Exhibit: 99-8(ll): Form of Fund Participation Agreement between ReliaStar Life
Insurance Company of New York, Aetna Income Shares (to be renamed ING Income
Shares) and Aetna Variable Portfolios, Inc. (to be renamed ING Variable
Portfolios, Inc.) and Aeltus Investment Management, Inc.
FUND PARTICIPATION AGREEMENT
ReliaStar Life Insurance Company of New York (the "Company"), and Aetna
Income Shares (to be renamed ING Income Shares) and Aetna Variable Portfolios,
Inc. (to be renamed ING Variable Portfolios, Inc.), on behalf of each of its
series (each a "Fund" or in the aggregate "Funds"), and Aeltus Investment
Management, Inc. ("Aeltus" or "Adviser") hereby agree to an arrangement whereby
the Funds shall be made available to serve as underlying investment media for
variable life insurance or annuity contracts ("Contracts") to be issued by the
Company.
1. Establishment of Account.
The Company represents that it has established the ReliaStar
Select(star)Life Variable Account and may establish such other accounts
as may be set forth in Schedule A attached hereto (as may be amended from
time to time with the mutual consent of the parties hereto) (the
"Accounts"), each of which is a separate account registered under the
Investment Company Act of 1940 (except for such accounts for which no
registration is required), to serve as investment vehicles for the
Contracts. Each Contract provides for the allocation of net amounts
received by the Company to an Account for investment in the shares of one
of more specified open-end management investment companies available
through that Account as underlying investment media. Selection of a
particular investment management company and changes therein from time to
time are made by the participant or Contract owner, as applicable under a
particular Contract.
2. Pricing Information; Orders; Settlement.
(a) Each Fund will make shares available to be purchased by the
Company, and will accept redemption orders from the Company, on
behalf of each Account at the net asset value applicable to each
order on those days on which the Fund calculates its net asset
value (a "Business Day"). Fund shares shall be purchased and
redeemed in such quantity and at such times as determined by the
Company to be necessary to meet the requirements of those
Contracts for which the Fund serves as underlying investment
media, provided, however, that the Board of Directors of the Fund
(hereinafter the "Directors") may, upon reasonable notice to the
Company, refuse to sell shares of any Fund to any person, or
suspend or terminate the offering of shares of any Fund if such
action is required by law or by regulatory authorities having
jurisdiction or is, in the sole discretion of the Directors acting
in good faith and in light of their fiduciary duties under federal
and/or any applicable state laws, necessary in the best interests
of the shareholders of such Fund.
(b) Each Fund will provide to the Company closing net asset value,
dividend and capital gain information at the close of trading each
day that the New York Stock Exchange (the "Exchange") is open
(each such day a "Business Day"), and in no event later than 6:30
p.m. eastern time on such Business Day. The Company will send via
facsimile or electronic transmission to each Fund or its specified
agent orders to purchase and/or redeem Fund shares by 9:30 a.m.
eastern time the following business day. Payment for net purchases
will be wired by the Company to an account designated by the Fund.
(c) Each Fund hereby appoints the Company as its agent for the limited
purpose of accepting purchase and redemption orders for Fund
shares relating to the Contracts from Contract owners. Orders from
Contract owners received by the Company, acting as agent for the
Fund, from any distributor of the Contracts (including affiliates
of the Company), prior to the close of the Exchange on any given
business day will be executed by the Fund at the net asset value
determined as of the close of the Exchange on such Business Day,
provided that the Fund receives written (or facsimile) notice of
such order by 9:30 a.m. eastern time on the next following
Business Day. Any orders received by the Company acting as agent
on such day but after the close of the Exchange will be executed
by the Fund at the net asset value determined as of the close of
the Exchange on the next business day following the day of receipt
of such order, provided that the Fund receives written (or
facsimile) notice of such order by 9:30 a.m. eastern time within
two days following the day of receipt of such order.
(d) Payments for net redemptions of shares of a Fund will be wired by
the Fund to an account designated by the Company. Payments for net
purchases of the Fund will be wired by the Company to an account
designated by the Fund on the same Business Day the Company places
an order to purchase Fund shares. Payments shall be in federal
funds transmitted by wire.
