it expects the Fund's
information technology systems will by Year 2000 Compliant. Each party shall
notify the other if there is a change in the status of their informational
technology systems or upon having a reasonable basis for believing that their
information technology systems will bat be Year 2000 Compliant.
"Year
2000 Compliant" shall mean that the systems or software in question shall
be
able to accurately process date or date-related data, without creating any
material logical or mathematical inconsistencies from, into and between,
the
twentieth and twenty-first centuries, when used in accordance with the
specifications set forth for such systems or software; provided, however,
that
neither party shall be responsible for any failure of its systems or software
to
by Year 2000 Compliant which is caused by or related to the interaction or
interface of such systems or software with the systems or software of a third
party which are not Year 2000 Compliant.
Section
21. Partnership
Nothing
in this Agreement shall be deemed to create a partnership or joint venture
by
and among the parties hereto.
Section
22. Amendments
Except
to
amend Schedule A, or as otherwise provided in this Agreement, this Agreement
may
not be amended or modified except by a written amendment executed by each
of the
parties.
Section
23. Countemarts
This
Agreement may be executed by facsimile signature and it may be executed in
one
or more counterparts, each of which shall be deemed an original, but all
of
which together shall constitute one and the same instrument.
Section
24. Authorization
Each
pasty hereby represents and warrants to the other that the persons executing
this Agreement on its behalf are duly authorized and empowered to execute
and
deliver the Agreement and that the Agreement constitutes its legal, valid
and
binding obligation, enforceable against it in accordance with its terms.
Except
as particularly set forth herein, neither party assumes any responsibility
hereunder, and will not be liable to the other for any damage, loss of data,
delay or any other loss whatsoever caused by events beyond its reasonable
control.
IN
WITNESS WHEREOF, the Parties have caused this Agreement to be executed in
their
names and on their behalf by and through their duly authorized officers signing
below.
SALOMON
BROTHERS VARIABLE SERIES FUNDS INC
Attest:___________________________ By:______________________________
Name:_[▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇]___________ Name:____Heath
▇. ▇▇▇▇▇▇▇▇]_______
Title:__[Asst.
Secretary]_____________ Title:_____[President]________________
SALOMON
BROTHERS ASSET
MANAGEMENT
INC
Attest:_______________________ By:_________________________
Name:___[▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇]_____ Name:___[▇▇▇▇▇▇
▇▇▇▇▇▇▇]____
Title:___[Asst
Secretary]________ Title:___[Director]____________
NATIONWIDE
LIFE INSURANCE
COMPANY
NATIONWIDE
LIFE AND
ANNUITY
INSURANCE
COMPANY
on
behalf of themselves and their
separate accounts
Attest:_____________________________ By:___________________________
Name:____Heather
C.
Harker_________ Name:___Joseph
P. Rath__________
Title:
____Compliance
Manager_______ Title:___Vice
President – Office of
Product
and Market
Compliance
SCHEDULE
A
PORTFOLIOS
AVAILABLE UNDER THE CONTRACTS
Salomon
Brothers Variable Total Return Fund Salomon Brothers Variable Capital
Fund
Salomon
Brothers Variable High Yield Bond Fund Salomon Brothers Variable Strategic
Bond
Fund Salomon Brothers Variable Investors Fund
SEPARATE
ACCOUNTS U ILI ING TIDE FUNDS
Nationwide
Private Client Corporate Variable Universal. Life
|
|
CONTRACTS
FUNDED BY THE SEPARATE ACCOUNTS Nationwide’s Private Client
Corporate Variable Universal Life
|
SCHEDULE
B
As
of
September , 1999, the Administrative Services Agreement between the Nationwide
and SALOMON BROTHERS ASSET MANAGEMENT INC is applicable to the following
portfolios of the Fund:
Salomon
Brothers Variable Investors Fund Salomon Brothers Variable Capital
Fund
Salomon
Brothers Variable Strategic Bond Fund Salomon Brothers Variable High Yield
Bond
Fund Salomon Brothers Variable Total Return Fund
The
applicable annual fee shall be 25 basis points (0.25%) of the aggregate
investments in portfolios of the Fund by all separate accounts of the Nationwide
related to the Contracts and Policies as a percentage of the average daily
net
asset value of such investments.
AMENDMENT
NO. I TO SCHEDULE A
This
amendment corresponds to the Participation Agreement dated September
1999.
|
SEPARATE
ACCOUNTS
UTILIZING
THE FUNDS
|
CORRESPONDING
NATIONWIDE
CONTRACT
|
PORTFOLIOS
AVAILABLE UNDER THE CONTRACTS
|
|
Nationwide
Private Client
Corporate
Variable Universal
Life
|
Nationwide
Private Clients
Corporate
Variable Universal
Life
|
· Salomon
Brothers Variable Total Return Fund
· Salomon
Brothers Variable Capital Fund
· Salomon
Brothers Variable High Yield Bond Fund
· Salomon
Brothers Variable Strategic Bond Fund
· Salomon
Brothers Variable Investors Fund
|
|
Nationwide
Qualified Plans
Variable
Account (‘APVA”)
|
Qualified
Plans Variable Group
Annuity
Contract
|
· Small
Cap Growth Fund
· International
Equity Fund
· Capital
Fund
· Investors
Growth Fund
· High
Yield Bond
· Strategic
Bond Fund
|
SALOMON
BROTHERS VARIABLE SERIES FUND
INC
|
Attest:
|
Attest:
|
|||
|
Name:
|
Name:
|
|||
|
Title:
|
Title:
|
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|
SALOMON
BROTHERS ASSET MANAGEMENT INC
|
||||
|
Attest:
|
Attest:
|
|||
|
Name:
|
Name:
|
|||
|
Title:
|
Title:
|
|||
|
NATIONWIDE
LIFE INSURANCE COMPANY
NATIONWIDE
LIFE AND ANNUITY INSURANCE
COMPANY
on behalf of themselves and their respective separate
accounts
|
||||
|
Attest:
|
Attest:
|
|||
|
Name:
|
Name:
|
|||
|
Title:
|
Title:
|
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