(e) Each party has the right to rely on information or confirmations
provided by the other party (or by any affiliate of the other
party), and shall not be liable in the event that an error is a
result of any misinformation supplied by the other party. The
Company shall assume responsibility as herein described for any
loss to a Fund caused by a cancellation or correction made to an
Instruction by a Contract owner or person authorized to act on his
or her behalf subsequent to the date as of which such Instruction
has been received by the Company and originally relayed to Aeltus,
and the Company will immediately pay such loss to such Fund upon
the Company's receipt of written notification, with supporting
data. Aeltus shall indemnify and hold the Company harmless, from
the effective date of this Agreement, against any amount the
Company is required to pay to a Contract owner due to: (i) an
incorrect calculation of a Fund's daily net asset value, dividend
rate, or capital gains distribution rate or (ii) incorrect or
unreasonably late reporting of the daily net asset value deemed
material in accordance with the Fund's error correction policy,
dividend rate, or capital gain distribution rate, upon written
notification by the Company, with supporting data, to Aeltus.
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(f) The Company agrees to purchase and redeem the shares of the Funds
named in this Agreement or in Schedule B hereof in accordance with
the provisions of each Fund's then-current prospectus and
statement of additional information. The Company shall not permit
any person other than a Contract owner or person authorized to act
on his or her behalf to give instructions to the Company which
would require the Company to redeem or exchange shares of a Fund.
This provision shall not be construed to prohibit the Company from
substituting shares of another fund, as permitted by law.
(g) The Funds and the Company agree to provide pricing information,
execute orders and wire payments for purchases and redemptions of
Fund shares as set forth in this Section 2 until such time as they
mutually agree to utilize the National Securities Clearing
Corporation ("NSCC"). Upon such mutual agreement, the Funds and
the Company agree to provide pricing information, execute orders
and wire payments for purchases and redemptions of Fund shares
through NSCC and its subsidiary systems as set forth in Schedule
C.
3. Expenses.
(a) Except as otherwise provided in this Agreement, all expenses
incident to the performance by each respective Fund under this
Agreement shall be paid by that Fund, including the cost of
registration of its shares with the Securities and Exchange
Commission (the "SEC") and in states where required. All expenses
incident to performance by each party of its respective duties
under this Agreement shall be paid by that party, unless otherwise
specified in this Agreement.
(b) The Funds or the Adviser shall provide to the Company periodic
fund reports to shareholders and other materials that are required
by law to be sent to Contract owners. In addition, the Funds or
the Adviser shall provide the Company with a sufficient quantity
of prospectuses, statements of additional information and any
supplements to any of these materials, to be used in connection
with the offerings and transactions contemplated by this
Agreement. In addition, the Funds shall provide the Company with a
sufficient quantity of proxy material that is required to be sent
to Contract owners. The Adviser shall be permitted to review and
approve the typeset form of such material prior to such printing
provided such material has been provided by the Adviser to the
Company within a reasonable period of time prior to typesetting.
(c) In lieu of the Funds' or Adviser's providing printed copies of
prospectuses, statements of additional information and any
supplements to any of these materials, and periodic fund reports
to shareholders, the Company shall have the right to request that
the Funds transmit a copy of such materials in an electronic
format, which the Company may use to have such materials printed
together with similar materials of other Account funding media
that the Company or any distributor will distribute to existing or
prospective Contract owners.
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4. Representations.
The Company agrees that it and its agents shall not, without the written
consent of a Fund or the Adviser, make representations concerning the
Fund, or its shares except those contained in the then current
prospectuses and in current printed sales literature approved by or
deemed approved by the Fund or the Adviser.
5. Termination.
This agreement shall terminate as to the sale and issuance of new
Contracts:
(a) at the option of either the Company, the Adviser or with respect
to any Fund, upon sixty days advance written notice to the other
parties;
(b) at the option of the Company, upon one week advance written notice
to the Adviser and to any Fund, if Fund shares are not available
for any reason to meet the requirement of Contracts as determined
by the Company. Reasonable advance notice of election to terminate
shall be furnished by the Company;
(c) at the option of either the Company, the Adviser or any Fund,
immediately upon institution of formal proceedings against the
broker-dealer or broker-dealers marketing the Contracts, the
Account, the Company, the Fund or the Adviser by the National
Association of Securities Dealers, Inc. (the "NASD"), the SEC or
any other regulatory body;
(d) upon the determination of the Accounts to substitute for the
shares of a Fund the shares of another investment company in
accordance with the terms of the applicable Contracts. The Company
will give sixty days written notice to the Fund and the Adviser of
any decision to replace the shares of that Fund;
(e) upon assignment of this Agreement, unless made with the written
consent of all other parties hereto;
(f) if shares of a Fund are not registered, issued or sold in
conformance with Federal law or such law precludes the use of such
shares as an underlying investment medium for Contracts issued or
to be issued by the Company. Prompt notice shall be given by the
appropriate party should such situation occur.
6. Continuation of Agreement.
Termination as the result of any cause listed in Section 5 shall not
affect the Funds' obligation to furnish shares to Contracts then in force
for which such shares serve or may serve as the underlying medium unless
such further sale of Fund shares is prohibited by law or the SEC or other
regulatory body.
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7. Advertising Materials; Filed Documents.
(a) Advertising and sales literature with respect to any Fund prepared
by the Company or its agents for use in marketing its Contracts
will be submitted to that Fund or its designee for review before
such material is submitted to any regulatory body for review. No
such material shall be used if the Fund or its designee reasonably
objects to such use in writing, transmitted by facsimile within
two business days after receipt of such material.
(b) Each Fund will provide additional copies of its financials as soon
as available to the Company and at least one complete copy of all
registration statements, prospectuses, statements of additional
information, annual and semi-annual reports, proxy statements and
all amendments or supplements to any of the above that relate to
the Fund promptly after the filing of such document with the SEC
or other regulatory authorities. At the Adviser's request, the
Company will provide to the Adviser at least one complete copy of
all registration statements, prospectuses, statements of
additional information, annual and semi-annual reports, proxy
statements, and all amendments or supplements to any of the above
that relate to the Accounts promptly after the filing of such
document with the SEC or other regulatory authority.
(c) Each Fund or the Adviser will provide via Excel spreadsheet
diskette format or in electronic transmission to the Company at
least quarterly portfolio information necessary to update Fund
profiles within seven business days following the end of each
quarter.
8. Proxy Voting.
(a) The Company shall provide pass-through voting privileges on shares
of a Fund held by the separate accounts to all Contract owners.
(b) The Company will distribute to Contract owners all proxy material
furnished by any Fund and will vote shares of the Fund in
accordance with instructions received from such Contract owners.
The Company and its agents shall not oppose or interfere with the
solicitation of proxies for shares of a Fund held for such
Contract owners.
9. Indemnification.
(a) The Company agrees to indemnify and hold harmless each Fund and
the Adviser, and their directors, officers, employees, agents and
each person, if any, who controls any Fund or its Adviser within
the meaning of the Securities Act of 1933 (the "1933 Act") against
any losses, claims, damages or liabilities to which the Fund 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) arise out of or are based upon any untrue
statement or alleged untrue statement of any material fact
contained in the Registration Statement,
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prospectus or sales literature of the Company 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, or arise out of or
as a result of conduct, statements or representations (other than
statements or representations contained in the prospectuses or
sales literature of the Fund) of the Company or its agents, with
respect to the sale and distribution of Contracts for which shares
of the Fund are the underlying investment. The Company will
reimburse any legal or other expenses reasonably incurred by a
Fund or any such director, officer, employee, agent, investment
adviser, or controlling person in connection with investigating or
defending any such loss, claim, damage, liability or action;
provided, however, that the 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 (i) an untrue statement or omission
or alleged omission made in such Registration Statement or
prospectus in conformity with written materials furnished to the
Company by the Fund specifically for use therein or (ii) the
willful misfeasance, bad faith, or gross negligence by the Fund or
Adviser in the performance of their duties or the Fund's or
Adviser's reckless disregard of obligations or duties under this
Agreement or to the Company, whichever is applicable. This
indemnity agreement will be in addition to any liability which the
Company may otherwise have.
(b) Each Fund and the Adviser agree to indemnify and hold harmless the
Company and its directors, officers, employees, agents and each
person, if any, who controls the Company within the meaning of the
1933 Act against any losses, claims, damages or liabilities to
which the 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) arise out of or are based upon any
untrue statement or alleged untrue statement of any material fact
contained in the Registration Statement, prospectuses or sales
literature of the Fund 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 material fact required to be
stated therein or necessary to make the statements therein not
misleading. Each Fund, as appropriate, will reimburse any legal or
other expenses reasonably incurred by the 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 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 or prospectuses which are in conformity
with written materials furnished to the Fund by the Company
specifically for use therein.
(c) Promptly after receipt by an indemnified party hereunder of notice
of the commencement of action, such indemnified party will, if a
claim in respect thereof is to be made against the indemnifying
party hereunder, notify the indemnifying party of the commencement
thereof; but the omission so to notify the indemnifying party will
not relieve it from any liability which it may have to any
indemnified party otherwise
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than under this Section 9. In case any such action is brought
against any indemnified party, and it notifies the indemnifying
party of the commencement thereof, the indemnifying party will be
entitled to participate therein and, to the extent that it may
wish to, assume the defense thereof, with counsel satisfactory to
such indemnified party, and after notice from the indemnifying
party to such indemnified party of its election to assume the
defense thereof, the indemnifying party will not be liable to such
indemnified party under this Section 9 for any legal or other
expenses subsequently incurred by such indemnified party in
connection with the defense thereof other than reasonable costs of
investigation.
10. Miscellaneous.
(a) Amendment and Waiver. Neither this Agreement, nor any provision
hereof, may be amended, waived, discharged or terminated orally,
but only by an instrument in writing signed by all parties hereto.
(b) Notices. All notices and other communications hereunder shall be
given or made in writing and shall be delivered personally, or
sent by telex, facsimile or registered or certified mail, postage
prepaid, return receipt requested, or recognized overnight courier
service to the party or parties to whom they are directed at the
following addresses, or at such other addresses as may be
designated by notice from such party to all other parties.
To the Company: To the Adviser:
ReliaStar Life Insurance Company of New York Aeltus Investment Management, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ Hartford, Connecticut 06103-3602
Attn: Counsel Attn: Chief Compliance Officer
To any Fund:
▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attn: President
Any notice, demand or other communication given in a manner prescribed in
this subsection (b) shall be deemed to have been delivered on receipt.
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(c) Successors and Assigns. This Agreement shall be binding upon and
inure to the benefit of the parties hereto and their respective
permitted successors and assigns.
(d) Counterparts. This Agreement may be executed in any number of
counterparts, all of which taken together shall constitute one
agreement, and any party hereto may execute this Agreement by
signing any such counterpart.
(e) Severability. In case any one or more of the provisions contained
in this Agreement should be invalid, illegal or unenforceable in
any respect, the validity, legality and enforceability of the
remaining provisions contained herein shall not in any way be
affected or impaired thereby.
(f) Entire Agreement. This Agreement constitutes the entire agreements
and understanding between the parties hereto and supersedes all
prior agreement and understandings relating to the subject matter
hereof.
(g) Governing Law. This Agreement shall be governed and interpreted in
accordance with the laws of the State of Connecticut.
(h) Non-Exclusive Agreement. It is understood by the parties that this
Agreement is not an exclusive arrangement in any respect.
(i) Confidentiality. The terms of this Agreement and the Schedules
thereto will be held confidential by each party except to the
extent that either party or its counsel may deem it necessary to
disclose such terms.
IN WITNESS WHEREOF, the undersigned have executed this Agreement by their
duly authorized officers effective as of the day of,2001.
RELIASTAR LIFE INSURANCE COMPANY OF NEW YORK
By:________________________
Name:______________________
Title:_____________________
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AETNA INCOME SHARES (To be renamed ING Income Shares)
AETNA VARIABLE PORTFOLIOS, INC. (To be renamed ING Variable
Portfolios, Inc.)
By:________________________________
Name:______________________________
Title:_____________________________
AELTUS INVESTMENT MANAGEMENT, INC.
By:________________________________
Name:______________________________
Title:
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SCHEDULE A
(For any future separate accounts - See Section 1)
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SCHEDULE B
------------------------------------------------------------ ---------------------------------------------------------
CURRENT FUND NAME NEW FUND NAME
----------------- -------------
AETNA INCOME SHARES ING INCOME SHARES
d/b/a/Aetna Bond VP (Class R Shares) ING ▇▇ ▇▇▇▇ Portfolio (Class R Shares)
AETNA VARIABLE PORTFOLIOS, INC. ING VARIABLE PORTFOLIOS, INC.
Aetna Index Plus Large Cap VP ING VP Index Plus LargeCap Portfolio
(Class R Shares) (Class R Shares)
Aetna Index Plus Mid Cap VP ING VP Index Plus MidCap Portfolio
(Class R Shares) (Class R Shares)
Aetna Index Plus Small Cap VP ING VP Index Plus SmallCap Portfolio
(Class R Shares) (Class R Shares)
------------------------------------------------------------ ---------------------------------------------------------
SCHEDULE C
Procedures for Pricing and Order/Settlement Through National Securities Clearing
Corporation's Mutual Fund Profile System and Mutual Fund Settlement, Entry and
Registration Verification System
1. As provided in Section 2(g) of the Participation Agreement, the parties
hereby agree to provide pricing information, execute orders and wire
payments for purchases and redemptions of Fund shares through National
Securities Clearing Corporation ("NSCC") and its subsidiary systems as
follows:
(a) The Funds will furnish to Company or its affiliate through NSCC's Mutual
Fund Profile System ("MFPS") (1) the most current net asset value
information for each Fund, (2) a schedule of anticipated dividend and
distribution payment dates for each Fund, which is subject to change
without prior notice, ordinary income and capital gain dividend rates on
the Fund's ex-date, and (3) in the case of fixed income funds that declare
daily dividends, the daily accrual or the interest rate factor. All such
information shall be furnished to Company or its affiliate by 6:30 p.m.
Eastern Time on each business day that the Fund is open for business (each
a "Business Day") or at such other time as that information becomes
available. Changes in pricing information will be communicated to both NSCC
and Company.
(b) Upon receipt of Fund purchase, exchange and redemption instructions for
acceptance as of the time at which a Fund's net asset value is calculated
as specified in such Fund's prospectus ("Close of Trading") on each
Business Day ("Instructions"), and upon its determination that there are
good funds with respect to Instructions involving the purchase of Shares,
Company or its affiliate will calculate the net purchase or redemption
order for each Fund. Orders for net purchases or net redemptions derived
from Instructions received by Company or its affiliate prior to the Close
of Trading on any given Business Day will be sent to the Defined
Contribution Interface of NSCC's Mutual Fund Settlement, Entry and
Registration Verification System ("Fund/SERV") by 5:00 a.m. Eastern Time on
the next Business Day. Subject to Company's or its affiliate's compliance
with the foregoing, Company or its affiliate will be considered the agent
of the Distributor and the Funds, and the Business Day on which
Instructions are received by Company or its affiliate in proper form prior
to the Close of Trading will be the date as of which shares of the Funds
are deemed purchased, exchanged or redeemed pursuant to such Instructions.
Instructions received in proper form by Company or its affiliate after the
Close of Trading on any given Business Day will be treated as if received
on the next following Business Day. Dividends and capital gains
distributions will be automatically reinvested at net asset value in
accordance with the Fund's then current prospectuses.
(c) Company or its affiliate will wire payment for net purchase orders by the
Fund's NSCC Firm Number, in immediately available funds, to an NSCC
settling bank account designated by Company or its affiliate no later than
5:00 p.m. Eastern time on the same Business Day such purchase orders are
communicated to NSCC. For purchases of shares of daily dividend accrual
funds, those shares will not begin to accrue dividends until the day the
payment for those shares is received.
(d) NSCC will wire payment for net redemption orders by Fund, in immediately
available funds, to an NSCC settling bank account designated by Company or
its affiliate, by 5:00 p.m. Eastern Time on the Business Day such
redemption orders are communicated to NSCC, except as provided in a Fund's
prospectus and statement of additional information.
(e) With respect to (c) or (d) above, if the Funds do not send a confirmation
of Company's or its affiliate's purchase or redemption order to NSCC by the
applicable deadline to be included in that Business Day's payment cycle,
payment for such purchases or redemptions will be made the following
Business Day.
(f) If on any day Company or its affiliate, or the Funds is unable to meet the
NSCC deadline for the transmission of purchase or redemption orders, it may
at its option transmit such orders and make such payments for purchases and
redemptions directly to the Funds or Company or its affiliate, as
applicable, as is otherwise provided in the Agreement.
(g) These procedures are subject to any additional terms in each Fund's
prospectus and the requirements of applicable law. The Funds reserve the
right, at their discretion and without notice, to suspend the sale of
shares or withdraw the sale of shares of any Fund.
2. Company or its affiliate, the Funds and clearing agents (if applicable) are
each required to have entered into membership agreements with NSCC and met all
requirements to participate in the MFPS and Fund/SERV systems before these
procedures may be utilized. Each party will be bound by the terms of their
membership agreement with NSCC and will perform any and all duties, functions,
procedures and responsibilities assigned to it and as otherwise established by
NSCC applicable to the MFPS and Fund/SERV system and the Networking Matrix Level
utilized.
3. Except as modified hereby, all other terms and conditions of the Agreement
shall remain in full force and effect. Unless otherwise indicated herein, the
terms defined in the Agreement shall have the same meaning as in this Schedule.
